Risk Seems to be Everywhere


QUESTION: Dear Martin,

Thank you for your commitment to helping others through this unsettling time.

Long before I found you, I was fascinated with the capital markets and historical financial crashes, in particular. I spent many years on Wall Street (and LaSalle ST) building and marketing trading systems for the listed options industry.

Through the numerous currency failures, be they inflationary or deflationary, running to private assets has been a lifesaver for some clever enough to figure it out or those lucky to be serendipitously well positioned. Yet, it is always about timing. That is the subject of this question.

If the value of a currency is based on the productive power of the people behind the currency, it makes sense that Socrates is pointing to private assets going forward. It seems to me that the very best private assets would be businesses that enjoy productive power (not so easy to predict/choose in this environment). Whether we are denominating in dollars, rice, or seashells, it seems that a solid business will crank out currency units in whatever form and be a good hedge.

Hugo Stinnes emerged after WWI as an industrialist. Controlling coal, steel, electricity, and other fundamental businesses, he was able to profit as the currency collapsed. Stinnes continued this work straight through the introduction of the Rentenmark and Reichsmark seemingly not skipping a beat. He possessed productive power but was also very politically connected, which is key to this question. Later, The Third Reich was notorious for shutting down or nationalizing businesses. We look to be headed in that direction.

For those accumulating profits in, for example, mining stocks during the commodity boom, or wheat contracts, or equities, the question is, how do we get out of those trades? What is the risk that we sell/trade at the right time only to have our assets seized? For example, do you foresee a day, here in the U.S., whereby the government liquidates a portion of an account’s common shares for a bail-in or wealth tax? If so, then illiquid private placements (productive real estate or businesses with durable Free Cash Flow) that are very hard to value (and liquidate) might be the only real safe haven.

The risk seems to be everywhere. The risk most concerning and most difficult to predict or quantify is Government Risk – even here in the U.S. I can understand why the very wealthy buy paintings and rare items. Such items represent a real possibility to function as a “time machine” to bridge this insanity.

I would love to hear your thoughts. Above all, Socrates is a lifesaver and I am humbled to have access.

With respect,
JC

Texas

ANSWER: Yes, I knew a client who bought up all the old coins for scrap metal. Then it turned out there was a shortage of metal so the old coins were deemed valid at a new exchange rate. He made a fortune. There are definitely commodities that will preserve wealth in times like this. We must be careful about the Socialists, for they will do the same as the Nazis and nationalize just confiscating assets.

I believe the best shot we have is Socrates — let it monitor the subtle shifts. The one thing you can count on is the greed of those in power. Just as I began to see the subtle shifts with the Repo Crisis last August 2019, thereafter the markets were showing something was not right. I stood up at the WEC in Orlando and warned that something was seriously wrong and that the market would undergo a serious correction with the turn in the ECM.

Historically, Socrates seems to pick up things we humans do not see because they are subtle. It is like playing chess. You have to come up with a strategy and play in your mind the next several moves. You will lose if you simply react on a one move at a time basis. This is what Socrates is doing. It is playing out strategies. It looks for the possible paths and then monitors the movements across the entire globe to determine the eventual path. This is why NOBODY can forecast the future with 100% accuracy. We cannot as humans see all the possibilities. Socrates is mapping out the future and it reveals the most likely path and course of action.

Things can change and we get cycle inversions. But it is always playing one region against another. This is why all of these pundits fail because they focus typically just domestically and never see the trends coming from external factors. Things are so bad in Europe and the politicians are deliberately blocking travel from the USA to Europe in an effort to overthrow Trump to further their New Green World Order. In the process, before year-end, they will bankrupt at least 20% of all small businesses and wipe out the tourist trade for Southern Europe. These morons think they can placate the public with minimal subsistence from Guaranteed Basic Income they are beginning in Spain.

They will NOT be able to defeat the Monetary Crisis Cycle no matter what schemes they come up with. This is totally insane. Nevertheless, we will be monitoring what markets we need to exit in advance to try to preserve assets. This is a game of survival of the fittest. We do not have to run around naked on some island eating bugs. But we may have to take precautions and move to safe havens outside of urban cities for sure.

Stores Must Take Cash by Law


QUESTION: Dear Mr Armstrong,

Here is a softball question for the holiday weekend.

If US currency is legal tender, aren’t retail stores obligated to accept it?

This would seem to restrict the ability of retail stores to 1) demand electronic payment and 2) reject payment using $100 bills.

Happy 4th to you.

