Armstrong Economics Blog/BRITAIN
Posted Jul 18, 2019 by Martin Armstrong
Nigel Farage’s new Brexit Party is now the second largest in Britain. The Conservatives still topped the YouGov poll with 24% of the vote, but they were boosted by the prospect of Boris Johnson, who is a Brexit believer, as the next Tory leader. The prospects for Europe remain up in the air as Brussels still refuses to reform and is looking to punish Switzerland as an example for Britain. But trying to exclude the London markets as a place Europeans can invest will cause a major economic decline for Europe rather than London.
Agricultural Loans Declining Right on Target
Armstrong Economics Blog/Agriculture
Re-Posted Jul 18, 2019 by Martin Armstrong
One of the most fascinating observations I have made over my career has been that the banks always lend at the top and contract lending at the bottom in every market. Going into 1980, banks were calling me to ask if I wanted to borrow money. Recently, I got a phone call from my bank asking, once again, if I would be interested in a loan. This to me is merely a confirmation that we are approaching a major turning point.
When I look at lending into the agricultural sector, the big Wall Street banks are once again perfectly in line with the cycle. They peaked in loans to farmers back in 2015, and have been declining ever since going into 2020. Bank lending to the agricultural sector peaked with the ECM and we will see it bottom in 2020. Our model will be correct in forecasting the next wave, which will be a cost-push inflationary wave. As the agricultural sectors come back to life, thanks to shortages, then the bankers will be willing to lend once again. The banks are the PERFECT indicator of how not to run a business. They make decisions emotionally and always get the economy dead wrong (i.e mortgage-backed securities peaked in 2007)
Representative Doug Collins Discusses Pelosi’s Clown Show on House Floor…
July 17, 2019
With Nancy Pelosi refusing to take up important legislative issues that need to be resolved: raising the debt ceiling, budget appropriations, USMCA ratification, immigration reform etc; and instead focus on a symbolic parliamentary resolution to criticize tweets, Georgia congressman Doug Collins calls-out the insufferable political games being played.
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Jordan B Peterson: How to End Postmodernism
Is the Gang of Four (The Squad) Trying to Start Race Wars?
Armstrong Economics Blog/Politics
Re-Posted Jul 17, 2019 by Martin Armstrong
U.S. Rep. Alexandria Ocasio-Cortez (D-N.Y.), Rep. Ilhan Omar (D-Minn.), Rep. Ayanna Pressley (D-Mass.), and Rep. Rashida Tlaib (D-Mich.) held a news conference on Monday to respond to President Donald Trump who targeted the women in tweets and comments, which of course people claimed were racist since you cannot attack what they say simply because they are women of color. They can call anyone racist, but no one can do the same to them. Nancy Pelosi has been attacked by them and they have used the race card because they can’t use gender since she is a woman. The only way to attack Pelosi is by implying she is a racist as well.
The Gang of Four are more than just the hard-left. They are radicals and their view is that Pelosi is the enemy for they want to change the United States and reshape it to their vision. They ran against the classic “liberal” Democrats, which includes Pelosi who they disagree with and see as the enemy. So the internal battle within the Democrats is this fight for the heart of the party.
The Gang of Four is actively trying to recruit people to run against the classic incumbent “liberal” Democrats to overturn the party in 2020. All they can do is use the race card and hope they divide the country even more on race in an effort to overturn the nation and reshape it into their vision. Hillary tried dividing the country between male and female. Madeleine Albright went as far as to say that there was a ‘special place in hell’ for women who don’t support Clinton. The Gang of Four are taking this to the race card. Omar said:
“This is the agenda of white nationalists, whether it is happening in chat rooms or happening in national TV. And now it’s reached the White House garden,” Omar said of what she called Trump’s “blatantly racist attack.”
In my company, we are like the UN. We have EVERY race, creed, and gender among our ranks. I find it offensive that people like this are in the public eye and fanning the flames of violence. This type of speech only inspires hatred on both sides that some will use to justify violence against others. This is highly irresponsible and people like this do not belong in any public office. The man who fire bombed and tried to kill ICE workers was inspired by AOC. He adopted her characterization that they are holding people in “concentration camps.” Meanwhile, the media is doing its best to ignore this attack because it would go against AOC. This type of rhetoric inspires people perhaps with mental issues to act.
WEC 2019 Orlando – Knockin’ On Heaven’s Door or the Big Fake Out?
Armstrong Economics Blog/World Economic Conference
Re-Posted Jul 17, 2019 by Martin Armstrong
This Year’s WEC is extremely important as we now approach the turn in the Economic Confidence Model come January 2020. There were two critical patterns which were possible – 2020 low and rally thereafter, or a 2020 high with respect to the share markets. Meanwhile, we face the biggest Bond Bubble in the history of civilization and the last time something like that took place, it did not end very nicely for civilization.
