Tag Archives: Understanding cycles

Jul 20 2020

Hoarding Cash and the plan to Eliminate cash!


Armstrong Economics Blog/Economics

Re-Posted Jul 20, 2020 by Martin Armstrong

The reason there is a shortage of cash developing around the world is rather straight-forward. The trust in the government is collapsing. Italy has just lowered the legal amount someone can pay for anything in cash from €3000 to €2000. Australia made it a criminal act to pay for anything with A$10,000 or more (US$7,000).  In Switzerland, the limit on cash you can withdraw from an ATM is CHF5,000. In Germany, the limitation is typically €1000. Greeks abroad will be able to withdraw up to 5,000 euros ($5,800) a month.

In the United States, the US Treasury says the pandemic has significantly disrupted the supply chain and circulation patterns of US coins. Additionally, the US Mint has been printing fewer coins to protect its employees from COVID-19. The World Health Organization (WHO) has not advised banning paper money, but it has stressed the need for handwashing after touching cash, which is a subtle caution that money should be limited. Some central banks are deploying measures to sterilize paper money with heat or UV light. Even the Fed began a seven to 10-day quarantine for United States dollars returning to the country from Europe and Asia.

It is very clear that governments are trying to paint money as dirty, and the solution is to eliminate physical money, despite the fact that it has been in use since about the 7th century BC. All of a sudden, it is a danger after 28 centuries. This plays nicely into the Socialist’s dream to control everything!

Jul 18 2020

Milton Friedman – What is America?


Armstrong Economics Blog/Economics

Re-Posted Jul 18, 2020 by Martin Armstrong

 

Jul 17 2020

The Legacy of Socrates for Humanity


Armstrong Economics Blog/Socrates

Re-Posted Jul 17, 2020 by Martin Armstrong

COMMENT: Dear Martin,

Thank you for spending your precious time to compose such a detailed blog post. The gems within your answer truly clarify this seemingly impossible situation for me. We *are* all connected and cycles are clearly human nature playing out. Greed, as you noted, is part of that equation. Socrates is the most important contribution to mankind that I can think of. Socrates can one day (finally) allow us to see our humanity and alter our course for the better.

Warm wishes,

J, Austin, TX

REPLY: Thank you. I have seen the world and how it functions. I’m extremely fortunate to have had a front-row seat from Europe to Asia, and even advising China during the 1997 Asian Currency Crisis. There are some things you can only come to understand by doing it. All the great economists who actually contributed something were traders who were not formally educated. Trading is the ultimate teacher, for it makes sure we must remain humble. Being called into China taught me something that should have been obvious, yet was never articulated.

I was taken to a secret installation in a motorcade that was surrounded by tanks and had three huge satellites on the roof. They were monitoring every commodity in the country, but they were not sintering. They were tracking 249 varieties of tea. They were fascinated that the same tea was selling for different prices in different cities. I had to explain transportation costs and human desire always mean something different from someplace else. Under communism, they were used to everything being the same price even it if cost twice as much to transport it across the country. I was there for the transition from communism to capitalism.

I have witnessed so many things around the world being called in to even the birth of the G5 (now G20) to the stock market and economic collapses. I have been called in by so many governments in times of crisis that it has taught me a variety of events and opened my eyes to the world economy and how we are all connected.

What I have witnessed is that we are all connected and it is IMPOSSIBLE for any head of state to stand up and promise some economic solution that requires global actions. The world economy has been destroyed from manufacture to food supply and distribution chains. What has been done is just beyond stupid. We cannot even imagine how world leaders were stupid enough to follow the advice of Neil Ferguson.  It is my hope that Socrates will one day be consulted rather than this sort of unprofessional approach to something that is so damaging that it threatens, not just starvation, but world war.

ANYONE who bad-mouths me personally is trying to prevent anyone from discovering that a computer can do an unbiased job, which threatens some aspect of their income or they are being paid under the table to try to prevent any change to the status quo. Attacking me personally is like attacking your wife because you did not take out the trash. All I can do is hope that when I am gone, they will be left with the reality of just a computer — not me.

Categories: Socrates
Jul 17 2020

Trend in Interest Rates


Armstrong Economics Blog/Interest Rates

Re-Posted Jul 17, 2020 by Martin Armstrong

COMMENT: Marty,

Good morning. Repo rates have been creeping up ever so slightly and quietly. Points wise not much, but percentage-wise, numbers are getting bigger. Has everybody been lulled to sleep and looking the wrong way again?

Best,
E

REPLY: The shift from a Public to a Private wave is in full motion. We can see this in Moody’s AAA Corporate Bond Index. Note that the while chaotic swing in March ran right up to the top of the Downtrend Channel and then we have swung down and just closed below the bottom of the channel. We have an important turning point arriving in October. We show the next major turning point in the US 30-year bonds being September.

These governments imposing lockdowns again are acting political rather than in the best interest of the people. Locking people down results in a collapse of tax revenue. Many in the USA have been promised by the Democrats they will be bailed out if they win the White House right down to their pension funds. This is what is going on behind the curtain – cutting deals.

Clearly, these governments are not stupid. They have to realize how much revenue has collapsed and how much damage they have caused to the people and the economy. Our models are projecting HIGHER interest rates ahead and this reflects their high-risk gamble on trying to overthrow Trump. What they fail to grasp is that the private sector has lost all confidence in governments and as such, they have destroyed the old financial system of perpetual borrowing.

As fiscal mismanagement abounds, interest rates will rise to reflect credit risk. The central banks are powerless to prevent this rise. The Fed cannot buy all state debt any more than the ECB will be authorized to buy all sovereign debt in the Eurozone. We have reached the point of no return.

Jul 13 2020

Socrates & its Forecast of Shortages in Food for this 8.6-Year Wave


Armstrong Economics Blog/Agriculture

Re-Posted Jul 13, 2020 by Martin Armstrong

 

COMMENT: Mr. Armstrong; I am beyond impressed with the forecast your computer puts out. More than a year in advance you forecast that this wave would be inflationary but due to shortages in food. I do not know how it makes such an interesting forecast, but nobody out there can even come close which is obviously why they try to mimic you while ignoring you and hope nobody lands on your site.

Thank you for bringing clarity to this chaos

All the best

DS

ANSWER: Yes, Socrates was projecting this would be a wave of inflation coming from SHORTAGES of food. We are already witnessing rising food prices. It was picking up all the subtle shifts in the world economy and I could see that something strange was in the development by last August 2019. Obviously, like war, it cannot forecast the precise person but it does reveal their actions. This is the same forecast ability. It was showing a shortage of food for this cycle, but it could not tell me it would be instigated by Bill Gates and the World Economic Forum trying to push their Great Reset.

Nevertheless, there are serious shortages of food on the horizon. Those who are attempting to destroy the economy so they can recreate it in their image are clueless about how the world economy functions. All they have looked at is their stupid models on CO2 when CO2 is 0.04% of the atmosphere. They have wiped out crops by destroying the food chain and either they are totally ignorant of their actions, or they have deliberately also tried to invoke starvation to reduce the population. Nobody will investigate either and I am sure they would claim to be ignorant of the impact on the food supply by pushing for lockdowns. There is ample evidence that this excuse is BS and they must know what they are doing which would bring up the question of crimes against humanity. They will then probably blame global cooling.

Jul 12 2020

The Forecaster Will be Available for Streaming on Amazon Soon


Armstrong Economics Blog/Products and Services

Re-Posted Jul 11, 2020 by Martin Armstrong

Jul 10 2020

Risk Seems to be Everywhere


Armstrong Economics Blog/ECM

Re-Posted Jul 10, 2020 by Martin Armstrong

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.