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Are Two-Tier Monetary Systems a Possible Tool?

Are Two-Tier Monetary Systems a Possible Tool? 

QUESTION: Mr. Armstrong; It seems few people even understand that there have been two-tier monetary systems. Do you think this can be a possible tool in the currency crisis you are forecasting for 2021?

Thank you;

Looking forward to Rome and meeting Mr, Farage as well

PC

ANSWER: Various countries used to mint trade dollars in silver with different weights for external trade with China. That was a two-tier monetary system for trade during the 19th century. But there have been instances where there were two separate currencies that were also used as capital controls to isolate the domestic economy from the external international capital flows. This was the case with South Africa.

An important example of an official deliberate two-tier monetary system is the modern monetary history of South Africa. Until the late 1960s, South Africa had a fixed exchange rate for its currency. The rand was pegged to major foreign currencies, as was the case under the Bretton Woods system.

It was during 1979 when the South African government switched to a system that formally expressed parity against the dollar. The value of the rand followed changes in the balance of payments and moved roughly with sterling and other weaker currencies until 1985 when the dollar soared and the birth of the Plaza Accord took place.

The foreign debt crisis of 1985 caused the rand to depreciate at a spectacular rate and the dollar rose in value. The rand fell to an all-time low of less than 40 cents to the US$. The rand recovered somewhat in 1987, reaching 43 cents, but it declined steadily thereafter into 1998. The rand collapsed to about 26 cents against the US$ in late 1995. Between February 1, 1996 and May 1, 1996, the rand lost roughly 16% of its exchange value, falling from R3.7 to R4.33 = US$1, or a value of about 23 cents to the US$.

 …click on the above link to read the rest of the article…

There Are No Coincidences – Why History Repeats

There Are No Coincidences – Why History Repeats 

QUESTION: Martin Today is Palm Sunday. In mass, they said HE colluded with the Galilean’s. HE was found innocent by the Council. They said HE was a tax evader. HE was found innocent by new leadership. HE correctly predicted that HE would be denied by his own party 3 times. The corrupt crowd lobbied to release a murderer, and sentence an innocent man to his fate. My question is do cycles go beyond what is physical as with planets and the stars that wobble and rotate around our galaxy? Does it include emotional and human behavior cycles? Does history rhyme? If so, are we living in a matrix that has been programmed with numerous cycles? We can show that animal life is irreducibly complex and therefore predesigned. But, I am now wondering about if the psychic has been programmed with cycles too?

Do we truly have free will?

EM

ANSWER: Your question is interesting. I have usually explained that history repeats because human nature never changes. Only technology does. Given the same circumstances, humans will ALWAYSrespond in the same manner. Just examine the same facts and you will see how there is NEVER any rule of law. It does not matter what century, for it is always the same. It is all a joke. Whatever the desire of those in power, they will always manipulate the law to produce the desired outcome.

Right now, just look at the government throwing Chelsea Manning in prison on contempt indefinitely, the $4.2 billion handed to Ecuador for Assange by the IMF, and then his immediate indictment and move for extradition. This is all a coordinated attack to launch against Trump for the 2020 election after the Mueller Report failed. There are NO COINCIDENCES when it comes to political maneuvers. You are watching history in the making. The Deep State is determined to get rid of Trump. They desperately want one of their own in power — a team player.

China & Buying Gold – Why?

China & Buying Gold – Why? 

QUESTION: Mr. Armstrong; I believe you said at the WEC in 2017 that central banks will diversify and increase their gold reserves going into the currency crisis coming in 2021. China has continued to increase its gold reserves. You would please update on that development.

Thank you

PK

ANSWER: Central banks are in a very difficult position. The ECB has really put the entire world at risk. Draghi is now realizing that negative interest rates have seriously harmed the European economy and led to a major growing liquidity crisis in European banking. The euro is regarded as a time bomb for it is neither a national currency nor a stable unit of account. The failure to have consolidated the debts from the outset has simply left the euro vulnerable to separatist movements and sheer chaos.

This is what has been behind the strength in the dollar. Central banks outside Europe have been caught in this dollar vortex. They have been selling dollars and buying gold in an effort to stem the advance of the dollar. China also has a debt problem with many provinces and companies who borrowed in dollars. Here in 2019, there is $1.2 trillion in Chinese dollar borrowings that must be rolled over. There is a rising concern that this year there could be a major threat of a dollar funding crunch. The total debt issued in US dollars outside the USA approached $12 trillion at the end of 2018. That is about 50% of the US national debt. The forex risk is huge, no less the interest rate risk on top of that. The more crises we see in Europe, the greater the pressure on the dollar to rise regardless of the Fed trying to stop capital inflows by delaying raising rates.