MB

ANSWER: You are correct. Stores MUST accept cash – that is what LEGAL TENDER means! Congress would have to pass an Act and the President MUST sign it to eliminate paper money.

Trading is the Only School to Learn Real Economics


QUESTION: I noticed that all the economists who are not academics are the people who actually discovered something. The academics always advocate for manipulating society like Keynes and Marx. Why is that?

PD

ANSWER: If you look at the first analyst to establish supply and demand, it was John Law. Even Adam Smith used his examples in “Wealth of Nations.” Adam Smith actually investigated his work to come up with his invisible hand. There was David Ricardo, who also made a fortune as a trader. Those are the three greats and NONE of them has a formal economics degree, which was first taught as a separate course in 1902 at Cambridge.

Those of us who come from the real world of trading, do not have the luxury to come up with Utopian theories that sound nice. Unless you have traded, you will never understand that the market is always right. If you do not listen to the market, you will lose everything.

Cyclical v Linear Analysis Special Report $4.95


A lot of people have inquired as to how our Computer System has been so accurate in forecasts not just markets and economic booms & busts, but political like the Trump victory and Brexit to the latest that the Coronavirus would peak in April ideally the week of April 6th,2020 when scientists, they claimed, were forecasting it would last for 18 months of longer. This special report dives into the methodology of academics in  all fields other than physics who use the assumption that if the temperature rises by 0.1% last year, they extrapolate that out and project we will all die in 20 years because a 1.5 degree increase will destroy the planet.

All of these forecasts have been simple linear progressions which are absurd. This is like saying the Dow rose 1,000 points last years so it will do the same for the next 20 years. We all know that such forecast are a joke. Even the Wall Street Journal would never publish such a forecast. They published a cycle back in 1933. Nevertheless, we have politicians imposing regulations all based upon this analysis that is not just a joke, it is an outright fraud.

This report has gathered all these forecasts since the beginning of the 19th century that mean we should all be dead by now. Despite these forecasts always being wrong, the press continually prints them all the time. The United Nations said entire nations would be wiped out by 2000. I think the data is 2020 if I am correct and nobody manipulated the calendar.

 

In 1932, they predicted the glaciers would melt and the water would rise to the 15th floor in New York City. You just can’t make up this stuff.  This is the methodology being used by all of these academics and in disease, this is what Gates has been funding to change the world based upon total nonsense.

This Report is Available for Download ….. $4.95

President Trump Delivers Remarks to NASA SpaceX Group After Successful Launch – 5:00pm ET Livestream…


After the successful manned launch of the NASA SpaceX mission to the International Space Station President Trump is scheduled to deliver remarks to the audience at Kennedy Space Center in Cape Canaveral, Florida.  Anticipated start time 5:00pm ET.

UPDATE: Video and Transcript Added

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[Transcript] – THE PRESIDENT: Well, thank you very much. Please. Please. Big day. This is a big day. And I want to thank our great Vice President for your fearless and tireless commitment to fulfilling America’s destiny in space. Thank you very much, Mike. Great job. Great job. (Applause.)

We’re also grateful to Mike’s wonderful wife, Karen, for being here and for all she does for our country. Thank you. Thank you, Karen. (Applause.)

Before going further on this exciting day for all America in space, I want to say a few words about the situation in Minnesota. The death of George Floyd on the streets of Minneapolis was a grave tragedy. It should never have happened. It has filled Americans all over the country with horror, anger, and grief.

Yesterday, I spoke to George’s family and expressed the sorrow of our entire nation for their loss. I stand before you as a friend and ally to every American seeking justice and peace. And I stand before you in firm opposition to anyone exploiting this tragedy to loot, rob, attack, and menace. Healing, not hatred; justice, not chaos are the mission at hand. (Applause.)

The police officers involved in this incident have been fired from their jobs. One officer has already been arrested and charged with murder. State and federal authorities are carrying out an investigation to see what further charges may be warranted, including against, sadly, the other three.

In addition, my administration has opened a civil rights investigation, and I have asked the Attorney General and the Justice Department to expedite it.

I understand the pain that people are feeling. We support the right of peaceful protesters, and we hear their pleas. But what we are now seeing on the streets of our cities has nothing to do with justice or with peace.

The memory of George Floyd is being dishonored by rioters, looters, and anarchists. The violence and vandalism is being led by Antifa and other radical left-wing groups who are terrorizing the innocent, destroying jobs, hurting businesses, and burning down buildings.

