Yeltsin turned to Putin for help and then handed him the Presidency.

Trump Jr & the Russian Meeting

Posted Jul 18, 2017 by Martin Armstrong

A lot of people have picked up on the mention of the Magnitsky Act is Donald Trump, Jr. statement of a meeting with a Russian woman. Trump Jr., said the meeting was “the most inane nonsense I ever heard. And I was actually agitated by it.” I seriously doubt that the woman explained the full background as to what took place in that affair and it is not likely that she even fully understood what took place behind the curtain. This Magnitsky Act was passed by Congress to “punish” anyone who was involved in sending him to prison where he dies before getting a trial. This is the company that was started by Safra in which they were soliciting me to join in Russia and I declined. This was the plot to takeover Russia by blackmailing Yeltsin  to step down. When Yeltsin realize he was being set up by NY bankers to grab the natural resources of Russia, he turned to Putin for help and then handed him the Presidency.

Just as the undercover tape on CNN exposed that everybody tries to influence political elections of friends and foes, the attempt to takeover Russia by the NY Bankers was at the center of my issue and is why there could never be a trial. They did not know how much I knew and they knew I had very good contacts all the way up even in Russia. Even Maggie Thatcher had asked me what I knew about a secret underground facility Russia was constructing that satellites could not see back in the Nineties. As I said, the fundamental principle in law is you never ask a question you do not know the answer to. Who knows what will come out. That was their problem with me.

And here’s a statement by Donald Trump Jr published on 11 July 2017:

To everyone, in order to be totally transparent, I am releasing the entire email chain of my emails with Rob Goldstone about the meeting on June 9, 2016. The first email on June 3, 2016 was from Rob, who was relating a request from Emin, a person I knew from 2013 Ms. Universe Pageant near Moscow. Emin and his father have a very highly respected company in Moscow. The information they suggested they had about Hillary Clinton I thought was Political Opposition Research. I first wanted to just have phone call but when that didn’t work out, they said the woman would be in new York and asked if I would meet. I decided to take the meeting. The woman, as she has said publicly, was not a government official. And, as we have said, she had no information to provide and wanted to talk about adoption policy and the Magnitsky Act. To put this in context, this occurred before the current Russian fever was in vogue. As Rob Goldstone said just today in the press, the entire meeting was “the most inane nonsense I ever heard. And I was actually agitated by it.”

You cannot reverse a recession/depression by lowering interest rates

Navigating the Business Cycle = Prosperity

Posted Jul 18, 2017 by Martin Armstrong

The key to the future is understanding (1) the past and (2) how everything functions. Sure there is a risk of a Dark Age after 2032. Hopefully, we can learn from the past to push things in the right direction at least for once. For whatever reason, the people who like to run government are the least qualified. They seem to be people who just like to order others around.

Since they have typically never had a job in the real world, they remain clueless about how to really deal with society no less the economy. This last crisis is the classic example. We have people in power who do not understand the past no less how things really function. As a result, someone comes up with this idea of lower interest rates to stimulate demand and NEVER even once do they review history and asked – Hey; did this every work before?

I find it truly amazing that I can even write about how lowering interest rates failed to stimulate the economy for almost 10 years in Europe, and yet people want to argue that somehow I am wrong. They never review the past and offer only opinion often taught in school as if that makes it absolute doctrine. Interest rates NATURALLY drop in a recession/depression because demand declines as people lose confidence in the future.

You cannot reverse a recession/depression by lowering interest rates. Until people BELIEVE they can make a profit in the future, they will never borrow as long as the horizon appears dark as dismal.

This solution from the 2007-2009 crisis of lowering interest rates has undermined the Pension funds. This has set the stage for the collapse in government as pensions being to fail first in the state/province level of government and municipalities.

I’m sorry. This is not Nobel Prize winning theories here. All you have to do is just open your eyes, shut your ears to propaganda, and look at the history. Just ask what happens and let the charts show you without political bias.

Throughout history, the solution to every crisis sets the stage for the next crisis. This is what happens when we have unqualified people running the joint.

The key to making money to secure your future is to shed all bias and just let the markets dictate the outcome.

Stochastic is never a forecasting tool. Volatility is interlinked with TIME

Understanding Time & the Kondratieff Wave

Posted Jul 17, 2017 by Martin Armstrong

QUESTION: Dear Martin,

I am an reader of your blog and attendee of some of your conferences. I am quite impressed about the timing of your forecasting arrays. In particular,  May 1 you published the arrays for DJIA (attached) where you showed two clusters of volatility: the weeks of 15 May and 26 June. I was really stupefied when I witnessed two vicious drops in XIV (an ETF replicating the inverse of 60 days expected implied volatility of S&P 500) precisely in the weeks you indicated. The best model academia has come up with for modelling volatility is a Stochastic Volatility Model with Jumps, where returns of the underlying (index) are random, their volatility is random (mean reverting though) and infrequent jumps also occur randomly. In fewer words forecasting volatility is just impossible for academics, but not for you.

Do you see any more clusters coming in the summer? Are you going to give access to forecasting arrays through ask-Socrates soon?

Best regards.

---

ANSWER: Academics try to create models about things they do not comprehend.  Volatility comes in different flavors and stochastic is an interesting confirming tool, but never a forecasting tool. Volatility is interlinked with TIME, but it is simply deeply hidden within this complex fourth dimension. 

You cannot forecast volatility in any of its flavors without interfacing TIME in every other aspect of this dimension. Creating flat models like a stochastic take one aspect of a market and then attempts to extrapolate the future based upon this single tool only to fail. We have a stochastic model you can plot and the interesting thing is it is never consistent since sometimes it’s peaking in advance to a turn and at other times after the turn. They never forecast a flash crash or anything on that nature. This Fourth Dimension is extremely complex. Far beyond any one dimensional model can map.

Even those claiming to be using the K-Wave cannot make real forecasts. The basis of Kondratieff’s argument came from his empirical study of the economy’s performance of the USA, England, France, and Germany between 1790 and 1920. Kondratieff took the wholesale price levels, interest rates, production and consumption of coal, pig iron, and lead for each economy. He then sought to smooth the data using an averaging mathematical approach of nine years to eliminate the trend as well as shorter waves. Kondratieff thus arrived at his long-wave theory suggesting that the economic process was a process of continuous waves of boom and bust. Under Marxism, seizing control of all private assets was supposed to eliminate this boom and bust cycle. Kondratieff suggested that changes in technology, wars and revolutions, and the emerging of new countries as well as the surges in the production of gold was the cause of this business cycle. (see his 1935 English Translation not someone else’s commentary on his work)

Anyone claiming to be using the work of Kondratieff to forecast the business cycle is most likely creating a smoke-screen since we can even see from the chart, that his original wave varied greatly both in time duration 47 to 63 years, as well as intensity. Moreover, Kondratieff himself explained the cause was shifts in production, war, and great booms and busts in the discovery of gold. So the K-Wave offers no reliable method to forecast the economy, yet it stands as a testament to the existence of a complex business cycle.

Kondratieff was by no means the first to discover the business cycle. There were many others trying to investigate the complexity of the business cycle.

Nevertheless, Kondratieff explained that the cause was complex and not a single thing. Any attempt to create a one-dimensional model will fall flat on the drown.

The pro-version should be available by September. I am pushing the staff as hard as I can.

If Phase Transition then target in TIME becomes 2020 followed by 2022

The Dow & the Future

Posted Jul 14, 2017 by Martin Armstrong

QUESTION: Mr. Armstrong,

I am fascinated by what you have accomplished in this model. You mentioned in your post about the Orlando conference a sling shot and phase transition, and I am trying to comprehend what that would look like exactly. Is that to say the DJIA won't complete its advance from 2015.75 to 2018 but that the cycle inversion underlying this market and the ECM will extend the high into 2020? When will the special report on these issues be released?

Thank you for the invaluable education,

NE

ANSWER: Yes. We can see from the Global Market Watch that the current year if it closed right here would imply a temporary high. That can change since it is based upon a dynamic view assuming each day that passes were the last trading day of the year. Nevertheless, it warns that we must stay on point.

There are two separate objectives – TIME and PRICE. With regard to PRICE, our three targets given back in 2011 were 18500, 23000, and 40,000. The minimum TIME objective was 2016/2017. Our next target in TIME becomes 2020 followed by 2022. This appears to be setting up for a major vertical move. This is why we will be reviewing how to trade a vertical market.

