Do Lower Interest Rates Promote Deflation?


Gorilla-Thinking

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

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

KS

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

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

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

Analysts v News Chasers


bank-run-1931

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

Thank you for the light to bring

KJ

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

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

Syria the Focal Point


wall-of-gorgan

QUESTION: Marty; You said Syria was the focal point for this ECM wave and the target for the beginning of World War III. I read you piece on Syria and the issue of religion rising from this single spot. I find it extraordinary how you can pick specific places like Ukraine and Syria long before something takes place. Is this all based on the historical records of war you have put together? Just curious. Does this have anything to do with the Biblical tribe of Gog and Maygog? May claim this is it. I figured you might know best.

Looking forward to Orlando. Have three friends who tried to get in now but can’t. You seem to also target your conferences to key periods in time.

Thanks for keeping us abreast.


ANSWER:
 On the prophecy of Gog and Magog, that is not the Syrians, Arabs or Turks. In ancient legend, outside the Bible, the Gates of Alexander was a legendary barrier supposedly built by Alexander the Great in the Caucasus to keep the uncivilized barbarians of the north from invading the land to the south. That was probably the Mongol tribes for they would have appeared Asian. Moscow is directly north to the east above Lebanon. Had it been the Russians, they would have appeared more white stemming from the Vikings. They would have been invading through Georgia. The Gates of Alexander may be the Great Wall of Gorgan, which was built during the Parthian dynasty or repaired at that time and new evidence suggests it may be 1,000 years older than the Great Wall of China. It was restored somewhat during the Sassanid era (3rd-7th centuries). Therefore, this wall is located north with the border of Iran and Turkmenistan. This was probably the same raiding tribes that inspired the construction of the Great Wall of Chins during the 3rd century BC.

Consequently, this legend of Gog and Magog is not confined to the Bible. The Romance of Alexander is comprised of several collections of legends concerning the mythical exploits of Alexander the Great. In one version of this collection of legends, “Goth and Magoth” are kings of the Unclean Nations. They were driven beyond a mountain pass by Alexander, and blocked from returning by the construction of a new wall becoming known as the Gates of Alexander. The account attributes Gog and Magog as barbarians who practice cannibalism of their conquests. Clearly, this is not confined to the Bible. Indeed, Gog and Magog also appear in the Quran as Yajuj and Majuj who are adversaries of Dhul-Qarnayn, which were generally equated with Cyrus the Great of Persia and al-Iskanadar (Alexander the Great) in Islam. So we have various attributions that have been applied over the centuries to such as Romans, the Turkic tribes from Central Asia, and of course the Mongols. The tribes of Gog and Magog remain forever associated with apocalyptic prophecy both in Christianity and the Muslim world. I am sure it will be attributed to the Russians if they invade through Turkey into Syria. Since China also constructed a wall, we might assume that these are closer to the tribes from Mongolia who were nomads rather than the Russians.

Relief_of_Shapur_I_capturing_ValerianNevertheless, with regard to Syria, this has been the crossroads between Asia and the West. It was within the sphere of Rome whereas Iran was the Persians of Parthia, which Rome never subjugated. In fact, it was Shapur I who captured in 260AD the Roman Emperor Valerian I (253-260AD) and made him his personal slave and finally stuffed him as a trophy upon his death. So this was the very place that market the collapse of Rome during the 3rd century. Curiously enough, 200 intervals of 8.6 years from 260AD was 1980 or the peak in the Public Wave. Time converges on this region from many aspects and the place has been a focal point between East and West for centuries.

Antioch of ancient Syria was indeed the third largest city in the Roman Empire and it was called “the cradle of Christianity” for it was always played a pivotal role in trade between East and West with the Silk Road, and also in the emergence of both Hellenistic Judaism and early Christianity. It was even the first city to have street lights. Antioch was located on the eastern side of the Orontes River and its ruins are near the modern city of Antakya, in Turkey. The name of the country Syria extends back to the Assyrian culture.

ninevehThe Assyrian Empire was built on a warrior society model much like the Greeks of Sparta. The Assyrians produced the most fearsome soldiers were had the most innovative generals of its time. They used chariots, iron weapons, and siege equipment to dominate their enemies before others. They maintained a standing Army with every young man was expected to train as a warrior and be ready to fight. The Assyrian Empire grew by conquest employing their standing army of professional soldiers whose only job is to fight. Their soldiers were trained in siege warfare, battle tactics, and hand-to-hand combat. The Assyrians would launch a battle campaign every Spring conquering cities and stripping them of all wealth. Based upon ancient sources, the Assyrian army was probably several hundred thousand soldiers in number.

