Public Sectors devouring the Private Sector


British Protest Note Enlargement

QUESTION: Dear Marty, I understand your general message and totally agree with it. I now see the big picture in a systematic trend and everything moving in the direction Socrates has forecast. I do have a few questions though. Can we call the trend: the public sectors trend to swallow the private sector? In other words, governments desire to “assimilate” the individual? And by trying to do so burn everything including itself to ashes from which hopefully a phoenix (new better system) will rise?

Evil Government

ANSWER: Unfortunately yes. This is really how Empire, Nations, and City States collapse. Government will hunt every dime to try to survive. The unfunded liabilities will drive them toward real dark authoritarian forms of government. This is the crash and burn mode. All we can do is try to educate people who is the real culprit here. They will claim it’s the rich to justify confiscating assets and we already have 65 million people in the USA who have been charged with something. They then can eliminate your right to even vote by simply charging you with something. They then make it a crime for anyone charged with a crime to have a gun even if it is tax evasion.

British Protest NoteThe American Revolution took place because the king had decreed 240 felonies. If you were charged with a felony, the penalty was death. This benefited the king because he got to confiscate all your property and your wife and kids would just be thrown out on the street.

Here is a note where the law was written that anyone in POSSESSION of a forged banknote was a felony subject to death. This protest imitation shows people hanging. They were not the forgers. They merely accepted such a note and tried to spend it. This was highly profitable for the king who was desperate for money to fight wars.

Unfortunately, we do not have a government of the people, by the people, for the people. The people are the victims as they always become under any Republican form of government historically.

History repeats because human nature never changes.

The Mechanism Behind the Rise & Fall of Nations


WorldEconomy

QUESTION: Mr. Armstrong; I recently read a book which claims that the disparity of wealth among nations is something recently unfolding post-Columbus. The thesis claims that before 1500, the income differences between nations were small. It proposes that only since the discovery of America, the interplay between geography, globalization, technological change, and economic policy has determined the wealth and poverty of nations. It claims that the West pioneered new technologies that have made them richer whereas prior to the Industrial Revolution, most of the world’s manufacturing was conducted in Asia. It attributes the Industrial Revolution to the economic reduction of Asia transforming then into underdeveloped countries based on agriculture. The thesis is that a few countries – Japan, Soviet Russia, South Korea, Taiwan, and perhaps China  are catching up with the West through creative responses to the technological challenges. Would you agree with this thesis?

LHG

Hong Kong

ANSWER: No. This is a review of only the post-Dark Age period which is akin to saying the stock market only rises by reviewing just the history back to 1948. Yes, the Industrial Revolution advanced Western society. Creating the steam engine advanced the West greatly. However, what may Lydia great was roads. But those roads were used by Cyrus the Great of Persia to conquer them. Athens rose as a power for banking and insurance. As insurance was invented, shipping expanded transforming it into the next financial capital of the world. The Philip of Macedonia conquered Greece and his son Alexander the Great  took on the world. He tried to conquer India, but was driven back. Rome then conquered the West and it was a single language along with Roman roads that made it the financial capital of the world peaking in 180AD about the same time China peaked under than Han Dynasty.

It was the fall of Rome that send the title of the Financial Capital of the World to Constantinople. When that fell, it moved to India. China then took the title from India and then Britain took the title from the Spanish. It was World War I which sent the title to the United States. Each of these empires saw the same trend moving away from agriculture. Aristotle in Politics wrote about the new market-economy that was emerging. He saw the traders who were men making money from money. This actually influenced Karl Marks.

Aristotle(1)Aristotle did not understand the economic evolution process dynamically which has taken place in ALL societies throughout recorded history. What Aristotle saw was the abandonment of what I have dubbed the Villa Economy of self-sufficiency and the gravitation of both people and capital toward commerce. This part of the economic cycle usually involves people becoming attracted to the big city abandoning the farm life. Every society sees this oscillation both in the concentration of capital as well as people.

Aristotle clearly lamented over the loss of the Villa Economy. The old rural ways were giving way to capitalism. Even at the start of the United States, we will see that Thomas Jefferson and John Adams both shared that view that true wealth was created by the rural farm life. Yet Aristotle’s imperfect understanding of the dynamics at work contributes to centuries of debate and influence, nonetheless, Aristotle tried to draw a line between capitalism that would assist economic growth and that which would fueled these booms and busts driven by speculation in his mind’s eye.

