Stock Market Crash & Gold Rally?


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QUESTION: Mr. Armstrong; So many people keep calling for a stock market crash. At the same time, it has hung on to the 18000 level in the Dow for dear life. Do you see such a devastating crash as even possible?

PJ

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ANSWER: No possible way. Retail participation is at near record lows. It has just started to lift begrudgingly. Even the Gallup poll on Americans shows the same thing. Retail participation is at best 55% down from 65% in 2007. Liquidity, however, is still off by 50%. This does introduce the likelihood of Flash Crashes and Flash Rallies. Such events are by no means because of a pending major crash. Just where do you put money if bonds are dead and banks a questionable? Of course some will yell gold. But gold is for the individual. Pension funds and institutional investors with billions and trillions cannot invest in gold bullion with no yield. Gold stocks, yes, but bullion no.

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Gold should bounce and rally to test the 1340 level by year-end. We need a weekly closing above the 1336 level to show some sustainability. Resistance begins at 1308 and we need a daily closing above 1319 to be impressive.

Keep in mind that this is the Year from Political Hell. The second election will be the USA and it is clearly a contentious race with the Bush family saying they will vote for Hillary proving that they too would screw the country to save the political status quo. This is like Obama going to Britain telling the Brits if they vote for BREXIT, screw you, get to the back of queue for the USA will prefer dealing with the French and Germans than British.

November is a Directional Change and then our next big target is January. We will be doing a Gold Video Update tomorrow.

The End of the Clinton Crime Syndicate!


Click on the Link below and read the post, if true it would be devastating!

The End of the Clinton’s

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WOW! Absolute MUST WATCH! Hillary’s ‘surrogate daughter’ tied to terrorists, 9/11 funders


The Clinton’s are their corrupt ways have destroyed the American system of government; hopefully not beyond the repair that trump can bring when he is the President.

Did Something Happen at the ECM Turning Point?


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bundy-brothersDid something happen on the October 28th, 2016 turning point? Just maybe what clicked yesterday was the tipping point against government. The Bundys, who were the armed antigovernment protesters led by Ammon and Ryan Bundy, were acquitted precisely going into the 28th of federal conspiracy and weapons charges. Since the Federal government’s abuse of “conspiracy” where they do not actually have to prove you committed a crime just wanted to, their conviction rate has soared to over 98%. To be acquitted of these charges is a mind-blowing event when it is virtually impossible to win in court when juries just assume the government walks on water.

The protest at Malheur National Wildlife Refuge over the government’s claim to land ended in bloodshed and the police shot and killed unarmed man getting out of his car and then were shooting at women and children in their car. The attitude of some police has degenerated to the point we are the enemy to be hunted and killed for their pleasure. The FBI effectively just murdered one individual. The FBI special agent in charge, Greg Bretzing, said, “They had ample opportunity to leave the refuge peacefully.” He continued, “And as the FBI and our partners have clearly demonstrated, actions are not without consequences.” Well the jury has acquitted those who stood up against this government’s outrageous abuse. Where the blacks are going wrong with Black Lives Matter, they are isolating themselves. They should create a movement that ALL LIVES MATTER and then there will be greater strength in numbers across all races, religions, and genders.

Why do I see this verdict on the very day of the Economic Confidence Model important and not just a passing moment? The ultimate revolution against monarchy that gave birth to the United States and the French Revolution, began with juries standing up against government abuse. It just may be that history is repeating here as well.

trial-william-pennThe most famous trial where a jury stood up refusing to find the defendant guilty in the face of a corrupt government, was that of William Penn, the founder of Pennsylvania. In 1670, William Penn held a worship service on a quiet street, which was attended by a peaceful group of fellow Quakers. Penn and another Quaker, William Mead, were arrested on a charge of disturbing the king’s peace and summoned to stand trial.

As the two men entered the courtroom and the bailiff ordered them to place their hats back on, which they had removed. Then the judge held them in contempt of court for being in the courtroom with their hats on. Penn demanded to know upon what crime he was being charged for preaching. The judge refused to supply any information whatsoever as to his crime and instead referred vaguely to the common law. When Penn protested that he was entitled to a specific indictment, he was removed from the presence of the judge and jury denied the right to defend himself. Penn could neither confront the witnesses who accused him of preaching to the Quakers nor ask them questions about their charges against him.

Finally, after the testimony the court concluded, the judge instructed the jury to find the defendants guilty as charged, dictating what verdict he expected. Penn tried to protest, but was silenced and again sent out of the courtroom. The jury, for its part, proved sympathetic to the two defendants and refused the judge’s command to find the defendants guilty just as we have seen in the Bundy case. The judge at this point became enraged and sent the jury back to reconsider their verdict. When they returned with the same verdict, the judge criticized the jury’s leader, Bushnell, and demanded “a verdict that the court will accept, and you shall be locked up without meat, drink, fire, and tobacco…We will have a verdict by the help of God or you will starve for it.”

Thereafter, the jury was sent back three more times, but returned with the same verdict. Finally, the jury refused to reconsider. The judge then fined each member of the jury forty marks and ordered them imprisoned until the fine was paid. Penn and Mead went to prison anyway, held in contempt for obeying the bailiff’s order that they put on their hats. Later, the members of the jury won a writ of habeas corpus and were released from prison. Penn and Mead left England after their release from prison, having a taste of justice, and sailed to America. (Earl Warren, “A Republic, If You Can Keep It”, p. 113-115)

The Case of William Penn was a major turning point. Just perhaps, yesterday’s verdict will be viewed as a tipping point in our struggle for freedom from a growing abusive and intrusive government that has lost its way and drunk with power.

As we now head into the next turning point next November, we will have the French and German elections. If both incumbents lose, we may be looking at the final break-up of the EU.

