QUESTION:

Marty,
it was interesting for you to mention some chinese history including the mongol empire the other day. i am currently studying the monetary history of china. am reading the book “Fountain of Fortune” and “History of Money” by Glyn Davies. Davies mentions how the Roman monetary system collapsed in about nine years, rather quickly. Have you read the book? I was wondering where he got that information- was it from you or elsewhere. was that a well known fact prior your creation of your chart and collection of coins?

In contra st to the abundance of information we have on Roman and western monetary history, it appears, that Chinese monetary history is relatively unknown, at least there is not much written about it in English. and the chinese history is still debatable. there are no hard and indisputable historical compilations of coins it appears.

The chinese used paper money well before westerners did, but then lapsed back to a more commodity based monetary system, as I understand it, until recently.

How are you able to predict China’s rise as the center of global economic trade by 2032 without much data? or do you have access to extensive historic monetary data on China?

it appears there is much work left to be done on Asian economic history, no?

it seems important to understand China’s role given that 2032 is only 16 years from now as the West fades into the sunset and crumbles to dust.

thank you for all that you do

S

ANSWER: I am not familiar with the reference you speak of. What I can say is that we have a very extensive collection that includes Asia. The monetary history of China is well defined. We even have China, Zhōnghuá Rénmín Gònghéguó (People’s Republic of China), and Tea Brick money (185mm wide by 234 tall, 1088.6 g) in the collection.

When it comes to Asia, there is not much we lack. We have put together weights, metal content, and contemporary values. Yet, the history of Rome that claimed to rule the world (orbis terrarum) stood at the opposite end of the world from the strikingly similar Han Dynasty (206BC-220AD) in China, which also claimed to have ruled the world (tianxia). There is a history book for Tang-Dynasty in China that covers the period 618-907 AD. Yet, the text mentions 17 times what appears to be the Roman Empire . It also describes an envoy that was sent by the Roman Emperor to China.

The Roman Emperor was recorded to have been “Anton”. The account of such an envoy who visited the older Han Dynasty predates the Venetian traveler Marco Polo (1254-1325) by more than 1,000 years. This envoy has been attributed to the year 166 AD during the reign of Marcus Aurelius Antoninus (121-180AD). The death of Marcus Aurelius marked the peak in the Roman Empire and the turning point that begins the decline and fall of the Roman Empire where its monetary system collapses just 72 years thereafter. This envoy established diplomatic contact at the peak in the Roman Empire from which a disastrous decline began. Any political economic aspirations to further such a relationship died with Marcus Aurelius.

Yet also, both empires would suffer the same fate of barbarian invasions. The Han Dynasty fell in 220 AD, afterward, the chaotic period known as the Three Kingdoms (220-280AD) emerged, which was the division of the once unified Chinese Empire. The Roman Empire fell into chaos and Diocletian created political reforms in 284 AD. So there are many parallels to be noted as well.

 

 

Japan remains unloved opening down 1% and then drifting even lower as exporters led the way. The JPY has seen the safety bid for the majority of the week whilst the Nikkei has lost around 4% so far. Finally we saw a little support return for JGB’s since the news but then they have seen yields rising (or I should say, less negative) since the end of July. HSI sadly joined the equity sell-off today having missed trading yesterday due to the typhoon hit. The Shanghai Index spent the majority of the day in positive territory and even closed around the days high levels but not really a significant positive closing just 0.3% firmer.

 

Europe was encouraged by the HSBC’s proposed share buy-back rather than anything else as H1 numbers saw a 29% decline YOY.  A mixed bag of tricks for the periphery PMI’s kept markets cooled ahead of the lunch time ADP in the States, which is usually taken as a precursor to Fridays NFP. ADP came in at +179k, better than the expected 170k but the later ISM a little under expectations kept the market in check but no real future guidance. Tomorrow many are expecting the BOE to cut rates and so it will only be a surprise if the cut greater than 25bp or no action at all. SONIA (Sterling Over Night Index Average) is pricing a 95% probability we see the 25 cut with an outside chance of a 50bp move and then nothing until Dec. Much more discussion is around the size of QE play. Most call for unchanged in 375bn and only a couple of players calling for an additional 50bn increase. We see what Mr Carny has in store for the market at noon BST tomorrow.

