Thank You
First Sovereign Debt Default 4th Century BC
ANSWER: Yes. The first such default that is definitively recorded took place at least in the 4th century B.C., when ten out of thirteen Greek municipalities in the Attic Maritime Association defaulted on loans from the Delos Temple of Apollo.
You must understand that historically, most fiscal crises were resolved through either war where the loser’s debt evaporates as Germany after WWI or the Confederate States in USA as two examples, or by currency debasement by either inflation or devaluation. This is demonstrated by numerous city debasements or reduction in weight of gold and silver coinage. One of the earliest debasements was during 404BC in Athens in the war with Sparta. The silver coinage was reduced to bronze and silver plated.
Lydia, which is where coins were invented, reduced the weight of their Stater due to war with the Persians, Cyrus the Great. This is how money supply still increased even if it was gold or silver. It never matters what is money, economic forces always conspire to create the natural course of inflation (assets rise and money declines). There is a cycle as we are going through right now of the opposite trend deflation because no single trend can be sustained without change. Hold your arm straight up above your head. Now keep it there. You will run out of energy and your arm will feel tremendously heavy causing you to put it back down. Everything works that way yet people try to deny cycles. Nothing but nothing can be sustained without change – N O T H I N G!
We see debasement of the gold coinage of Byzantium going into the Great Monetary Crisis of 1092. Of course the Roman did the same thing as Athens and issued bronze coinage silver plated during the 3rd century AD.
There really were no such things as debt restructurings in ancient times. Restructuring are a much more modern era development. Restructuring actually began with the serial defaults in France, Spain, and Portugal in the mid-sixteenth centuries. Other European states began to follow their lead during the 17th century, which included Prussia in 1683. Nevertheless, the two chronic serial defaulters in history were France and Spain. The Spanish defaults destroyed Italian banking and then German banking which allowed for the Dutch to rise to the occasion of being the Financial Capitol of the World.
When you reach the 19th century, debt crises, defaults, and debt restructurings became a normal course of business. Once must question why in the world anyone would invest in government debt when they all default in the end. Restructurings take place either after a default or under the threat of default. This seems to be a serious new global investment and capital flows which have evolved post-1720 bubbles. So Rogoff focused on the frequency of sovereign debt defaults in the modern era whereas previously debts were simply just denied, wiped out by war, devaluations, or debasements. Hammurabi’s Code expressly regulates interest rates showing one would not due that unless they too experienced swings in the rates of interest. He tried to regulate it as well.
World Economic Conference v General Non-Investor Audiences
QUESTION: Hello Martin,
Have you ever considered holding a world economic conference at a
university for us younger followers at a more affordable cost. I am sure
there are more like myself who would love the opportunity to hear your
thoughts on the current issues that plaque our society, as well as ways
in which we can fix them going forward. After all it is the younger
generations perspective that must be changed if we are to dramatically
alter the current situation in the future and generations to come.
ANSWER:These World Economic Conferences are about investing. They are two day events covering the world in detail. This year includes BOOTCAMP for analysis – how to use the model and one you understand the methodology, you can look at any market in the world and instantly understand its trend.
We do hold shorter sessions for much less that are for a few hours which are geared for the general public. They are the informative sessions rather than specific investment strategies. So they are two different animals. We do try to address this area as well. We are certainly doing that also with Socrates.
These WEC events are a tremendous amount of work for we have to cover the world and bring in the correlations for everyone to see. They are fantastic for networking and brings together the world to the point you can see the capital flows within the room.
London Property Market
QUESTION: Mr. Armstrong, do you think the property market in London has peaked?
Thank you
DS
ANSWER: Yes. This is the high-end. The property market outside of London is spotty. Most areas OUTSIDE OF LONDON PROPER have not exceeded the 2007 high, as has been the case for London. Keep in mind that this has been a foreign capital driven market.
If Britain gets its act together then the decline may not be as bad. The Labour Party has gone totally mad as they are embracing Communism and the Conservatives are just out of their mind taxing everything that moves or not to reduce the debt creating deflation in most sectors. Somewhere in-between perhaps lies some sanity but neither policy will offer any long-term sustainability for economic growth.
Money Week in Britain did comment on our forecasts for the London property market.
We will be distributing a special report on real estate at the World Economic Conferences in Princeton and Berlin. Non-attendees will have the ability to purchase this report after the conferences.
Swiss Member of Parliament Warns of Islamic Invasion
This is an old story that is starting to now resurface with the Islamic Invasion
Swiss Ban Muslim Prayer Towers
This was an old story which is starting to now resurface
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