Armstrong Economics Blog/ECM Re- Posted Aug 23, 2023 by Martin Armstrong

While some economists are flipping from pessimistic to increasingly optimistic the US will beat inflation without a near-term recession, some still preach the standard doom & gloom prophecy for the economy. Everything in their field always turns on the Keynesian Model of interest rates, with the standard fallout from higher interest rates always will depress the economy, including real estate and stock trading. They will even point out that the Fed’s forecasts are typically wrong but never look in the mirror themselves.

The economic profession clings to Keynesian Economics because they have no alternative. So they have a broken clock, and it is always high noon, or perhaps it is midnight. That depends on which side of the bed they got out of that morning. Even Keynes began in 1924, arguing that economists can manipulate society to eliminate recessions. But before he died, even Keynes admitted that everything he fought against, the business cycle, was simply wrong.

Even Arthur Burns, who was the head of the Federal Reserve when Bretton Woods collapsed, concluded that Keynesian economics had failed. The business cycle always defeated every theory economists devised to try to eliminate it. That was even Karl Marx’s goal of Communism. Seize all private assets, and that would terminate the business cycle. Well, even Communism failed.

Now we have our modern-day Marx, Klaus Schwab, who is trying to force the entire world to adopt his version of communism where once again, “You will own nothing and be happy.” Schwab has failed to understand that ALL social-economic advancement comes from curiosity. If people have no incentive to dream, they will never advance. That is why communism fell, and Schwab does not get it because academics, more often than not, are still pursuing this dream of ultimate power to defeat the business cycle.

To force his theory upon the world, we must become like cattle — herded and denied our very freedom. To Schwab, privacy must be terminated. The state must control everything to defeat the business cycle. These people seem to want to play God because they clearly have no respect for the very nature they pretend to be so concerned about, and we, too, are part of nature.

I went behind the Berlin Wall in the late ’70s with a friend to visit the family trapped there in East Germany. His cousin took us around, and if anyone were close to us, she would say how wonderful the government was in caring for them, for indeed, they owned nothing. As soon as nobody was around, she cursed them in every language she knew.

I did my research at the Firestone Library at Princeton University. They had many newspapers on microfilm. This was where I discovered the list of panics that led me to what became the Economic Confidence Model. I became friends with a professor there. He said that I reminded him of Einstein. I was shocked. I said I was not a physics genius. That is when he explained that my curiosity in figuring out how the world economy functioned was the same trait that Einstein attributed his discoveries to – curiosity.

Over the years, that encounter opened my eyes to understand why Communism collapsed, and this is what Schwab and his World Economic Forum are trying once again – total control. That is what Communism prevented — human individuality. Without CURIOSITY, nothing will ever be discovered. If I were not curious about why civilizations rose and fell, which became obvious from history, I would never have discovered the Economic Confidence Model.

Schwab’s very idea of how to control the world is what fails. You cannot dehumanize society, for the elite are NOT the people who discover things – they pretend to sit in judgment over those who do create things. I have observed this not just in academia and governments but at the corporate level as well.

I have worked with some of the largest companies around the world. The boards tend to get occupied by accountants and lawyers. Far too often, they get rid of the people with curiosity who founded the company. Without them, they lose the creativity that made the company in the first place; Project Veritas is dead. I will never donate 10 cents. In 1997, Jobs returned to Apple as CEO after acquiring NeXT. He was primarily responsible for reviving Apple, which was on the verge of bankruptcy because it lacked the vision and curiosity of a person who creates rather than dictates. This is EXACTLY why communism failed. They eliminated the creators and their curiosity.

I know some non-programmers think Bill Gates built a bigger company than Steve Jobs. However, it is well known among programmers that Bill Gates didn’t write the operating system which made Microsoft known as DOS. Gary Kildall (1942-1994) wrote CP/M, an operating system that ran on early microcomputers based on 8-bits. IBM perhaps wouldn’t make a deal with Kildall. Bill Gates bought what became MS-DOS from Seattle Computer Products for $50,000 and licensed it to IBM.

Gates’ mother, Mary, was a board member of United Way of King County. Also on the board was John Opel, then-chairman of IBM. That was his entry to IBM. DOS was actually written by 22-year-old Tim Paterson (born June 1, 1956). How much of Kildall’s intellectual property he appropriated is a matter of some dispute. IBM later did make a deal with Kildall by some accounts after threatening to sue IBM because DOS infringed on his copyright. The early IBM PC was sold with both CP/M and DOS operating systems, but CP/M was sold at a much higher price. Many never were aware of the two systems. Most buyers chose MS-DOS, which became the standard or were steered toward MS-DOS by IBM.

Gate’s reputation has always been cloudy. His co-founder of Microsoft, Paul Allen (1953-2018), wrote in his memoirs that Bill Gates is a ruthless schemer who demeaned his employees and conspired to rip off his business partner. Bill Gates could not compete against Steve Jobs as a programmer. Steve Jobs created his own computer and software from scratch.

This is why Klaus Schwab thinks Gates is the #1 entrepreneur of the century. He was able to manipulate the people and expand the business on an operating system he never invented and bought for $50,000 from someone who was the real creator with curiosity, not Bill Gates. Everything he has done since then is always about manipulating society to achieve his ideals, not science. Sorry, Gates does not even reach the honor stage of the true entrepreneur. That is reserved for creators ONLY!