Monday, September 7, 2015

MARTIN ARMSTRONG'S LATEST BLOG POSTS

Texas Gold Promoter Claiming to Store Metals Found $30 million missing

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The Austin Texas Bullion Direct has filed for bankruptcy and it is alleged that $30 millionin metal that was supposed to be store is gone. (Bullion Direct Bankruptcy-Case-Filing-7-20-2015). This has been one of the big problems with gold promoters who claim to be storing customer’s metals without independent audits, insurance, etc. This was a problem as with dealers going to prison for the same problem after the crash from 1980 into 1985. Interest rates were high back in 1981 and Internal Gold Bullion Exchange opened in Florida with the scam of selling gold coins at spot (4% below cost) but with delayed delivery of 90 days. The owner eventually went to prison for 10 years. If you want to trade back and forth, use the COMEX.

Julius Caesar & The Black Basalt Bust Commissioned by Cleopatra

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Antony-Cleopatra-TetThe Black Basalt Bust of Julius Caesar is more likely than not the one commissioned by Cleopatra herself. We know that Cleopatra had built an elaborate shrine, or Caesareum, to Julius Caesar opposite the harbor of Alexandria. He was the father of her son and she was clearly politically driven to take Rome by marriage. After all, after Caesar’s assassination, she turned her political designs to Marc Antony. There are numerous coin issues showing her portrait with that of Antony demonstrating her political designs.
Cleopatra-BustIn this heroon created by Cleopatra once stood an image (simulacrum) of the deified Julius Caesar in black basalt – a stone reserved for people of the highest rank. After the death of Cleopatra, this shrine was dedicated toAugustus and therefore became anAugusteum. Unfortunately, we do not know what other images of members of the Augustan and Julio-Claudian house were also set up here. However, since this heroon was rededicated to Augustus, a portrait of Augustus was undoubtedly added.
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Because it was also common practice to set up images of other members of the imperial family in such shrines, a portrait of Augustus’ niece Antonia Minor which has also survived and was defaced in the same manner as the bust of Caesar which was known to have been in southern France, would also be a likely candidate for honoring in a rededicated Augusteum. Of course it cannot be determined with certainty whether the two basalt portraits were created at the same time, or whether a portrait of Antonia Minor along with other (now missing) portraits of family members were added shortly after the re-dedication of then creation of the Augusteum. Nevertheless, this black basalt portrait of Julius Caesar was the first established by Cleopatra herself obviously for political reasons.
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Nevertheless, it does seem that the two surviving black basalt busts of Caesar and Antonia were part of the same imperial portrait group because of iconographical considerations, the distinctive and relatively rare material, the size and similarity of workmanship (undoubtedly produced by the same workshop), the nature and degree of damage, and their reported association with the same collection in Southern France suggesting that they were brought back to France during the Napoleonic campaign..

Money: What Is It? What is Interest? What is the Wealth of a Nation?