“Now money-making, as we say, being twofold, it may be applied to two purposes, the service of the house or retail trade; of which the first is necessary and commendable, the other justly censurable; for it has not its origin in [1258b] nature, but by it men gain from each other; for usury is most reasonably detested, as it is increasing our fortune by money itself, and not employing it for the purpose it was originally intended, namely exchange.”

(Politics, Chapter X §1258b-1259b translation by William Ellis 1912)

What Aristotle did not comprehend was the concentration of capital.  There is no difference between a landowner who leases his land for a farmer to grow crops and someone who has excess cash to likewise lease it out for a fee known as “interest.” Aristotle thus focused in on this concept of making money from money. He did not quite understand that when a city or a nation becomes the center of the global economy, capital concentrates and the natural evolution process begins.

So the thesis of which you ask is not well established for it merely propagated a theory post-Dark Age. There was the same economic processes that predated our modern era.

Japan – Is this The End of the Govt Bond Rally?


JAP10Yr-D 8-2-2016

BANK-OF-JAPAN-sign

Japanese 10-year bonds have crashed because the government is stopping its bond-buying program, at least for now. Prime Minister Shinzo Abe’s monetary policy is starting to demonstrate the dangerous position we face on a global scale with respect to interest rates and debt.

Japanese 10-year bonds have crashed since the Bank of Japan now holds over a third of the entire nation’s marketable government debt. By comparison, the Federal Reserve holds less than 20 percent of all US Treasuries, and this entire quantitative easing (QE) effort since 2007 to support the economy has utterly failed. The capital markets are demonstrating that the BOJ’s holdings of government debt threaten the world’s third-largest economy. This entire QE effort for these past 8.6 years is coming to an end. The JGBs have crashed and the Bank of Japan has suspended its buying for just now. This will indict the fate of interest rates moving forward.

JAP10Yr-M 8-2-2016

We are looking at this same pattern beginning to emerge in other government bond issues. The entire QE program is wiping out pension funds and savers. With the four elections (Brexit, USA, France, & Germany), the degree of confidence in government debt should begin to decline sharply.

Analysis of Global Temperature Trends, June, 2016, what’s really going on with the Climate?


The analysis and plots shown here are based on the following two data series. First NASA-GISS estimates of a global temperature shown as an anomaly (converted to degrees Celsius) as shown in their table Land Ocean Temperature Index (LOTI) and shown in the following Chart as the red plot labeled NASA. This plot is shown as a twelve month moving average to minimize the large monthly swings and better show trends the scale for the temperatures is on the left. Second NOAA-ESRL Carbon Dioxide (CO2) values in Parts Per Million (PPM) which are shown in the following Chart as a black plot labeled NOAA. This plot is shown exactly as the data from NOAA is presented and there is no need for a moving average the scale for CO2 is shown on the right.

NASA published data as stated in the first paragraph is shown as an anomaly, but what is a temperature anomaly?  An anomaly is a deviation from some base value normally an average that is fixed. There were two problems with the system that NASA picked which were number one there is no “actual” global temperature and two since climate is a variable there cannot be a real base to measure from. NASA known for its expertise back in the day thought it could get around these issues and created a system to do so. First they developed a computer model which took readings from all over the planet and made adjustments to them called homogenization and came up with the estimated global temperature. Second they picked the period 1950 to 1980 (30 years) and averaged the values and came up with 14.00 degrees Celsius and make that their base.  Then they took that temperature and subtracted the base from it which gave them the anomaly. The problem is that both the base and the anomaly are arbitrary.

NASA NOAA 01

Now that we have a base to work with we are going to add to the previous Chart three things. The first is a trend line of the growth in CO2 since that is the entire basis for climate change according to the government through NASA and NOAA. That plot is superimposed over the black plot of the actual NOAA CO2 values as the cyan line labeled as the CO2 Model and one can see there is a very good fit to the actual NOAA values so there should be no dispute about its validity.  This plot allows us to make projections as to future global temperatures according to the science. The second added item is James E. Hansen’s Scenario B data, which is the very core of the IPCC Global Climate models (GCM’s) and which was based on a CO2 sensitivity value of 3.0O Celsius per doubling of CO2. This plot is shown here in lavender and is part of a presentation that Hansen showed to congress in 1988 when the UN was about to set up the International Panel on Climate Change (IPCC) and this plot is labeled as Hansen Scenario B which Hansen stated was the most likely to happen based on his theories’.  The third item is the current plot of the most likely temperature of the planet based on the growth of CO2 published by the IPCC. This plot is shown in Red and is labeled as IPCC AR5 A2 as that is the table where the data was found. This plot is a GCM computer projection of the planets temperature based to the complex relationships developed on the levels of CO2 by the IPCC through NASS and NOAA.

