Martin Armstrong- My story-
Over my career, I believed I was perhaps too restless in search of something I could not find nor describe so I tended to try different things from banking to brokerage to hedge fund management. Those combined experiences have opened my eyes. Then having offices on every continent and over 240 employees, as Milton Friedman put it – I had a front row seat to observe a world few even knew existed. I began in computer engineering and saw RCA, which was at the top of its game, sell its computer division to IBM & Univac because it judged the computer as its experience with radio. I began to observe how big corporations made decisions and planted the seeds of their own destruction.

RCA (Radio Corporation of America) was one of the high flying stocks even during the Great Depression. No matter how bad it was, people wanted to buy a radio to hear how bad it was. RCA thought the computer began at the top of a cycle and would collapse like the radio becoming a crystal set for kids in a 5c & 10c store. They were wrong. Sold their future and became a tiny subdivision of GE. Oh. How the might have fallen!
I moved into the metals. I became one of the largest market makers in the CASH business for 1980. I wrote the laws for the State of NJ making gold not subject to tax in 1975 only to have the state later say it was & I may have misunderstood what the Senate asked me to do, The feds after 1980 came in and declared me to be a bank so they could seize all our records and investigate 3,000 customers to see if they paid their taxes.
I was probably the largest in gold industry as a market maker since I was the one the IRS targeted, not for my taxes, but for clients. I was a major shareholder of a bank and was on the board participating in decisions as to who got loans or not. We sold that bank to the NY boys.
I have been touted as starting the overnight markets because to make markets AFTER COMEX closed, which was unheard of in the 1970s, I used my international contacts, made markets after the close while competitors and others swore I was just speculating. In truth, I was selling in Hong Kong, yet I had to make physical delivery in London the next morning. This was scrap gold I bought from all the dealers that took 6 weeks to refine. I had to “borrow” physical gold in London to make delivery, then the next day do the trade on COMEX and swapped that position with the dealer in London. I got little sleep and then showed people how to do it. I became a partner in one of the oldest brokerage houses – one of the founding members of the LME in London and sold that to the Australians.
I have been called into virtually every crisis since the collapse of Franklin National Bank in the mid-70s. That got me well behind-the-curtain. Because of my computer skills, I could see how writing a program in the 1970s would track the world. When I was retiring from making markets, the analysis we provided was spun off as Princeton Economics. We were more than a decade ahead of everyone – the first to even create computer models for markets. Because of my background in Physics, competitors tried to mimic us hiring what became known as “quants” to try to also apply physics. When I warned of the 1987 Crash, the White House disagreed because we were the ONLY people with a model that was could forecast a rise in volatility. We recently published the 1985 chart handout for the World Economic Conference held in Princeton, New Jersey showing the amazing volatility projections for the decades that have now materialized.
We predated both Goldman Sacks & Solomon Brothers. I have seen the futures “trading” community take over Wall Street and not only flipped it on its head, but made proprietary trading the primary objective. They repealed Glass Steagal so they could trade with other people’s money and set the stage for the collapse of Western Civilization because they have created products that blow up consistently and it is all about just making money now.
These stories of “paper gold” and other nonsense are so far from reality, they can only be diversions to set people up to be perpetual buyers in order to sell and make money. They succeed in making people accept the losses and want more convincing them that they are not wrong so double up and you will see! Just go with the flow. This is about surviving the economic collapse these people have created by misinforming government and greasing their hands. Don’t worry. The world is collapsing anyway because politicians will not act until it crashes and burns. This has nothing to do with “paper” gold and pretending they are not really wrong and gold has not risen BECAUSE of all the “paper” shorts. That is brain-dead reasoning, twisting the very facts about a free market, borders on communism, and fails to appreciate that it is the “shorts” who buy during declines when nobody else has the guts to do so,

The investigations into WHO was short by the Senate during the Great Depression is WHY the stocks fell by 90% since nobody wanted to go short for fear that they would be hauled before the Senate and accused of treason. No shorts = collapse with no buying. The bullshit is good – but it is still bullshit. The assumption is only people who buy are “real” and they will always have the money to constantly buy more and the CONFIDENCE to always hold. This is just gibberish. Watch gold collapse and you will see CONFIDENCE evaporates so you may still believe, but will you put your money where your mouth is or just desperately try to convince others to buy to support your failing position? Only the fools die dead broke. People who listened to such stories when that same pitch was made by stock brokers – buy and hold – led to numerous suicides. This is a market. It is how it trades. That’s it. Learn and go with the flow or jump now because you will end up broke.

