Some Bubbles are Just Outright Frauds


QUESTION: BitCoin has crashed and it looks like it will never be what people dreamed as some replacement for the dollar. Are bubbles always involving some failed product? A dream that is just unrealistic like the Tulip bubble?

JE

ANSWER: No. There have been many, many, many “bubbles” throughout history. Some have been just crazy like the Tulip Bubble and others have been outright frauds like the Panic of 1825 which was a stock market crash following the same idea as the South Sea and Mississippi Bubble of 1720. This time, it was again a new emerging market country that was completely just a fraud. It was a wild speculative investment in Latin America, that was all about an imaginary country of Poyais. The stock market boom became a bubble and banks caught up in the euphoria made risky loans all on this imaginary new market.

The Sovereign Debt Crisis has Spread to 119 Countries


QUESTION: Mr. Armstrong; For the past two WEC events you have warned that the Sovereign Debt Crisis will strike first outside the USA and the rise in the dollar and US interest rates will push emerging markets into default. Since you also said that pension funds had rushed into emerging market debt to get higher yield not available in USA and Europe, then this will also feed into the pension crisis. I recently read here in Germany that almost 100 nations are on the brink of a debt crisis. Only now people are starting to talk about it. Do you still see this as a catalyst for a strong dollar along with war?

I am really looking forward to this year’s WEC.

LR

ANSWER: The Sovereign Debt Crisis is on schedule to be noticed starting here in 2018. We have 13 governments now who are already in default of their debt payments. There are more than 100 nations who are on the verge of a debt crisis. The rise in US interest rates and the strength behind the dollar pushes these nations over the edge. I have been warning that this trend would emerge as part of the turning point back in 2015.75. It will now intensify as we head into 2020. China’s debt to GDP is more than TWICE that of the United States. DEBT is our worst enemy and there are no viable solutions coming forward because anything implied by others is tinkering with the current system. There is no solution is valued circles, other than mine, which calls for the complete revision of the debt system. Everything being proposed so far is tinkering with raising taxes and reducing benefits as well as raising the age for pensions.

I fear that all we can do is protect ourselves. Nobody is willing to listen to me. When they will, it will be too late. Hence – the crash & burn becomes unavoidable. Nobody will scrap the system before it crashes. It is against human nature.

Mexican Presidential Race Front-runner Blames Corruption For President Trump’s Perspective…


The next president of Mexico, Andres Manuel Lopez Obrador, or “AM LO” as he is known locally, is a well known Marxist.  AM LO is virtually certain to be the winner of the July 1st Mexican election.  The U.S. will have a Hugo Chavez ideologue at our southern border.

Today, front-runner AM LO told an audience in Rosarito (Baja California peninsula) that President Trump’s bad experiences investing in Mexico, and encountering corrupt officials throughout government, were likely the reason for his negative view of the country.

“[Trump] invested here in Rosarito and also in Cozumel, Quintana Roo, and because of Mexico’s corrupt governments he had to leave,” Lopez Obrador said. “That’s why he got a bad impression of our country.”  (Reuters link)

AM LO went on to say his national government would eliminate the decades-long corruption within government and the judicial system.  Keep eyes-wide-open; once in office AM LO will likely repeat Chavez/Maduro and remove blocks to his agenda including legislative opposition, elections and eventually term limits.

Cycle of Religion – Detailed


COMMENT:  In your blog on the cycles in religion, you may want to add some more dimensions: (1) Hindu worldview is cyclical over a vast cosmological timescale and then through a fractal (as above so below) astrological philosophy of action there appears an a-causal (synchronistic) relationship between cosmic, global and local possibilities for events which however are precipitated by individual choice of action. The outcomes of individuals’ actions are based on those choices. (2) There does not seem to be any awareness in your analysis of the latest revolution in religion that happened on 23 May 1844 in Shiraz, Persia merely 36 hours before the the other ignored revolution in human affairs caused by Mores’ telegram, “What Hath God Wrought!” which is the direct antecedent of the global communication revolution. Babi-Baha’i Religion is that new religion at the start of the new economics of global economic and political action based on the use of telecommunications well documented over the last 160 years. Exact dates and times are available for some of these events which should provide you with an ample opportunity to test various cycles going backward and forwards and generate more insights for refinements in your models!
Very best,
AAW

