Tag Archives: Russia

Sep 28 2017

Germany – Trying to Form a Government Won’t Be Easy


Armstrong Economics Blog/Germany

Re-Posted Sep 28, 2017 by Martin Armstrong

Trying to form a government in Germany is not so easy. Green leader, Simone Peter, says they and the FDP agree with Merkel that there should be no limit to refugees. He said” “In a coalition with us, there will be no upper limit for refugees, just as with the CDU and FDP. The CSU has to adjust to this if it wants to seriously question Jamaica,” he told the Rheinische Post.

The CSU, normally the sister party of the CDU in Bavaria, saw what they lost to the AfD. Even Merkel is vowing to bring back the right into the fold.

Meanwhile, the 75-year-old former Minister of Finance Wolfgang Schäuble (CDU) is to become the new Bundestag president. The Bild newspaper reports that Schäuble has already given his consent to his departure as Finance Minister. Schäuble would therefore not be in charge of finances in the new government. He has been the federal finance minister since 2009. As the Bundestag President, Schäuble would not participate in the coalition negotiations

Sep 27 2017

Politicians Start to Run Away from Global Warming


Armstrong Economics Blog/Nature

Re-Posted Sep 27, 2017 by Martin Armstrong

Politicians have been confronted with the real cost of their support for global warming. France has suddenly come out in support of diesel because of the jobs that could be lost. The diesel crisis may have started in Germany, but there are more diesel car owners in Europe as a whole.

Suddenly, when confronted with the loss of jobs, the politicians are turning against global warming and revealing that the scientists have been WRONG on their timing. The actual study claims we will need another 30 years to reach a level of carbon to raise the temperature by 1.5 degrees C. It still only addresses the level of carbon in the air to raise the temperature and does not address that carbon has been significantly higher historically before cars. It simply employs linear analysis and assumes whatever trend is in motion will remain in motion. They ignore even the laws of thermodynamics.

Indeed, the politicians were eager to jump on the global warming theory because they have been able to raise taxes without providing a corresponding cost. The estimated cost to the private sector for global warming has reached about $1 trillion globally. The price of everything from electricity to gasoline has risen due to global warming taxes. Not to mention, it is driving the cost of meat and dairy products higher with claims that cows, the second-leading culprit behind cars, produce damaging gas to the environment. Look at the taxes on air travel. On average, 50% of the price goes toward taxes.

We are starting to now see more and more articles in the major press exposing that global warming is a fraud (see Sun; Independent; Australian; National Geographic).

Sep 26 2017

Ice Core Samples Prove CO2 Levels Lag Behind Temperature Increases


Armstrong Economics Blog/Nature

Re-Posted Sep 26, 2017 by Martin Armstrong

QUESTION: Are you saying there is no direct correlation between CO2 and a rise in temperature?

ANSWER: Correct. We have data going back 800,000 years that was gathered from drilling core samples from deep underneath the ice sheets of Greenland and Antarctica. Detailed information on air temperature and CO2 levels disproves that a rise in CO2 will cause a rise in temperature. The core samples from EPICA Dome C ice core on the Antarctic Plateau establish that temperature rises first and CO2 level follow in a lagging manner. All of this was well before human kind (see ScientifAmerican). So is it the chicken or the egg? Which comes first?

Data has also established that the cooling of the Earth seemingly begun 200 years ago in the North before it spread to the South. Changes in the ocean currents appear to have been the catalyst for the major ice ages.

Sep 26 2017

Has Merkel Been Undermined in Germany?


Armstrong Economics Blog/European Union

Re-Posted Sep 26, 2017 by Martin Armstrong

 

There German election was on par with the global trend that is rising up against the establishment as we have known it. Angela Merkel has been accused of weakening her respective coalition partner. The election result of the Bundestag election shows that not only the SPD has to worry about losing ground, but the Union of the CDU and the CSU in Bavaria has been substantially weakened.

Merkel has always created a coalition by incorporating the key program points of the other parties into the Union. However, the election saw the Union lost nearly 9%, which is a historic defeat. In addition, there is a real rift emerging now with the CSU in Bavaria, where the CSU fell below 40% for the first time. In both cases, this has been caused by the refugee issue Merkel has tried to pretend is not a crisis.

Merkel has drastically underestimated the AfD and the refugee crisis. She concentrated on the Greens and the SPD and tried to bury the other parties with extremist labels. The AfD Merkel tried desperately to paint into the Nazi corner. She has failed to understand that the refugee crisis is a real crisis and it has undermined the people’s feeling of security.

The Union and the SPD wanted to negotiate the issue of refugees and migration. The SPD under Martin Schulz even was proposing that they should be allowed to vote. Without any comprehension of how serious the refugee crisis has been, Merkel attacked even the German-Turks in the TV duel as Turkey told Turks not to vote for Merkel. Schulz raged against the German-Turks despite the fact that the Turks in Germany were not refugees and had been there for decades.  Merkel positioned the CDU to the left of the center with the SPD in her entire term of office and wanted to put the key to their long-term strategy in this election of socialism.

Merkel’s Grand Coalition has seem a significant vote amounting to 46.8% voting against everything she stands for. The people have elected the FDP, the Greens, or the Left Party, while the bourgeois-conservative voters have moved to AfD. The union lost a million voters to the AfD, which was remarkable. This goes to the substance of the refugee crisis.

Merkel and her Grand Coalition have tried to downplay this political disaster. While Merkel has clung to power, the CSU is demanding concessions how in light of its loss to the AfD in Bavaria. Merkel may still be in office, but she suffered a defeat that was morally decisive as was the case with Hillary Clinton.

Merkel’s CDU has been unable to prevent voters from abandoning her Grand Coalition. She has indeed not strengthen the Grand Coalition, but weakened it. With the economy turn down and the inability of the ECB to cope with the deflation, the prospects moving forward for the Grand Coalition appear to be headed for a major political collapse.

Merkel’s failed strategy of setting up a left-green-conservative Volksspartei in the center for the CDU has meant that Germany is currently almost unregulated as Merkel has tried to be the Chancellor embracing all points of view except the AfD.

Germany’s Social Democrats (SPD) were hoping to at last oppose Merkel. However, they lost 5% from the 2013 election which has reduced them to a diminish socialist party. The SPD won just 20.5% of the vote, which was the party’s worst result in the 19 general elections since the creation of the federal republic. This demonstrates what our model has been forecasting that we are in the collapsing stages of socialism.  Martin Schulz his SPD party had no choice but to go into opposition “to defend democracy against those who question it and attack it,” after dropping to a post-war low.

Talk of the SPD abandoning Merkel and joining a black-yellow-green coalition with the FDP and Greens, does not look to be promising. The opinion makers in both parties are radical opportunists but not really team players. This would produce a coalition of just 40.1% against the CDU’s 32.5%.

Merkel has clearly abandoned the conservatives, which puts tremendous pressure on the CSU in Bavria. The CSU has made it clear that they must position themselves to the AfD given the attitude in Bavaria. This position is completely incompatible in a coalition with the Greens. It is as good as incompatible with a FDP. The CSU could not possibly align with the Greens without being in complete opposition with the AfD.

Merkel’s previous political strategy has called into question coalition politics. Yet after 12 years in power, many say that Merkel would have to be dragged out by the hair. The see the CDU as too corrupted by holding power too long. The CDU has lost all vision of where the people really stand. The AfD has offered these “deplorables” as Merkel called them an alternative, because the CSU was not able to penetrate the Union.

Merkel has won the first place and she has become a chancellor for a 4th term. But because the German political parties are in ruins, the question arises whether being chancellor even matters in this environment within Germany. Some fear that Germany will go the way of the Netherlands or Spain and muddle along temporarily governed by provisional rule until a new election is unavoidable in the end. Merkel’s underestimating the Refugee Crisis may seal the fate of Germany moving forward. An those who saw the Euro defeating the dollar; well good luck. The rend is down long-term.

Sep 25 2017

Climate Change & Economic Activity


Armstrong Economics Blog/Nature

Re-Posted Sep 25, 2017 by Martin Armstrong

QUESTION: Hi Martin,

I was wondering why a cold period would result in a commodity rise?
Thank you in advance for your time.
MG

ANSWER: When the climate turns cold, that is when food shortages takes place. When the climate turns warm, that is when economic activity starts and empires expand. The cold period we are entering will be on time for the shift in empires going forward.

global-warming-cyclical

All the great empires expanded during warming periods – not cold.

Sep 25 2017

Merkel Wins but Still only 32.5% Down Significantly


Armstrong Economics Blog/European Union

Re-Posted Sep 24, 2017 by Martin Armstrong

Once again Merkel fails to win the popular vote in Germany. Angela Merkel’s Christian Democratic Union lost 9% compared to the last elections. Nevertheless, her party has remained as the largest party in Germany’s parliament. Merkel’s CDU won 32.5% of the popular vote far less than any president in the United States history. That was a major decline for Merkel yet she will still rule Germany and Europe for that matter.

Germany’s electorate is more divided than ever before. The AfD won seats for the first time and they now came in as a strong 3rd position. Traditionally, power has either been held by the Christian Democratic Union (CDU) plus its sister Christian Social Union (CSU) party, or the Social Democratic Party (SPD). This year, however, the AfD will be making things more interesting and will play a far more crucial role as they exploit the Refugee Crisis with each and every terrorist act.

Sep 24 2017

UKIP Wants Nigel Farage Back Claiming May Has Betrayed BREXIT


Armstrong Economics Blog/BRITAIN

RE-Posted Sep 24, 2017 by Martin Armstrong

 

Theresa May’ Florence speech is being seen by many as a betrayal of BREXIT. Instead of getting on with it, she has said that there will be a longer transition period even two years beyond 2019 into 2021. She said that Europeans will still be able to come and work in Britain into 2021 but under a “registration system” that many fear will still allow terrorists to enter from Europe.

Prime Minister May said that the temporary transitional arrangements “will not go on for ever”and will end around two years after Britain leaves the European Union (EU) in 2019. She made it clear that “[d]uring the implementation period, people will continue to be able to come and live and work in the UK.” She did also say that “[t]here will be a registration system, an essential preparation for the new regime.”

Dragging this on has many concerned. While she says businesses should have the time to plan, quite honestly, two years is plenty of time. The way the markets are looking going forward, Britain may find itself engulfed in the European banking crisis even before 2019.

The Yorkshire MEP Jane Collins, who was preparing to run for the leadership of UKIP, has said she would step aside and Nigel should come back. Most people say he is by far the most effective politician perhaps in Europe as a whole. In my opinion, all Nigel has to do is show this chart on TV. British GDP has gone nowhere but down since it joined the EU. Britain is in Europe, but it should never be part of the EU – plain and simple.

 

Sep 23 2017

Merkel Poised for 4th Term as Head of Europe/Germany


Armstrong Economics Blog/Germany

Re-Posted Sep 23, 2017 by Martin Armstrong

The German election takes place tomorrow, with Chancellor Angela Merkel the favorite to defend her position against Martin Schulz for a fourth term in power. The AfD will for the first time win seats Bundestag elections. The the union parties and the SPD are losing approval while Merkel’s party, CDU / CSU, polls at just 34%, which is two percentage points less than the last election. The SPD is polling at just 21% with the left at 11% and the FDP at 9%. The AfD, according to the opinion research institute Insa, is gaining two points and comes to 13%, the Greens increase one point to 8%.

Polls currently show that Merkel’s Christian Democratic Union (CDU) party – with its Bavarian sister party, the Christian Social Union (CSU) – will be the largest party after the Bundestag election, but they will fall short of a majority once again so there will have to be coalition government with the SDP. This is what is harming Germany and Europe for it gives the impression that Merkel has a mandate when she cannot win 51% of the German vote.

Therefore, the wildcard remains the AfD and if they come in at a higher level than expected, there will be an ongoing battle that will turn against Merkel in the next two years. If the AfD come in above 15%, then the shape of the coalition government may be different than expected. As one German politician put it, you will have to drag Merkel out by the hair to get her to to leave office. Therefore, expect no change in the course of direction for Europe. As long as Merkel is still there, it will be more of the same but worse with ever increasing taxes and more deflation. You cannot reverse the course of Europe without changing the leadership.

Sep 23 2017

German Elections Void of Any Critical Discussion


Armstrong Economics Blog/Germany

Re-Posted Sep 23, 2017 by Martin Armstrong

The German Bundestag election campaign has seen a total black-out of any discussion of the major crisis that is building in Europe. Nobody is mentioning that Euro crisis, ECB monetary policy, disintegration of the EU, refugee crisis, pension crisis, the municipalities on the brink of insolvency, or the drastic increases in taxation coming AFTER the election that will only lower disposable incomes and extend deflation.

The politicians, and the press, are in full swing to hide the real trend at foot. The press is running stories why the Germans Love Merkel, yet she has never won even 40% of the popular vote. Even the press outside of Germany is in on the “selling” of Merkel because she is the leader of Europe – good – bad – indifferent.

Perhaps the monetary policy of the ECB has set the stage for a serious monetary crisis over the coming years that will seriously disrupt the German economy, in one way or another, depending upon the industry. Mario Draghi has experimented with negative rates which has kept the Eurozone governments on life-support – but they have not used the time to reform anything.

Draghi’s experiment has altered the economy and the financial sector in Europe. They now are faced with two equally unfortunate alternatives: if the ECB continues its monetary policy, many banks in Europe will slip into bankruptcy. Today, the traditional business models are no longer working because most banks with zero and negative interest rates have lost the most important source of revenue – deposits. A simple mathematical calculation projects widespread bank insolvencies in Europe as we enter the next decade.

The events in Barcelona demonstrate that there is a denial of any democratic government in the Eurozone. The elites have made the decision to federalize Europe and nobody is allowed to leave. Brussels learned nothing from BREXIT and this disintegration of the EU will worsen as the economics turns against it. The disintegration of the EU is only further enhanced by the refugee crisis. No other Arab country will accept the refugees such as Saudi Arabia or UAE. They know better. Two of the terrorists in Britain were refugees.

The negative interest rates have carved out huge holes in the pensions of Europe. Some members have issued 100 year bonds at less than 2.5%  and 50 year bonds as in Switzerland below 1%. This is merely a reflection of deflation projected out for extended periods of time.

The German Bundestag election is void of any discussion of the trouble in the EU or how Germany will be affected in beginning after the election. There is no mention of imposing a turnover tax on the internet and no mention of forcing companies to prepay all the VAT even on a 5 year contract covering installments. The desperate need for cash among the governments is not being addressed. Nobody seems to think twice that the governments constantly need a greater proportion of  private sector money to stay afloat and this in itself is driving the deflation.

Sep 22 2017

Spain Showing the World It is Still A Fascist Government – Sell Spanish Debt


Armstrong Economics Blog/European Union

Re-Posted Sep 22, 2017 by Martin Armstrong

The Spanish government is facing the real moment of truth. It is displaying that it is by no means concerned about human rights nor is it a true democratic system. Spain has reverted to Franco fascism as now more than 40,000 people have gathered in Barcelona to protest over the Catalan independence vote being shut down as the Spanish Government sends in 16,500 troops to deal with the activists. This is showing just how far out of touch this entire EU anti-democratic government has gone. The people no longer matter – the elite know what is best for them.

This is 86 years from the beginning of the Second Republic in Spain so 2017 is precisely on target for this type of civil unrest. What this is demonstrating is the old adage – the king is dead, long live the king. No matter what form of government takes power, it will ALWAYS, and without exception, seek to act only in its own self-interest precisely as Thrasymachus argued against Socrates.

You cannot short Spanish debt. So those who hold it, had better sell it to the ECB before it is too late. This is a very serious event that reflects upon the entire European Project. It should have been a trade union – not a political union by force of arms. Napoleon and Hitler tried that one before. It cannot work. Human rights include the dignity to assemble and the freedom of thought. Article 17 provides that no one may use the rights guaranteed by the Convention to seek the abolition or limitation of rights guaranteed in the Convention. This addresses instances where states seek to restrict a human right in the name of another human right, or where individuals rely on a human right to undermine other human rights (for example where an individual issues a death threat). Human Rights includes the freedom to hold opinions, and to receive and impart information and ideas. Spain has ignored the European Convention on Human Rights and is pretending that its national security overrides human rights – i.e. self-interest.