The main victims of this horrible, horrible situations are the citizens who live in these once lovely communities. The mobs are devastating the life’s work of good people and destroying their dreams. Right now, America needs creation, not destruction; cooperation, not contempt; security, not anarchy. And there will be no anarchy. Civilization must be cherished, defended, and protected. The voices of law-abiding citizens must be heard, and heard very loudly.

We cannot and must not allow a small group of criminals and vandals to wreck our cities and lay waste to our communities. We must defend the rights of every citizen to live without violence, prejudice, or fear.

We support the overwhelming majority of police officers who are incredible in every way and devoted public servants. They keep our cities safe, protect our communities from gangs and drugs, and risk their own lives for us every day.

No one is more upset than fellow law enforcement officers by the small handful who fail to abide by their oath to serve and protect. My administration will stop mob violence and will stop it cold.

It does not serve the interests of justice or any citizen of any race, color, or creed for the government to give into anarchy, abandon police precincts, or allow communities to be burned to the ground. It won’t happen.

Those making excuses or justifications for violence are not helping the downtrodden, but delivering new anguish and new pain.

From day one of my administration, we have made it a top priority to build up distressed communities and revitalize our crumbling inner cities.

We fought hard with Senator Tim Scott and many others to create Opportunity Zones, helping to draw a surge of new investment to the places in our country that need it most. We must all work together as a society to expand opportunity and to create a future of greater dignity and promise for all of our people. We must forge a partnership with community leaders, local law enforcement, and the faith community to restore hope.

Radical-left criminals, thugs, and others all throughout our country and throughout the world will not be allowed to set communities ablaze. We won’t let it happen. It harms those who have the least. And we will be protecting those who have the least.

The leadership of the National Guard and the Department of Justice are now in close communication with state and city officials in Minnesota. And we’re coordinating our efforts with local law enforcement all across our nation.

In America, justice is never achieved at the hands of an angry mob. I will not allow angry mobs to dominate. It won’t happen. It is essential that we protect the crown jewel of American democracy: the rule of law and our independent system of justice. Every citizen in every community has the right to be safe in their workplace, safe in their homes, and safe in our city streets.

This is the sacred right of all Americans that I am totally determined to defend and will defend. My administration will always stand against violence, mayhem, and disorder.

We will stand with the family of George Floyd with the peaceful protesters and with every law-abiding citizen who wants decency, civility, safety, and security.

We are working toward a more just society, but that means building up, not tearing down; joining hands, not hurling fists; standing in solidarity, not surrendering to hostility.

Moments ago, as we witnessed the launch of two great American astronauts into space, we were filled with the sense of pride and unity that brings us together as Americans. That same spirit which powered our astronauts to the Moon has also helped lift our country to ever greater heights of justice and opportunity throughout our history.

So today, as we mark a renewed commitment to America’s future in space, a tremendous commitment it is. Let us also commit to a brighter future for all of our citizens right here on Earth.

When Americans are united, there is nothing we cannot do. From day one of my administration, we put America first. (Applause.)

This afternoon, I’m delighted to be with you at Cape Canaveral, in this storied home of American daring, aspiration, and drive.

This is the first big space message in 50 years. Think of that. And it is an honor to be delivering it.

Today, as we gather in this special place to celebrate not only the launch of a new spacecraft but also our nation’s bold and triumphant return to the stars, it’s a special day. Moments ago, the world bore witness to the flight of the first new manned U.S. spacecraft in nearly 40 years since the Space Shuttle launched in 1981 — a long time ago.

I am thrilled to announce that the SpaceX Dragon Capsule has successfully reached low-Earth orbit and that our astronauts are safe and sound. (Applause.)

With this launch, the decades of lost years and little action are officially over. A new age of American ambition has now begun.
Past leaders put the United States at the mercy of foreign nations to send our astronauts into orbit. Not anymore. Today, we once again proudly launch American astronauts on American rockets, the best in the world, from right here on American soil. (Applause.)

Those of us who saw the spectacular and unforgettable liftoff this afternoon watched more than an act of history; we watched an act of heroism. Every time our astronauts climb aboard a rocket — which is many, many stories of only engine and fuel — and vault across the sky, they display breathtaking valor.
What Colonel Douglas Hurley and Colonel Robert Behnken did this afternoon was pure American genius and courage. They join the ranks of just seven prior American astronauts who have made the perilous maiden voyage to test a new class of spacecraft.

The names of Hurley and Behnken will stand in the history books alongside those of legends like Alan Shepard, Gus Grissom, John Young. Now these brave and selfless astronauts will continue their mission to advance the cause of human knowledge as they proceed to the International Space Station before returning to Earth. We wish them Godspeed on their journey, and as one proud nation, we salute their fearless service.

Thank you. Thank you. (Applause.) Thank you.

I also want to send our nation’s gratitude to the wives of these valiant astronauts, both of whom are astronauts themselves: Karen Nyberg and Megan McArthur. We join them in praying for our heroes’ safe return.

As you know, this spring, our nation has endured the pain and hardship of a global pandemic. As we usher in a new era of manned spaceflight, we are reminded that America is always in the process of transcending great challenges. Our nation is blessed with limitless reserves of talent, tenacity, and resolve. The same spirit of American determination that sends our people into space will conquer this disease on Earth. It should’ve never happened. Nothing — not even gravity itself — can hold Americans down or keep America back.

We are grateful to NASA Administrator Jim Bridenstine and Director of the Kennedy Space Center Bob Cabana for welcoming us this evening. Very special. Thank you very much. Thank you. Thank you. (Applause.) Thank you. Great job. Great job. Come a long way in three and a half years, Jim, haven’t we? Huh? A long way.

To the incredible men and women of NASA, from here at Kennedy Space Center, to the Johnson Space Center in Texas — we love you too — to NASA Plum Brook Station in Sandusky, Ohio: Thank you all for working so hard to make this day a reality. We have many other great days almost ready to happen.

Also with us are many members of my Cabinet, including our great new DNI, John Ratcliffe. Thank you, John. Thank you. (Applause.) We have a great friend of mine, a special man, ran a great, great campaign: Governor of Florida, Ron DeSantis. (Applause.) Thank you, Ron. Thank you, Ron.

Your Senators Rick Scott and Marco Rubio. Thank you very much. Thank you. (Applause.) Thank you. Thank you. Leader Kevin McCarthy. Kevin, thank you very much. (Applause.) Great job you do, Kevin.

And Representatives Matt Gaetz, John Rutherford, Michael Waltz, Bill Posey, Gus Bilirakis, Daniel Webster, Brian Mast, Elise Stefanik, Bill Flores, Brian Babin, Rodney Davis, Roger Marshall, and Steven Palazzo. Thank you very much, fellas. Thank you. (Applause.) What a great group of people. They’re warriors. They’re really warriors. They helped so much get this done, and so many other things.

With us also is our Air Force Chief of Staff, General David Goldfein. General, thank you very much. (Applause.) Thank you. Thank you, General. Thank you. And Chief of Space Operations — the first-ever named — and now a member of the Joint Chiefs of Staff, because we created the United States Space Force — General Jay Raymond. Thank you very much. Jay. (Applause.) Thank you, Jay. And senior members, also, of our great United States military. It’s never been stronger than it is right now.

Also, Attorney General of Florida, Ashley Moody, and Chief Financial Officer of Florida, Jim Patronis, and many other distinguished guests.

Thank you very much for being here. (Applause.) We appreciate it.

I especially want to congratulate someone who truly embodies the American ethos of big thinking and risk-taking. After achieving success as an Internet entrepreneur, he could have spent his fortune doing anything, including yachting, lots of things. He could do lots of things. But in 2002, he began pouring tens of millions of dollars of his own money into research and development for a new rocket. He’s a little different than a lot of other people. He likes rockets. He assembled a crew of some of the greatest minds and talent in American aerospace.

In the years since, SpaceX has become the first private company to develop and successfully launch its own rocket into orbit, the first to launch and recover its own capsule, and of course, moments ago, Space X became the first private company to put humans into orbit around the Earth.

Elon Musk, congratulations. Congratulations, Elon. (Applause.) Thanks, Elon.
For Elon and 8,000 SpaceX employees, today is the fulfillment of a dream almost two decades in the making. For years on end, they have worked hand-in-hand with NASA, sculpting aluminum, tightening valves, tuning nozzles, testing parachutes, and filling massive tanks with thousands and thousands of pounds of kerosene and liquid oxygen.

Today, the groundbreaking partnership between NASA and SpaceX has given our nation the gift of an unmatched power: a state-of-the art spaceship to put our astronauts into orbit at a fraction of the cost of the Space Shuttle. And it’s much better.

From now on, the United States will leverage the fast-growing capabilities of our commercial sector and the finest pieces of real estate on Earth — which you need very badly — to send U.S. astronauts into space.

Under NASA’s Commercial Crew program, we will use rockets and spacecraft designed, built, owned, and launched by private American companies, at a fixed price for the American taxpayer.

Today’s launch makes clear the commercial space industry is the future. The modern world was built by risk-takers and renegades, fierce competitors, skilled craftsmen, captains of industry who pursued opportunities no one else saw and envisioned what no one else could ever think of seeing. The United States will harness the unrivaled creativity and speed of our private sector to stride ever further into the unknown.