REPLY: I did not go into great detail with respect to religion for it is a touchy subject. There is clearly a major cycle and it too adheres to the 8.6-year fractal sequence. The Roman religion was similar to Hindu insofar as it accepted local gods from the provinces. The early dominant Roman god was Janus. We find the earliest Roman coin, the As, bore the picture of Janus. The As began as one pound of bronze and it was divided into twelve fractional units known an Uncia. This is our current weight system. We still celebrate Janus’ feast day, which was January 1st. The two faced god is still what we say on New Year’s Eve – goodbye to the old and we look forward to a new year with resolutions for change.

The Black Stone Of God

Gold Aureus Stone of Emesa

The Roman emperor known to history as Elagabalus (218-222AD) takes his name from the sun-god of Emesa (Homs Syria today) for which he had been made high priest on May 16th, 218 AD. Elagabalus was actually born about 205 AD. With the assassination of Caracalla in 217 AD, power passed to the Praetorian Prefect Macrinus, but the desire for power from the Severian women led by his grandmother, Julia Maesa in Antioch, was very political and power hungry. They prevailed and Macrinus was deposed along with his son Diadumenian.

When Elagabalus departed for Rome, he also took with him the famous Black Stone of Emesa, which was the symbol of the sun-god Elagabalus from the temple at Emesa in Syria. Herodian described this Stone of Emesa as being rounded at its base and rising to a point at its top. There were a few rough projections, in which people believed they saw an image of the sun. This black stone was most likely a meteor lending its legend that it came from heaven as a gift from the god to mankind. Therefore, the role of the priest and the possession of this stone was of great symbolic power.

Elagabalus had been made a high priest of the sun-god cult when he was very young. Both he and his mother were religious fanatics and went as far as to take their eastern god to reign over all Roman gods in Rome itself. He constructed a very large temple adjacent to the Colosseum on the Palatine Hill. A second temple was erected just outside of Rome. He and his family would walk backward in a procession before the stone as it was brought to the second temple outside of Rome during a midsummer festival. Cassio Dio describes sacrifices of both animals and young boys. They made it mandatory for all to worship at the Shine of the sun-god including Jews and Christians. The sun-god was supreme and all other gods were subordinate to it. His religious practices drew sharp criticism when in 220 AD Elagabalus divorced his first wife Julia Paula and took a Vestal Virgin as his wife – Aquileia Severa. Vestal Virgins had been buried alive for breaking their vows even during the reign of Caracalla. Against the advice of his mother and grandmother, Elagabalus married Aquileia arguing that a union between the high priest and priestess would be born a son of god. But this religious taboo led to so much outrage, that Aquileia had to be divorced and a third wife Annia Faustina was selected.

For all of Elagabalus’ religious positions and many wives, he was also very notorious for being a bisexual who also enjoyed dressing up and playing the part of a woman. Cassio Dio tells us that Elagabalus even married a male slave named Hierocles and enjoyed being beaten by him as if he was Hierocles’ female salve. Other men who slept with him were given high positions in government. Homosexuality among the Romans was not acceptable as it had been in Greek culture. Respect for Elagabalus declined significantly. It was even said that Elagabalus asked doctors if they could medically transform him into a woman and carried out his own experiments by cutting off the gentiles of young men as a sacrifice to his sun-god. His reign was notorious for religious fanaticism, for cruelty, bloodshed, and excesses of every description, and there was general satisfaction when, on March 6th, 222AD, Elagabalus, and his mother Julia Soaemias were murdered in the praetorian camp. Their bodies were dragged through the streets of Rome for display and then thrown into the Tiber River denied any burial right.

The Cycle of Religion clearly follows the 8.6-year frequency. From the Battle of the Milvian Bridge which took place between the Roman Emperors Constantine I and Maxentius on the 28th day of October 312AD (312.824), it was 309.6 years until the rise of Islam. At the age of 40 in 610AD, Muhammad is said to have received his first verbal revelation in the cave called Hira. This was the beginning of the writing of the Quran that continued up to the end of his life. There was also the persecution of the newly converted Muslims like there had been among the Christians. Muhammad and his followers migrated to Medina in 622AD, an event known as the Hegira and the birth of the Islam calendar (622.298).

It is not certain when Jesus Christ was actually born. The census that is the story of having to travel to Bethlehem was actually the Census of Quirinius which took place in 6AD after Herod I the Great had died and the Romans were dividing Judaea into thirds among Herod’s sons. There is no actual evidence of Herod issuing an order to kill the firstborn males when in fact he clearly died about 10 years before. Such an order would have to have been issued by one of his sons, yet there is no surviving evidence to support that as fact.

Nevertheless, our model does place a turning point about late 3AD when most scholars agree that Jesus was born based primarily upon the Census of Quirinius. We then have in 312AD the victory of Milvian Bridge by Constantine the Great who then decrees that Christianity will be the state religion primarily so he got to plunder all the wealth of pagan temples. It is rather stunning how we come to major religious events every 309.6 years. This appears to be a change in beliefs that do not necessarily suggest complete changes in religions. Often these are shifts that become more fundamentalist in their beliefs or a turn toward liberalism.

Muhammad thus begins Islam 309.6 years after Constantine. The next target sees the beginning of pilgrimages to the Middle East during the 10th century. The belief that the world would end come the year 1,000 was very prominent, so much so that the English King Aethelred II (978-1016AD) replaced his image on the coinage with the symbol of Christianity – the lamb. Once the fearful date pasted, he reverted to placing his own portrait on the coinage once again. This particular cycle marked the Crusades, which began in 1095 as a pretense to protect the pilgrims.

The next target in 1241 which was the year of the Great Mongol Invasion. Poland fell to the Mongols that year who are eventually beaten back. We also see in this cycle was a new trend of Antipopes when France seized the Catholic Church and installed French popes as puppets of the French king that became known as the Avignon Papacy. This was the period from 1309 to 1376 during which seven successive popes resided in Avignon. The Seventh Crusade was a crusade led by Louis IX of France from 1248 to 1254. This was the cycle that we see Constantinople fall to the Turks in 1453.

The next cycle turning point began in 1551 when the Council of Trent reconvened to deal with the Protestant Reformation. This cycle also marks the attempt of Islam to conquer Europe and impose Islam as the state religion. The invading army was the new Ottoman Empire, which was defeated at the Battle of Vienna which took place on the 12th of September 1683 after the imperial city had been besieged by the Ottoman Empire for two months. The peak of that cycle arrives 212 years from the beginning. That was 1763 and the start of George II restrictions placed upon Americans which led to the American Revolution, which was also about the freedom of religion.

 

This brings us to 1860 and this is the beginning of the American Civil War, which was rooted in a religious question concerning slavery. This current cycle will reach its peak in 2072 and the next will begin in 2170. We are clearly moving toward a clash of philosophies both within Christianity as well as among different religious foundations. As we move into that major turning point, we will see rising discontent and religious confrontation engulf the world. In the USA, we have the liberal v conservative confrontation which is also incorporating the religious right and anti-abortion movements v women’s liberation factions. They see this as plain and simple – thous shalt not kill. Yet this is inconsistent with the idea of war itself. Perhaps it is ok to kill someone if the government tells you to do it?

This is part of the religious cycle as well. We will also see the conflict between Christianity and Islam build in Europe. This will be no different from the anti-immigration movement that surged into gun battles on the streets of Philadelphia during the economic depression that followed the Sovereign Debt Defaults by states during the 1840s. As the economic decline picks up speed from 2018 into 2020, the tensions against immigration will only rise. This is also behind the separtist movements in Europe.

