Using the Global Market Watch


The Global Market Watch (GMW) is PURELY an alert system. It is not intended to be a trading tool. It is simply an alert to allow you to see the entire world collectively and is only a pattern recognition model EXCLUSIVELY The last entry is dynamic and it will change during the course of that period (weekly to yearly) until it is final with the close of that period. It merely reflects what the pattern would be if the week to year had closed that day. We never buy or sell on this model since it is ONLY an alert and thus a confirming tool. Reversals and Arrays are the only forecasting methods that provide price and time. Th GMW is just an alert which is better on some more developed markets than less traded instruments. It is also more reliable on the higher monthly time levels up to yearly for there the patterns are less complicated. One the daily level, what is astonishing has been that this is an AI system which is constantly learning and has therefore identified more than 50,000 patterns so far. The mere fact that there are so many patterns that it has identified demonstrates the complexity of markets and how impossible it is for a human to actually forecast a market consistently. I have always found the long-term term easier to see than the short-term.

Interest Expenditures Will Now Exceed Military Spending – We are being Walled-In by our Own Debt


I have been warning for years at the World Economic Conferences that interest expenditures will reach the point that they will crowd out everything else. Well at last, as we enter 2019 and the War Cycle heats up, interest expenditures will now EXCEED even military spending. Welcome to the SOVEREIGN DEBT CRISIS. I have also stated for years that we elect people to run a government with absolutely NO QUALIFICATION whatsoever. There were people who want Oprah to run for President because she is (1) black and (2) a woman. This is the standard of expertise far too many people apply when it comes to politics. I have also made the analogy that this is like asking a cab driver to conduct open-heart-surgery on you because he smiles nice and holds a good conversation.

Historically, society has always gone through a major debt crisis. Perhaps that is why the Bible talked about a debt jubilee where debt is simply forgiven every 49/50 years. One question that jumps out at us is rather blunt. Does the Old Testament Debt Jubilee present a solution to our modern financial crisis? The mere fact that this is in the Bible suggests that there must have been major debt crisis even before the Bible. We do know that Hammurabi’s Law Code imposed regulation on interest. It also imposed Contract Law and required people to reduce agreements to writing that were witnessed. By implication, such a law must have meant that one person said he lent money and the other denied it. We have legal records that have survived from Babylon which even demonstrate they had an active futures market where people bought a crop for future delivery creating even options.

One of the earliest Debt Crisis in recorded history that is well documented by contemporary writers was the Debt Crisis in Athens of 354BC. Corruption between government and the bankers is nothing new. The banks were the Temples since money was donated to the gods who had no use for it. Typically, the government would borrow from this hoard of Temple money to fund wars. The priests became the bankers. In Athens during 354BC, there was one of the early banking crisis events involving what we would call the Secretary of the Treasury so to speak and his banking friends. The money grew to a vast sum in the Temple which kept all these donations in the Opisthodomos. The Temple was not earning interest on its hoard of money which just sat there funding the lavish lifestyle of the priests. The treasurer agreed to lend the money to personal banking friends who would then pay the treasurer interest that he could then personally put that in his pocket. When the banking crisis hit and there was a liquidity problem, the banks could not repay the loans to the Temple.

Most of the loans were going to real estate. When the business cycle hit and real estate turned down, people could not pay their debts and could not sell the property in a down market. Suddenly, the bankers could not repay the priests so they then tried to cover up their scheme by setting fire to the Opisthodomos. Nevertheless, the scheme was detected and the Treasurers of the Temple of Athena were seized and imprisoned, about 377-376BC. In 1989, government ministers of Crete pulled the same scam. They were depositing government funds in the Bank of Crete and interest was being diverted to themselves. It was the failure of the Bank of Crete that exposed the scam (See NY Times, 9/21/89, A14; 9/27/89, A3). So you see, history repeats like a Shakespeare play – just the actors change over the centuries while the storyline remains unchanged.

Obviously, debt and contracts have been around for thousands of years. Is there a dramatic and simple way out of all this? Some argue that there is a “debt jubilee” they take from the Old Testament book of Deuteronomy, the concept derives from the biblical injunction for a day of rest one day out of every week, a “sabbath” day. There appears to be a fractal system which is laid out in the Bible. The next injunction is for a Sabbath year every 7th year. Here, people are to not work. The next injunction appears on the year after the 7th of those sabbatical years, i.e. the 50th, (one year after the 49th). This is where we find there would be a jubilee year during which any slaves would be emancipated and everyone would return to their land and family to live off of natural providence. A clear implication of this teaching is that all obligations, including debt obligations, would be forgiven in the process. I do find it curious that this lines up fairly closely with the Economic Confidence Model (ECM) and its 6 waves of 8.6-year intervals which build up to major events every 51.6 years. Is the Bible saying that there is a debt crisis every 50 years where the solution is to default on all debts? The next 51.6-year target on the ECM will come in 2032 and our model does show that the West will yield the crown of the Financial Capital of the World to China. So does the Biblical Debt Jubilee suggest we “should” forgive all debts at the 50th interval of the 7th year or does it forecast that debts will be forgiven simply because everything will crash at that point?

 

I have further warned that our elected officials could not even run a bubblegum machine as a business. When they spend all the money they took in on themselves, they have nothing left to buy more gum to refills the machine. Their solution is just to raise taxes and refill the machine and spend it all again on themselves with lavish perks and pensions. The Sovereign Debt Crisis is alive and well. This is now when it is going to begin to surface to where it will become more obvious to people around the world. Indeed, I am off to Europe today for this very reason with two weeks of meetings. The risk is beginning to become obvious as interest expenditures will crowd out everything other areas of spending. Governments will try to keep the debt revolving by raising taxes and this will only further reduce both the economy and our living standards. We are being walled-in by our own debt with no place to go except default if we do not act NOW!!!!!!!

Some Bubbles are Just Outright Frauds


QUESTION: BitCoin has crashed and it looks like it will never be what people dreamed as some replacement for the dollar. Are bubbles always involving some failed product? A dream that is just unrealistic like the Tulip bubble?

JE

ANSWER: No. There have been many, many, many “bubbles” throughout history. Some have been just crazy like the Tulip Bubble and others have been outright frauds like the Panic of 1825 which was a stock market crash following the same idea as the South Sea and Mississippi Bubble of 1720. This time, it was again a new emerging market country that was completely just a fraud. It was a wild speculative investment in Latin America, that was all about an imaginary country of Poyais. The stock market boom became a bubble and banks caught up in the euphoria made risky loans all on this imaginary new market.

The Sovereign Debt Crisis has Spread to 119 Countries


QUESTION: Mr. Armstrong; For the past two WEC events you have warned that the Sovereign Debt Crisis will strike first outside the USA and the rise in the dollar and US interest rates will push emerging markets into default. Since you also said that pension funds had rushed into emerging market debt to get higher yield not available in USA and Europe, then this will also feed into the pension crisis. I recently read here in Germany that almost 100 nations are on the brink of a debt crisis. Only now people are starting to talk about it. Do you still see this as a catalyst for a strong dollar along with war?

I am really looking forward to this year’s WEC.

LR

ANSWER: The Sovereign Debt Crisis is on schedule to be noticed starting here in 2018. We have 13 governments now who are already in default of their debt payments. There are more than 100 nations who are on the verge of a debt crisis. The rise in US interest rates and the strength behind the dollar pushes these nations over the edge. I have been warning that this trend would emerge as part of the turning point back in 2015.75. It will now intensify as we head into 2020. China’s debt to GDP is more than TWICE that of the United States. DEBT is our worst enemy and there are no viable solutions coming forward because anything implied by others is tinkering with the current system. There is no solution is valued circles, other than mine, which calls for the complete revision of the debt system. Everything being proposed so far is tinkering with raising taxes and reducing benefits as well as raising the age for pensions.

I fear that all we can do is protect ourselves. Nobody is willing to listen to me. When they will, it will be too late. Hence – the crash & burn becomes unavoidable. Nobody will scrap the system before it crashes. It is against human nature.

Mexican Presidential Race Front-runner Blames Corruption For President Trump’s Perspective…


The next president of Mexico, Andres Manuel Lopez Obrador, or “AM LO” as he is known locally, is a well known Marxist.  AM LO is virtually certain to be the winner of the July 1st Mexican election.  The U.S. will have a Hugo Chavez ideologue at our southern border.

Today, front-runner AM LO told an audience in Rosarito (Baja California peninsula) that President Trump’s bad experiences investing in Mexico, and encountering corrupt officials throughout government, were likely the reason for his negative view of the country.

“[Trump] invested here in Rosarito and also in Cozumel, Quintana Roo, and because of Mexico’s corrupt governments he had to leave,” Lopez Obrador said. “That’s why he got a bad impression of our country.”  (Reuters link)

AM LO went on to say his national government would eliminate the decades-long corruption within government and the judicial system.  Keep eyes-wide-open; once in office AM LO will likely repeat Chavez/Maduro and remove blocks to his agenda including legislative opposition, elections and eventually term limits.

