How Lows are Made
QUESTION: Are not the bankers now preaching gold down?
ANSWER: Yes. This is what is necessary. At the lows, the MAJORITY will give up and then point to much lower lows. I wrote previously:
“At the low, everyone is bearish and shorts abound. That in turn is the fuel for the reversal to the upside. The classic short-cover out of the hole, So we need the majority of analysts to now turn bearish at last. They will begin to call for $600 gold soon. We need this type of bearishness to build in order for the low to take place.”
The more bearish the people get, the closer you get to the turn. But that turn will not come until 2014 at best.
The Euro & Dollar – the Essence of Chaos
Nothing has changed with the Euro v the dollar. We are waiting for the turn in 2014 and that remains in place. In order to set the stage for the worst of the worst, we need to move to extremes in both directions. Economically, Europe is a disaster. You typically have the currency rise in the last deflationary way. The Euro has NOT however, rallied to where it could have on our models at the 147 level. Yet we do not see the dollar rally that will then by DEFLATION on this side of the pond just yet.
The capital flows show tremendous investment still pouring into the US from Europe with smart money trying to get out in anticipation of the 10% confiscation. Others have been shifting within Europe to the DAX. Those raising money for fund here in the States are all reporting the biggest investors are Europeans. The retail American public is just not ready to jump in yet when the TV financial evangelists keep touting the end is near because the S&P is up 70% and household income is down 4%.
One interesting comment called me “establishment” because I speak to people in government and therefore I have to trash gold and preach the dollar. Of course it is someone who lost most of everything investing only in gold. This is just insane when I state that we will end in default and people like Glen Downs is willing to step out and speak because he too does not like what he sees coming. Talking up the dollar will not save the day. Nothing will save the day.
But Hoover in is Memoirs made it clear. The dollar rallied dramatically and they were clueless as what was taking place and why. The Great Depression began with the default in Austria. They are getting violent in Europe and marching with pitchforks. They are still fat and happy in the States.
This is the DEFLATIONARY rally to the dollar in the 1930s. The rise in the Euro is not drastic and it is less than what I would expect so far. But the rise in the Euro will create more unemployment just as we saw the Bonus Army march on Washington in 1932. The used tanks on the streets and killing even women and children. Why do you think Homeland Security bought 2700 tanks for domestic use? It is the ECONOMYthat forces change. That change will not come without pain.
A rise in the Euro is NOT a good thing. This is how the greatest amount of social pressure is applied. Nor will the rise in the dollar that will then cause massive defaults among many who borrowed in dollars overseas to save money andDEFLATIONARY social pressure here be bullish for the future. People will not get made and protest in a bull market. Only when it costs them something and historically that is ALWAYS a recession or depression. We NEED this type of havoc to create the major political change that is on the horizon. If anyone thinks this is establishment or talking up the dollar to trash gold, you are in serious trouble because if you do not RATIONALLY comprehend the seriousness of the situation we face, you will not survive.
Capital is fleeing from bonds to equity because it is safer and institutional pension funds have NO CHOICE but to try to earn something more than rate or they go bust after 2015.75
We will be launching our Asset Portfolio Allocation models shortly as well and they are about jumping off the computer trying to get away from bonds without me saying anything.
Time & Price
QUESTION: Dear Sir,
are the following figures still valid. Will Gold fall to USD 950 per Ounce or is it more likely to build the low in the optimum range?
Thank you for the great audio-interview and your support of the little guy!
T
ANSWER: Yes. The timing is 2014 as the optimal target. However, we could see a cycle inversion pushing the sideways to lower trend into its final low in 2015 and then rally as the ECM declines. This will be laid out in the coming report. But it isALWAYS a question of TIME and PRICE. Keep in mind that NOTHING trades in a vacuum. This is like a ballet and every step and every dancer has to be in their place to pull off the great performance.
As far as the low is concern, the price can be between 1050 and 850. It is moreWHEN the price is reached rather than the express actual number. BOTH have to be achieved. If we saw $950 tomorrow, sorry, that would not be the low because the time is not right.
