Prime Minister Boris Johnson apologized on Sunday to Conservatives for failing to take the U.K. out of the European Union by Oct. 31st. Nigel Farage said he won’t personally run for a seat in Parliament. The plan to leave by Oct. 31st was blocked by the Remain crowd who refuse to accept any democratic process because they lost the vote. This is what is behind the decline and fall of western civilization. The losing crowd to any election is unwilling to ever accept a loss and move on. We have entered the second half of the Economic Confidence Model wave where governments simply lose all-purpose. The Remain crowd prevented a BREXIT without a divorce deal. They required Johnson to seek a BREXIT extension. The EU has granted a three-month Brexit extension until Jan. 31st, 2020.

Johnson has pushed for an early national election on Dec. 12th in which he hopes to get a more BREXIT-friendly Parliament. Nigel Farage has, in turn, pushed for his BREXIT Party to team up in a coalition with Johnson’s Conservatives for the December election. However, Johnson has so far refused the offer. That seems to be a wrong decision on Johnson’s part. This has resulted in Farage vowing that his party will contest every seat in England, Scotland and Wales against the Conservatives unless Johnson drops his BREXIT agreement, which Farage and his party believe is far worse than a no-deal BREXIT. Nigel told the BBC he will travel within Britain to support some 600 BREXIT Party candidates rather than by seeking a seat for himself. It is ironic that probably the best-qualified person to lead BREXIT is Farage, but he told the BBC: “I don’t want to be in politics for the rest of my life.”

The migrants trying to get into Europe for free welfare rioted on Monday in Malta setting cars on fire and attacking staff. Malta had agreed to house them temporarily in a detention center waiting for other EU countries to accept them for settlement. This illustrates the fears of many in Europe about all of these migrants who have been allowed to enter without skills in language or fields that would be suitable for employment. Despite the violence, European politicians simply cannot admit that this has been a huge mistake.

QUESTION: Hi Marty,

I’m based here in South of England, within the commuter belt into London. The ECM forecasts an economic downturn 18.01.2020, and Europe looks to be at the epicentre. My own research tells me the job cuts in the auto sector in Germany are quite severe.

How does all this play out after January? We have already witnessed companies collapsing, Thomas Cook, and many teetering on the very of edge of collapse. How bad is this going to be, and how does this compare to 2008?

Of course, the next 3 months of 2019 are going to be very volatile, what I’m trying to understand is how does all this look like to the average city worker within finance, law or professional services.

Within my own peer group most are clueless on what is going on and perhaps they should be thinking of income protection rather than going out and buying £60k Range Rovers. The apathy never ceases to amaze me.

I welcome your insight. Thanks for your great work which keeps us mere mortals informed.

Cheers IB

ANSWER: The answer is very bad. The structure of the Eurozone is an absolute disaster. It is promoted as a single country, but it lacks everything that stands behind a currency. Just look at the tariffs starting between the USA and the EU. It is IMPOSSIBLE to negotiate a trade deal with Europe because each country can veto any deal, proving this is not a single country, and thus there is no substance behind the single currency. This is why I say Brexit is the only way for Britain to survive. It cannot negotiate any trade deals with the USA, China, Canada, or whoever because any other state can veto it. They surrendered their sovereignty and it is undermining the European economy.

If the US had to seek the approval of all 50 states before it could do any national policy, nothing would ever get done. The French can block trade deals and the US will look at the EU as a single entity because that is the structure on the surface. So the US could impose tariffs on German cars because of something France refuses to yield on. It is a giant political mess.

The only way for Europe to survive is for the Eurozone to actually collapse. Then each country could negotiate for itself without a veto from another over something irrelevant to their economy.

If the Eurozone were to survive, each country must surrender all autonomy to Brussels on everything retaining only local culture and laws. Brussels is trying hard to make it the United States of Europe, but the first thing that must go is the refusal to consolidate the debts and end the bail-in policy. Anything shy of that is playing with fire.

While the ECM is turning in January 2020, that appears to be impacting more externally to Europe. Europe may see economic turmoil into 2021.

QUESTION: SOS from Sweden:

Dear Mr. Armstrong,
Please take a look at Sweden. I know you can not look at every single country but Sweden would be interesting since it is the country were socialism has gone farthest in the world and totally crazy. One of the most well-organized countries in the world with the oldest Central bank and well run global companies have turned into total chaos. Socialism has turned a peaceful country into a crime capital. Rapes are now among the highest per capita in the world. Robbery likewise. We are flooded with immigrants from MENA countries that have no skills. Many can’t even read. They live on welfare and get better paid than people working. Taxes are going through the roof. Police force under extreme pressure. Jails are overfull. Same with healthcare and education.

The municipals are bankrupt. They borrow via Kommunivest to meet the gigantic burden of immigrants. The loans go to welfare paychecks, not to investments. Kommuninvest issues international bonds and then lend to all municipals. International investors do not know how bad the financial situation is for Kommuninvest. It’s the Black Swedish Swan that is going to blow up soon. Mr. Hans Jensevik is the one person in Sweden that has worked with the municipals economy all his life. He is a very respected old-timer. He has even come out with a video warning international investors from buying Kommuninvest bonds!

Government debt is not catastrophic but the municipals are. The Government made the municipals take on the debt when the state unloaded immigrants in all our 290 municipals… Many municipals are now warning they are bankrupt and need emergency finance. So the Government is going to be forced to bail out the municipals very soon.
The state own media dominates TV and radio. Imagine only CNN running TV and radio channels in the US! Competitors only allowed entertainment. State own media pushing agenda on mass-migration, open borders, climate change, pro-euro and hate for Trump. All newspapers are subsisted by Government running the same agenda. Swedish Riksbank is trapped and forced to follow ECB down the drain with subzero rates and more QE. The SEK is tanking. This is not going to end well.

Could you please shed some light and interpret Socrates outlook for Sweden, SEK and OMX30

Thanks for your great work.

SG

ANSWER: The impact of migrants in Sweden has been the worst in Europe. Then you have this climate change nonsense that led to “flygskam” or “flight shame” in Sweden. This provides a threat of a sharp decline in flights as people are being looked down upon for flying, thanks to Greta Thunberg, because it hurts the environment.

There is no question that we also see the dollar rising here as well, The economy of Sweden is turning down very hard on the ECM turning point. A closing for 2019 above the 94600 levels will confirm the greenback’s advance. The share market has been trying to reflect the currency decline and has risen only due to currency inflation.