Cycle of Religion – Detailed


COMMENT:  In your blog on the cycles in religion, you may want to add some more dimensions: (1) Hindu worldview is cyclical over a vast cosmological timescale and then through a fractal (as above so below) astrological philosophy of action there appears an a-causal (synchronistic) relationship between cosmic, global and local possibilities for events which however are precipitated by individual choice of action. The outcomes of individuals’ actions are based on those choices. (2) There does not seem to be any awareness in your analysis of the latest revolution in religion that happened on 23 May 1844 in Shiraz, Persia merely 36 hours before the the other ignored revolution in human affairs caused by Mores’ telegram, “What Hath God Wrought!” which is the direct antecedent of the global communication revolution. Babi-Baha’i Religion is that new religion at the start of the new economics of global economic and political action based on the use of telecommunications well documented over the last 160 years. Exact dates and times are available for some of these events which should provide you with an ample opportunity to test various cycles going backward and forwards and generate more insights for refinements in your models!
Very best,
AAW

REPLY: I did not go into great detail with respect to religion for it is a touchy subject. There is clearly a major cycle and it too adheres to the 8.6-year fractal sequence. The Roman religion was similar to Hindu insofar as it accepted local gods from the provinces. The early dominant Roman god was Janus. We find the earliest Roman coin, the As, bore the picture of Janus. The As began as one pound of bronze and it was divided into twelve fractional units known an Uncia. This is our current weight system. We still celebrate Janus’ feast day, which was January 1st. The two faced god is still what we say on New Year’s Eve – goodbye to the old and we look forward to a new year with resolutions for change.

The Black Stone Of God

Gold Aureus Stone of Emesa

The Roman emperor known to history as Elagabalus (218-222AD) takes his name from the sun-god of Emesa (Homs Syria today) for which he had been made high priest on May 16th, 218 AD. Elagabalus was actually born about 205 AD. With the assassination of Caracalla in 217 AD, power passed to the Praetorian Prefect Macrinus, but the desire for power from the Severian women led by his grandmother, Julia Maesa in Antioch, was very political and power hungry. They prevailed and Macrinus was deposed along with his son Diadumenian.

When Elagabalus departed for Rome, he also took with him the famous Black Stone of Emesa, which was the symbol of the sun-god Elagabalus from the temple at Emesa in Syria. Herodian described this Stone of Emesa as being rounded at its base and rising to a point at its top. There were a few rough projections, in which people believed they saw an image of the sun. This black stone was most likely a meteor lending its legend that it came from heaven as a gift from the god to mankind. Therefore, the role of the priest and the possession of this stone was of great symbolic power.

Elagabalus had been made a high priest of the sun-god cult when he was very young. Both he and his mother were religious fanatics and went as far as to take their eastern god to reign over all Roman gods in Rome itself. He constructed a very large temple adjacent to the Colosseum on the Palatine Hill. A second temple was erected just outside of Rome. He and his family would walk backward in a procession before the stone as it was brought to the second temple outside of Rome during a midsummer festival. Cassio Dio describes sacrifices of both animals and young boys. They made it mandatory for all to worship at the Shine of the sun-god including Jews and Christians. The sun-god was supreme and all other gods were subordinate to it. His religious practices drew sharp criticism when in 220 AD Elagabalus divorced his first wife Julia Paula and took a Vestal Virgin as his wife – Aquileia Severa. Vestal Virgins had been buried alive for breaking their vows even during the reign of Caracalla. Against the advice of his mother and grandmother, Elagabalus married Aquileia arguing that a union between the high priest and priestess would be born a son of god. But this religious taboo led to so much outrage, that Aquileia had to be divorced and a third wife Annia Faustina was selected.

For all of Elagabalus’ religious positions and many wives, he was also very notorious for being a bisexual who also enjoyed dressing up and playing the part of a woman. Cassio Dio tells us that Elagabalus even married a male slave named Hierocles and enjoyed being beaten by him as if he was Hierocles’ female salve. Other men who slept with him were given high positions in government. Homosexuality among the Romans was not acceptable as it had been in Greek culture. Respect for Elagabalus declined significantly. It was even said that Elagabalus asked doctors if they could medically transform him into a woman and carried out his own experiments by cutting off the gentiles of young men as a sacrifice to his sun-god. His reign was notorious for religious fanaticism, for cruelty, bloodshed, and excesses of every description, and there was general satisfaction when, on March 6th, 222AD, Elagabalus, and his mother Julia Soaemias were murdered in the praetorian camp. Their bodies were dragged through the streets of Rome for display and then thrown into the Tiber River denied any burial right.

The Cycle of Religion clearly follows the 8.6-year frequency. From the Battle of the Milvian Bridge which took place between the Roman Emperors Constantine I and Maxentius on the 28th day of October 312AD (312.824), it was 309.6 years until the rise of Islam. At the age of 40 in 610AD, Muhammad is said to have received his first verbal revelation in the cave called Hira. This was the beginning of the writing of the Quran that continued up to the end of his life. There was also the persecution of the newly converted Muslims like there had been among the Christians. Muhammad and his followers migrated to Medina in 622AD, an event known as the Hegira and the birth of the Islam calendar (622.298).