This launch also marks an exciting turning point for NASA. This agency will now focus its unmatched ex- — expertise, like nobody has ever seen, and power and integrity to do what NASA does better than anyone else — and it’s not even close: embark on the most difficult, most daring, most audacious missions in the history of humankind.

When I first came into office three and a half years ago, NASA had lost its way, and the excitement, energy, and ambition, as almost everybody in this room knows, was gone. There was grass growing through the cracks of your concrete runways. Not a pretty sight. Not a pretty sight at all.

The last administration presided over the closing of the Space Shuttle and almost all of the giant facility that keeps so many people working, so many brilliant minds going. People were crying. They were devastated. But now it’s the greatest of its kind anywhere in the world and will get greater and greater with years to come. I promise you that. (Applause.)

We have created the envy of the world and will soon be landing on Mars, and will soon have the greatest weapons ever imagined in history. I’ve already seen designs. And even I can’t believe it.

The United States has regained our place of prestige as the world leader. As has often been stated, you can’t be number one on Earth if you are number two in space. (Applause.) And we are not going to be number two anywhere. (Applause.)
Nowhere is this more true than with our military, which we have completely rebuilt. Under my administration, we have invested two and a half trillion dollars in new planes, ships, submarines, tanks, missiles, rockets — anything you can think of. And last year, I signed the law creating the sixth branch of that already very famous United States Armed Forces: the Space Force. (Applause.)

For every citizen who has eagerly waited for America to reignite those engines of will, confidence, and imagination that put a man on the Moon, I stand before you to say: You need wait no longer.

Through NASA’s Artemis program, the United States is preparing for a crewed mission to Mars. Earlier this week, I saw the Orion capsules being worked on in this building. As part of the Artemis Moon-to-Mars program, those capsules will soon return Americans to lunar orbit for the first time in over 50 years — half a century.

By 2024, our astronauts will return to the lunar surface to establish a permanent presence and the launching pad to Mars. (Applause.) And the first woman on the moon will be an American woman. And the first nation to land on Mars will be the United States of America. (Applause.)

Since I signed the order to establish these goals shortly after taking office, we have made rapid gains. A new 22,000- pound capsule is already built. The next generation of space suits are already made. Colossal rockets are now being tested. And the contracts for three separate lunar landers have been awarded and signed, and they are magnificent.

In the years ahead, America will go bigger, bolder, further, faster, and America will go first. America will always be first. (Applause.)

To be certain, we will meet the adversity and hardship along the way. There may even be tragedy, because that is the danger of space. There’s nothing we can do about that. The power that we’re talking about is unrivaled. There’s nothing we can do about problems. But we’ll have very few of them.

We will confront all of those challenges, knowing that the quest for understanding is the oldest and deepest hope in our souls. The innate human desire to explore and innovate is what propels the engines of progress and the march of civilization. We will preserve and persevere, and we will ensure a future of American dominance in space.

To that end, over the last three years, I reestablished the National Space Council. I issued a directive cutting red tape for innovative space companies such as SpaceX. We created the world’s first comprehensive space traffic management system. Last month, I signed an executive order establishing U.S. policy for the recovery and use of space resources and minerals. Administrator Bridenstine announced the Artemis Accords to govern the future of space exploration and development.

Together, we will assert America’s rightful heritage as the greatest space-faring nation on the planet. And already, it’s not even close.

In the half a century since the United States stopped sending astronauts to deep into space — 1972 — no other country has ever done it. The reasons are simple: cost, technological complexity, and tremendous danger.

For instance, I was told that the rocket you just witnessed had to be launched within one second, or it would be impossible for it to hit its target. And I was here two days ago, and I said to Jim: “Jim, it’s okay. Why don’t you wait 5 or 10 minutes?” (Laughter.) And he said, “Sir, we only have a window of one second.” And I walked out of here shaking my head. (Laughter.) Is that true, Jim? Yes, it true.

Space travel is not a feat of engineering alone. It’s also a moral endeavor — a measure of a nation’s vision, its willpower, its place in the world. Exploration is a test of our values and of our faith. America is a nation defined by its commitment to discovery — to solve mysteries, to chart the unknown, to press the limits, to achieve the fullest expression of life’s potential, and to ensure that America is the nation that always leads the way, and especially in space.

