Posted originally on Jan 5, 2024 By Martin Armstrong
“Could governments seize bitcoin?” That is a common question, and much to the dismay of many, my opinion does not match the typical analysis. I have lost clients due to my honesty regarding crypto. I understand many firmly believe that Bitcoin will one day become the alternative to the USD, but it is unwise to believe that it is a safe haven to park money. I will not sugar-coat the truth, as feelings must be removed from trading. The answer is an astounding YES – governments can seize Bitcoin and all other cryptocurrencies.
To begin, there is much speculation around the founder(s) — Satoshi Nakamoto – who created Bitcoin (BTC) on June 3, 2009. The mystery person or group (or government agency) has been MIA since 2011. Yet 1 million Bitcoins remain in their original account, untouched. His wallet is estimated to be up to $73 billion, and if this is indeed an individual, he or she is one of the top 15 richest people in the world. They have never moved a fraction of a BTC from their account. So, one wallet contains 5% of all mined bitcoin. Will this person or entity perpetually hold?
Only 2.3% of Bitcoin owners own a full Bitcoin, while 74% own less than 0.01 BTC. Bitcoin was initially a way to remain under the government’s radar, with people using cash to fund their anonymous accounts. The majority no longer use this method and favor platforms that are required by governments to collect and verify all user data.
Bitcoin’s price is akin to the problem that existed when the bubble burst in 1966 with mutual funds because they were listed back then. The value can change at a volatility rate of 10x that of the dollar, making it a highly dangerous instrument as a store of wealth. It is solely a trading vehicle until they weigh it and the value is changed.
In 1966, investors bid the mutual funds up beyond net asset value so during the crash, people lost everything when they thought it was a secure investment. The net underlying assets may have dropped 20%, but they paid 20% over the net asset value and then sold at 50% of the net asset value. Many mutual funds crashed 70-90%, whereas the Dow drop was 26.5%. Ever since, mutual funds have no longer been allowed to be listed. You go in and out at net asset value. Bitcoin must change its structure, or it will never become a valid currency with a stable store of value, which is supposed to be the whole point. It is just an asset class of high volatility.
Countries with strong currencies do not want bitcoin in existence. There are numerous ongoing efforts to regulate all cryptocurrencies, as politicians claim people are using it to either bypass taxes or commit crimes. Governments have reached the end of their rope and are actively on the hunt for additional taxes. They will default on all their debts, and the new monetary system they are planning will give them total control.
Those who call Bitcoin “digital gold” are onto something, as governments have seized gold in recent history. Herbert Hoover admitted in his “Memoirs” that the investigation that led to the creation of the SEC was on the back of a phone call where he was told it was a conspiracy against his administration to create the stock market crash.
Governments will impose capital controls as they always do. That will mean that they will have no intention of allowing people to buy and sell cryptocurrencies. They will most likely do that as well when it comes to gold and silver. A black market in precious metals may exist with a supply that cannot be increased. They might even seize gold mines.
Governments are allowing cryptos like Bitcoin to exist because they can trace the transactions far better than paper currency. Bitcoin is a trading vehicle and nothing more. Just follow Socrates. That gives at least an unbiased viewpoint. What goes up comes down, and what goes down eventually goes up. That is just the law of the market.
Every major central bank has said they plan to move to CBDC. The entire purpose of the CBDC is to impose COMPLETE capital controls. So, how will you buy and sell anything that they deem to be a threat to their totalitarian world?
Posted originally on Jan 3, 2024 By Martin Armstrong
Everyone wants to know what the Federal Reserve will do in 2024. Of course, people want to believe that the Fed will slash interest rates in the New Year. The pundits cling to every word except when, at the start of the month of December, Powell boldly criticized the Biden Administration, saying that his outrageous spending is “unsustainable” and central banks do not criticize their governments. They certainly do not criticize each other. I have met with the boards of central banks worldwide because I understand their predicament. Unless you have been behind those closed doors, you will never comprehend the intricacies that are taking place.
The Federal Open Market Committee (FOMC) held rates at the 5.25% to 5.5% range at their last meeting in December 2023. Additionally, the committee indicated the possibility of at least three rate cuts in 2024, as their favored gauges for inflation appear to be easing. The “dot plot,” which reflects individual members’ expectations, suggests the potential for four rate cuts in 2025 and three more in 2026, bringing the rate down to between 2% and 2.25%. Now, that is simply what the public has been led to believe.
The Fed’s last decision reflects a cautious approach to policy tightening, considering multiple factors unknown to the public before any further adjustments. The committee’s PUBLIC decision and future outlook are based on the evolving economic conditions in relation to inflation and the labor market.
The Federal Open Market Committee will meet in 2024 as follows:
Jan. 30-31
Mar. 19-20
Apr. 30 – May 1
Jun. 11-12
Jul. 30-31
Sept. 17-18
Nov. 6-7
Dec. 17-18
There are simply things I cannot publish on the public blog. I have posted articles on the Socrates private blog that explain the Fed’s direction for 2024 in further detail. Now, consider the dates above and consider what events align with them. Further details will be provided in the Year-End Report, which should be out by the end of this week.
The Federal Reserve cannot criticize the federal government. The most significant issues facing our economy are simply out of the Fed’s hands: war, taxation, and government spending. Chairman Jerome Powell surprised everyone when he called current government spending “unsustainable.” While not a direct criticism, Powell issued a stark warning that aligns with our Revolution Cycle of 72 years. In 1951, the central bank defied the US government by refusing to purchase debt to prevent rate hikes amid the Korean War.
So, there is bad news for the perpetual bulls who insist rates must decline. There is a HUGE divergence unfolding between short and long-term rates. Institutions are buying up government debt without considering the potential that rates may not fall. Absolutely no one is factoring in the largest driver of inflation – WAR – nor are they factoring in the three main pillars of government debauchery (war, taxation, government spending) that the Fed cannot control.
Posted originally on Dec 29, 2023 By Martin Armstrong |
Several US states are considering legislation to reclassify gold and silver as money rather than commodities. Bills filed in Oklahoma and Missouri aim to eliminate state capital gains taxes on the sale of gold and silver, and to treat these metals as currency. Other states like Arkansas and Utah are also considering introducing similar legislation. The proposed laws also include provisions to authorize the state to invest in gold or silver and to prevent state entities from seizing gold or silver bullion.
These measures are seen as steps toward reducing barriers to using gold and silver as money and lowering the investment cost of precious metals. On the plus, gold and silver may be used in transactions without an additional fee. If I purchase something for $100, I am not charged an additional fee for using USD – but let’s not give the government any ideas. Proponents of the bill say the Federal Reserve has a monopoly on our banking system, and deeming precious metals legal tender would prevent the central bank from having total control over fiat currency.
Not so fast – the government will not relinquish their control over the monetary system. They have told us their plan for digital currencies and deeming gold and silver currency will only make it easier for the government to confiscate. The entire problem that people do not grasp with regard to any return to a gold standard is that if the money supply is FIXED in any way, that necessitates the collapse of SOCIALISM. The two are directly linked. Politicians only know how to run with deficits. “Vote for me and I will give you everything!”
The Bretton Woods gold standard collapsed because they FIXED the price of gold at $35, but they continued to print money far beyond the supply of gold at that fixed price. Then there is the largely ignored business cycle. No matter what the money might be, there will be boom times when the value of money declines and the asset values rise. There is a natural course of a business cycle to the economy you cannot flatline or eliminate no matter how many schemes you invent from central banks, Keynesianism, Monetarism, Socialism, or Communism. It just cannot be accomplished.
The problem is not the physical money we use. The problem is that governments continually abuse their power and recklessly dive deeper into debt with each new spending package. Bretton Woods collapsed, as did every attempt to create any monetary system of some fixed value. Yes, they are not considering a gold-backed system here, but deeming gold and silver legal tender misses the mark. Gold and silver were hedges AGAINST government. The people have been able to use commodities to trade amongst themselves since the dawn of civilization. This legislation permits the government to intervene and naturally impose regulations.