It is not certain when Jesus Christ was actually born. The census that is the story of having to travel to Bethlehem was actually the Census of Quirinius which took place in 6AD after Herod I the Great had died and the Romans were dividing Judaea into thirds among Herod’s sons. There is no actual evidence of Herod issuing an order to kill the firstborn males when in fact he clearly died about 10 years before. Such an order would have to have been issued by one of his sons, yet there is no surviving evidence to support that as fact.

Nevertheless, our model does place a turning point about late 3AD when most scholars agree that Jesus was born based primarily upon the Census of Quirinius. We then have in 312AD the victory of Milvian Bridge by Constantine the Great who then decrees that Christianity will be the state religion primarily so he got to plunder all the wealth of pagan temples. It is rather stunning how we come to major religious events every 309.6 years. This appears to be a change in beliefs that do not necessarily suggest complete changes in religions. Often these are shifts that become more fundamentalist in their beliefs or a turn toward liberalism.

Muhammad thus begins Islam 309.6 years after Constantine. The next target sees the beginning of pilgrimages to the Middle East during the 10th century. The belief that the world would end come the year 1,000 was very prominent, so much so that the English King Aethelred II (978-1016AD) replaced his image on the coinage with the symbol of Christianity – the lamb. Once the fearful date pasted, he reverted to placing his own portrait on the coinage once again. This particular cycle marked the Crusades, which began in 1095 as a pretense to protect the pilgrims.

The next target in 1241 which was the year of the Great Mongol Invasion. Poland fell to the Mongols that year who are eventually beaten back. We also see in this cycle was a new trend of Antipopes when France seized the Catholic Church and installed French popes as puppets of the French king that became known as the Avignon Papacy. This was the period from 1309 to 1376 during which seven successive popes resided in Avignon. The Seventh Crusade was a crusade led by Louis IX of France from 1248 to 1254. This was the cycle that we see Constantinople fall to the Turks in 1453.

The next cycle turning point began in 1551 when the Council of Trent reconvened to deal with the Protestant Reformation. This cycle also marks the attempt of Islam to conquer Europe and impose Islam as the state religion. The invading army was the new Ottoman Empire, which was defeated at the Battle of Vienna which took place on the 12th of September 1683 after the imperial city had been besieged by the Ottoman Empire for two months. The peak of that cycle arrives 212 years from the beginning. That was 1763 and the start of George II restrictions placed upon Americans which led to the American Revolution, which was also about the freedom of religion.

 

This brings us to 1860 and this is the beginning of the American Civil War, which was rooted in a religious question concerning slavery. This current cycle will reach its peak in 2072 and the next will begin in 2170. We are clearly moving toward a clash of philosophies both within Christianity as well as among different religious foundations. As we move into that major turning point, we will see rising discontent and religious confrontation engulf the world. In the USA, we have the liberal v conservative confrontation which is also incorporating the religious right and anti-abortion movements v women’s liberation factions. They see this as plain and simple – thous shalt not kill. Yet this is inconsistent with the idea of war itself. Perhaps it is ok to kill someone if the government tells you to do it?

This is part of the religious cycle as well. We will also see the conflict between Christianity and Islam build in Europe. This will be no different from the anti-immigration movement that surged into gun battles on the streets of Philadelphia during the economic depression that followed the Sovereign Debt Defaults by states during the 1840s. As the economic decline picks up speed from 2018 into 2020, the tensions against immigration will only rise. This is also behind the separtist movements in Europe.

We are in the Seventh Wave following the birth of Christ. From a pure cyclical perspective, the next turning point in 2072 may be a significant religious change. What comes, can only be subject to speculation. We have completed six waves of 309.6 years. The Seventh is where major change and conflict will be unleashed.

 

Armstrong on the Solution


Interest Rates and Bonds


The New Head of the EU Commission – they Call Him the “Monster”


Martin Selmayr, nicknamed “the Monster” by colleagues because of his fearsome reputation, has become the new European Commission Director General – the man in charge of the European Commission. He has been one of Brussels’ most controversial EU officials and he was unexpectedly put in charge of the entire EU civil service. Selmayr, who was chief of cabinet to president Jean-Claude Juncker since 2014, replaces Alexander Italianer, who had announced he would be stepping down after three years in the job. But the rumors behind the curtain tell a different story. With the Hungary election, Italian election, BREXIT, and Catalonia, the handwriting is on the wall. The EU is crumbling from its undemocratic internal authoritarian power that refuses to yield concerning its European Project to federalize Europe. If the Euro goes, there goes Brussels. They refuse to even concede that they created a nightmare with the Refugee Crisis. Italianer left because he disagreed with the internal policies. Selmayr is known as the “Monster” and this is a desperate turn to force central power upon the whole of Europe