Manipulations & Monetary Systems
QUESTION: Mr. Armstrong: You frequently discuss how markets cannot be manipulated, has not the Federal Reserve manipulated markets with Zero interest rates.
As a follow-up to our exchange regarding valuations. I believe I understand your explanation the markets will increase for capital appreciation, but are you excluding that there could be price increases with extreme volatility?
Could you expect there could be market runs to the upside, but with price levels the same in ten years that they are today?
Could you expect there could be market runs to the upside, but with price levels the same in ten years that they are today?
Best Regards, RC
ANSWER: No market can be manipulated on any sustained basis. The duration of an attempted manipulation seems to be 26 years max. That is what happened with Bretton Woods. Any attempt to fix an exchange rate is an attempt at manipulation. Progressive taxation is also a manipulation. Keeping interest rates so low to reduce government expenditure is also a manipulation. None of these attempts are ever sustainable indefinitely. They collapse with regularity.
The low-interest rates will collapse because it is threatening the pension funds. The banks charge what they like but pay you nothing based upon the manipulated rate. They charge interest according to market conditions. Hence, it cannot be sustained indefinitely.
Am I “excluding that there could be price increases with extreme volatility?” Absolutely not. That is a Panic Cycle and not a sustainable action indefinitely.
“Could you expect there could be market runs to the upside, but with price levels the same in ten years that they are today?”
That is most likely an impossibility. The volatility will indeed cause prices to rise. However, it is more likely that we will end up with a new currency than continuing to deal with the current monetary system.
Will the Republican Party divide in TWO?
QUESTION: No.1: “Today you wrote “Democrats Continue to Try to Destroy Republican Party”….. How does this end? What is the sequence of events? When do they come after the wealthy? How do you protect your wealth? “
QUESTION: No.2: “I understand the process, but do you ever think logic will prevail? Obama is the President and Leader and the shut down and default is ultimately his responsibility. Will the people ever get it?”
ANSWER: Initially, there were the Federalists v the Democratic-Republican Party. After the Federalists were defeated, the Party of Jefferson eventually split in two becoming the Democrats and the Republicans. The Democrats became the South and supported Slavery. The Republicans were the Party of Lincoln. They switched roles somehow when the Republicans opposed the rising Marxist policies of the late 1800s.
The Republicans will most likely split in two thanks to the Country-Club Republicans like Boehner who kicked off all fiscal committees that supported Ron Paul and then pulled his own dictatorship refusing to allow Ron Paul’s name to even be presented at the Convention. That action alone was treason – denying the people the right to be heard. Boehner himself has dealt a serious blow to the Republican Party and has driven a stake deep into its heart. This will cause the fiscal conservatives (the People who elected Reagan) to split and form their own party. This may indeed happen if Obama is successful in dividing and destroying the Republican Party as it stands today led by Boehner who is obviously clueless.
Will the people wake up and see what Obama is doing? Sorry, but the press is too bought and paid for these days so that can never happen in the mainstream. Perhaps this is what we need. The pendulum must swing so far to the left like France destroying the economy long-term before the people get up off of their ass, stop watching football, and say – this line you shall not pass.
So if we see this Obama victory in this mess, capital will have a greater incentive to flee into equity markets as banks will become unacceptable for sizable cash to sit and waiting for a miracle. Obama will raise taxes sharply and eliminating the Republicans you will see taxes soar. This will send unemployment higher and destroy the US economy and the West in general over the remainder of this Private Wave and China will emerge as the new financial capital of the world after 2032.
Democrats Continue to Try to Destroy Republican Party
The House Republicans offered to increase the debt limit and end the shutdown as part of a package that includes spending cuts. Obama will not negotiate and the hidden agenda on the Hill that the mainstream press will BY NO MEANS REPORT, is that the Democrats are counting on the shut down and want a default so they can blame the Republicans and take the House next year. This is an all out war and Obama is seeking to gain a virtual dictatorship with the Democrats simply jumping as high as he demands.
This is no longer politics as usual. This is outright political warfare and the mainstream press will support Obama in destroying all liberty and sending taxes through the ceiling. Obama’s agenda is to drastically raise taxes and this will set the stage for also the seizure of all pension funds.