We are looking at such an important shift this time in the Business Cycle that those attending the WEC this year will also receive ongoing video updates as needed because things are not going to be just a walk in the park. The fact that the Dow has exceeded the 2018 high already, warns that the pattern we face is going to be plagued with a political crisis. Indeed, politics is becoming so polarized, not merely in the United States, but also in Britain, Switzerland, EU, and it is beginning to surface in Asia in Japan and Hong Kong.
The Pi target on the ECM 11/21/2018 was the start of a slingshot where we had to drop sharply, scare the longs, and then rally to new highs. The problem with this pattern is that such moves are more often not sustainable on a broader sense and can warn of trouble ahead depending on who gets sucked into the mix.
We have so many markets at critical junctures as we head into the ECM turning point, this year’s WEC is going to be a critical forecasting event. Most importantly, we have to face not just a Monetary Crisis Cycle which is becoming obvious to everyone as the British pound takes a nosedive, but everything from Energy to Agriculture is in the staging ground for the next ECM along with precious metals.
For these reasons, we have some markets preparing for false breakouts and a critical mass approaching in 2020 on such a global scale. Central Banks (some who have been attending the WEC), are now beginning to lobby the fiscal side trying to warn them of impending doom and how they CANNOT possibly prop-up the world economy this time around. There is also a debate behind the curtain about pegging interest rates (long-term) v Quantitative Easing. We also have a battle brewing over cryptocurrencies as a major push to start eliminating cash in Europe.
Because all of these things are coming together, the attendees of this year’s Orlando WEC will receive ongoing video updates because this is just such a widespread crisis that is impacting every possible corner of the global economy and the ONLY way to survive this is going to be with Socrates because there is ABSOLUTELY no precedent to which we can refer to in history.
There are people calling now for the greatest crash in history, and others are now starting to claim the Dow will test 30,000. The opinions ARE just not going to cut it in this environment. So this year’s WEC will be different, but very critical. So are we Knockin’ On Heaven’s Door or the Big Fake Out as we face the Monetary Crisis Cycle and probably the most polarized political election ever in 2020. So those attending will get ongoing updates as necessary since this is probably the most critical period we face in modern economic-political history.
The Black Hole of Debt
Armstrong Economics Blog/Pension Crisis
Re-Posted Jul 17, 2019 by Martin Armstrong
We are facing a serious collapse in government that appears to be shaping up on the horizon beginning 2021/2022. Take the city of Chicago for example. The city is buried under a mountain of city employee pension debt and it’s impossible to see how their city could possibly survive. There will be a major financial collapse because those in power are also involved in the very same pension scheme so they have no incentive to do what is required to save Chicago — implement major structural reforms.
The total amount of city, county, and state retirement debt Chicagoans are on the hook for amounts to $150 billion, according to Moody’s most recent pension data. If we look at the city’s one million plus households, that means that each household is on the hook for nearly $145,000 to cover government employee pensions. They can forget their own pensions. One-fifth of Chicagoans live in poverty and nearly half of all Chicago households make less than $50,000 a year. There is no possible way to raise taxes to cover these obligations.
Naturally, the politicians want to hunt the rich. If we then look at the households that earn $200,000 and just tax the “rich” we end up with $2 million in obligation per household. We cannot expect government officials to save the day when they too have personal pensions at stake. This story is being repeated around the nation and in Europe. Nobody is willing to address the problem because they have personal pensions on the line.
Central Bankers on Their Knees Pleading with Politicians
Armstrong Economics Blog/Central Banks
Re-Posted Jul 17, 2019 by Martin Armstrong
Our confidential sources are reporting that the Fed, ECB, and BoJ have agreed to lobby politicians in an attempt to warn them that they cannot continue propping up the world economy. The ECB, in particular, has been keeping the EU on life support and they have no room to lower interest rates to try to support their economies any longer. They are beginning to argue that they need help from governments in the rescue effort, which our computer model warns will fail.
Even in China, economic growth has declined to its lowest point since 1990. The slowing global economic growth has pushed the Federal Reserve, European Central Bank, and perhaps even the Bank of Japan to look at more Quantitative Easing. However, the Fed, especially, wants no part of buying government debt. The cries behind the curtain are that monetary policy alone in the coming months cannot support the economy. There is just less room to act with regard to interest rates than in the past. This has been the pitch in Brussels as the ECB is warning politicians they will need to assist if a downturn takes hold
Squad Goals: Anarchy
July 16, 2019
RNC ad highlights the intense calls to violence from the congressional anarchy caucus.
Jim Jordan Responds to the Hot Mess Today in Congress…
July 16, 2019
Obviously Fox News needs to present two-and-a-half minutes of negative spin prior to getting to the nub of the representative interview (happens at 2:45 below), but eventually MacCallum gets around to discussing the Moonbat legislative fiasco with Jim Jordan:
