Dow & the Future
QUESTION: Hello Mr. Armstrong,
I am a big fan of your work. I read ALL of your blogs and have purchased some of your materials. You truly opened my eyes to how the world really works. I am unfortunately one of those public workers you talk about. I first hand see how my employers are having trouble finding the funds to pay us. I also realize that i won’t touch my pensions when my retirement will come around like the baby boomers have been doing. So i am investing in the market to create my own pension mostly thanx to your guidance.
My questions for you is concerning the dow jones. Do you still see it go up till 2016 or might it go up till a later date. Last question is do you still believe the price range of mid 25000 still feasible by 2016…
Thank you very much for your time and god bless you.
ANSWER: I fully appreciate the idea of working for the government. I have friends that do. The problem is whatever government does really should be privatized for then you would get the pensions you were promised. Government can violate everything and never get prosecuted. Doing what they have done to their workers is deplorable. What they are doing to the Vets is typical. They are just not trustworthy period.
That said, your question probably cannot be answered until after this next turning point on the ECM. We are coming up to September 3/4th, 2014. There is the traditional business cycle that would imply a high in 2016. However, that would also imply the traditional flight to quality (government bonds) when the economy turns down.
The question requires capital flow analysis because we have two major turning points 2016 and 2020. If we get a Phase Transition into a major high for 2016, then we may see the traditional crash into 2020. However, if we make a new high into 2015 that is marginal and not a doubling effect of a Phase Transition and a decline into 2016, then the cycle inversion will move forward and the high will come 2020.
That can be created by two converging trends. First there is the cycle of war with its first big target 6 years after 2014 and that is 2020. This would send capital fleeing into the USA. Second, we have the economic side of the Sovereign Debt Crisis. This also will unfold in Europe and send capital into the dollar. The flight to quality then shifts from bonds to tangible assets and that will be primarilyMOVABLE assets of which equity is in that category. We should also see gold rally WITH stocks.
Here you can see that the Dow rallied during the 1970s basically following the same cycle as gold reaching a high in 1980, although this was not a Phase Transition as was gold doubling in value the last 6 weeks. Hence, a rally in stocks and gold is not unusual.
We will be addressing this issue shortly. We are finishing the computer systems to get everything up and running in time to resolve these questions – not by opinion, but by analysis.
The Age of Disinformation – Hiding Truth in Plain Sight
QUESTION: Mr. Armstrong; I listened to your discussion with Glen Downs. You said that the first golden rule of disinformation is to exaggerate the event. Can you elaborate on that?
Thank you
OG
ANSWER: This is standard operational procedure and it is why I am very skeptical about conspiracy theories. Trace the origins and you will find that they are generated as part of a plot to hide in plain view the truth. Take 911. There are now people who claim that there were no planes at all and it was all staged. There were planes – I was there and saw them. I felt the building shake upon the first impact. I stated that the terrorists from the First World Trade Center attack drew the twin towers on the wall in their cell BEFORE the event. The Feds knew what they were up to and allowed it to happen and used it to their advantage. There was plenty of confirmed evidence that they knew what would happen. Did then stand back and allow that to happen? Most likely. How do you cover that up, you simply exaggerate everything to destroy any credible investigation. This makes anyone who question 911 a conspiracy nut job. Perfect cover to hide the truth right in front of your eyes. I will get a slew of emails swearing I am wrong and the whole thing was a CIA plot. They cannot see that this argument goes nowhere. It is like the one claiming there is no gold in Fort Knox. Big deal. Prove it! Until the government falls in some sort of revolution allowing access, it is just rhetoric that discredits to speaker.
I question both the collapse of WTC7 and the Pentagon and the plane that crash in Pennsylvania was probably the one headed to the Pentagon. What hit the Pentagon does not appear to be a plane. So how do you cover-up what is in plain sight? The oldest trick in the book is disinformation. You create the controversy centered around the Twin Towers and exaggerate the claims. The majority will begin to see through the exaggerations as a conspiracy theory and stop there never looking further. The intentional attacks by the government on WTC7 and thePentagon are no longer investigated or looked at for they are painted with the same discredited view of the Twin Towers. People will get so intense that the Twin Towers had to be a US plot, that this acts as perfect cover for the real issues.
