Guyana & the Future


QUESTION: Hi Martin, thanks for including little Guyana in your blog today. I was born in Canada, but my parents emigrated from Guyana decades ago. I haven’t been back yet. Nevertheless, I am eager to see great things become of the country, have been tracking the oil industry developments there, and am invested in it as well. I want to see this country elevate out of poverty as a result of all of this but I am concerned about lack of strong and moral leadership and corruption. If you don’t mind me asking, what makes you so confident that democracy will rule out? Growth is growth, but all we have to do is look across the pond to Africa to see the mix of growth and corruption!
Thanks as always sir – your teachings and insights have reshaped me many times over.
Regards, D

ANSWER: I am not certain that Guyana will be the perfect democracy. South America has historically had a problem with corruption in government. The US sanctions against Venezuela are really stupid. The economy was turning down dramatically and the government has done everything possible against the people. The US sanctions merely give people an excuse to point to the US as the cause of the economic decline despite the fact that the sanctions were put on in response to the events and not before them. I am opposed to sanctions anyhow because they never seem to work. They boosted the support for Putin instead of causing the people to blame Putin. This is really brain dead.

Nevertheless, simply because you can invest in Guyana is a major difference in comparison to Venezuela. There will be corruption. That seems to be systemic in South/Latin America, but it is also a rising problem globally. Hopefully, they will still keep the free market as long as they get their fair share under the table unlike Venezuela. We have added the currency to Socrates.

Manipulating the World Economy – COMING SOON


“Manipulating the World Economy” has been printed and shipped to Amazon. We are hoping to have the links up for Christmas. I have tried to make this an interesting textbook on the world economy and how it functions. Every page of this hardcover book is printed in full color. I have illustrated everything I could get my hands on, including old newspaper articles from contemporary events, so you can read what I read. This illustrates the problems we have with governments and how they have lost control of events going forward.

  

I have tried to cover all the important subjects such as economic theories, Philips’ curve, supply & demand, random walks, defining what is really money, banks and their role in the creation of money, capital flows that overpower domestic policy objectives, taxation, a history of contagions, Modern Monetary Theory, and class warfare – among many more subjects.


These hardbound, full color books will make great Christmas gifts. They will be priced under $100.

(Click on any image above to enlarge)

We will let everyone know the moment they go on sale in Amazon.

The Mother of all Financial Crises


COMMENT: Sir,

While taking a break from reading the Repo Report, I came across these words written by Albert Einstein before he passed away

“Not one statesman in a position of responsibility has dared to pursue the only course that holds out any promise of peace…” he wrote. “For a statesman to follow such a course would be tantamount to political suicide. Political passions, once they have been fanned into flame, exact their victims.”

I fear we are going to crash and burn as you have said

Keep up the good work

DK

REPLY: That is a very good quote. It is so true. All the disinformation circulating around about this Repo Crisis one must question can they really be that stupid? This is really the Mother of all Financial Crises which will impact everything it touches. This will make the 2007-2009 financial crisis look like a trial run.There is no politician who will stand up and talk about this crisis nor will they dare to even ask pertinent questions for fear what will be revealed.

This is why this report does not end with this report alone. We will update it next year as everything unfolds. So it is more like a subscription to this catastrophe.

Premiere of The Forum (Davos)


I attended the premiere of The Forum last night and got to meet those “elite” they spin such conspiracy theories about. Putin will be the keynote speaker at the next session in 2020. Interestingly, the film will be released to the general public on the turning point of the ECM – January 18th, 2020.

Most people have no idea that the World Economic Forum, which Nigel Farage said our World Economic Conference is the alternative, is more like a convention. They employ 800 people and they try to stand politically in between. It was founded by Klaus (Charles) Schwab.

Klaus’ vision was to create a forum where world leaders can meet each other and create a bond. The conspiracy theories that paint these meetings as the place where they decide what the world will do for the next year is really nonsense. These people are not in control of anything and as the world turned nuts in 2019, the leaders of Germany, France, and the US all declined to attend.

It began with the model being the Chamber of Commerce meeting in the United States. Klaus took it one step further and tried to bring business and government together. As events unfolded, it grew into an annual meeting which then people wanted to be seen as being apart of it.

The film is the first to show the behind the scenes of Davos.

 

Repo Crisis – Best Kept Secret Ever!


COMMENT: Marty; I want to thank you for a great conference. It is clear you are the only true institutional adviser. Our board is very impressed. The FT reported that there is still no  single factor that caused the dislocations in the repo market in mid-September. You are the only one who explains the event authoritative.

Thanks

JG

ANSWER: Nobody will talk publicly. Everyone is scared to death of starting a panic. This is the BEST kept secret I have ever seen in my career. The real test comes at year-end when banks typically step back from the repo market so that their balance sheets are smaller for December 31 regulatory calculations. We will see what really happens then on the chaos scale of 1 to 10. I find it really funny how there are articles calling it the new QE to where the Fed is clandestinely buying T-Bills through repo. This really seems to be an orchestrated effort at disinformation. It is hard to say if the people who make this up are deliberate agents of the government hired to keep people looking in the wrong direction.

