Tag Archives: progressives

Jul 3 2018

Diversity in Europe is the Key to Understanding the Eurozone Crisis


Armstrong Economics Blog/European Union

Re-Posted Jul 3, 2018 by Martin Armstrong

COMMENT: Mr. Armstrong; I find your analysis refreshing here in Europe. Sometimes we cannot always look in the mirror objectively. You are correct that perhaps the greatest fault in trying to create the euro has been this idea of forcing one culture upon everyone in Europe. The feelings about the EU are very different in the south compared to the north.

Thank you for being unbiased. It does help to see things through different eyes.

PD

REPLY: Perspective is everything. When I speak to people in government in Italy, they see the EU as oppressive and believe their country is now occupied with the will of Brussels being imposed against their own culture. I have lived in Europe and I have probably spent 1/3rd of my life there. What I LOVED about Europe was indeed the diverse culture. Language has been the greatest stumbling block. Even myself, very short trips running around between countries puts a different strain on you. In just 10 days, I was in Germany, then flew to Zurich, then down to Milan, over the Paris, off to London, and then back to Frankfurt. While I was checking into a hole in Paris, there was a Japanese couple trying to check in and the hotel had nobody to speak Japanese. I then stepped in trying to help. After a few days, you try to speak and a missmash comes out of several languages combined and you are so tired, it gets hard to keep flipping between the languages. I LOVE Europe for that, but not on a business trip of rushing around in the middle of madness. Even getting cash from an ATM varied depending on the country you were in. In Switzerland, 1,000 CHF was no problem. In Paris, €200 euros was max.

There is absolutely no open question that the European Union remains a very diverse Union. There are significant differences in the concerns of the people in the EU as a whole. I have explained that Southern Europe got the worse deal. They converted their debts to Euro and then the Euro rose from 80 cents to $1.60 doubling their national debts and the austerity policy forced economic recession upon their economies. In southern European countries, the YouGov polls showed that unemployment was seen as the major issue, but this was less so elsewhere in northern Europe where the number one issue was terrorism.

The terrorism was viewed as a major issue in Britain, France and Germany, where the terrorist acts have been primarily targeted. The number one concern was health and social security when you turned to Poland and it was a top concern also in northern European countries. Lithuania was the only place where inflation was the most important current issue. Sweden was the only country where crime came in the top three, but this was related to the immigration issue which is beginning to create a new Separatist movement there as well.

While the whole thing with global warming seems to be mostly confined to northern Europe rather than southern. Nevertheless, the refugee crisis, of immigration crisis as well as rising terrorism as a result, are clearly the two top issues across the EU as a whole. The YouGov poll is indeed showing the diversity among the cultures within the Eurozone. This idea that one central government can dictate policies to be imposed on the whole is a failed model that has brought about the communist revolutions. Even in the USA, there are 12 branches of the Federal Reserve BECAUSE after the Panic of 1907, it was realized that there was a great diversity economically throughout the United States. We have called it the Texas-New York Arbitrage for when commodities boom, New York suffers. That diversity was suppressed by Roosevelt to impose one central policy on the nation to fight World War II. It was never returned to normal and this once again is fueling regional discontent despite the single language. ONE-SIZE does not fit all and Europe copies the Roosevelt model rather than understand the history behind the economy. It was the diversity that made America work. The same is true in Europe. You cannot force cultural change to this ONE-SIZE fits all policy. It will fuel the separatists as it is doing in the United States to a lessor degree driven more by left v right politics

Jul 3 2018

Soros Sneaking Around to Meet with the President of Spain off the Official Agenda


Armstrong Economics Blog/Politics

Re-Posted Jul 3, 2018 by Martin Armstrong

Sources in Spain have confirmed that the new president, Pedro Sánchez, met with George Soros secretly last Wednesday afternoon in Moncloa. They met around 7 PM for about 1.5 hours. What is strange is that Soros had two other unidentified people with him and the meeting was NOT on the public schedule. Soros has been pushing his Open Society and people do not criticize him because he has too much money. They just smile and say, “You are right.” Then they hold out their hands.