We are in the Seventh Wave following the birth of Christ. From a pure cyclical perspective, the next turning point in 2072 may be a significant religious change. What comes, can only be subject to speculation. We have completed six waves of 309.6 years. The Seventh is where major change and conflict will be unleashed.

 

Armstrong on the Solution


Interest Rates and Bonds


Draghi Confirms ECB Will not End QE


 

 

Mario Draghi is by no means going to stop his Quantitative Easing program. All my sources behind the curtain express fear what will happen when Draghi leaves. Who will buy the government debt and who will keep subsidizing the governments of the Eurozone? Draghi has not merely declined to end Quantitative Easing, he has pledged to continue to reinvest in debt which it matures because he knows there will be no bidders. The ECB is exceeding 40% of all Eurozone debt on its balance sheet. There will be no bid for Eurozone debt and even the German bunds are reflecting weakness.

Draghi has publicly even distanced the ECB from the monetary policy considerations of Austria’s central bank chief Ewald Nowotny, a board member. Nowotny told Reuters interview on that future of bond purchases would decline and possible interest rate moves to the upside were coming. The ECB came out and publicly stated that the views of Governor Nowotny did not represent the view of the Governing Council. This is confirming our sources which have been stating that Draghi realizes he is trapped and he is trying to hold it together until he leaves so he will not be blamed for the mess he has created in the world economy after he leaves in 2019. I hate to tell him, but I do not think he will win that race out the door before chaos hits.

War & Markets – The Pre-Russian Revolution


 

QUESTION: Marty; You so casually mentioned that Britain closed the share market during World War I and that such a risk exists in Europe. Can you elaborate on this at all?

Thank you for all you contribute to society

OD

ANSWER: The entire period leading into World War I was a period of extreme socialism. This is when the world was enamored with Karl Marx. That lasted until the Russian Revolution in 1917 and the murder of the Czar and his family. The Romanov family were shot, bayoneted and clubbed to death in Yekaterinburg on the night of 16-17 July 1918. This demonstrated the hatred that Karl Marx unleashed upon the entire world. Only then did people in the West begin to look at this Marxist rebellion as something serious rather than a fashionable liberal change of mind.

Most people are ignorant about how the world economy functions no less its history. They assume that today this is a “Global Market” for the first time in history. That notion is completely wrong. Prior to World War I, the world economy was open and global. It was this openness of global financial markets prior to the war that led to the closure of stock markets. Europe will do the same so beware. It is important to understand what took place because history will REPEAT going forward in Europe.

Before World War I, financial capital was free to move from one country to another without exchange controls.  All the major countries of the world were on the Gold Standard. People assume this meant that money was real and stable. That is just propaganda for the world currency markets were still arbitraged despite the gold standard. The differences in exchange rates were arbitraged back then through the buying and selling of international bonds that were listed on the world’s stock exchanges.  Russia would issue a bond that was then listed on the St. Petersburg stock exchange as well as the major world stock exchanges in London, New York, Paris, Berlin, and Amsterdam.  Differences in exchange rates between countries were arbitraged according to the shifts in CONFIDENCE with respect to nations by buying and selling bonds in different markets. In reality, this made European stock exchanges a single, integrated market which they claim they are trying to accomplish today with the Euro

 

To the shock of most people, even back in 1914, currency flowed between countries with lightning speed thanks to the telegraph and international banking.  Even during the Napoleonic wars, money moved, but it was slower in that physical metal and coin needed to be transported by ship or train from one country to another.  By 1914, the Transatlantic cable stretched across the ocean connecting North America and Europe. This reduced the communication from 10 days to 17 hours with the first communication taking place on August 16th, 1858.  By the Roaring ’20s Bull Market, stockbrokers were on ships so you could trade while traveling between New York and Europe.