The year 2025 will bring a turning point in Marxism as we reach the midpoint of the 224-year cycle (1913-2025).
Posted originally on the CTH on December 23, 2023 | Sundance
As the story is told, the “republicans” have the lowest amount of reserve cash on hand in the past seven years. However, as readers here are well aware, it’s not the republicans that are “running out of money,” it is the RNC Corporation that is running low on funds. These are two distinctly different things.
In the era of the great political awakening, the term “uniparty” has now become a well-known in conservative lexicon to describe our national political situation. The RNC and DNC are two private corporations that form each wing of the Uniparty vulture.
The RNC and DNC are private entities, private corporations, that manage the illusion of the two-party political system in the United States. The reality is that both corporations are funded by the same multinational donors.
The RNC and DNC are essentially private clubs, business entities that exist within a political system they create and control. In the era of Donald J Trump, this stark reality is now clear to almost every voter.
As a result, the RNC corporation does not receive most of its funding from the American electorate. The people have switched from funding the republican corporation, the RNC, to directly funding the individual republican candidates.
The people who control the RNC keep the illusion in place because they have no option; their entire business model is dependent on retaining a false premise. However, the people have moved on. The RNC is irrelevant to grassroots, small donors. Only the multinationals continue funding the RNC, which makes the candidate funding from the RNC an outcome of who the multinationals, hedge funds, and Wall Street billionaires choose to select.
The MAGA base does not fund the RNC, and in most instances the RNC funded candidates are antithetical to the objectives of the America-First movement. This inherent reality creates two types of Republicans, the RNC/Corporate republicans – beholden to the multinationals and millionaires, and the MAGA republicans who must serve the interests of the MAGA voters.
We are currently in this transitional phase, which is why we see the constant battle between the two distinct groups of republicans in DC.
Candidate President Donald Trump often is in a position of trying to connect the two disparate groups; however, recently there has been a more confrontational approach toward the corporate controlled republican politicians. This dynamic, conflict and inherent battle is what we call “The Big Ugly” and it must be waged in order to stop the historic illusion of choice being gamed by the RNC.
[Newsweek] – The amount of money that the Republican National Committee (RNC) had on hand for spending at the end of November was the lowest bank balance it has had at that point in any year since 2016, disclosures to the Federal Election Commission (FEC) show.
In a filing on Wednesday, the GOP governing body revealed it had $9.96 million to spend as of November 30, which is less than half what it had to work with when Donald Trump was contesting his first presidential election.
By comparison, the Democratic National Committee (DNC) reported cash on hand of over $20 million for the same day. Both parties’ committees have seen downward trends in funds they can draw upon since 2021, but the RNC’s balance has been around half that of its counterpart in the past two reporting periods.
[…] Oscar Brock, an RNC member from Tennessee, told the Post: “We’re going through the same efforts we always go through to raise money: the same donor meetings, retreats, digital advertising, direct mail. But the return is much lower this year. If you know the answer, I’d love to know it.” (read more)
Given the nature of corporate political structures, I suspect Kevin McCarthy will eventually replace Ronna McDaniel…
Posted originally on Dec 21, 2023 By Martin Armstrong
QUESTION: Why do you seem to be the only analyst who understands central banking? My son got an internship at one of the major banks in New York during the summer. I won’t say which bank, but he asked a senior-level guy there about you and the interest rates, explaining I had been following you for years. He said you were the only one with international experience and who has ever advised multiple central banks. Is that the answer?
PK
ANSWER: Perhaps in part. But there is a massive gap between the experience of those of us who have dealt at high levels internationally and domestic analysts who always seem wrong calling the shots based on the headlines they read.