The markets are far more precise than anyone could have ever imagined. It is unfortunate that the analytical field is plagued by people pretending to be prophets or gurus like the old snake-oil medicine salesmen of the 19th century. Nobody can forecast anything from as personal opinion perspective on a consistent basis. Sure, everyone can make a single forecasting call based upon a gut feeling. But they cannot accomplish that on any consistent basis. This is all about a journey into a world of hidden order – the chaos theory. It is not being a prophet, guru or physic. Such titles reduce the analyst to a snake-oil salesman

Germany Begins to Censor the Internet

Posted Jul 13, 2017 by Martin Armstrong

Merkel’s attempt to silence any internet site that disagrees with her government seems to be the resurrection of the idea of East Germany where she grew up. Freedom of speech was outlawed. When I went behind the Berlin Wall, people would speak freely only when nobody else was close enough to listen. Today they have listening devices that can be pointed at you for 100 yards away.

Signs of this is what unfortunately we are facing. As government mismanagement comes to a boil, they become increasingly desperate to retain power. This is yet another sign of the times that what we are facing is the collapse of government. If everything was fine, they would not care what you have to say. The mere fact that we are looking at this crisis in government is why we suddenly see outright censorship now appearing on the internet.

Establish courts with true independent judges nominated only by the private sector, and their terms should be a maximum of 2 years and out

China & The Rule of Law

Posted Jul 12, 2017 by Martin Armstrong

QUESTION: Mr. Armstrong; I read your analysis of Country Risk. It was truly fascinating. You are correct. We do not consider investing in Syria or Iran no less North Korea because they are not safe places to do business. That is clearly the first decision which shuts down any further consideration.

So I must ask. What is your next advice to China? And will you be coming to Shanghai for a conference anytime soon?

Thank you

ANSWER: My advice to China is now to formalizing the Rule of Law, establish courts with true independent judges nominated only by the private sector, and their terms should be a maximum of 2 years and out – barred from ever holding any government job again. I am aware that Federal judges from New York went to China to explain how to establish the court system modeled on the USA. Do NOT listen to such advice. American judges cannot be trusted.

Absolutely no legal right should be subject to the oscillating wishes of a judge. Sir William Blacksone wrote in 1776: “That the king can do no wrong is a necessary and fundamental principle of the English constitution.” That is fundamentally at odds with what he also wrote: “It is better that ten guilty escape than one innocent suffer.”

We must be mindful that perhaps the most honest ruler to have have held power with respect to the Rule of Law was Julian II (360-363AD) known as the Apostate, because he rejected Christianity after he family, related to Constantine I the Great, were murder the night he died by his son to prevent any rival to the throne. When Julian II came to power, he was the most brilliant ruler ever. In the criminal trial of Numerius, governor of Gallia Narbonensis, who was accused of embezzlement, Numerius had successfully defended himself against the prosecutor Delphidius. The prosecutor did not like to lose and said anyone could be found guilty if they only denied the charges. Julian’s response, quoted in Book XVIII of Ammianus’s History, “Can anyone be proved innocent, if it be enough to have accused him?”

Julian said that not even the emperor was above the law. This should be fundamental to the Survivability of any society. We must understand that those in the judiciary call themselves“honorable” without ever having to demonstrate that they possess such as distinction.  For I think prosecutors and judges, act in their own little bubbles to the detriment of society, yet give very great pleasure to themselves in wielding power and always being correct.

Established the best UNBIASED Rule of Law and capital will pour into China fleeing the corruption of the West.

Pension structure - They assumed that population would always increase

Germany Pensions System Crisis

Posted Jul 10, 2017 by Martin Armstrong

The German publication DWN has come out and warned that the German Pensions system is collapsing. They wrote:

The core problem of the German economy and society is miserable demography. A positive development, namely the increasing longevity of the population, is an extremely negative groundbreaking, namely a small number of children. This is reflected in one of the lowest birth rates in the world – and this has been the case for decades. The record-breaking birth rate is by no means rooted in a biological, but in deeper social causes and inadequate policies at different stages. One consequence is a pension system that is not sustainably financed , because the ratio of contributors and receivers will drastically deteriorate. 

The very design of pensions has been universal. They assumed that population would always increase and thus pensions would be funded by taxing the current generation to pay for the previous. The declining birthrate and the increase in longevity has blown out the pensions systems on a global scale. In the case of Germany, this is a primary reason behind accepting refugees with hopes of making up the decline in the birth rate. The problem has been the lack of a desire to assimilate when we are looking at 70% of refugees are males and are really just economic migrants lacking skills and language.