Therefore, arbitrage kept the currencies in check through the bond markets predicated upon CONFIDENCE. Because traders throughout the world could sell bonds and shares instantly, this is why the European governments shut down the markets. This was the check and balance based upon CONFIDENCE in their governments. On July 31st, 1914, the New York Stock Exchange closed its doors for the longest period in exchange history due to the political pressure for fear that European bonds would be sold there. The New York Stock Exchange remained closed until November 28th, 1914, when bonds began trading once again. Here is a chart of the bonds listed on the NYSE that crashed during the Sovereign Debt Crisis of 1931. That was the end of the formal bond arbitrage.

Europe feared massive selling and foreign investors would try to repatriate their money which would aid an enemy. Effectively, the free markets shut down and this was a political directive. In London at that time, individual trades were made on a daily basis, then carried until Settlement Day when trades were matched and crossed.  Brokers would make up the surplus or deficit on their accounts by settling outstanding trades with cash.  As long as there were no significant swings in stock or bond prices, brokers had sufficient capital to settle their accounts.  However, since traders relied on credit, large swings in prices could and would bankrupt many of the brokers, worsening the financial panic. This was one more concern that the brokers themselves had fearing volatility and thus supported the closures during World War I. Trading became a black market off exchange.

 

 

We have the largest database ever constructed when it comes to the global economy. Research has been carried out with one simple rule – let’s see what happened. Instead of beginning with a predetermined theory, we approached the global financial history with a view to learning how it worked rather than trying to prove a point. Markets speak to us when we listen. They show the trend and are not arbitrary. We have all been connected globally for a very long time. Capital has moved around the world based on fear and opportunity from ancient times.

At this year’s WEC. we will be also looking at how the markets speak to us and what are they saying this time about the years just ahead. Here is a chart of the Russian share market where we have created an index to expose how capital functioned and behaved going into the Russia Revolution. There was a period of two years with compressed consolidation following the 1911 high in Russia just prior to the move with the second attempt at a Russian Revolution. The market always reveals what is to come.

Has the ECB Been Manipulating the Euro?


There have been persistent rumblings behind the curtain that the ECB has been “frowning” on anyone taking short positions on the Euro. They have already outlawed shorting government bonds and they are trying to wrestle the market in the Euro from London to bring it within their power and control. Up until now, they have been politely discouraging shorting the euro. The Brussels empire is crumbling before our eyes and with each and every step, the EU Commission is moving to eliminate free markets because they have been moving against the dreams of the EU Project to federalize Europe without federalizing all the debts of member states.

The Telegraph in London published a piece where they call the “remain” crowd supported by George Soros ‘remainiacs’ who are trying to halt Brexit and like those in Brussels, think the people are too stupid to understand what they even voted for. They obviously hate democratic votes when they go against their goals and this is why they want to go fully into the EU which has also eliminated democracy since their leaders are also all unelected running Brussels machine to subjugate all of Europe with the same goal of Napoleon and Hitler – to create the United States of Europe. They appropriately called the deal would keep Britain shackled in a ‘Hotel California’ Brexit – one where you can check out anytime but you just can’t leave?

The author was a historian and cultural anthropologist, and he applied those techniques to review the EU. He wrote: “By getting out now we may just avoid the cliff-edge of a major crisis in the EU. And the ‘remainiacs’ just don’t see it. If we apply a famous technique for analyzing the risk of collapse in complex societies to the EU, we find that it is squarely within the zone of that risk.”

He points out that even the last President of the Commission, José Manuel Barroso actually called it an empire. Indeed, our models agree that the EU must be seen as an empire and the member states are just vassals no different from the Soviet Union, the Athenian Empire (454–404 BC) and its the Delian League, or even the United States. Not a single empire has ever survived because centralized control and dictatorship is unable to comprehend the difference within the economic trends of its vassal state empire. It attempts to impose one rule upon the whole, which historically always fails.

When the Federal Reserve was first established, it had 12 branches and each was autonomous. The structure recognized that there were regional differences based upon the economic dominance of each region. Some were oil based, others agricultural, and others leisure and still others were manufacture or financial. It was always the New York Texas Arbitrage because when oil was booming, inflation rose and when oil crashed stock markets and bonds rallied. Even in Canada, it was the Western commodity regions against the financial East of Toronto. To this day, we see rising separatist movement in Alberta all because of this same disease from trying to run an empire from a single central rule. One size does not fit all!

As pointed out in the Telegraph, the models used to analyze the risk of the fall of empires is surprisingly simple. The risk of collapse in empires is when the complexity of a central government reduces the benefits of individuals in a society. It emerges when the government sees itself as the sovereign nation and the people as the great unwashed economic slaves to be exploited. Indeed, this very simple analysis shows that even the United States is at risk of collapse. As I just explained, prosecutors are above the law and have absolute immunity. That is the essence of tyranny. Our model adds the economic backdrop and correlates this with the rest of the world and we see that historically people migrate economically when the costs rise, freedom declines, and the standard of living is in a bearish trend when even their children see their own future will be worse than their parents. This is why there was such a great migration to America from Europe. It is also why America was more isolationist. FDR had to plead for support in Boston to just send arms to Britain. That city was dominated by Irish who rejected sending their sons to battle to defend the English after their import restrictions on food for trade led to millions of Irish deaths.

 

The refugee migration to Europe is economic. They see the opportunity for a better life. That is the very same reason the barbarians invaded Rome. The Ostrogoths when they invaded Rome, wanted to be Roman. They issued coins imitating the Roman Empire after Rome fell in 476AD. They tried to pretend to be Roman but they failed in culture and management skills. This demonstrates that the invasion of Rome by the barbarians was economic. Even in the USA, the net migration from Illinois to Texas and Florida is economically driven. The Greek youth have been migrating because there are no jobs and they see no future in staying in Greece. These are the signs of how an empire crumbles into dust.

The entire project has been a con-job. They introduced the currency FIRST and believed they would gradually move to federalize Europe thereafter. The failure to consolidate the debts was devastating. They effectively wanted a free ride with leaving the garbage behind. Then, because the debts were not consolidated, they left each member state to also retain its central bank. Then they tried to enforce spending criteria on each state in one-size fits all policy. This has been the federalization of Europe on the cheap.

Nobody in their right mind would have begun a country with such a model. This is why the European Project is going down in flames and the very thing they convinced themselves was the real purpose, to end European wars, they have ignited the old hatreds that have existed within Europe for thousands of years.

All the manipulation tactics in the world will not save the Euro. They have made it illegal to short Eurozone bonds. The currency will be next. They are converting the Euro into the old Russian ruble drained of liquidity. Euro accounts are being charged 2.4% annually to have more than 100k in the bank. This is a tax on money.

War is Coming Because We Need It?


 

QUESTION: Mr. Armstrong; I find it amazing that you were the only analyst I found who consistently called the bull market in the Dow until January. You have forecast even weather. You have so many correct forecasts there is nobody who even comes close. Then there is your War Cycle that turned up in 2014. You warned that 2018 is where it would start to pick up steam. You have also said it is in the west rather than with Korea. The newspapers are starting to talk about war with Russia. Is everything still on track?

MS

ANSWER: Unfortunately yes. The NATO Secretary-General Jens Stoltenberg has constantly been pushing for a confrontation with Russia, He has been moving military installations to the Russian border while Putin has been forced to pursue buffer zones around Russia. The European Member States have been instructed that they should construct roads and bridges that will allow tanks to freely move throughout Europe. Interestingly, it was the construction of the roads in Turkey that allowed Cyrus the Great of Persia to invade and conquered the entire Anatolia region. So what on the one hand would allow Europe to deploy tanks against Russia, would also allow Russia to take Europe much easier. Indeed, in Poland, there is a motorway leading east to the Ukrainian border that is rarely used.