The number one problem is this fiction that the dollar is a fiat currency when, in fact, currency from the beginning of time has ALWAYS been valued NOT by its pure metal content but by who issued it. There has historically always been a premium to the currency of the dominant economy.
When Cyrus the Great conquered Lydia, he continued to strike coins of their design because they were highly regarded in international trade. We see the same with Roman coinage imitated in India when they, too, could have issued their own designs, but the Roman coinage carried a premium.
Even when the Barbarians were on the Northern frontier of Rome, they too took silver and struck imitations of Roman coins because they were worth more than the metal content. In 260AD, when emperor Valerian the Persians captured me, there was a Financial Panic of 260AD where bankers suddenly did not know if Roman coins would still be worth anything when there was no emperor.
While everyone claimed hyperinflation would engulf the world because of Quantitative Easing (QE), I warned there would be no such inflation. Indeed, with QE, there was no inflation, and people then developed the Modern Monetary Theory, claiming that they could increase the money supply and it would not result in inflation.
The entire problem rests with the fact that these people not only did not understand the role of money but also failed to grasp international capital flows and how they play into the world economy. Because you can now buy US TBills and place them as collateral to trade with at a brokerage house, the debt is simply money that pays interest. BEFORE 1971, it was illegal to borrow against government bonds. For you see, if you could borrow against the bonds, that meant the bonds were part of the REAL money supply.
Once debt became cash that paid interest, that changed economics forever. I have said over and over again the Fed is NOT the problem, and it can not stop inflation with interest rates. The REAL money supply if the national debt, so if the Fed buys-in 30-year bonds and creates cash to do so, it is NOT increasing the money supply; it is increasing the liquidity – that is all. Swapping cash for bonds does not change the balance sheet. If you buy a house for $100,000 and pay cash, then you have merely converted your cash into an asset.
Now, it all depends upon the buyer. If I have a building and sell it to a fellow American for $10 million, it does NOT alter the domestic money supply. However, if I sell it to Brit, he brings in cash to buy the property, and that DOES INCREASE the money supply BECAUSE he has imported $10 million that did not previously exist within the domestic system.
This is a very complex topic that only those of us in international finance ever encountered. I helped the Japanese reduce their trade surplus for political reasons. I had them buy gold in New York, export it to London, and sell it there. The trade statistics only count dollars in and dollars out – not the product. Buying gold and exporting it reduced the trade deficit, and nobody understood anything.
I handled a lot of the takeover boys during the 1980s when they made the move about Wall Street. They never understood what I was doing. The stocker was way undervalued when you could buy a company, sell its assets, and double your money. I took it to another level. I ran the model on currencies, and we would then buy like all the Courage Pubs in England but borrow in Swiss in a currency that would decline against the asset. We were making 20% on the currency moves besides the asset values. I was restructuring companies selling assets in one currency to buy assets in another to create balance hedge portfolios. That’s how I became friends with Maggie Thatcher. She wanted to know who this guy was sending companies into Britain.
Maggie was one of the few world leaders who grasped what I was doing. She kept Britain out of the EU because she understood what and how I was restructuring multinational companies. They staged a coup against here to take the pound into the Euro, then Soros attacked the overvalued pound in the ERM, and John Major had to reverse the entire mess, making Soros very rich in the process.
I will get around to doing my memoirs. I understand what I was doing set the stage for the world economy post-1971 Bretton Woods. That’s why Milton Friedman bothered to listen to my lecture about currencies in Chicago.
Posted originally on Dec 17, 2023 By Martin Armstrong
QUESTION: Marty: You have mentioned that Trudeau’s freezing of accounts of anyone who donated to the Truckers was a test run for CBDCs. Do you think this is the end goal to control 100% of our lives?
GD
ANSWER: Hopefully, this will become a Presidential campaign issue. But they are desperate to stop Trump. Congress, including the traitors pretending to be Republicans, passed legislation that NO president can withdraw the US from NATO. This will enable the Neocons to start war BEFORE the 2024 election, and this legislation is to usurp the power of the president, assuming it might be Trump to make it so that he cannot exit World War III. Every politician who voted for that legislation should be thrown out of office in 2024 – PERIOD!