Yuan & the Death of the Dollar? Good One!
QUESTION: Is this story that the dollar is dead because products will begin trading in Chinese Yuan in Singapore and Hong Kong have any validity or is this more propaganda to covertly sell gold?
Thanks
RG
ANSWER: It is exaggerated propaganda. We monitor capital flows and the flows through Swift transfers. I reported that the Yuan has now displaced the Euro, which they also touted would destroy the dollar. But the Yuan is only about 8.6% of trade flows. The stories that the dollar is dead unfortunately are still the same nonsense from dollar haters who are clueless how should things unfold.
Look – we were the first to point out that China would rise to the new financial capital of the world/ In part, that is why I was invited to the Central Bank of China in 1997. Most of these people have never been to China. I was driven around in a motorcade and taken to an installation that was filled with people downloading the entire internet back in 1997. It was heavily guarded and surrounded by tanks. I wondered where the hell they were taking me deep behind the curtain. They were also actually monitoring everything that moved within the economy at that facility, yet were not interfering with prices – just observing. I was asked questions why products were selling at different prices in different regions that was baffling to former communists who only saw the same price everywhere. I was explaining how a capitalistic system functioned to help then make the transition. I was asked about that trip by the US Treasury upon my return. You cannot write about stuff irresponsibly without having real knowledge of the true nature of the trend.
True, eventually all systems fail. The United States will break apart and will crumble as a political union. That is certain. However, the question is WHEN?Trust me. Not on this economic wave. That will manifest ONLY when the debt goes. That will happen ONLY after the financial implosion unfolds in Europe and Japan. Then this economic disease will spread like a contagion to the US economy.
I have been stating that China has to let go of the currency and allow it to freely float in order to make it a reserve currency. We forecast that the dollar will fall against the Yuan and this is inevitable. However, to claim the dollar will be instantly dead so run out and buy gold is like saying there is a forest fire in Idaho and your house in San Francisco is now in danger.
The dollar is not ready to die. It is the World’s Reserve Currency oddly because we have a debt that allows people to park $17 trillion in during this world of confusion. Who will put all their savings in a bank that has problems? Anyone? Well do you really expect that the Yuan will displace the dollar and in the next breath say war with China or Russia is inevitable? That would be like running to Hitler to hold your money while Patton is on his way to Berlin. Come of. Where is the common sense here? Guess common sense is anything BUT common.
Eventually, the Financial Capital of the World will move to Asia. The West is dying by its own hand that of Socialism and both China and Russia can smell the blood. Give this transition time. For that is what is required. But to claim this is the end of the dollar because they will start to trade in yuan – come one. That is the same bullshit we heard with the Euro and how that would kill the dollar. The Middle East is also creating a single currency and that will be linked to the dollar, not the Euro nor the Yuan or the Ruble. Let’s get real here for once.
Yes we will be publishing in Chinese and covering Chinese stocks. But that does not mean the dollar is dead – long live the yuan. It Just takes Time!
Gold Promoters Are Part of the Manipulation Against Investors
I have gotten a lot of emails asking who is who in trying to deliberately mislead investors. Let me state this up front. There are plenty of “shills” out there who are paid to put out bullshit to whip the public into a buying frenzy so the pros can sell the highs. EVERY manipulation I have ever seen in the metals has been to the UPSIDE not downside, for just get the metals up and the buyers assume this is the time and rush in. Only rallies are REAL to them and declines are fake. Sell gold down, and the diehards hold until they have nothing left and they lose the house, the kids, the wife, and the dog. I do NOT believe Jim Sinclair is one of the Shills who is paid under the table by the bankers. We may disagree on timing and reasoning, but that is the extent of any disagreement. I believe in what goes up also goes down and I look at the entire world not just one sector or market and certainly not just the domestic economy,
The decline in gold is NATURAL and NECESSARY to set the stage for a future rally. There is a TIME and PLACE as well as PRICE for everything. As to why the pretend analysts with their shows do not quote me, the answer is very simple. They want people to ignore me and they only try to sell gold – not buy.