It can be seen in this Chart that the lavender plot and the Hansen plot are very close from 1965 to around 2000 after that, from 2000 to 2014, there is a very large and growing deviation reaching close to .5 degrees Celsius in 2014, which is not an insubstantial number.  Also of note is that there doesn’t seem to be a good correlation between the growth in CO2 and the increase in the planets temperature. The CO2 is going up in a log function and the Temperature was going down in a log function until recently where it reversed and is now going up in a log function. That major change in direction that occurred in 20014 is the subject of this paper.

NASA NOAA 02

The next Chart is developed from the raw data from NASS and NOAA as shown in the first Chart.  This plot was made first by adding ten years blocks of temperature and CO2 as indicated in the Chart and diving by 120 to give an average for each.  Then the average Temperature was divided by the average CO2 to give degrees of temperature increase per PPM of CO2. After that was plotted it appeared that there were two different curves the first was from block 1965-1974 through block 2004-2014 shown as Black Dots and the second was from block 1995-2004 through block 2005-2016 shown as Black Dashes. When trend lines were added they were both almost perfect fits to the raw data and so you cannot see the data points  very well on the Chart.  These blocks were picked to represent the entire period of time where we had both NASA temperature data and NOAA Co2 levels.

On the following Chart are two sets of color coded information. The first is Cyan plot and the Cyan box with the equation in it along with the R2 value 0f 1.0 are for the first series from block 1965-1974 through block 2004-2014. The other is the Red plot and the Red box with the equation in it along with the R2 value of 1.0 which are for the first series from block 1965-1974 through block 2004-2016. We can speculate on how this change has happened but it cannot be said that the plot change is not real; however additions data over the next few years will be required to actually prove that something has changed.

In summary the Cyan data set indicates a diminishing effect of CO2 on global temperature for about 54 years and the Red data set represents an increasing effect of CO2 on global temperature for the past 2 years. Since both data sets have an R2 value of 1.00 the trend lines cannot be in question.

NASA NOAA 03

Before we get into a possible explanation to the drastic change from the Cyan data to the Red data that occurred in 20014 we need to consider other factors than CO2 on Climate change.  The fault that occurred in the work that was done in the 1980’s was in assuming that there was an optimum or constant global temperature and therefore any change that was being observed was from the increasing amount of CO2 in the atmosphere.  There may have been correlation but it was never proved that there was causation (high R2 value) between CO2 and global temperatures. With that assumption which limited options we moved from true science into the realm of political science.  True science has an open mind and finds relationships that work in matching observations with predictions.  Political science changes history and/or facts to match the desires of the politicians. Since the politicians control the money political science is what we get; which means that what we get may not be technically correct.

A decade ago when I started looking at “climate” change the first thing I did was look at geological temperature changes since it is well known that the climate is not a constant; I learned that 52 years ago in my undergrad geology and climatology courses in 1964. The next paragraph explains currently observed patterns in climate related to this subject.

Ignoring the last Ice Age which ended some 11,000 years ago when a good portion of the Northern hemisphere was under miles of ice the following observations give a starting point to any serious study on the subject. First, there is a clear up and down movement in global temperatures with a 1,000 some year cycle going back at least 3,000 to 4,000 years; probably because of the apsidal precession of the earth’s orbit of about 20,000 years for a complete cycle. However about every 10,000 years the seasons are reversed making the winter colder and the summer warmer in the northern hemisphere. 10,000 years from now the seasons will be reversed. Secondly, there are also 60 to 70 year cycles in the Pacific and the Atlantic oceans that are well documented. These are known as the Atlantic MultiDecadal Oscillations (AMO) in the Atlantic and as La Nina and El Nino in the Pacific. Thirdly, we also know that there are greenhouse gases such as carbon dioxide that can affect global temperatures. Lastly the National Academy of Sciences (NAS) estimated that carbon dioxide had a doubling rate of 3.0O Celsius plus or minus 1.5O Celsius in 1979 when there were only two studies available and one for sure and maybe both were not per reviewed.

The result of looking objectively at the three possible sources of global temperature changes was a series of equations based on these observations that when added together produced a sinusoidal curve that seemed to follow NASA published temperatures very closely.  Since this curve was based on observed temperature patterns it was called a Pattern Climate Model (PCM) which has been described in previous papers and posts on my blog and since it is generated by “equations” many assume it is some form of least squares curve fitting, which it is not. It does seem to be related to ocean currents.

As can be seen in the following Chart the PCM there is a 69.1 year cycle that moves the trend line up and then down a total of 0.29O Celsius and we are now in the downward portion of that trend (-.01491O C per year) which will continue until around ~2035.  This short cycle is clearly observed in the raw NASA data in the LOTI table going back to 1880. Then there is a long trend, 1036.7 years with an up and down of 1.65O Celsius (.00396O C per year) also observed in the NASA data. Lastly, there is CO2 adding about .0079 degrees Celsius per year so they all basically wash out at -.0039 O C per year, which matches the current holding pattern we are experiencing. After about 2035 the short cycle will have bottomed and turn up and all three will be on the upswing again.  Note: the values shown here are only representative as the actual model uses many more places than what are shown here.

When using the 12 month running average for global temperatures up until 2014 the PCM model was within +/- .01 degrees of what NASA was publishing in their LOTI table since the early 1960’s as shown in the next Chart. Further the back projection of the PCM plot matched historical records and global temperatures going back past the time of Christ. It should also be consider that geologically CO2 levels have reached levels many times that of the current 400 ppm without destroying the planet so the current hysteria over the current small numbers can only be explained by political science not real science.

NASA NOAA 04

The nest step in this analysis is to put all of the known data and projections into one Chart which will contain: NASA’s table LOTI global temperature estimates, NOAA’s actual CO2 values, the CO2 model projections, the PCM model global temperature plot, Hansen’s Scenario B 1988 global temperature plot, and lastly the IPCC AR5 A2 global temperature plot. With that done we can look at the results and try to make some sense of what is going on with the various arms of the federal government that are promoting that carbon based fuels be eliminated since they are responsible for the global temperature level  going up.  As previously started when the government pours money into the sciences the sciences respond with technical papers the support the governments views, this is what is call political science verses real science as was done prior to the 1980’s; money talks and BS walks as everyone on the street knows.  This Chart views a good overview of the current situation showing all the facts and all the projections.

This Chart contains no manipulation of the data and the only change that was made was to convert the NASA anomalies back to degrees Celsius to make it more readable to lay people.  This is only a change in units and has no bearing on the look.  A subject not broached here is that of the NASA homogenization process itself and the base period from 1950 to 1980. The portion in the black circle contains the NASA base period of 14.00 degrees Celsius and the reason it’s brought up here is that the Homogenization process causes the global temperatures to move around since the entire data base all the way back to 1880 is recalculated.  But since the base has to stay at 14.00 degrees Celsius the program must be set to not allow changes in that period of time. I’m sure the programmers have fun with that. Prior work here has shown how this creates a teeter totter effect with the data plots, some of which have recently been significant.

NASA NOAA 05

The next Chart will be a look at the period from 2010 to 2020 so we can see the detail of the past few years where a change in CO2 of only a few ppm has caused a major change in the global temperature way beyond anything previously shown in any published NASA data. There are two black ovals on the Chart one at the top of the Chart which is a black oval around the CO2 levels for 2014, 2015 and part of 2016 and it’s very obvious that there has been very little change, maybe 4 ppm or about 1%. Then at the bottom of the Chart is another black oval around the NASA global temperature levels for 2014, 2015 and part of 2016 and its very obvious that there has been a very large change, maybe .33 degrees Celsius or about 2.2%. There has never been such a large increase in temperature from such a small increase in CO2.

By contrast the previous comparable period of the last part of 2010 through 2013 shows about the same for CO2 at 1.1% but only a .2% increase for global temperature, basically flat. Worse it appears that this upward trend will continue as these values are based on a 12 month moving average and the current values being published by NASA have been very high for the past 6 months and so I would expect the NASA plot to be well over 15.00 degrees Celsius within a few months.  In looking at the raw data for September 2015 and October 2015 there is a jump of about .25 degrees Celsius that is a very large number for one month and as we have shown here in a previous chart not reasonable at all and a perfect example of political science.

NASA NOAA 06

In summary, the IPCC models were designed before a true picture of the world’s climate was understood. During the 1980’s and 1990’s CO2 levels were going up and the world temperature was also going up so there appeared to be correlation and causation. The mistake that was made was looking at only a ~20 year period when the real variations in climate all move in much longer cycles.  Those other cycles can be observed in the NASA data but they were ignored for some reason.  By ignoring those trends and focusing only on CO2 the models will be unable to correctly plot global temperatures until they are fixed.

Lastly, the next chart shows what a plot of the PCM model, in yellow, would look like from the year 1400 to the year 2900. The plot matches reasonably well with history and fits the current NASA-GISS table LOTI data, in red, very closely, despite homogenization.  I understand that this model is not based on physics but it is also not curve fitting. It’s based on observed reoccurring patterns in the climate. These patterns can be modeled and when they are, you get a plot that works better than any of the IPCC’s GCM’s. If the conditions that create these patterns do not change and CO2 continues to increase to 800 ppm or even 1000 ppm than this model will work into the foreseeable future.  150 years from now global temperatures will peak at around 15.75 to 16.00 degrees C and then will be on the downside of the long cycle for the next 500 years.  The overall effect of CO2 reaching levels of 1000 ppm or even higher will be about 1.5 degrees C which is about the same as that of the long cycle.  The Green plot on the Chart shows the observed pattern with no change in CO2 from the pre-industrial era of ~280 ppm.

NASA NOAA 07

The purpose of this post is to make people aware of the errors inherent in the IPCC models so that they can be corrected. 

The Obama administration’s “need” for a binding UN climate treaty with mandated CO2 reductions in Europe and America was achieved as predicted at the COP12 conference in Paris in December 2015. To support this endeavor NASA was forced to show ever increasing global temperatures that will make less and less sense based on observations and satellite data which will all be dismissed or ignored.  Within a few years the manipulation will be obvious even to those without knowledge in the subject, but by then it will be to late the damage to the reputation of science will have been done.

 

Sir Karl Raimund Popper (28 July 1902 – 17 September 1994) was an Austrian and British philosopher and a professor at the London School of Economics. He is considered one of the most influential philosophers for science of the 20th century, and he also wrote extensively on social and political philosophy. The following quotes of his apply to this subject.

If we are uncritical we shall always find what we want: we shall look for, and find, confirmations, and we shall look away from, and not see, whatever might be dangerous to our pet theories.

Whenever a theory appears to you as the only possible one, take this as a sign that you have neither understood the theory nor the problem which it was intended to solve.

… (S)cience is one of the very few human activities — perhaps the only one — in which errors are systematically criticized and fairly often, in time, corrected.

They Are Tracking Duty Free Purchases in Airports, Why?


Duty Free

Did you ever wonder why when you are flying, you have to show your boarding pass to buy something in the shops after security when in fact nobody can be there without a boarding pass? The answer is start to surface. It turns out the government is tracking the destination of travelers who buy anything. With such a database, that means they could take the next step and send that info to your destination to ensure you pay the tax upon landing. The German magazine GMX has pushed to ask this question that would seem stupid to require a boarding pass once you get through security to buy anything. The hunt for money just keeps getting worse.

Front-Running Now a Crime?


DOJ

The US Department of Justice has arrested Mark Johnson who was the global head of foreign exchange trading at HSBC as well as a former colleague, Stuart Scott. The two traders are accused by the US government of using inside information to profit from a $3.5bn currency deal. Of course, inside trading only is a crime in stocks – not commodities, futures, or currency. The US Department of Justice (DoJ) accuses these traders of “front-running” and opens Pandora’s Box..

The implication of this new aggressive tactic means in reality, Goldman Sachs can be shut down entirely with probably every other cash market maker in New York City. Anyone who now looks at a client’s position and adjusts the prices or trades ahead of an order in anticipation, is committing a crime according to this latest case allegations. This would easily be applied to any analyst who has positions in something and then tells people it will rise. Is that now front-running? Buying before you put out a recommendation? It may no longer be simply to say you have positions in that instrument. This too, under this new interpretation, would constitute “front running” which they are calling a criminal act. Obviously, if you want to tell the world what to do, you better not have a trading account. These interpretations can change a lot.