That said, the CBDCs are intended to control our social behavior. This transforms society into a digital prison, which is why the Founding Fathers outlawed Direct Taxation. The rally to Marx at the end of the 19th century led to the introduction of the Income Tax in 1913, and they swore they were going only after the trich. By World War II, they introduced the Payroll Tax because Roosevelt’s Marxist agenda was to include Social Security, and we, of course, had to be FORCED to save for our own future. That became a slush fund that was restricted to buying only government debt to fund this Marxist agenda.
You are being imprisoned with every piece of legislation, like reporting $600 transactions through various cash apps. You have lost ALL your LIBERTY – you don’t know it yet. They could simply create some nonsense and prevent you from donating to Trump or RFK and just make up some nonsense charge. The January 6th had unmarked buses filled with federal agents dressed as MAGA supporters before anyone showed up to stage the event so they could charge Trump and use the 14th Amendment to prevent him from gaining the White House. The Democrats refused to let RFK in, and Biden refused to give him Secret Service protection. In Florida, they tried to remove any contender from the ballot to challenge Biden. This is all about creating war. They let the border open to allow terrorists in so they can declare Martial Law and restrict everyone’s movement. All FREEDOM has been lost!
What Trudeau did in Canada permitted the bypassing of due process of law, which is the foundation of a free society. Wake up! Digitization of the monetary system will allow them to totally kill all dissent. There will be NOTHING left standing. This is what 2032 is all about. We are the ants beneath their feet. Anyone who thinks they care at all about us is an absolute fool.
We cannot stop it. This is NECESSARY for political change. This is them fighting to retain power when they fully understand that this monetary system is collapsing. This is not going to be this Great Taking. That would be an instantaneous revolution. They are not that stupid for even the army would rise up against them. This is about total control leaving you with your trinkets.
As this is rolled out, ONLY then will it open the eyes of the masses. Unfortunately, this is also why movements like Transgender, Black Lives Matter, you name it, are all about dividing the people. They MUST keep the people divided and fighting among themselves so they do not unite against the government, where the common denominator is FREEDOM.
It was Julius Caesar who said – Divide and conquer. Hitler attacked the Jews BECAUSE they were the bankers, and he needed to blame the hyperinflation on the bankers. He divided the people and then came – Papers, please! That is precisely what they are doing to us with CBDCs. This is the purpose of Gates’ UN-organized digital IDs. To prevent freedom of movement. Digital IDs to vaccine passports are all designed to prevent movement. Europe, as of January 1, 2025, will require visas from Americans to visit, and they will apply your social credit score to determine if you are eligible. Still, they intend to start World War III before that, creating an external distraction to divert people from the loss of liberty. This is the government’s objective- the enemy of freedom – as always, no matter what century or culture to look at.
Posted originally on Dec 14, 2023 By Martin Armstrong
Whenever those in Congress mess with real estate, they have ALWAYS, and without exception, caused a major crash. The Entire Savings & Loan (S&L) Crisis was a catastrophic disaster that wiped out nearly one-third of all the 3,234 savings and loan associations in the United States between 1986 and 1995. I previously mentioned that hedge funds were created by a regulation conflict between the Commodity Futures Trading Commission (CFTC) and the Securities & Exchange Commission (SEC). If you obeyed one, you went to jail with the other.
Back in the 1980s, we began the S&P500 Report when futures started to trade. We had to refund everyone’s money and shut down the report because these two agencies were fighting over who had the regulatory power of stock index futures. We could not provide analysis as long as the two agencies fought for power. It came down to a Supreme Court decision that finally said forecasting was free speech – SEC v Lowe. Nevertheless, in funds management, you could not hedge for a client domestically because if you had a stock portfolio and you thought there was a crash unfolding, you were only allowed to hedge 17% for anything more than that made you a futures fund – rather than a stock fund. The only way to trade everything was to move offshore, and these were called Hedge Funds, which you were not allowed to do domestically. To this day, you have separate funds domestically, each claiming they are the best, forcing the decision onto the average person.