 …click on the above link to read the rest of the article…

Turkey & the Real Risk of a Debt Crisis

Turkey & the Real Risk of a Debt Crisis 

The Treasury and Finance Ministry of Turkey announced that the country’s net external debt stock totaled $286.2 billion going into the end of the 3rd quarter of 2018. The country’s net external debt stock to its gross domestic product (GDP) ratio was 34.4% at the end of the third quarter of 2018. However, Turkey’s gross external debt stock amounted to $448.4 billion at the end of the 3rd quarter, bringing the debt/GDP ratio to 53.8% according to the official figures.

Interestingly, because of the fear of the Turkish lira, Turkish corporations have been often compelled to borrow in dollars. Therefore, the private sector’s share in the country’s gross external debt stock was 68.2% ($305.9 billion), while some $215.9 billion of this amount consisted of long-term debts with a maturity of more than one year. The Turkish public sector’s share of this debt was 30.6% in the country’s total foreign debt, which is about $21.4 billion in short-term (under one year) with $115.7 billion in the long-term (over one year). The banking sector’s (lenders and the central bank) external debt stock was $176.99 billion at the end of the 3rd quarter.

When we break this down further, 58.5% of the total gross external debt is denominated in U.S. dollars with only 32.3% denominated in euros. The amount denominated in Turkish lira among the external debt stock was a trifling 5.9%. This illustrates the crisis that will emerge with a change in the currency values.

IMF Hands $4.2 billion in loans for Ecuador for Julian Assange

IMF Hands $4.2 billion in loans for Ecuador for Julian Assange 

The evidence of political pressure on Ecuador is surfacing. The IMF Executive Board Approved US$4.2 Billion  (435% of quota and SDR 3.035 billion) Extended Fund Facility for Ecuador. The Executive Board agreed to this arrangement with strings attached. The Board’s decision enables the immediate disbursement of US$652 million (equivalent to SDR 469,7 million, or 67.3 percent of Ecuador’s quota). This arrangement provides support for the Ecuadorean government’s economic policies over the next three years provided they gave up Julian Assange.

It is very interesting how corruption and bribes grease the world. Every person who ever becomes a whistleblower on government goes to prison.

The USA immediately unveiled its request for extradition on computer hacking charges that carry 5 years. Of course, the US must put on its case to get its hands around Julian’s neck. Once he is extradited to the USA, they will unleash a battery of other charges to ensure he does life.

The rumblings behind the curtain are that the Democrats in league with the Deep State are behind this, hoping to force Assange to say he got Hillary’s emails from Putin as part of a plea deal. The danger of all of this nonsense is simply the plain fact it will bring us one more step closer to world war. What is clearly involved here seems to be a highly coordinated scheme that links the IMF and throwing Chelsea Manning in prison who will conveniently have to testify against Assange who can be eventually charged as was Manning and face the death penalty. By linking this to Russia, they hope to also prevent Trump from granting him any pardons.

This is getting very deep. Tyranny under the Banner of Liberty & Human Rights.

Why Has Everything Turned Sour? Is it the Press? Or is the Press Part of the Cycle?

Why Has Everything Turned Sour? Is it the Press? Or is the Press Part of the Cycle? 

QUESTION: Hello Mr. Armstrong,
I´d like your opinion on this,
During 7 Decades in which our lives got better, longer, richer, safer, healthier, better educated, more peaceful and more stimulating. Even World poverty has decreased in a rate never seen before, still, news coverage got increasingly negative

What explanation could there be for this? Is it excessive competition for attention as media sources multiply or an excessive any deeper reasons? I compare it to Markets, seems to be similar like trading on news, which is impossible because when the news is the worst, usually its the low and when everything and everyone is optimistic its the high.
regards

ESVideo Player00:0000:54

ANSWER: Coming out of World War II, society really advanced in many ways from technology to medicine. This is the part of the societal cycle that is best to live in. Then what happens is corruption. The news becomes corrupt in sync with politics. I believe this becomes the case because news becomes institutionalized as it is owned by big firms who then direct the news to slant to their personal benefit. This is a funny skit on British News. It is so true here in the States as well. The Democrats love CNN and the Republicans love Fox. The news gravitates to a political slant and is no longer about news – it is always about selling more ads and pushing their propaganda like some religion handing out flowers in airports.

Yellow journalism was created by the battle between Pulitzer and Hearst. They created the Spanish American War to sell papers. Pulitzer’s name was worthless. To rehabilitate it he donated money to create the Pulitzer Prize for good journalism, which he never practiced.

 …click on the above link to read the rest of the article…

Our Flawed Monetary System & Why it is Doomed

Our Flawed Monetary System & Why it is Doomed 

QUESTION: You mentioned that Rome had no national debt and no central bank. Exactly how did it function for 1,000 years?

JY

ANSWER: In addition to not having a national debt or a central bank, Rome had no police force or agency charged with enforcing the law. There were specific crimes against the state that would be prosecuted such as arson and treason. But the prosecution of a murder would be carried out by the family. The responsibility for enforcing the law thereby fell on the kin, tribe, gens and patron of the offended individual.

It was the King of England after Magna Carta who began to prosecute people for what was private crimes all so he could make money. By the time of the American Revolution, there were 240 felonies all of which carried the death penalty. So the king got to confiscate all your property and throw your family out on the street all based on what had historically been a private dispute.

As far as finances, the government simply minted coins to pay its expenses. As I have said, if we just created the money to fund the government rather than borrow, it would be far less inflationary. Because we borrow, with no intention of paying anything off, we must keep paying interest to roll the debt. That suppresses the economy, for it is competing with the private sector. It is a contributing factor as to why 70% of small business get turned down for loans that would expand the economy.

As shown here, the accumulative interest expenditures eventually exceed 70% of the total debt so the money never went to anything such as schools, roads, or social programs. If the government simply created the money, as did Rome, then the economy is segregated between public and private.

 …click on the above link to read the rest of the article…

Climate Change, Midwest Floods & Food Shortages

Climate Change, Midwest Floods & Food Shortages 

The Great Flood of 1927, flooded the lower Mississippi River valley in April 1927.  It was one of the worst natural disasters in American history. More than 23,000 square miles of land was submerged, hundreds of thousands of people were displaced, and around 250 people died. The flooding impacted areas in Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri, Tennessee, Texas, Oklahoma, and Kansas.

Following that Great Flood of 1927, we then see the climate swing dramatically in the opposite direction into the extreme drought that led to the Dust Bowl of the 1930s. The Dust Bowl was a period of severe dust storms that greatly damaged agriculture in the Midwest prairies during the 1930s. The Dust Bowl was a severe drought that came in three primary waves, 1934, 1936, and 1939–1940. The entire event actually complied with our Economic Confidence Model when many regions of the high plains experienced drought conditions for eight years.

Unfortunately, the global warming people are already out in force and blaming this on moms driving the kids to soccer matches. They always pretend these are catastrophic events never before seen. Cars were not really in wide use until post-1940s. They could care less about history or truth. The cycle is very clear. This major flooding which may destroy at least 6 billion bushels of wheat is a prelude to what is coming.

Long before there was the Global Warming crowd, there were the record-setting heat waves and drought of the 1930s that contributed to the Great Depression and wiping out agriculture that was employing 40% of the civil workforce at the start of the century. There were runs of extreme temperatures which broke all records. There was a stretch of 11 days straight in July with temperatures over 100. The two worst years were 1930 and 1936.

 …click on the above link to read the rest of the article…

Trump – Israel – Putin – Middle East

Trump – Israel – Putin – Middle East 

The interesting aspect of our war models has been that this cycle turned up in 2014 and we really do not reach the point of a major peak before 2022/2023. Back in 2015, we published a segment on the rising tensions that would emerge in the Middle East – the War Cycle. We warned about the division along the lines of religion in the Middle East which has pitted Saudi Arabia against Iran would become the major issue. As far as Israel was concerned, this would tend to turn up from January 10th, 2019, which is the conclusion of a 51.6-year wave from the 1967 6-Day war. Now the pieces are beginning to line up.

U.S. President Donald Trump’s statement that “it is time for the United States to fully recognize Israel’s sovereignty over the Golan Heights” received an enthusiastic welcome in Israel. Prime Minister Benjamin Netanyahu, was boosted in his position in the upcoming April 9th elections. He said he welcomed this “Purim miracle.” His rival Benny Gantz, whose party’s leading lights helped push for American recognition of the Golan’s annexation, said in a statement that Trump was cementing his place in history as a true friend of Israel.