As they say, if you want honesty, fairness, and a straight up deal where you get what you pay for without pretense, go to a brothel. If you want to really get screwed, go to politics where there is plenty of corruption, lies, back stabbing, and backroom deals off the books

Jul 2 2018

Is Conversational AI Here?


Armstrong Economics Blog/AI Computers

Posted Jul 2, 2018 by Martin Armstrong

IBM has been working on what we call Conversational AI. When I was working on developing Socrates’ Natural Language, I was not interested in creating a machine to debate me. I was interested in creating a machine that I could at least have a conversation with. I teamed up with Dragon Systems back then when it was still hardware. I built a system and gave it to my children so that the computer could learn how to keep a conversation going. It would remember what they spoke about, so the next time they came back its knowledge base grew. I came home one day and found my daughter by the computer with all her girlfriends, for apparently they did not believe she could communicate with the computer. No doubt all her friends ran home and demanded a talking computer from their fathers. Needless to say, it taught me a lot about how to create a machine to have a conversation with and this was back in the 1980s.

IBM has been trying to take this to the level of debating humans. They call it Project Debater. They carried out their first such public debate. The IBM Debater managed to score points for it certainly has a knowledge base that would be unprecedented. It can easily retrieve facts and information to mount evidence for its arguments in a rapid short period of time. However, the answers it provided did tend to ramble a bit and lack the human understanding of finesse in how to deliver it with a punch. All said and done, the technology definitely demonstrated that this is just in the primitive stages for now but the future will certainly improve.

Jul 2 2018

Andrés Manuel López Obrador (“AMLO”) Easily Wins Mexican Presidential Election – Hugo Chavez 2.0 Now Running Mexico….


Re-Posted from The Conservative Tree House on July 1, 2018 by

The official announcement is coming momentarily.  All other candidates have conceded.  Looks like Andrés Manuel López Obrador, an avowed soft-Marxist, will EASILY end up with 53 to 59% of the vote and is the next President of Mexico:

Primary platform points:  ♦Amnesty to all drug cartels.  ♦No longer will work with U.S. immigration enforcement.  ♦Nationalize oil industry.  ♦Farm subsidies. ♦Elimination of multinational corporate influence on farming.  ♦Support and assistance for economic growth plan: using •mass migration of Mexican nationals into Southern U.S., •create AmeriMex border region, and •remittance of earnings back to Mexico as initiative for rapid domestic economic growth.

MEXICO CITY (Reuters) – Leftist outsider Andres Manuel Lopez Obrador won Mexico’s presidential election handily on Sunday, exit polls showed, setting the stage for a government that will inherit tense relations with Washington and the scrutiny of nervous investors.

Jose Antonio Meade, the candidate of the ruling centrist Institutional Revolutionary Party, or PRI, conceded defeat to Lopez Obrador, a 64-year-old former Mexico City mayor, within minutes of the polls closing.

“For the good of Mexico, I wish him the very best of success,” Meade said in a speech. Lopez Obrador’s other rivals also conceded that the race was lost.

Lopez Obrador is expected to move Mexico in a more nationalist direction as he becomes the first leftist to rule the country in decades. He has pledged to reduce economic dependence on the United States.  (read more)

Jul 2 2018

Cryptocurrency Crash – Has it Done Long-term Damage?


Armstrong Economics Blog/Cryptocurrency

Re-Posted Jul 2, 2018 by Martin Armstrong

QUESTION: Mr. Armstrong; I am impressed with your computer system for without historical data depth, it still manage to correctly forecast the high in Bitcoin. The BIS had come out against cryptocurrencies as has our central bank here in Switzerland calling them crude and unlikely to become a world currency without impressive advancement in the technology. With Bitcoin off more than 70% from the high, I am amassed that people keep calling for new highs. They did the same on gold. It appears to be some sort of emotional drug that these people get addicted to or are they just frauds?