The S&L crisis was also created by Congress’s persistent quest to regulate things they do not understand. Once more, there was a conflict and mismatch of regulations regarding S&Ls v banks. Congress had imposed restrictions on S&Ls with the creation of the Federal Home Loan Bank Act of 1932, which included such caps on interest rates on deposits and loans. They also directed that S&Ls should be lending into the real estate market and banks should be focused effectively on businesses. The banks still could do mortgages.
The market conditions moved into deflation between 1981 and 1985 because Volcker raised rates at the Fed to 14% to stop inflation, which caused capital inflows to buy bonds, sending the dollar to rise dramatically on international markets. The British pound crashed from $2.40 to $1.03 by 1985. However, the regulations on how much interest an S&L could pay meant they could not compete with the rates that the Fed adopted, and nobody in Congress noticed until 1982. The S&Ls experienced a massive capital outflow, and they were left with low-interest long-term mortgages.
In 1982, President Ronald Reagan signed Garn-St. Germain Depository Institutions Act, which was intended to correct the conflict between high interest rates and caps on the S&Ls. The reform eliminated loan-to-value ratios and interest rate caps for S&Ls. In addition, it also allowed them to hold 30% of their assets in consumer loans and 40% in commercial loans for the first time. The S&Ls began paying higher rates to attract funds. S&Ls also began investing in commercial real estate, which had tax advantages with regard to amortization.
As always, the Democrat’s constant hunt to punish the rich with every breath they take caused the entire S&L crisis of the 1980s. The Democrats only see the money dangling in front of them and nothing else. They pushed through a landmark 1986 Tax Reform Act that reduced the top personal income tax rate from 50% to 28%. However, in a bitterly divided Congress, as usual, demanded a compromise and that the income tax cuts were to be paid for by raising the rate on capital gains from 20% to 28% and limiting the deductibility of real estate losses for passive investors. The braindead unintended consequences undermined the entire real estate market and took down the S&L Industry in the process.
The S&L crisis demonstrated that those in government NEVER understand the private sector. They created the business model of the S&Ls whereby they made 30-year fixed-rate mortgages, which Roosevelt invented to solve the real estate collapse back in the Great Depression. To provide those loans, S&Ls depended on a deposit based on DEMAND that could be withdrawn within 30 days. When the Fed raised rates to 14% in 1981, the S&Ls were in trouble and lost deposits when they were prevented from paying higher rates. That was not lifted until the Reagan 1982 reform. This is the basic banking model using on-demand money to lend out long-term. To this day, the Fed directs the “Model Risk,” which you can review at SR 11-7: Guidance on Model Risk Management.
At first, the measures seemed to have worked, and by 1985, S&L assets had risen by almost 50%. Commercial real estate became the “hot” market. This is what attracted the Democrats. They saw all this money pouring into mortgages, so they could not resist changing the laws to get at that money in 1986. The Economic Recovery Tax Act of 1981 accelerated the depreciation of commercial and noncommercial real estate, making those investments quite attractive. Then, the Democrats saw the money and pushed the Tax Reform Act of 1986 to extend depreciation schedules for both real estate forms, reducing the attractiveness of those investments.
These people NEVER understand market behavior. By extending the depreciation tables, they created a one-way market. Real Estate collapsed, everyone tried to sell, and there was NO BID! One of the few Congressmen with real estate experience at the time called me and asked what my model projected. I told him this would be a major crash that would cost a fortune because there were also government guarantees behind a portion of the mortgages left over from the Great Depression days. Nobody would listen to his warnings.