I have always worked behind the curtain where I have seen it all. I have had PhiBro walk across the pit and show my brokers their book to try to get me to join. I watched the manipulators get the press touting the Hunts to get everyone in so then could crush the market and had the exchange rig the margins so it was minimal to go short and required more margin to go long. I had AIG get in to see me to try to get me to join the club on the coat-tails of one of their board members Alan Walters who was a personal friend and former adviser to Lady Thatcher. I have seen it all and that is why they do not dare want me telling anyone what really is going on.
I have been forced to come out in front of the curtain. I can retire and go off to some island and wait it out until I die. But I too have family and what kind of a future they face because of all this nonsense does not let me sleep beyond 3 hours at night. What I have been put through was for a reason and those who try to ignore me are only exposing their own lack of integrity or bias. I really do not care what they think of me. It means nothing to me. I just consider the source. They will one day wake up and see while they are fighting with their own egos, they risk losing all liberty because the real battle is not with me, it is the man with the tanks and guns. That will start to become very clear in 2014. All they are interested in is filling their pockets and forgetting they are playing with the risk of war and a Dark Age unless we steer this ship through the treacherous waters ahead.
So anyone who quotes economists or analysts and what they see for 2014 while refusing to mention this work, are obviously not independent and are either biased or have some other agenda.Typically you report contrasting views. I really could care less and prefer not to do interviews unless I know the person for they rarely get it right. It is what it is. They are more interested in controlling what you hear than providing an honest perspective. I never courted the media because our institutional clients who paid big bucks did want to read that same information on front page of a newspaper for free.
Do not worry about if they try to cover everyone but what you read here. It is either bias or control – the same reason Snowden did not get Man of the Year by a US magazine. Right! Like they would not do whatever Obama told them. Just look at what any so-called news show is promoting and if there is some particular outlook it will be easy to pick up. Just like Fox puts out conservative news and other support Obama. We are not dealing with independence here. It is always some agenda.
NOBODY can forecast the future on a consistent basis from a personal opinion perspective. That is just irresponsible and impractical. So placing EGO before the welfare of readers is not acceptable in the real world of analysis.
In the early 1980s, I had lunch in Geneva with the head of one of the major Swiss banks who was a client. I asked his opinion what name should I use for the company when I was to open my first European office. I assumed there was an undercurrent of anti-Americanism so I thought we should have a separate European name over there. He asked me to name one European analyst. I could not. He laughed and said there were none because if he was French, British, or German, they all were bullish their own countries. He then told me why all the major institutions relied on our firm. He said I did not care if the dollar would rise or fall. It was that lack of bias that made us the largest firm ever with more than $3 trillion under contract. Nobody has ever come close to that. That is why I was even asked to testify before Congress.
I have been behind the curtain. Met with governments from Asia to Europe. Their problem with me is I have the experience. They know that. So if you want to put out an agenda, I do not need the money, cannot be bought, been there done that, and am awaiting me exist from this insanity we call life plagued by manipulations and hidden agendas. So those who do not quote our work – it is usually because they are promoting a different outcome.
More Global Warming
Thank God this is Global Warming. Can you imagine how much snow would have fallen in Egypt for the first time in 112 years had there NOT been Global Warming? I prefer warm weather. It is bloody cold!!!!!! This theory of Global Warming is up there with Marxism.
Pope – Sorry You are a Marxist & Dead Wrong
I am not the only one who has said the Pope is preaching Marxism. He does not know anything about the economy and what he has said is highly dangerous and likely to justify violence and more civil unrest in Italy particularly. He has responded to critics who have also called him a Marxist:
“Marxist ideology is wrong,” the Pope told the Italian newspaper La Stampa in an interview published on Saturday. “But I have met many Marxists in my life who are good people, so I don’t feel offended.”
I am sorry. He may have beat Snowden for Man or the Year only because Timewould have been in trouble with Obama for naming Snowden who he says is a traitor to exposing the illegal active of his administration. I guess that is like blaming the person who told your spouse you were cheating that led to the divorce not that you were cheating has anything to do with the issue.