Thank you

PVC

ANSWER: The Global Market Watch is best on the higher levels. There are over 100,000 different patterns and it is still learning. It is matching patterns it discovers and when it discovers a new one, it records it and tests against it in the future. So it was able to forecast Bitcoin correctly from a pattern recognition perspective alone. That does not require heaps of historical data. It is a very interesting tool which completely evolves with time. I find it funny when people try to argue against it pointing their finger at me personally when it is the computer that is doing that job – not my personal opinion. The daily level is the most volatile for the complexity is off the charts. The reliability increases as we rise through the timing levels.

Nevertheless, there are some people who miss the high and refuse to admit that they are wrong. You had people constantly calling for gold to take off for a 19 year decline. Even after the 2011 high, I got intense hate mail blaming me for the decline from these same type of people. They prefer to blame me rather than admit that they were investing emotionally, which is the worst strategy of all. I have stated before that when I was doing an institutional conference in Tokyo at the Imperial Hotel, a guy bribed his way in just to ask me what to do. He bought the Nikkei the very day of the high with $50 million and it was his very FIRST attempt at investing in stocks. He still had the position despite being down some 40% at the time.

There is a basic rule that I have come to determine. A market can survive as long as the correction on a monthly level does not closed beyond 43% down from the high (8.6 /2). The next stage is 51.6%. Move beyond that and you cross into Meltdown Mode. Bitcoin crossed the 43% decline mark so that was a warning this was not a short-term correction from which new highs were possible. Moving beyond 51.6% meant that new highs are not likely for quite some time.

The Swiss National Bank has come out and stated it is not looking at cryptocurrencies and the blockchain technology for they consider them “far too crude” to support a digital franc. The Bank for International Settlements (BIS), the central bank to the central banks, has also come out with devastating prespective of the cryptocurrencies. They have highlighted the hacking and a number of perceived technical flaws as a major deterent to them advancing to a digital currency among nations. The BIS flat outright made it clear that they are too unsuitable to serve as a new global currency.

Of course, those who are the new crypto-believers will never yield. They believe what they WANT TO believe and close their minds to anything else. They analyze, forecast, and invest purely on emotion. Whenever emotions are involved, decision will NEVER be prudent, wise, or successful. This seems to be some strange human flaw for it is by no means confined to cryptocurrencies. As I have stated before, this same type of pattern appears throughout history in everything from tulips, stocks, gold, silver, and DOT.COMs just to mention a few. However, like the DOT.COM Bubble, there is valid shifts in technology that will advance in the years ahead.  The NASDAQ decline was 78.4% in two years 2000 to 2002 bottoming with the ECM turning point back then. BitCoin dropped 69.06% in the first two months. June made a new low bringing the correction to 69.83%. It took the DOT.COM Bubble 18 months to reach that same percentage decline. It took the Japanese Nikkei 106 months to reach that percentage decline. For the 1929 Crash, it took 24 months to reach that same percentage decline. Therefore, it is abundantly clear that the losses in cryptocurrencies have dwarfed most other bubble declines and it reflects the skepticism inherent within as smart money realizes this is not going to circumvent central banks and bring governments to their knees

Jul 2 2018

Trade War with China


Armstrong Economics Blog/World Trade

Re-Posted Jul 2, 2018 by Martin Armstrong

QUESTION: What is your “opinion” on the Trump tariffs dispute with China?

ANSWER: Years ago, an old friend from high school was in the Philadelphia Steam Fitters Union. They went on strike for a very long time. He finally came to me and asked for a job. I gave him one and all I ever heard was how if he stayed 15 minutes longer, he would be paid double time. I sent him to New York and everyone always came back by the end of the day besides him. When I asked what happened, he said it was 3 o’clock and there was no point to come back to the office for just a couple of hours. This was the 70s. He drove a Toyota. When I asked why he was driving a foreign car he said it was cheap and reliable. I asked what about the union jobs he was bypassing. He did not answer. Needless to say, I had to fire him.

