Hello Armstrong, I could not resist to make a comment in regards of the freaking Tariffs war that is going to begin on this coming Tuesday between Canada and the USA .

The future looks bleak and as always the working class would see their lives going from bad to worse. I feel the world just need to go kaput !?Now!

Gemma

REPLY: The 2025 Canadian Report will be available after next weekend to everyone after Mike Campbell’s Conference in Vancouver. No doubt, the attendance after these tariffs will be a hot topic in addition to the resignation of Trudeau. Trump posted a message that there may be some pain, but the end will be fantastic. He tells them to build it here with no tariffs. So you will cause unemployment outside the USA to which you will be unable to sell anything to them. Sorry, we are headed into a recession for some places and a depression elsewhere. This was not a smart move.

Trump has just made our model correct once again. The world economy will now shrink and decline going into 2028. By the time this cycle is over, he will be blamed for much, contributing to when the government will collapse, feeding into the end game – 2032.

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The computer seems to have predicted Trump’s antiquated economic theories, for it had a Directional Change on the yearly level in the C$. Trump is acting on the old theories inspired by Karl Marx that he and everyone else are still taught in school to this day. I was just having a discussion with an economic professor in Italy who can see what has been taught is just wrong. This is all wrapped up in the theory of labor and the nonsense that the company will move if someone works for $5 less than someone else. That is just not true.

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There are so many factors involved that I had hoped Trump would have reached out and at least talked to me rather than his cronies who keep preaching the old theories that died with Bretton Woods. I was going to have a World Economic Conference for the next generation, where I go over all of these nonsensical theories that have failed and explain how the real-world economy functions. Trump won’t attend, but he should. He has just initiated what I warned about – he will go down in history not much different from Herbert Hoover. I wrote about the role of tariffs during the Great Depression. I suggest you read it and send your senator and congressman a copy.

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This asinine theory of tariffs and currency manipulation all for trade is beyond being just lamebrain. This dates back to when money was gold and silver coin, and even Sir Thomas Gresham’s law that bad money drives out good money has been so distorted, along with the theory that the quantity of money tied to inflation no longer stands the test of time. This was when foreign exchange was entirely based on the metal content of the coinage, for there was still no dominant financial capital of the world coming out of the Middle Ages.

Then came John Maynard Keynes, a mathematician, not an economist. What he observed was the essence of a recession or depression. As uncertainty arises about the future, people will hoard their money and NOT spend it. This is what Gresham observed: debasing the coinage under Henry VIII, people hoarded the old coinage and spent the debased. The money supply shrinks with the velocity of money. I have been buying hoards of coins over the years, generally from the 3rd century AD when the political situation of the Roman Empire was in chaos. People buried the money in times of uncertainty. This is a fundamental human nature aspect.

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I had sold Athenian Owls, which were also a hoard, during the uncertainty of the Peloponnesian War when Sparta defeated Athens. I had also offered a hoard of Roman Republican victoratii that also was a hoard from the uncertainty of the Punic War. We do not tend to find hoards from the good times. I would love to find a hoard of the Julio-Claudian period, but this was generally a stable period in Roman history. The amount of hoards from that period is limited. But hoards are also a snapshot of what was in circulation at that moment in time. When the eruption of Vesuvius buried Pompei, one of the most common coins discovered was still the Marc Antony legionary denarii from about 100 years prior.

What Trump does NOT understand, nor does any of his economic advisors, is that inflation can also be caused by asset shortages or a speculative boom and currency declines causing inflation. What Trump is going to be slapped in the face with is currency inflation. A number of reasons can cause a decline in a currency. What Hoover did not understand was the 1931 sovereign defaults in Europe sent the dollar higher. This was MISUNDERSTOOD and led to the tariffs because foreign wheat was then cheaper than domestic. What Trump fails to comprehend is that the political turmoil in Canada, mixed with 25% tariffs, can send the C$ down to new lows and test even the 46-50 cents level. That would be a 27.5% decline in the C$, negating his idea of tariffs.

This will be just one day dealing with how the world truly works. We won’t have the typical gourmet food or the cocktail party that hotels charge just $100 a head for cocktails. We are trying to reduce costs so the next generation can afford to attend and make like-minded friends perhaps for life. But we will also have live streaming worldwide. They can watch even from China and Russia. It seems we are not blocked around the world. We must speak to the hotel to see when we can get space. I am thinking about between April and May. The cost will be affordable since there will be no forecasting reports, lunches, and dinners.