Nevertheless, making the Pope Man of the Year does not change the fact that he is more-likely-than-not fueling the fires of civil unrest that will lead to more violence rather than peace. Just for the record that people who will think I am just anti-Catholic or something like that – I was raised Catholic. Like politics, I do not buy what any leader has to say just because of their position. God created us withequal rights – not equal talents – not a disproportionate right to be extorted and abused for being more talented than a bureaucrat.
How about reading the Ten Commandments instead of coveting what everyone else possesses. If this was the Law of God, written by God, then I would think they should overrule what Marx wrote that led to the killing of far more people in history than any other theory – Stalin, Hitler, and Mao. I will be glad to fly to the Vatican to explain economics before tens or millions die in the coming civil unrest because of socialism thanks to this stupid endorsement of corrupt politicians. As they say, the Road to Hell is paved with good intentions.
Thou shalt not covet
| EXODUS 20:1-17 | DEUTERONOMY 5:4-21 |
|---|
| “or his male servant, or his female servant, or his ox, or his donkey, or anything that is your neighbor’s.” | “or his male servant, or his female servant, his ox, or his donkey, or anything that is your neighbor’s.’ |
Riots In Singapore
The riots that erupted in Little India in Singapore on December 9th are indicative of an underlying problem there. Because of so many foreigners have moved to Singapore, it is widely viewed that they have cause widespread inflation. This has spilled over into a “general” feeling about foreigners even migrant workers. This is all economic based. The rising tensions around the world are building and there is NO PLACE that will be immune from this trend in rising civil unrest on a global scale in the Cycle of War. (see news reports)
Dow Jones Industrial & BitCoin Correlation?
QUESTION: Hi Martin; It is very interesting that both virtual currencies, Dow Jones Industrial Average(US Stock Market) and Bitcoin, topped out on November 29, 2013. I’m not saying that this is the top of the markets, I’m saying the Dow(US Stock Market) is Bitcoin for the Super Rich. I’m saying that they are both are now correlated. Both are being valued as a way of protecting wealth from bail-ins. Therefore, as goes the Dow, so goes Bitcoin. Is the Dow Jones Industrial Average in a bubble? Your answer may correlate to Bitcoin. What do you think?
Thanks,
F
ANSWER: Congratulations! You are starting to see the interconnected world. The reason both Bitcoin and the Dow peaked the same day is because human collective behavior is the same regardless of the instrument. Why has the Economic Confidence Model worked so well? Because it was NOT based on a single individual market. It was based upon what you just observed. Humans speculate like clockwork. What they speculate in honestly makes no difference. Some people feel more comfortable with gold. Others stocks, others real estate. They will ALL act for the same reason, to preserve capital. What they invest in depends upon the mood and what they BELIEVE in.
The Goldbugs have taken this so personal that the world is wrong and only gold will survive and they attack anyone who disagrees. Their dream that EVERYONEwill buy gold is stupid for it is no different from expecting everyone to vote Republican or Democrat. I am a political-agnostic because I see both sides and yet they agree on one thing – government needs to control society albeit for different reasons.
Both peaked because it is a cycle of human trends, not per se a specific market. So yes, you get these correlations that verify the overall trend. However, Bitcoin is a bubble for its value soared in a Phase Transition that the Dow Jones has not yet accomplished. Keep in mind that the Dow can absorb huge capital where and Bitcoin or even gold cannot.
Can Human Confrontation be Reduced to a Mathematical Formula?
The answer to the question can human confrontation be reduced to a mathematical formula is absolutely correct. The study of confrontation has long been around and various ways to determine the mood of a mob have produced incredibly interesting studies. There is definitely the madness of crowds where we as humans are influenced by the crowd. This is what drives markets and it is why the majority MUST always be wrong.
Scientists have now worked out human emotion reducing it to a mathematical formula for confrontation. Taking how a baby cries and observing how it will escalate against its parent is comparable to the way riots unfold in the civil context. Scientists have reduced these patterns following how the Protagonist (e.g. baby or rioters) adapts quickly enough to escalate its attacks confronting the larger adversary who is the Antagonist. The target adversary Antagonist (e.g. parent or government),is unable, or unwilling, to respond in a timely manner to satisfy the Protagonist, according to a new study published in Nature‘s Scientific Reports and reported in Science Daily.