Meanwhile, the U.S. Department of Justice also filed lawsuits seeking to seize dozens of properties tied to Malaysian state fund 1Malaysia Development Berhad (1MDB), saying that over $3.5 billion was misappropriated from the institution. The lawsuits, filed in Los Angeles, seek to seize assets “involved in and traceable to an international conspiracy to launder money misappropriated from 1MDB”. The alleged offences were committed over a four-year period and involved multiple individuals, including Malaysian officials and their associates, who conspired to fraudulently divert billions of dollars from 1MDB.

The Malaysian lawsuits did not name the  Prime Minister Najib Razak, but they did name his step-son Riza Aziz. They also named Malaysian financier Low Taek Jho and the Abu Dhabi government officials Khadem al-Qubaisi and Mohamed Ahmed Badawy Al-Husseiny.

The DOJ probably has no clue that Goldman Sachs is deeply involved in this fund. They will not like where the breadcrumbs might lead.

In both of these cases, there is a great departure of business as usual. You can bet that the NY bankers will be pouring money into Hillary’s campaign at this point and may even start going to church on Sundays.

Why Are Italian Banks Breaking Europe?


BadBank

QUESTION: Mr. Armstrong, why are Italian banks in worse shape than most other countries. What happened to the bail-in program of the ECB? Can you explain why Italy is threatening the entire banking system of Europe?

ANSWER: The bail-in policy of the IMF and ECB was directed at the idea that the rich would pay, even if that meant paying for pension funds. But in Italy, stock ownership is distributed predominantly among individuals. Therefore, politicians were unwilling to deal with the crisis. Forcing bank holders of shares and bonds to take a haircut meant the middle class would be scalped, and that meant political unrest. Italy never cleaned up its banks, and as such, it has been a growing problem with about €360 billion in underperforming loans. This is nearly 18% of all loans in Italy. They are dealing with this in the typical manner of forcing haircuts on those who have been stupid enough to invest in banks in other countries that amazingly go back for more pain and suffering. In Italy, this may lead to a pitchfork revolution.

LongBranchNJ-DepressionScrip

This is not unusual. This was also the core crisis that created the Great Depression. In that case, foreign governments issued bonds in dollars in small denominations and the New York bankers sold them to the general public. The crisis emerged because this was a Sovereign Debt Crisis in 1931. Hence, there could be no bailout domestically within the United States to protect foreign bonds sold to domestic mom and pops.

As the economic depression deepened in the United States during the early 30s, which also was when the Dust Bowl unfolded, farmers had less and less money to spend in town and could not pay their loans. Banks began to fail at alarming rates in the Mid-West as farmers could not repay, and in the East, the default on foreign government bonds wiped out savings and caused depositors to withdraw funds. During the 20s, there was an average of 70 banks failing each year nationally. During the first 10 months of 1930, 744 banks failed. By 1934, 9,000 banks had failed in all. It’s estimated that 4,000 banks failed during the year of 1933 alone. By 1933, depositors saw $140 billion disappear through bank failures.

This is what made the Great Depression so great. Banks saw bad loans soar and mom and pops who bought foreign bonds were wiped out. The combination of these events led to the massive collapse in the capitalization of the economy. More than 200 cities had to issue their own money for there was a shortage of money and banks.

Euro Crisis - 1

When mom and pops hold the bonds and shares of the banks, the option of a haircut is greatly diminished. The risk that we now see in Europe is the further deflationary pressure of the collapse of capitalization of the European financial system. This is not something that can be resolved by the ECB. When a country surrenders its currency, it is indistinguishable from a gold standard if they lose the ability to devalue to offset the crisis. The pressure would normally have been offset by the collapse of the Italian lira. That being extinct, the pressure becomes a contagion that will spread throughout Europe.

This is the price of a single currency, but without full federalization politically. This combination of events renders the crisis insurmountable and the outcome can only be the destruction of the euro and the single monetary system. The danger here is that the politicians in Brussels will fight to save their personal power at the expense of the entire continent.