That Netanyahu and Gantz were both delighted no doubt. The annexation of the Golan and the settlements established there enjoy widespread support in Israel. Ever since the Yom Kippur War of 1973, Syria has refrained from any attempt to recover the Golan by force. After 51.6 years, even the Druze residents of the northern Golan had accepted Israeli rule without rebelling. Naturally, Syria slammed Trump’s statement that it was time to recognize Israeli sovereignty over the Golan Heights as “irresponsible” remarking that it confirms “the blind bias of the United States to the Zionist entity.”

 …click on the above link to read the rest of the article…

Climate Change: Real – Fake – Exaggerated?

Climate Change: Real – Fake – Exaggerated? 

QUESTION: I find it interesting that you are against human-induced global warming yet you confirm that climate change is natural. You seem to be in the middle of these arguments. You warned that solar activity was declining and there was a risk of going into a mini ice-age, but you did not seem to place high odds on that one. So can you elaborate on this since you seem to be the voice of reason?

GR

ANSWER: Sunspot activity has declined on schedule. February was an incredible month void of sunspots. This is clearly contributing to the extremely cold weather we are having. Cyclically, between 1645 and 1715, there was a prolonged collapse in sunspot activity known as the Maunder Minimum. Indeed, that was a period where sunspots all but disappeared. This coincided with the “Little Ice Age,” which was a period from 1500 to 1850 in the northern hemisphere. It was so cold, Viking settlers even abandoned Greenland.

I have stated many times that a major error in analysis is the attempt to reduce a problem to a single cause and effect. This topic of climate change is no different. Many scientists have strongly suggested that the Maunder Minimum caused the Little Ice Age. As I have shown, correlating everything that took place revealed that during solar minimum there is also an increase in volcanic activity and earthquakes.

You will read that scientists seem to be debating between the two rather than comprehending that EVERYTHING is absolutely connected. We cannot reduce everything to a single cause and effect. Therefore, in order for me to confirm that we are heading into a new ice age requires more volcanic activity in addition to a prolonged solar minimum.

…click on the above link to read the rest of the article…

2019 is Breaking All Records for Cold – The Real Threat is a Global Freeze

2019 is Breaking All Records for Cold – The Real Threat is a Global Freeze 

QUESTION: Global cooling….you talk a lot about global cooling in the colder winter this year. But what effect does it have on the future summer temperatures and growing of crops?

GL

ANSWER: This type of climate change has the potential to be very profound. 2019 is already setting new records for cold and snowfall. In the center of the USA, the snowfall has risen to more than double that of 2000. There are many influences it has produced historically and the summer crop seasons grow shorter and dryer. Historically, this results in starvation in some areas but primarily malnutrition. That sets the stage for the rise of disease and plagues.

The Black Death was preceded by the Wolf Global Cooling where temperatures dropped by nearly 20% from the Medieval Warming period. As temperatures decline, the crop cycle shortens. In fact, so many people died during the 1300s that this brought an end to feudalism because there was a shortage of labor.

The Little Ice Age followed the Wolf Global Cooling. We can see that the price of wheat began to break out in 1545. Keep in mind that our model was created by pulling in everything we could get our hands on and correlating the entire world. When our model is showing Global Cooling and a pending bull market in the price of food, it is something rather important enough to put on the agenda. During the 1700s, even Thomas Jefferson and John Adams commented on how the ground froze to a depth of 2 feet. Nothing will grow under such conditions.

The Insane Surveillance of your iPhone that Exposes You To Massive Risks

The Insane Surveillance of your iPhone that Exposes You To Massive Risks 

There is a new and very serious data scandal rising up with iPhones that Apple is being asked to shutdown. There are a number of major companies who are now secretly recording your every move on their iPhone apps without your permission or even your knowledge. They are actually recording every keystroke you make. The list of companies are Abercrombie & Fitch, Air Canada, Expedia, Hollister, Hotels.COM, and Singapore Airlines to mention a few.

According to an investigation by App Analyst, they checked apps created by Glassbox by reviewing their listed customers to see exactly what data was leaving their iPhones and going back to the companies. According to TechCrunch, none of the apps that were checked bothered to tell the client that they were recording their screens or that they were sending the information back to each company. This type of surveillance to see what you might be interested in buying next is EXTREMELYdangerous. This is going way too far and we really do need laws to prohibit this type of data collection. They are capturing everything including your banking details.

What is becoming painfully obvious is you SHOULD NOT use your phone for financial transactions — PERIOD!!!!! Additionally, get a cheap laptop and use that for any financial transactions with NO OTHER apps for movies, travel, or anything. Segregate your financial transactions from the rest of your activities.