This evening, I am more confident than ever before that America stands poised to thrive in this grand undertaking. It’s incredible. We are a nation of pioneers. We are the people who crossed the ocean, carved out a foothold on a vast continent, settled a great wilderness, and then set our eyes upon the stars. This is our history, and this is our destiny.

Now, like our ancestors before us, we are venturing out to explore a new, magnificent frontier. It’s called: space. Our most daring feats, our most epic journeys, our biggest adventures, and our finest days are just beginning. America’s proudest moments are still ahead. We are on the verge of our most exciting years, and next year may be the most exciting of all. You just watch.
So today, as our brave American astronauts shake the Earth and blaze a trail of fire and steel into the heavens, we proclaim for all to hear that we have not yet tested the full strength of the American character, and the world has not yet seen the full glory of the American spirit. For our country, for our children, and for humanity’s march into the stars, the best is yet to come. (Applause.)

It was a great honor for me to deliver this speech. God bless our brave astronauts now soaring through the heavens. God bless the men and women of NASA. And God bless America. Thank you very much. Thank you. (Applause.)

END 5:49 P.M. EDT

White House Livestream Link – RSBN Livestream Link – NBC News Livestream

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NASA SpaceX Crew Dragon – Falcon 9 Rocket Launch – 3:22pm EDT Livestreams…


History will unfold today as NASA and SpaceX launch astronauts Robert Behnken and Douglas Hurley to the International Space Station. This mission marks the first time since the retirement of the space shuttle in 2011 that humans will fly to the space station from U.S. soil.  Targeted Launch Time 3:22 pm EDT  – Livestreams Ongoing

NASA and SpaceX are providing live coverage from launch to arrival at the space station. Teams are targeting an instantaneous window of 3:22 pm EDT for the launch of the SpaceX Crew Dragon spacecraft atop a Falcon 9 rocket from Launch Complex 39A at NASA’s Kennedy Space Center in Florida.

The Crew Dragon is scheduled to dock to the space station May 31st.

NASA Livestream Link – SpaceX Livestream Link – CSPAN Livestream Link

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Trump Could Launch the Receivables Liquidity Corporation


The RLC backed by the government is in a better position to wait out the economic recovery and collect at the best time and have an organized collection program

Jonathon Moseley image

Re-posted from the Canada Free Press By  —— Bio and ArchivesMay 24, 2020

Trump Could Launch the Receivables Liquidity Corporation

We are fortunate that President Donald Trump is a businessman who knows how to bounce back from difficulties.  However, the United States really is already in a depression.  We don’t yet have technical indicators stretching over several quarters.  Yet:  “Total nonfarm payroll employment fell by 20.5 million in April, and the unemployment rate rose to 14.7 percent, the U.S. Bureau of Labor Statistics” reported on May 8.

We can fix this.  But it will take swift and decisive action.  We’ve seen it in movies:   The giant airplane is in a power dive heading down into the side of a mountain.  The hero manages to restart the engines and turns the nose up just in time to clear the mountainside and head back upward.

This is a proposal based on my years as a debt-collection attorney in Virginia

President Trump could create a Receivables Liquidity Corporation. (You heard that name and idea here first.)  After the Savings & Loan crisis, the government created a private corporation backed by the U.S. Treasury, called the Resolution Trust Corp.  The RTC took over failing banksand slowly liquidated their assets at opportune times.  During the 2008 mortgage crisis bailouts, allegedly the U.S. Treasury turned a profit eventually.  The government sold the stock it acquired in the bail outs at a time of panic (low prices) and then sold them after the economy had grown healthy (high stock prices).

This is a proposal based on my years as a debt-collection attorney in Virginia.  This could work for Canada, the European Union, now independent England, even the Bahamas or almost any country – not just the United States.  It can even work combining several nations together.  However, it does require a nation with sufficient financial credit to carry debts for a long time until the ideal time to collect on them.  And it requires a mindset to think outside the box with a more business-oriented public private partnership.

The engine has seized up.  When we try to start the engine again, it is going to be bad.  If everyone pulls back and values plummet just because people are frightened, the damage will be far greater than if the new RLC takes payment much later, after things have rebounded.

As soon as the economy re-opens, it will end the freeze on evictions of renters behind on their rent and foreclosures on mortgages.  Within two months of re-opening, many of those 20.5 million unemployed could be homeless.   Those unemployed won’t be able to suddenly repay 2 to 4 months of overdue rent or mortgage payments.

Businesses have been unable to pay rent for offices, store fronts, etc.  Utilities haven’t been paid.  Businesses have accounts receivable but their clients can’t pay those invoices because they are not getting paid.  Those clients can’t pay because their own clients aren’t paying.  And on and on.