Donald Trump Puts Reinstatement of Glass-Steagall Act Into 2016 Republican Party Platform…


I have a degree in economics and although I did nt take that road in privet life and have kept up with the field and the field move with the banking as it gave the idealists a way to get more money to cover up what they were doing to main street. This move my Trump is significant as Sundance writes here. Read this post several time and save it as it is a key point in saving the country.

Taxation Without Representation or Even Residency


Tax Robbery

QUESTION: Mr. Armstrong; The taxation of the internet seems to be rising. At the same time it appears as though this could really harm the economy by reducing competitiveness of small companies trying to comply with collecting taxes of so many different states. Have you looked at this as a possible factor in creating the next economic depression?

Thanks

BV

ANSWER: Absolutely. There is a tremendous clash of jurisdictions and governments are fighting for more and more taxes to pay government pensions. It has turned into a them against us confrontation and he who makes the rules typically wins until he provokes revolution. Most revolutions are ALWAYS over taxes as was the American and French Revolutions. The Supreme Court ruled in Quill Corporation v. North Dakota 504 U.S. 298 (1992) that there was nothing inherently unconstitutional about requiring out-of-state retailers selling over the internet to collect state and local sales taxes on orders shipped to in-state residents.  The only question was whether imposing such a requirement would cross the line from an acceptable burden on interstate commerce to an unreasonable one. That the Court did not decide. They claimed that technology had greatly eased the burden of collecting taxes for multiple jurisdictions, however, the Court concluded that Congress should make the call.

The ruling demonstrates how courts cannot be trusted to defend our liberty when those judging are appointed by the political machine. What if every state applied taxation based upon the same methodology that the Feds do. Lets say you were born in New York but moved to San Francisco. New York could then claim that since you were merely born there, you owe taxation to them on your income yet you use no services. California then imposes income tax on the theory you are a resident using services. Now you owe income taxes to two States plus the Feds. This would destroy the freedom of movement rapidly. Those who leave the United States suffer the same fate and owe taxes to the USA for the simple reason of their birth.

If the Congress enacted such a law demanding everyone on the internet are tax collectors for every possible taxing authority, the economy would collapse. Then cities could demand the same thing so places like Philadelphia or New York City that impose additional sales taxes of some kind would jump on the wagon and everything would collapse. Now you can see how revolution is born. Those in power always want more without regard for the consequences. This is why I have argued we MUST eliminate income taxes at the federal level and states must be restricted to their territory. No state has the right to impose any duty upon a non-resident of their jurisdiction – PERIOD. Forcing small business to collect taxes for every state would destroy small business and compels them to be quasi-government employees with criminal penalties for failure to comply, without any compensation.

The 2015.75 Crisis Moving into 2020.05


Crisis

The world financial crisis that is unfolding post-2015.75 is different from that which followed the 2007.15 peak in the ECM. As stated countless times, each event is a crisis in a different sector. The 2007.15 crisis was the over-leverage in real estate that the bankers created. This time, we are looking at the demise of governments. Under normal conditions, bond prices would be falling with interest rates in the public sector rising. We still see this unfolding in the peripheral markets. The markets where central banks have been buying government bonds to try to stimulate the economy has utterly failed and created a crisis beyond contemplation. We are looking at the collapse of government’s ability to issue debt as we move forward into this cycle. The only buying will be central banks at the end of the day – totally insane.

Bailout-R

The Sovereign Debt Crisis of the 1840s was the demise of the states, thanks to Andrew Jackson shutting down the Bank of the United States. This led to a banking crisis with individual states trying to support their banks. Because the states could not create money. The states issued debt to bailout the banks, but the crisis was far too massive, and as a result, the banks took down the state governments, which had no choice but to permanently default on their debt. This time, governments are trying bail-ins and this is causing confidence to collapse. Why should people trust banks at all? Once they hoard cash; that is it. The velocity of money implodes and you end up with an economic depression.

Draghai Euro CrisisTo answer all the questions about whether this will be covered at the World Economic Conference — of course. And to answer why we did not hold one in Berlin, yes, our models were warning about significant civil unrest in Europe as a consequence of the complete fiscal mismanagement of the ECB. It appears that the negative interest rates are totally insane. This is the complete incompetence of those who think they know how to manipulate society from Larry Summers to Mario Draghi.

These people will never admit a fatal mistake. Thus, we have to stand by and what Rome burn.