In our model, this aspect is what I would call VOLATILITY, which gives you the magnitude of the event, but not the timing of the event as to when it will happen. But yes, you can reduce ALL human behavior to a mathematical formula on a collective basis. And yes, our volatility models for the Cycle of War are rising exponentially on the Civil Unrest models. This is why we are starting to see the shift from non-violent to violent confrontation right on time for 2014 and it is escalating on a global scale.
How to Interpret Consecutive Directional Changes
QUESTION: Martin – how should consecutive “Directional Change” indicators be interpreted?
Regards,
DR
ANSWER: Normally this type of pattern produces just a sideways churning back and forth. This is why in the Euro there has been nothing to write about. It is just a deflationary contraction. The dollar rose sharply between 1980 and 1985 also 1929-1932. Whatever the currency is during an economic decline will rise in purchasing power as people sell assets and need cash.
What we are facing on this cycle is highly unusual and it is why it has become so confusing. The traditional flight to quality is you run from PRIVATE assets into cash/government bonds (PUBLIC). However, what do you do when it is government that is collapsing? You will have no choice but to run to PRIVATEassets. This is why we are seeing real estate rise and equities.
The models have targeted 2014 for a reaction high in the Euro. That appears to be lining up with the EU elections and people are starting to become more violent. That is the distinction between pre-2014 protests and post.
We are expanding the Forecasting Arrays to include more models. This will include different types of volatility so you can see when to expect over-night moves versus intraday.
Global Market Watch Dec 13th
The Global Market Watch has been posted for the close of December 13th, 2013.
OPEN SOURCE – Perhaps the Real Curse
QUESTION: Hello Martin, Would you ever consider open-sourcing your source code?
R
ANSWER: I am a firm believer in open source in areas of research. But in this case, what I have gone through for this code is off the charts. Governments see it as a potential for a weapon of mass destruction. When the model was able to forecast wars and the collapse of Russia back in 1998, that is when everything went nuts. They simply told me to my face that they had to OWN the model.
Honestly, people have tried to steal the code. I have had to endure too many corrupt individuals. These dumb-ass people do not realize what they are playing with. If they had the code, they would kill them to get their hands on it. For me, it is my protection because they need me to interpret. Had I turned over the code, I would have been declared dead of something and kept in some bunker. I was literally influenced by two great men. The first was Socrates who when sentenced to death said he did not care. It was either the migration of the soul to where he would see all his old friends, or it would be like a mid-summer sleep, so peaceful you are not disturbed by a dream. Once I adopted that position, I actually disarmed them. They can no longer hurt you if you release all fear of death.
The second person to influence me was Patrick Henry who saidGive me Liberty or Give Me Death. Only when you realize that we ALL live in a prison and are not free to come and go as we please to even book an airline ticket without them checking who you are, then and only then do you appreciate what those words really meant. To yield is to surrenderALL liberty – you cannot relinquish just a little.
So we are given the fortitude that helps us survive. I would release the code only to OPEN SOURCEafter the crisis is over. They will truly kill anyone else who was stupid enough to think they can take the code and become rich. These people are looking at political control – not money. They see the potential to manipulate countries and create wars. You have to understand that one of the very tools in war was to counterfeit your opponent’s currency to undermine their economy.
Here is a counterfeit British note produced by Germany. They see this as a potential economic weapon. This is the way they viewed the code. They wanted me to go to Washington to build the model for them.
Governments look at this model because everyone knows what it has done and need to know what it says even if they intend to defend against what is happening. So the answer is no! You would not want what they think has national security potential. If you want to see how fast someone will vanish, let him even pretend to have his hands on the code. I would not wish that on my worst enemy. This is not about money to them. It is about power.
I doubt seriously that any attempt to release this into the world of OPEN SOURCEwould not be looked upon very kindly.