Obama’s White House Kept List of Muslims For Top Jobs


No surprise here has there are way to many Muslims in the government especially in high level positions.

Bankers: Have They Ever Been Good?


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QUESTION:
Mr. Armstrong:

I hope you are well. I ask you:

1. What were the contributions to the economy and international trade, of the great bankers of the modern history, such as, Medici, Fugger, Welser, Berenberg, Rothschild and Morgan?

I look forward to hearing from you as soon as possible.

Sincerely,

J.E.M.V.

ANSWER:The contribution was to facilitate the advancement of society by enabling the free movement of capital and thus the integration of commerce. Of course, people will immediately disagree with me by citing the Rothschilds who did lend to the governments of Europe. They were more of the exception rather than the rule.

The Medici were different. Raymond de Roover, who became a Professor of history at Brooklyn College, wrote “The Rise and Decline of the Medici Bank,” which was first published in 1966. It remains the seminal work on this period. He had access to contracts and internal documents. A special clause was entered into the core contract of the Medici bank “to deal as little as possible with the court of the Duke of Burgundy and of other princes and lords, especially in granting credit and accommodating them with money, because it involves more risk than profit.” (id/ p 343)

Obviously, Raymond de Roover makes it clear that the Medici did not wish to lend to the prices of Europe, for there was no way to collect a debt from a sovereign. The contract continued by warning that “many merchants in this way fared badly…our fathers have always been wary of such involvements and stayed aloof, unless it was a matter of a small sum lent to make or to keep friends.” The Medici policy was “to preserve their wealth and credit rather than enrich themselves by risky ventures.”

Indeed, later generations ignored this command, and once they lent to government, that was the end of the Medici. The Fugger’s were the German bankers wiped out by the default of Spain, which was rather stupid since they had previously defaulted after wiping out the Italian bankers.

Banking has always furthered the economy and raised the standard of living for all. When the bankers get in bed with government, society is placed in a dangerous position.

Merkel to Regulate Real Estate Loans


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Merkel wants to regulate real estate loans in Germany. The Federal Government is planning to implement extensive regulations on real estate loans. Among other things, debtors will be required under certain circumstances to repay their loans within a given period. The Federal Government said on Monday that the draft law should be followed by recommendations from the German Committee on Financial Stability.

While there is no real estate bubble right now, it appears they are concerned about further capital inflows, perhaps caused by the failed euro. The new hurdles to be imposed for new loans may have the negative impact of making sales of property in Germany far more difficult as a whole. Such schemes have tended to have a negative impact upon price.

Civil War at the Fed?


Do Lower Interest Rates Promote Deflation?


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QUESTION: Mr. Armstrong; You have said that the only way to reverse the deflation is to raise interest rates not lower them. I understand that the low rates only reduce the cost of funds for banks, but it hallows-out savings and pensions. Has anyone listened to you and tried the opposite trend to raise interest rates? It seems the Fed is listening to you but the IMF and others plead to the Fed not to raise rates. Can you point to any hope in this regard?

Thank you for you do. Truly you make us think.

KS

ANSWER: Actually, all you have to do is look at Iceland. Not only did they throw the bankers in prison instead of giving them bonuses, but they also raised interest rates unlike everyone else in the Western world. In an attempt to stimulate their economies, Western central banks lowered rates and the European Central Bank (ECB) moved to negative rates after implementing a very unconventional monetary policy suggested by Larry Summers. Meanwhile, the Central Bank of Iceland (CBI) did precisely the opposite by raising interest rates and reducing the size of its balance sheet. This stands in direct contrast to the ECB, the Bank of England (BOE), Japan, and the United States.

Just step back and look objectively at the evidence. Back in July 2011, the CBI’s benchmark rate of 4.25% was significantly higher than the ECB’s benchmark rate of 1.50%, and it was substantially higher than the BOE’s benchmark rate of 0.50%. Since that point in time, the CBI’s benchmark rate increased relative to both the ECB and BOE.

Iceland now has the strongest economy in all of Europe where its GDP has risen more than 100%, doubling since 2009. This stands in amazing contrast to the ECB where European growth since 2009 has been just 14%, and in Britain, the total GDP growth since 2009 has been 27%. This is clear evidence that this policy of low interest rates is nonsense. The rate of interest reflects inflation and future opportunities. If rates are at zero, it demonstrates that there is zero confidence in the future of Europe. I think even an ape could figure out that this is not working.

Analysts v News Chasers


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QUESTION: I am beginning to see the light. It seems as though when gold rallies strong, the sentiment is reflected in these gold promoters. Then gold drops and they preach the same thing again. This leads them to buy every high and in fact they are merely cheering the news and are not analysts at all. They are not objective in any way. So are they just news chasers?

Thank you for the light to bring

KJ

ANSWER: Yes, of course. They act more like the most novice investor just starting out. Their forecasts are based solely on emotions, and they try to look for fundamentals to fit their predetermined conclusion. We are all human and that means we are subject to the same human frailties as everyone else. So, when these people see a strong price move, it is their emotion that takes over and the forecast is not connected to reality. They are convinced about a single theory. They are incapable of learning because advancing in knowledge requires admitting mistakes.

These type of people claiming to be analysts give the field a bad name because they are by no means analysts, but simply news followers. They think something has to have a reason behind every move. This is where they are dead wrong. Markets move in ANTICIPATION of future events. This is why professionals say, “Buy the rumor and sell the news.” It really does not matter if the event is real or not. If people THINK it may happen, they will act accordingly in ANTICIPATION. Deutsche Banks shares crashed because people ANTICIPATED it would collapse. They did not wait for a formal announcement, as it would have been too late to act. So they act, expecting something might happen. In the case of bank runs, that fear can lead to actual bank failure even the rumor was false.