What you must understand is that the West NEEDS a war desperately as a distraction from the collapse of Socialism. NATO has been looking for any excuse to turn this into a confrontation with Russia. The crazy thing is that war has changed. Neither side wants to “occupy” the other as was the case with Napoleon and Hitler. So why are we preparing for war? What is the objective?

Turkey needs a war and they are becoming much more aggressive because the currency is collapsing. Yet Turkey is a NATO member who is threatening Greece another NATO member. Turkey is strategically moving closer to Russia than Europe. At the Ankara summit, the impression was clear that Turkey was on his side of Russia. This has fundamentally changed the situation on the Black Sea and indirectly also in Eastern Europe. In the east of the Black Sea, that is also Russia’s southern border.

Russia had included the Crimea peninsula. It gave it to Ukraine when it was part of the Soviet Union. Russia took it back because it was strategic and you can bet that the USA would have done the same had Japan tried to take Okanowa. The Russian Black Sea Fleet has been located in Crimea for more than two centuries. There was no possible way Russia would have given that back to Ukraine. The West knew that and have used that excuse for sanctions against Russia knowing full well that they were turning up the heat that could easily lead to war.

NATO has signed numerous agreements with Ukraine providing it with arms and has in all but name made it a NATO member. NATO continues to portray Russia as an aggressor when it knows that Crimea was part of Russia until 1954 when it formally gave it to Ukraine to manage, But the dominant language spoke in Crimea remains Russian – not Ukrainian. NATO is also encouraging Romania and Bulgaria to create fleets to confront Russia using the Crimea crisis as justification.

 

Russia, unlike China, lacks a strong domestic economy for it has been much like the Middle East – counting on commodity exports. However, as commodity prices have declined, this has weakened the Russian economy and here too Putin will need a war to overcome the economic decline ahead. NATO is an organization that can no longer be defined and it seeks to hold onto old world philosophies to justify its existence. NATO needs a war to ensure its own funding. If Russia has no real designs to invade and occupy Europe, then why do we need NATO?

The Prince Eugene of Savoy (1663-1736) was considered even by Napoleon as one of the seven greatest strategists in military history. He was also plagued by a rumor that he was really the illegitimate son of King Louis XIV of France which he perpetually denied. Yet, Louis XIV was always ashamed of such offspring and he restrained Eugene’s ambitions as if he was perhaps his son so that after 20 years of living in Paris and at Versailles, he left France and offered his talent to the kings of Europe. He fought for Leopold I (1640-1705), Holy Roman Emperor who was fighting the Turks. He distinguished himself in the siege of Vienna in 1683 and his military career was born.

Yet the Prince of Savoy was a man who observed patterns. This helped in in military strategy, but it also allowed him to see the function of government. He came to comprehend that standing armies would be easily used. It was his observations that kings would go to war BECAUSE they had standing armies that they paid for even if they did nothing. The Prince explained that there should be no armies and that would reduce war by itself. He passed on this brilliant insight to Montesquieu, who the Founding Fathers of the United States understood and thus created the right to bear arms which became the Second Amendment to the United States Constitution which is under attack today. In Switzerland, you enter military service to be trained, and then you take your gun home ready to be called upon if there is an invasion.

Unfortunately, NATO by itself needs a war. As the budgets get tighter and tighter, funding is shifted to social programs. NATO will then layoff people and lose its power base. It needs to demonize Russia as much as possible and to even provoke a confrontation to justify getting more money. Of course, it seeks to provoke a confrontation for money but it assumes there will not be World War III because neither side desires to occupy the other. So exactly why do we need standing armies today is simply a political issue. However, maintaining such a military power also ensures that it will eventually be used.

If the reason for war is no longer occupation but more like a brawl between two drunks in a bar, they do we need standing armies especially when we can just push a button? It is sad to say that now we will see tensions rise from 2018 onward into the peak of the cycle.