andragoras-238bc-seleucid-satrap-of-parthiaAssyria was a kingdom located between the Tigris and Euphrates Rivers that dominated the ancient world from the ninth century to the seventh century BC. Its capital was Nineveh. It was the Assyrians who destroyed the northern kingdom Israel when they besieged Samaria dragging Israel into captivity after defeating them in 722 BC. They were very smart and realized that to conquer, they must destroy the sense of nationalism. Assyrian policy was therefore to deport conquered peoples to other lands within their empire. This is how they destroyed their sense of nationalism breaking any hope of rebellion. In this manner, they would always replace the people with strangers from another conquest mixing them up. They did not build an economic based economy, but robbed everyone else making them slaves. They were notoriously known for being cruel and creating horrible atrocities. They were the first Vlad the Impaler (Dracula) who skinned their prisoners alive cutting off various body parts to inspire absolute terror in their enemies. Records have survived documenting that Assyrian officials would pull out tongues and displaying mounds of human skulls of their victims intentionally to invoke sheer horror to compel people to submit. They extracted tribute from surrounding nations and they remain perhaps the most cruel of all armies ever to have exited.

Keep in mind that this is the focal point that even Rome could not overcome. For whatever reason, this is just the place.

PUTIN’S WARNING – Now Russia tells the US ‘if you want a war you will get one EVERYWHERE’


Obama the pussy had better not mess with Putin the bear he will not win!

Donald is Right – The System is Rigged 


Really great news here one and all … 😦

US Government Enters The Dark Cyber Realm, Begun the Cyber War It Has – Episode 1107 


A reasonable outline of the last two months of the year.

Elizabeth Warren Calls for the Dismissal of the Head of SEC Who Refuses to Comply with Law


Elizabeth-Warren

white-mary-joElizabeth Warren wrote to Obama demanding Mary Jo White, the head of the SEC, be fired. She wrote: “I do not make this request lightly.”  Warren has sought that the SEC require corporations to reveal their political donations. “I have tried both publicly and privately to persuade Chair White to direct the agency’s resources toward pressing matters of compelling interest to investors and the public, and toward completing those rules that Congress has required it to implement. But after years of fruitless efforts, it is clear that Chair White is set on her course. The only way to return the SEC to its intended purpose is to change its leadership.”

I know Mary Jo White and I can say, while I do not agree with Warren on much of her economic ideas, nonetheless, she is right on point here with the performance of the SEC. Mary Jo White was the head of the Justice Department in New York City when my case began. I did not know who she was. At my first bail hearing, my lawyer got the government to admit that they never bothered to call a single client. Instead, they repeated whatever the bankers alleged, and the judge in Trenton, New Jersey, was shocked.

tr-9-13-1999-bail-hearing

 

After I won that hearing, the government never bothered to call any clients to verify anything the bank told them. Mary Jo White came up to me and was literally snarling and showing her teeth to the point where I looked at her and asked what the hell was her problem. I did not know who she was. All I knew was that she looked like she was about to bite me like some animal. My lawyer then told me who she was. It was totally unprofessional to say the least.

She did not understand anything about the transactions. In the end when they had to plead guilty and return all the funds, they were exempt from prison. It was exactly like the ending in “The Big Short.” New York bankers never go to jail.

Mary Jo White has ALWAYS protected the establishment. That is what she is there for.

Brussels Contemplates Outlawing Short Selling on European Bank Stocks


EU Parliament

The European banks are in much worse shape than their US competition. The reason being argued in Europe is that the US government imposed a ban on speculation after the financial crisis. However, that was imposed on September 19, 2008, and it ended on October 9, 2008. But some Europeans claim that is why US banks survived and want to outlaw short selling on banks stocks in Europe. The problem with this proposal running around behind the curtain is that Brussels would lead, not to short selling, but wholesale liquidation. They would have to suspend all trading, period. The problem is that it would not last for more than one month, as was the case in the United States. This would only destroy confidence in Europe altogether.

Washington’s game of good terrorists vs bad terrorists


Obama’s and Hillary’s ideas for the middle east are insane destabilizing all most every country has created a hell hole that is spilling over into the EU and now America. Obama needs to be tried for treason!

CNN INSTANTLY REGRETS ASKING GROUP OF UNDECIDEDS WHO THEY’LL VOTE FOR IN LIVE POST-DEBATE POLL


Ten to 5 than there is hope that the citizens are awake this time and understand the Hillary belongs in jail.