President Trump hoped early on that there would be pent-up demand and the economy would snap back.  But he acknowledged back then that the longer the economy stays closed the harder it would get.  Now, there may be a lot of desire to buy.  But will people have the money to spend?

Consider the situation for many small businesses:  As a solo attorney, I am a small business.  Before the pandemic, clients typically had no money to pay me.  Now, no one is paying them.  They have on-going expenses for food and what rent they can cover, with no income in most cases.  The people who should be paying them have no money because they are not getting paid.  So I’m not getting paid for past work or hired for new work.  So my vendors aren’t getting paid.  Etc.  A negative cascade.

The stimulus checks in the United States were small and late.  For many businesses, the $10,000 small business advance loan never arrived.  And the Paycheck Protection Program Loan—for the very small businesses who can get one—is only 2 ½ months of a business’ payroll after cutting any salaries above $100,000.  The size of the economy is enormous.

However, those programs do not have to be repaid.  The only way that the U.S. Government can afford to spend a lot more is if the money is repaid—eventually.

How?  The time horizon for small business is short.  They can’t survive for long without getting paid by clients.  By contrast, the Treasury can carry those invoices for years until the economy has rebounded and the debtor can afford to pay.

So let’s say a landlord is owed 4 months’ rent for a business or a residence.  Once the economy restarts, and the ban on evictions is over, he’s got to collect that unpaid rent from people who don’t have any money after 4 months of house arrest.  Or businesses have shipped products that they haven’t been paid for.  Or utility companies have overdue utilities for 3 to 5 months.  What are they going to do?  If they try to collect, they will leave businesses in the dark without electricity or homes without water.  How is the economy going to rebound like that?

Instead, the landlord or utility company sells the invoice to the Receivables Liquidity Corporation and gets paid in full.  Hopefully, the invoice eventually gets paid to the RLC with interest when the economy has recovered.  The debtor must agree to:

  1. waive rights to discharge that particular debt in any bankruptcy,
  2. provide the owner’s personal guarantee for a business,
  3. waive the statute of limitations,
  4. consent to deduction from tax refunds,
  5. certify that they do not dispute the debt or to what extent, and
  6. add interest if the invoice did not provide for it.

In return the debtor gets a grace period of one year or more before having to start repaying the invoice(s) (with a possible hardship extension if circumstances warrant on application).   The debtor would get an installment plan to pay back over time.  If the debtor does not agree they are subject to immediate collection action.  So they have motivation to agree to the terms.  If they cooperate, they get a breather of at least a year before they have to pay.

The RLC backed by the government is in a better position to wait out the economic recovery and collect at the best time and have an organized collection program.  While some invoices will not get paid, hopefully enough will be paid with interest and collection fees – eventually—to come close to breaking even.

One small problem:  Who would run this program?  Wink.  Call me….

Doctor From NY City Offers His Observations


Forecasting Technical v Fundamental


QUESTION:  Hi AE….I have a thought/question/idea that is an observation, not a criticism, & begs a response.
Have long noted AE’s reliance on technical analysis, for your forecasts, to the almost total exclusion of broader fundamentals, like out-of-control corruption. From day one, this has been a revelation to me, but must concede that your success in forecasting speaks for itself.
Meanwhile, over a lifetime, I’ve also observed the US gov’t dep’ts morph from “normal” corruption, to outright corruption, in every possible way, regardless of which alphabet dep’t you can name–CIA, FBI, FDA, FCC, OSHA, health care, justice (as you well know), education (indoctrination), plus all MSM. Amazing, Trump is still standing.
The system is so rotten, it cannot much longer endure. It has come down to the honest “little people”, in flyover country VS the matrix of entrenched financial/political/globalist parasites.
So, my question…your technicals work well in economics in a “normal” environment, but somewhere, deep in my psyche, a voice insists that at some point, all this blatant deceit, & even hatred is going to overwhelm all the charts & graphs, as in almost no markets at all, for a while.
There must be 100’s, if not 1000’s of your readers with similar thoughts.

HS

ANSWER: Trying to forecast based upon fundamentals is just opinion. That is not reliable for we all have good days and bad days. The trend is proven by the analysis. For example, Socrates projected that unemployment would rise faster than it ever has in history. That is not a forecast any person could have made BEFORE this virus even appeared.

I have told the story at conferences. We had a client, the Universal Bank of Lebanon, back in the 1980s. They discovered a ledger in the basement where someone had recorded the value of the Lebanese pound going back into the 1800s. They asked if we could create a model. They sent someone to the states with a copy of the ledger. I input the data into the computer and out came with a forecast that their country would fall apart in eight days. I thought the computer was wrong. When I told them the result and apologized, they simply asked me which currency would be best. The war started in eight days.