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Angela Merkel and IMF chief Christine Lagarde can laugh it up as Europe burns down. The whole crisis stems from antiquated ideas that center on what money actually is. If you do not grasp what the true function which money actually provides within the economy, then you will be unable to get anything else right either. This entire idea of austerity is the crazy notion that money somehow should be a store of value. This is up there on the list of myths with those who also argue that markets decline because of shorts rather than comprehending that eventually longs do also sell.
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Money is the OPPOSITE of assets and has always been historically. This is incredible important to understand far more than you may realize. If you want money to retain its purchasing power/value, you are creating a false image of how the economy functions. For Germany to be politically obsessed with the days of hyperinflation and constantly attempt to impose austerity, they are adopting the anti-asset position and that is the source of deflation.
Interest is actually supposed to be a measure of expected inflation and is essentially dealing in options. Whatever the rate of interest, the lender is expecting that the money will buy the same amount of assets upon repayment plus some profit in excess of the interest rate. Bankers want the same purchasing value back upon repayment plus their profit which is the entire purpose of lending money. Yet historically, the boom and bust cycle is the rise and fall in the purchasing power of money as measured in terms of assets. That is what is rising and falling – the purchasing power. When the purchasing power of money declines and assets rise, we call this a BULL MARKET. When the purchasing power of money falls, we call this a BEAR MARKET.
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I have written many times that there is no magic level in interest rates that will cause the stock market to fall. As a market rises (BULL MARKET), interest rate MUST rise for that is the option on money and its future purchasing power upon return. Thus, it hasNEVER BEEN the direction of interest rates that determines the direction of assets, for they are historically linked and must be. Only a fool, indoctrinated by Marxist-Keynesianism, cannot grasp that the economy cannot be manipulated by interest rates. This is why doing empirical studies of these two factors on a correlation model reveals simply that the stock market HAS NEVER peaked with the same level of interest rates twice in history. The level of interest rates is indistinguishable from a option premium on the future expectation of that particular asset.
bank-robberThe Federal Reserve keeps talking about the “normalization” of interest rates. They will not come out and explain what I am doing right now because it would expose that the emperor is naked. The Fed sees that negative interest rates proposed by the legendary banking advocate Larry Summers who may have been an agent from Hell sent to Earth to wipe out the economy, are highly destructive and amount to a tax on money. Negative interest rates can only be totally destructive to all asset classes and furthers deflation to the extreme. People then would hoard money outside of banks to avoid the tax and this leads government on their quest to eliminate physical money and embrace the age of electronic money. That changes the entire game and embraces economic totalitarianism.
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These people are fundamentally destroying everything because they are clueless about what is really money. Both China and Japan rose from the ashes without gold, proving that the wealth of a nation is not its gold reserves, but the total productive capacity of its people. Returning to a gold standard will not provide some magical check and balance where assets still rise in value yet gold/money would retain its purchasing power. They are totally lost in the rambling of their own mind. When gold was used as money, it rose and fell just as anything else that has ever been money proving it does not matter what you use for money, the same result will always emerge – money is on the opposite side of money. If you cannot grasp this fundamental realization, then you are doomed to screwing up the economy and society big time.
Caesar-5The only politician throughout history who truly understood this fact of life was Julius Caesar. To solve the debt crisis, he realized that the value of money rose above what it once had purchased and the price of assets reflected in terms of money had declined. He realized that say when a banker lent you money to buy a home say $100,000, and the market crashes, a $100,000 can perhaps buy two houses. The banker then reaps a huge profit demanding full repayment. Caesar’s solution? He appointed a board to revalue all assets to the point when the debt was entered. He then attributed all previous interest payment to reduce that capital borrowing and therein settled all accounts. He revitalized the economy and ended the debt crisis.
Money is merely a reflection of its purchasing power. It has NEVER been historically a store of wealth and cannot possibly be under any circumstances where assets rise in terms expressed in money. For assets to rise in terms of money, that means money must decline in purchasing power. This is rather simple to understand. Money is simply a medium of exchange that fluctuates in purchasing power rising and falling based upon human activity. We are lost in understanding the future because we cannot understand the past and the role of money no less debt and interest rates, which are merely an option on the future expectation of the purchasing power of money.
The wealth of a nation is the total productivity of its people. If I have gold and want you to fix my house, I give you the gold for your labor. Thus, your wealth is your labor, and the gold is merely a medium of exchange. So it does not matter whatever the medium of exchange might be. You will give your labor provided you know someone else will accept the medium of exchange from you in purchasing something else. It is the labor of the people and their productive capacity that creates the wealth of any nation. Germany rose from the ashes in Europe to be the strongest economy without gold all on the back of the total productive capacity of its people. The same is true for Japan and for China. Where corruption prevailed as in Russia and they relied upon selling a commodity rather than the productive capacity of its people, then its economy has not soared as did China, Japan,  or Germany. This also explains the third world status of South America and Africa. When a country exploits is natural resources to gain wealth rather than educating its people, its long-term viability will diminish with the reduction in the supply of its natural resources or in the case of oil, against rising cheaper alternatives. We do not get this fundamental principle correct, we will destroy our economies with excessive taxation, which in turn, reduces the total productive capacity of its people.

World’s top 5 miners lose $540 BILLION market worth

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The World’s top 5 miners lost $540 BILLION market value as the Age of Deflation grips all asset classes helping to send cash running into the open arms of government borrowing. Market values of the top 5 miners have collapsed between 60% and 88% from the major high in 2011. After copper, coal has been the big mining commodity and here too we have seen a crash from nearly the $200 a tonne level back in 2008 to now where it is averaging in the low $60 range.
Despite the shouting that the dollar will crash, stock market will crash, and hence, gold will rise, that scenario does not hold up even looking at the Great Depression era. There too, commodities peaked in 1919 and underwent a 13 year bear market bottoming WITHstocks in 1932. The scenarios painted by so many to sell precious metals are just not true. Commodities and stocks rallied out of the 1932 low TOGETHER.
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The US share market had risen during the boom days into 1929 in terms of all currencies. That is what made the Phase Transition for it was a bull market in global terms as was Japan going into 1989. Note there are significant differences. The Dow peaked in 1917 in Swiss franc terms whereas the dollar high was 1919. This reflected the return of capital following World War I. The 1929 and 1932 lows matched in Swiss and dollar terms. However, we again see a leading indicator for the Dow peaked in 1935 in terms of Swiss and 1937 in terms of dollars. The low thereafter in Swiss was 1942 again reflecting the shift in capital flows moving to the USA because of World War II creating the dollar low at the same time.
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When a currency rises, that creates the deflation for exports become dirt cheap and local business cannot compete increasing unemployment. As money rises in purchasing power, all assets must fall. Indeed, this was 1935 when Roosevelt created even the 30 year mortgage desperately trying to revitalize real estate.
The collapse in commodity prices are on schedule. The difference between a correct forecast and sophistry all depends upon the database and of course, the fact that one is not part of the industry where your income depends upon the price of the commodity you are claiming to be forecasting but are in fact you are just trying to support your business no different from the comment of politicians and central bankers. It’s call talking you own book.

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