In the meantime, pressure was mounting on the Federal Savings and Loan Insurance Corporation’s coffers (FSLIC). By 1987, the FSLIC had become insolvent. Rather than allowing it and S&Ls to fail as they were destined to do, the federal government recapitalized the FSLIC, exposing taxpayers to even greater risk. The S&Ls were allowed to continue to pile on risk. I had a client who wanted to buy an S&L, and I advised him not to get involved and that the crisis would worsen. He did not listen, bought a failed S&L, and recapitalized it; as the crisis worsened, they kept changing the capitalization requirement, ended up seizing his S&L, and lost most of his investment.
A bill is now being introduced to Congress that will prohibit hedge funds and other institutional investors from buying single-family homes. What these people in Congress FAIL to ever understand, is that they will now eliminate that segment of buyers and create a one-way market. Prices will have to collapse as these investors will ONLY be able to sell to a mom-and-pop, and as we head into a recession from 2024 to 2028, this does not bode well for the blue states especially.
The intent of the bill is to address the housing supply, which continues to dry up as prices have been climbing 20% since 2021. They believe that the low housing supply is driving up prices, and they are pointing their finger at hedge funds to blame, like Blackrock. The bill’s sponsors are U.S. Senator Jeff Merkley (D-OR) and Representative Adam Smith (D-WA). Of course, they ignore their spending, and pouring countless billions into Ukraine has nothing to do with inflation, and certainly, their COVID scam had nothing to do with anything regarding prices or unemployment. It is NEVER them on Capital Hill – it is always we, the Great Unwashed.
This bill is entitled the End Hedge Fund Control of American Homes Act of 2023, targeting both hedge funds and private equity firms that have been buying single-family houses as investment properties. While the bill addresses a serious issue, what we MUST understand is that people “feel” rich when their homes rise in value, for they see that as their savings. Both the Great Depression and the Great Recession of 2007-2009 impacted real estate, and this is the MOST sensitive area of the economy. You can take the stock market down 90% and the bond market. They will impact only a portion of the economy, typically the upper classes. However, when you take down the real estate market, now you are messing with the bulk of the middle class.
Senator Jeff Merkley said in his statement, “The housing in our neighborhoods should be homes for people, not profit centers for Wall Street.” While I do not support Blackrock and its agenda, this is closing the barn door after the horse ran away. He has made a big splash, saying: “It’s time for Congress to put in place commonsense guardrails that ensure all families have a fair chance to buy or rent a decent home in their community at a price they can afford.”
Larry Fink, BlackRock CEO, is a board member of Klaus Schwab’s World Economic Forum who preaches you will own nothing and be happy. Fink is also behind Zelensky, promising to invest in a war zone. Meanwhile, Fink sent his 2022 letter to CEOs of companies he has invested in on January 17th, 2022, while intimidating them to follow Schwab’s WEF. His letter reflected Klaus Schwab’s Agenda 2030. He stated:
“I write these letters as a fiduciary for our clients who entrust us to manage their assets – to highlight the themes that I believe are vital to driving durable long-term returns and to helping them reach their goals.”
BlackRock insists that it does not invest in single-family homes. It claims that it invests in multifamily properties, apartment complexes, and other residential real estate. They insist that they are not one of the large asset managers and private equity firms who have been buying single-family homes.
On August 2, 2021, CNN reported that during the first three months of 2021, “nearly a quarter of all homes sold in the United States were going to investors.” They reported that BlackRock (BLK), JPMorgan Chase (JPM), and Goldman Sachs (GS) were among the big-name buyers. They further reported, “Institutional investors still own only about 2% of all single-family rentals in the United States, or roughly 300,000 homes, according to John Burns research director Rick Palacios.”
The headline from 2021 made it sound that Blackstone was BUYING 17,000 single-family houses, outbidding regular mom-and-pop buyers with its $6 billion war chest. Blackstone bought Home Partners of America, which had already owned 17,000 single-family houses, and rents them out to tenants with an option to buy at a preset price at any time with 30 days’ notice. They insist that they are facilitating private home ownership by providing an option to buy.