The very same thing took place concerning the Iran-Iraq War. We had a client who was very well connected and owned a shipping business. He called and asked me what gold would do the next day. He informed me that Iran was going to begin attacking shipping in the Gulf. I asked, “Are you telling me a war is going to begin tomorrow?” He said yes.

With time I began to understand that the computer was monitoring the capital flows. It would project the trend based upon the movements it was picking up. As a result, it knew nothing about who was moving the money or why – just that the capital was moving. I came to comprehend that if you were going to start a war, you would move your money appropriately in advance. I delivered the forecast that Russia was about to collapse in 1998 which led to the Long-Term Capital Management collapse. The computer saw $100 billion going into Russia, but $150 billion fleeing.

I have learned over the years that the fundamentals mean nothing. Yes, there have been deficits and people keep calling for the crash of the dollar. Yes, there has been rising corruption. The question is when will those fundamentals finally mean something? That is where the computer comes in. No opinions – just the trend. It boils down to public confidence. You can see it with this virus scare. The vast majority believe what is being said. They are fools who rush in and just follow people like Gates. He counts on such foolish ignorance.

Value of a Currency


QUESTION: Hi Mr. Armstrong,
You have said that money is not gold, or silver, or oil, or fiat currency, but rather represents the collective elbow grease and ingenuity of a people. From the work of Socrates, which country or countries best typify this concept and therefore will become the better countries to live in, so that we may guide our families and children in that direction?
As always best to you and your vision, and thank you.
MB

ANSWER: What made America great was not our resources. The Silver Democrats tried to force a higher silver to gold ratio and were bribed by the silver miners. When the world was on the gold standard, that dictated the value of a currency in international FOREX markets because the value of the currency was just the metal content. Napoleon attempted to create that standard and the idea, known as the Latin Monetary Standard, was used after his defeat where the coins were all of the same weight and purity.

However, great disruptions to this standardized system of metals repeatedly led to major economic upheavals. The economy of Florence suffered from the tremendous economic crisis and people were burning down the houses of bankers because they blamed them without understanding the real cause. Due to the war between France and England, the French debased the coinage. This drove the price of silver up dramatically where there had been a two-tier monetary system — gold for international transactions and silver for domestic. Since wages were paid in silver, as the price rose, employers could no longer afford to operate and the economy crashed with a vast rise in unemployment.

Only after World War I and II did modern society begin to see that the value of a currency was not simply the metal content. There was a premium even over gold’s value attributed to the Romans, as was the case with silver and the Greeks. This is proven by so many surrounding nations imitating their coinage with the same metal content and weight showing that there was a premium over the raw metal.

China, Japan, and Germany all rose from the ashes because their people were productive. Once the unions began and extorted higher sums of wages beyond competitiveness, the USA began to see its labor move offshore for it was overpriced relative to the world because of also taxes on labor — not merely the hourly wage.

Adam Smith in his “Wealth of Nations” saw that it was not simply metal. If a farmer or candlestick maker sold something from London to Paris, they both returned with gold. It was the value of their labor that mattered.

Unfortunately, the socialists are leading the charge and have conspired together to bring down the economy to force political change. They are also weakening the West and inviting war. Just as Rome saw its economy decline sharply within 8.6 years during the 3rd century, the barbarian invasions began. These socialists have no idea what they have unleashed. The world economy will NEVER be the same all because of a pretend virus that has a death rate of 10% of the annual flu.

Unfortunately, the baton will pass to Asia. The West will be engulfed in civil strife. The Socialists have killed the economy precisely as did the communists during their revolutions in Russia and China. We have a turning point in 2021 even for Russia.

Industrialization in the Soviet Union was a process of accelerating the industrial potential of the Soviet Union to reduce the economy’s lag behind the developed capitalist states, which was carried out from May 1929 to June 1941.

The official task of industrialization was the transformation of the Soviet Union from a predominantly agrarian state into a leading industrial one. The beginning of Socialist industrialization as an integral part of the “triple task of a radical reorganization of society” (industrialization, economic centralization, collectivization of agriculture and a cultural revolution) was laid down by the first five-year plan for the development of the national economy lasting from 1928 until 1932.

In Soviet times, industrialization was considered a great feat. The rapid growth of production capacity and the volume of production of heavy industry (4 times) was of great importance for ensuring economic independence from capitalist countries and strengthening the country’s defense capability