The European Crisis of Philosophy is the Destruction of the European Union

The European Crisis of Philosophy is the Destruction of the European Union 

The entire project of creating the Euro was a means to allow Northern Europe to effectively takeover Southern Europe and impose its philosophy in a totally one-sided arrangement. I have stated plenty of times that all the debts of member states should have been consolidated into the central Euro debt and thereafter each state would be on its own as is the case in the United States. But from the outset, this was like pretending to be one family, but you do not really want to associate with your drunken brother-in-law who is always asking for money. Oh yes, you have to pretend to be nice at funerals and weddings. But that is where family ends. The European Union is no different.

The crisis brewing here is monumental and it will tear the European Union apart at the seams. There is this crisis that because the Euro was NEVERdesigned properly to begin with, Brussels is trying to enforce its demands upon every member state to maintain austerity regardless of the consequences domestically in each member state.  When Southern European states joined the Euro, they had to convert all past debts from their local currency to the Euro. What happened was not only their national debts DOUBLED in real terms, but ALL PRIVATE debts also DOUBLED. Suddenly, banks that had lent Italian lira were now demanding to be paid in Euro which doubled in real value. Nonperforming loans skyrocketed and every politicians blamed the bankers for their own misguided creation of the Euro.

Noe the crisis in philosophy is rising to the surface. The new Italian government wants to provide €1.5 billion to compensate savers for bank failures. Brussels is insisting that violates their bail-in rules and cannot be done.

 …click on the above link to read the rest of the article…

So When Will the Yellow Vest Movement Take Hold in the USA?

So When Will the Yellow Vest Movement Take Hold in the USA? 

The Yellow Vest anti-government movement (#YellowVests, #GiletsJaunes) began in France on November 17, 2018, when over 300,000 people across France protested a carbon tax on fuel. President Emmanuel Macron claimed the French were leading the world in the battle against climate change. The Yellow Vest protests evolved rapidly into an all-out general anti-government movement that was supported by 70% of the French population. When Macron was forced to back out of the tax, the first thing he did was look for something else to tax to make up the difference. Then the French government had to ask Brussels for an exemption from austerity. This all proved one thing — the fuel tax was really about just raising taxes.

Now, the Yellow Vest Movement has gone worldwide, spreading at first to Belgium, where Brussels riot cops had to deal with them for week after week of protests blocking an oil depot. Then on December 8, 2018, the Belgians attempted to breach a riot barricade while calling for the resignation of Prime Minister Charles Michel, resulting in around 100 arrests. So in both France and in Belgium there are demands for the heads of government to resign.

What is conspicuously absent from the list below is the United States. Trump has rejected the climate taxes and lowered tax rates, moving directly opposite of all the other countries on the list. Nevertheless, the future for the United States is looking very bleak. The budget will force a rise in taxation as more and more government workers retire, thereby dramatically increasing the cost of government.

 …click on the above link to read the rest of the article…

New Monetary Theory is Like Sleepwalking

New Monetary Theory is Like Sleepwalking 

QUESTION: Bernie Sanders was basing his whole economic proposal to just keep spending and make everything free. They seem to be teaching this in school now. This macroeconomic theory whereby a country’s spending is only constrained not by revenue in taxes but by inflation when it creates a sovereign currency. It seems too good to be true, but some economists were teaching this to my son. Would you care to comment on this theory?

JH

ANSWER: The problem with what many call “new” or “modern” monetary theory is that it is like sleepwalking. You walk, creating GDP, while you are also dreaming. It reminds me of Shakespeare:

“To die, to sleep–To sleep–perchance to dream: ay, there’s the rub, for in that sleep of death what dreams may come when we have shuffled off this mortal coil, must give us pause.”

This economic theory is the same old incantation — how to prosper with other people’s money. Rome had no national debt and no central bank. It created money to fund itself. In hard times, they used the law to confiscate the property of people as they are doing today with their civil asset forfeitures.

What is missing in this theory is the question of debt. They assume they can borrow without end and never have to account for what they have done. They fail to understand that concept and try to regulate pension funds, which requires them to obtain government debt that they never pay off.

Yes, you can just create money to fund the government and it is confined by inflation. That is a true statement if taken by itself. However, you cannot then borrow with no intention of paying down the debt because the accumulative interest payments will end up representing 100% of the debt. This theory fails for it ignores dealing with the debt.

 …click on the above link to read the rest of the article…

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