Martin Armstrong

1970 – When Gold Fell BELOW $35

April 18, 2013:

There are gold promoters who made outrageously false advertisements on TV that are just astonishing. They primary theme is somehow gold rises because of monetization and the Fed. They tout the US national debt is $17 trillion and paper money will fall to dust. When you do simple correlations, you see that the claims are just false. The theme that Paper currency is fiat and the national debt alone is reason to buy gold, the numbers do not add up. The debt has exploded by 800% during the decade that followed the 1980 high at $875 on January 21st, 1980. In fact, the national debt hit almost $1 trillion in 1981 (997.9bil) and by 1999 it reached $5.656 trillion when gold fell to $254. This idea that buy gold because the debt is rising, when it did that for 19 years as gold declined. That is NOT the reason to have gold, it is a hedge against the collapse of government but core economies historically NEVER implode from hyperinflation. They always commit suicide as we are witnessing today. They hunt down people and confiscate their assets.
The other thing they sell is the “logic” would have it that gold cannot possibly decline because of fiat currency or the cost of production, and a host of other issues. Well, in 1970, gold fell BELOW $35 fixed rate at Bretton Woods. That was supposed to be impossible. It took place. The unthinkable ALWAYS must take place to really shake the tree so a new bull run can take place.The unthinkable always happens before big moves.

Why primary dealer bankers are black mailers

Martin Armstrong- Why are financial institutions always in need of bailouts and rescue plans? FIRST the banking system model is inherently subject to booms and busts because it is fundamentally flawed and began as a fraud. Once upon a time you paid a bank to hold your money for safekeeping. Then the banks figured they could lend your money out and make a profit keeping just 8% or less to cover withdrawals. Then when a crisis would hit, they could not get the cash back in time to meet the demand for withdrawals and the bank would close and the assets, loans they made, were then liquidated at deep discounts. They created the Federal Reserve with the power to create money in times like that to meet the demand for withdrawals without having to dump assets in a panic. Then World War I came and instead of the Fed stimulating the economy by buying corporate paper to directly create jobs, politicians instructed the Fed to buy only government bonds. The Fed was never returned to what it was intended to do and today it can take over any corporation if it deems they are too big to fail no longer limited to banks. After PhiBro took over Solomon Brothers, Goldman Sachs took over J. Aaron. Suddenly, the trading of commodities became the mainstay of bankers. Then Robert Rubin of Goldman Sachs/US Treasury Secretary pushed to overrule Glass–Steagall. That opened the door for these banks to then be officially trading with other people’s money. Today, the bankers who are trading banks are typically also primary dealers and when they blow up because they are liable for deposits on a demand basis yet invest long-term, they then turn to the government for bailouts threatening them that if they do not cover their losses, government cannot sell its debt.

Speculation in shares - 2032

Martin Armstrong. Demise of USA 2032? Question- I was at your 1985 Conference in Princeton. You made two points with the ECM that have stuck with me all these years. You said the peak in Britain was with World War I following the 309.6 year wave That was 1918. You then said the 2032 turning point was death of the USA. Is that still on target? Answer- Yes. But the devil is in the details. The 2032 target lines up with the era of the birth of speculation in shares – the South Seas Bubble and the Mississippi bubbles (1720). We will be looking at this at the World Economic Conference March 18-19th.

What interest rates actually mean ! ! !

Martin Armstrong Now we come to the argument that if interest rates rise the stock market will decline. I am sorry. That is pure bullshit! Interest rates rise with bull markets and decline with bear markets. Look at Japan. Here is the Great Depression and the Fed kept raising interest rates as the market rallies. They then cut rates sharply as the market declined. So just where does this nonsense come from. The idea that the stocks will go down if the interest rates go up because it will cost more to borrow presumes everyone is leveraged. It also assumes the cost of business will rise lowering profits. The sad part of this reasoning is that it has been so prevalent. This is the reasoning that dominates the TV shows and spread the nonsense perpetually. Interest rates ALWAYS rise in bull market because people are investing. As the economy is expanding, people bid for capital because they see an opportunity. In Japan, interest rates are virtually zero. The market still does not rally because they see no opportunity. That is the key that is being ignored in this very shallow reasoning. All you have to do is actually demonstrate with evidence where this idea even comes from. Nobody can show the stock market rising with a bear market in interest rates. Impossible!

Barry Ritholtz on possible bear market beginning now

"All this week, I have been discussing why I thought we may be coming to an end of the cyclical bull market that began in March 2009: Listen to Ritholtz Sees “Major Cyclical Correction” from Tuesday morning, and watch this and this from Thursday. I have cut back on some major holdings, and raised our cash levels to 25% in the asset allocation model I manage. I removed half of our energy positions, eliminated our emerging markets exposure. The biggest move was cutting S&P500 exposure by 50%. A handful of clients who had outsized Apple exposure saw those positions reduced by a third. We maintain a heavy bias in long portfolios in health care and in consumer staples. I have no desire to reduce treasuries or munis, which will become a safe harbor if and when things get choppy. (I have NOT added inverse ETFs, but that is something I may consider in the future)."

Gundlach Sees No Lost Decade for Stocks

Bloomberg "Gundlach, 52, is following Bill Gross, manager of the world’s largest bond fund, in flirting with stocks as the biggest bears wager that markets won’t fall back to their March 2009 lows. Gross’s Pacific Investment Management Co. three years ago started an expansion into equities in anticipation that their returns will beat those of bonds over coming years. Laurence D. Fink, chief executive officer of BlackRock Inc. (BLK), the world’s biggest money manager, has been urging investors to get out of cash and bond securities and put money into equities."