Why people are so bent on the entire thing being a conspiracy instead of seeing that at the core there was a real attack usurped by the Feds who used that attack to cover-up and expand the government may be government disinformation. That remains the real agenda and by exaggerating the claims on the Twin Towers, they render the entire subject as a conspiracy theory and hence you have hidden the real issue in plain sight. Insisting upon the entire 911 was a conspiracyGUARANTEES there will never be any serious investigation and the real issues will remain un-investigated. Yet people will insist I am wrong and I have to wonder who is being paid to put out such exaggerated stories that other just believe everything is a conspiracy.
This is how it is done all the time. Exaggerate whatever it is and you will convert it into a conspiracy theory and then the issue is discredited. This is just standard. Always look at the source. Propaganda wars began with World War I and it has expanded dramatically ever since. It is organized disinformation. People love conspiracy theories – give them one that points away from government and the politicians are always home free.
Military Takes Control of Thailand
On this War Cycle, Asia is about 2 years ahead of Europe. In the Cycle of War Report I noted that the cycle for China was slightly ahead of 2014. This is being reflected in the elections in India, which was an uprising politically against corruption there as well. Thailand has been in turmoil given the political corruption that has sparked massive demonstrations and police violence. Now the military has come out and stated bluntly that they are now taking full control. We have a full-blown Military Coup in Thailand.
Anyone who thinks this Cycle of War is bogus, fails to grasp that everything is connected. People do not go to war and rise up against government domestically if everything is running smooth. Turn the economy down and you get chaos on so many levels. It is like the crazy people who predict $50,000 gold. They hate the dollar, but measure gold’s profit potential in the very object they hate so much implying it will survive. They only see that one dimension and fail to understand that everything is connected. The global economy runs like the gears in a machine. You cannot get the dollar to collapse without turning every other gear that is connected. Just Impossible.
Welcome to the Private Wave where reality confronts theory of status quo. It’s is time to wake up. Which pill do you want? The Red or the Blue?
Historic Trade Deal Russia & China – Will this Dethrone the USD?
QUESTION: My question is this:
Russia and China making bilateral trade not using USD, China doing so with other countries etc. the buzz now is USD falling from grace. Yet is seems to me that as long as currencies out there are relating in any way with USD, and oil is priced in USD then in some manner they cannot disengage from it. So the question is: Is there any way to disengage from the USD?
Thank you for your time, attention and possible answer.
Kind regards,
IW
ANSWER: Trade is not the determining factor behind a currency’s value. Russia and China are trying to side-step the USD, but that is really a fleeting effort. The yuan is less that 10% of trade flows and the euro is even below the yuan. The key behind the dollar remains the simple fact that this is the RESERVE CURRENCY. What does that really mean? That is more than just saying so.
The USD is an extremely deep currency into which capital flows take place and park on a global basis. The euro failed in this regard because they did not consolidate the debts of all member states even though they have been federalizing Europe. Europe is no different from the state debt level in the USA – not ready for reserve status and way too much different security risks among the members.
The currencies of Russia and China are not ready for prime time. There is too much political instability right now and that undermines the value of a currency aside from the fact that people can trade in them, that is nice, but they then quickly covert to dollars. The process of dethroning the dollar is nonetheless underway. However, that will not be accomplished by trade. The way that will happen is only when we see the inevitable systemic collapse in government debts. That will begin in Europe, then hit Japan, and the USA will be last.
Both China and Russia had difficulty in selling their bonds this time around. Without the ability to park huge amounts of money into these currencies, there is no possible hope of undermining the dollar. Trade flows are just too tiny – it is the capital investment flows that count. Just ask yourself are you willing to buy bonds from China and Russia? Do you really think they would be a safer investment than the US? If you are honest in your answers you will see the reality distinguished from the same nonsense as usual that the dollar will collapse and somehow the rest of the world will just watch in amazement. These are people with opinions that are as biased as ever and have been saying the same thing all the time. That does not cut it when it comes to parking serious money.
Foreign countries issue debt in dollars to sell them taking on the currency risk themselves. China’s previous debt that it defaulted on during the Great Depression was likewise denominated in foreign currencies at that time. You can buy their bonds and Russian bonds from the 1930s for framing. You cannot do that with US bonds.