Here is a chart provided by Freddie Mac, which shows the contest between large institutional buyers vs mom-and-pop as a percentage of the marketplace. The overall market share of investors has grown to around 30%. Like the changing of the depreciation table on real estate in 1986 by the Democrats caused a one-way market of sellers with no bid, outlawing investors now when they already have 30% of the market can lead to a MAJOR recession following the ECM between 2024 into 2028.
We have a Directional Change in 2024 and should expect higher volatility into 2025.
Posted originally on Dec 14, 2023 By Martin Armstrong
Government officials do not understand why Americans are disappointed with Bidenomics. Biden’s own team did not realize the term “Bidenomics” was intended to mock the president’s policies and they have adopted it as their own. “Bidenomics is about growing the economy from the middle out and the bottom up, not the top down,” Joe Biden posted on X, formerly Twitter, in July 2023. Americans’ personal financial situation has only deteriorated under Bidenomics and no one seems to understand why.
A November poll published by the Financial Times found that only 14% of Americans believe they are better off financially under Biden. Those people are likely on welfare. Around 70% of American voters feel Bidenomics hurt the economy or had no impact, with 33% saying they “hurt the economy a lot.” These numbers are staggering, as no president in recent history has managed to derail a stable economy so rapidly.
When asked why Bidenomics was not landing with Americans, Treasury Secretary Janet Yellen said she believes COVID is to blame. COVID has provided Biden with the only optimistic data figure in that unemployment naturally decreased once the economy reopened, but of course he is chalking it up to his policies. Sacrificing America’s energy independence for the Build Back Better agenda was Biden’s priority on day one in office. We have seen inflation rise every month of his presidency and experienced record-high inflation in June of last year. INFLATION WAS AT 1.4% WHEN JOE BIDEN TOOK OFFICE IN JANUARY 2021.
Now, I obviously do not blame the government for the issues at the Fed and their QE failures. However, the Fed has been attempting to tame inflation by raising rates and it simply is ineffective. Biden prided himself on implementing countless multi-trillion-dollar spending packages at a time when America is operating at its steepest deficit. Then Biden’s Administration managed to insert itself in numerous overseas conflicts. They also allowed million of illegals to invade America and paid them to do so. Inflation cannot decline amid war.
The majority of Americans have a drastically lower standard of living thanks to Bidenomics. Some estimates believe 63% of Americans now live paycheck to paycheck. Real disposable income has decreased 7.5% since January 2021, and credit card debt is up 36.2%. Monthly savings have plummeted 81.4% since Biden took office, and home affordability is down 37.3%.
It is an insult at this point for the current administration to gaslight Americans into thinking our situation is anything but dire.
Posted originally on Dec 11, 2023 By Martin Armstrong
According to a recent Federal Reserve report, US household wealth experienced a significant decline in the third quarter, largely attributed to deep stock losses. The central bank’s report revealed that household net worth fell by approximately $1.3 trillion, or 0.9%, from July to September, amounting to $151 trillion. The decline was primarily driven by a $1.7 trillion drop in the value of equity holdings.
This comes after a volatile year for the stock market, with all three major indexes experiencing a significant downturn in mid-2023. While the market has since recovered, the report also indicated a continued rise in household debt, which increased at a 2.5% annual rate in the third quarter. The decline in household wealth has raised concerns about its potential impact on consumer spending, borrowing, and investing, as well as its implications for the broader economy.
Americans living off credit began pulling from their 401K accounts early during Q3. Hardship withdrawals rose 13% in the beginning of June after already being 27% higher than January. Hardship withdrawals allow employees to pull money out of their 401K for an “immediate and heavy financial need.” No one would recommend doing this unless the situation was dire as individuals must show evidence that the money will be used for a major hardship in order to avoid the 10% early withdrawal fee imposed for those under 59.5.
The year 2023 marked the first time personal credit debt surpassed $1 trillion. Credit card interest rates average 24.56%, according to LendingTree. Credit cards aside, American households are carrying $17.29 trillion in various forms of debt, with the average household hosting $103,358 in debt that continues to compound.
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