It’s always comical to me how people always want the cheapest price they can buy, and then they want the highest possible wages to work. I believe in free trade. Tariffs are only forcing consumer subsidized high wages. If someone can produce the same product at a better price, that is the benefit of the consumer. Those people should move on and retrain to an industry that is higher paid rather than demanding excessive wages for jobs other can do for a lot less.

The United States really has a trade surplus of about $1.4 trillion when trade is allocated to the flag a company flies. The USA is moving more into the high-tech areas. Lawyers are a dying profession and medical is slowing by overpricing itself and there too we will see real price shocks. Let the free markets decide the future. That is what they are good at

Jul 2 2018

López Obrador Wins Mexico 43.7%


Armstrong Economics Blog/Mexico

Re-Posted Jul 1, 2018 by Martin Armstrong

López Obrador has won Mexico but its political system is flawed as is most parliamentary type systems. It allows for coalitions to be formed from very different parties. The French have a run off with the two highest winning candidates thus forcing the people to choose between the two. The problem with the Mexico election lies in the promises. The people were fed up with the corruption and they just wanted to throw out whoever is in power. However, Obrador is more like Bernie Sanders. There is NO POSSIBLE means available to him to pay for his ambitious slate of social programs. He will raise taxes dramatically and we will see Mexico spiral downward into 2020. He is illprepared to get rid the government of corruption when the bureacracy is the problem. In fact, many who were deeply involved in the corruption saw the shifting trends and were a part of Obrador’s campaign. It is also not likely that he will make a dent in the unyielding violence of the drug war. The people are fed up with the drug wars which has escalated out of control. There were more homicides last year in Mexico than any time in the last two decades.

The US dollar is still poised to rise against the Peso in the years ahead.

Jul 1 2018

The 6 Month Rule on Passports


Armstrong Economics Blog/Rule of Law

Re-Posted Jul 1, 2018 by Martin Armstrong

COMMENT:  Dear Mr. Armstrong, I look to help others as you do.

My wife turned 60 in June and we planned a trip to Milan and Lake Como on June 30.  We arrived at the airport in Nashville yesterday, checked in, printed our boarding passes and tagged our luggage, then presented our tagged luggage to the AA attendant.  She reviewed our passports to verify the name matched the luggage tags and boarding pass, then said we could NOT board the plane.  We were told that my passport expires less than 60 days before our return flight and we would not be allowed to board without an updated passport.  I spoke to the gate manager at AA and he indicated we would be deported if we arrived and checked in to Italian customs.  My passport does not expire until a month after our return, but we were told it has to be 6 months.

When we purchased the Airline tickets, we entered the passport information to include the exp date.  No problem was indicated.  We checked in the Airport with our Passports and entered the exp date. No problems. We had to process all the way to the gate to be told we could not travel.  How does this happen with the advanced computer systems we have today?  How costly could it be to update the program for buying tickets to reject a passport number with an exp date of 6 months or less?  AA told us it was not their fault, but they stand to gain significantly with change fees.  I have been traveling internationally since 1981 and have never encountered this problem.  I have not spoken to a person who travels internationally that knew about this rule.

….

Best,

John

 

REPLY: Each country has different rules. The 6 month rule is also applied by the USA to foreigners and that also applies to visas. Any employee from Ukraine has to have a visa that will not expire in less than 6 months in order to come here even if their passport is good for 10 years. I have a very good travel agent who books me on international flights in the most amazing ways. Often they will be one-way tickets because meetings pop-up often during a crisis and so it is not always black and white when I have to travel overseas. Some just learned through the grape-vine that I am in their country and requests begin.

Most of the time I have no problem even with one way tickets. The only country that causes a problem in France. I must have a return ticket out of France. One from Greece does not count for some strange reason. My agent will book a first class return fully refundable for me to land booking that the day before. When I arrive, he cancels it and I can then go on my way around Europe. The easier work-around is to travel to France within the EU and fly into Frankfurt or Brussels first.

It is the airline fault for their computers should flag a passport that expires in less than 6 months. There are many countries that do have that rule, yet it varies. Best to renew a passport more than 6 months before it does expires just to be safe.