William Koch & Ancient Coins


QUESTION: I understand that the Koch brothers bought ancient coins. Is there any truth to that?

WJ

ANSWER: Oh, yes. William Koch was involved in a very famous case involving the Athenian decadrahms. There was a hoard discovered in Antalya by a television repairman and two other people back in 1984. They found a hoard of 2000 ancient silver coins with a metal detector. The hoard contained the rare Athenian decadrachms, which were produced as a commemorative 10-drachma coin. There were only 7 previously known examples. The Elmali Hoard contained 14 of them and became known as the “The Hoard of the Century.” The first one sold for $600,000 dollars, easily breaking the old record. The billionaire, William Koch of Boston, bought 1,800 of the coins for $3.5 million dollars. The Turkish Government knew that the treasure had been smuggled out of the country, but after it was taken across the border they didn’t have the slightest knowledge of its whereabouts. The treasure disappeared.

Based on the evidence, the Turkish Government started legal proceedings in Boston. The judge gave an important interim judgment in Turkey’s favor. Koch lost the hoard to Turkey

Britain GDP Has been declining ever since joining the EU


REQUEST: 
Hi Martin, I trust you are well. Would you post the chart you showed of how the UK has performed since joining the EU? I’ve been ploughing through your emails but am unable to find it. In short, I want to show my partners son the chart, who is a vehement ‘remainer’. Ie, evidence that the Uk would be better off leaving the EU.
Thanks for your help,
Cheers
Charlie

Understanding the Repo Crisis


COMMENT: Marty, thank you for a great conference. The comments out there on the liquidity crisis have been just domestically focused. Thank you for keeping my eyes focused on international events and your analysis about the crisis at Deutsche Bank

GH

REPLY: The raid on Deutsche Bank in Germany back in September over the money laundering probe of Danske Bank, which is the biggest lender in Denmark, contributed to the sudden collapse in confidence. The governments are desperate for money and they are hunting it on a global scale. Deutsche Bank served as a correspondent bank to Danske’s Estonia branch. That is where the latest money laundering is alleged to have occurred. The banker there in the Estonia branch of Danske, Aivar Rehe, was found dead by police there in Estonia. He had been previously questioned by prosecutors and was considered to be THE key witness in the money laundering probe. As always, just like Jeffrey Epstein, his death was declared to be a suicide. This is standard whenever they need to cover something up. Boris Berezovsky suddenly commits suicide being very remorseful for making billions I suppose. Anyone who could expose things others do not want always seems to commit suicide.

The crisis in liquidity is that American bankers will NOT lend to Europe. Because of the European Banking Crisis, banks just do not trust banks. Nobody knows who will be standing after a failure at Deutsche Bank. The Fed has had to step in to be the neutral lender NOT because of a crisis in the USA, but because of the collapse in confidence in Europe’s banking system as a whole. Stay alert – this is just getting started.

Gold & the Future


QUESTION: Mr. Armstrong; First I want to thank you for your conference. It was my first time and I was impressed when your daughter asked how many people attended prior sessions. The number of people standing beyond 10 years was impressive. I spoke with one who had been at your 1987 WEC. He said you not only called the crash and the day of the low, but you said gold would rally only $25 and resume its decline. Now we have people still preaching how gold will rally because of the credit crisis they seem to lack the understanding of how it is unfolding. I just finished reading the Hoarding Dollars report. It is really outstanding.

Do you see these people preaching the end of the world so buy gold as just a broken record? I looked at the 1987 move. You were correct. Gold rallied begrudgingly and then resumed its decline. What will it take to make gold sustainable?

WK

ANSWER: The 1987 Crash was a FOREX crisis caused by the G5 trying to manipulate the dollar down. The rally in gold from 1985 to 1987 was simply because of the decline in the dollar. When the G5 tried to stop the decline in the dollar with the Louvre Accord in February 1987, the dollar continued to decline and that was the tipping point. The talk was that the central banks were impotent and could no longer control the economy. We are approaching that same moment in time, but it may flip back the other way. The collapse in confidence is concentrated in central banks OUTSIDE the United States. Eventually, that will migrate to the US and then we will see gold rally when people wake up and see that governments are lost.

Gold Standard & the Never-Ending Fantasy


QUESTION: Do you think it is remotely possible for any return to a gold standard? I believe these arguments are not realistic.

DR

ANSWER: The fringe fantasy of a return to the gold standard just never dies. If we did not have vast unfunded liabilities and rising socialism to contend with, then such a possibility of a partial backing is possible. But to back the currency by gold, even say 1%, the restraints upon government would be unbelievable. First and foremost, politicians could not run with all sorts of promises. Bernie and Warren would be outlawed. We are so far away from any possible fixed exchange rate it is laughable.

There is so much that would have to change politically and economically for any form of a fixed exchange rate system, no less one backed by gold or anything that would be limited. You simply have to comprehend that even attempts to fix the currencies have blown up like the pound in the ERM crisis and the Swiss-euro peg. There is just so much more to this than some fictional return to a gold standard. Bretton Woods collapsed because they fixed the dollar to gold. You cannot fix even gold and silver to an unchanging ratio.