 

US stocks were encouraged by the afternoon rally in oil and finally breaking the recent bear trend. Volumes remain light given summer trading but more news later in the week so traders are happy to play the waiting game. Gold lost around $10 in equally quiet trading despite some vocal support from key players. Bond markets recovered a little with a parallel shift across the curve. 2/10 remained unchanged at 87bp; 10’s closing at 1.54%. 10yr Bund closed 1bp lower at -0.04% closing the spread at +158bp. Italy 10yr closed 1.21%, Greece 8.15% (+7bp), Turkey 9.62% (+11bp – inflation showing faster than expected), Portugal 2.91% (+1bp) and UK Gilt 10yr at 0.80%.

 

As they lose ground in the Middle East, ISIS is continuing to lash out while expanding their terrorism since they cannot win the war. They have now come out and threatened Russia. “Listen Putin, we will come to Russia and will kill you at your homes … Oh Brothers, carry out jihad and kill and fight them,” a masked ISIS member threatened in a video posted online. We have to expect a sharp increase in terrorist plots in Eastern and Western Europe. Unfortunately, this is the trend into 2018.

Japanese 10-year bonds have crashed because the government is stopping its bond-buying program, at least for now. Prime Minister Shinzo Abe’s monetary policy is starting to demonstrate the dangerous position we face on a global scale with respect to interest rates and debt.

Japanese 10-year bonds have crashed since the Bank of Japan now holds over a third of the entire nation’s marketable government debt. By comparison, the Federal Reserve holds less than 20 percent of all US Treasuries, and this entire quantitative easing (QE) effort since 2007 to support the economy has utterly failed. The capital markets are demonstrating that the BOJ’s holdings of government debt threaten the world’s third-largest economy. This entire QE effort for these past 8.6 years is coming to an end. The JGBs have crashed and the Bank of Japan has suspended its buying for just now. This will indict the fate of interest rates moving forward.

We are looking at this same pattern beginning to emerge in other government bond issues. The entire QE program is wiping out pension funds and savers. With the four elections (Brexit, USA, France, & Germany), the degree of confidence in government debt should begin to decline sharply.

QUESTION: Mr. Armstrong; Do you think that Hillary can win? And if so, what would happen?

Thanks

RP

ANSWER: Our model is not unanimous for Trump. There is technically a 25% chance that Hillary could win, which one of our four models projects a Democratic victory. However, if you look at the mainstream channels from CNN, CBS, ABC, and NBC, it is very clear they have an agenda to defeat Trump. Just like in Britain, they are starting to manipulate the polls already. I would not expect the polls to be fair or honest this year as was proven in the BREXIT vote. The elites are desperate to kill Trump and they will manipulate the polls just as they forced the head of Fox News out on the very day Trump was to deliver his acceptance speech. They rig and coordinate absolutely everything to prevent a Trump victory. This is all out political war. Make no mistake about that. Even the Republican elites like Paul Ryan and John McCain want to defeat Trump and will hail Hillary behind the curtain. Neither one wants an outsider who might expose their corruption. McCain voted to put a sales tax on the internet and then denied he voted for a tax increase claiming he was voting only to force collection of what was owed to the States. He is a two-face liar with a nasty temper who berates even a waitress for the slightest mistake.

The press is part of the establishment and have received their marching orders to push Hillary. They are vehemently against Trump as are all the Republican elites like Paul Ryan, John McCain, and Mitt Romney because those in Washington want to rob the people as always and are clinging to power. The claimed Billionaires for Hillary are buying the White House and various positions on committees for ego. Hillary’s pick for Secretary of the Treasury will be Larry Fink, Chairman and Chief Executive Officer of BlackRock. He will get to sell all his stock in Black Rock tax free. This is why these people take these positions in addition to ego. They have to sell their shares and the law allows them tax-free status because this is a requirement. Why do you think Robert Rubin and Hank Paulson from Goldman Sachs took that position. Besides helping Goldman, they get to cash out tax free.

Those in power in Washington  fear a revolution is in the wind as they have watched in Europe. Politicians know all too well that what begins in Europe spread to the USA as a contagion in politics just as it does in fashion. So Hillary is one of them and both the Democrats and Republican elite are really behind Hillary to prevent any outsider from changing their power base.

I fully expect that those in power will rig the votes to try to make Hillary victorious just as they stole the election from Bernie in the primaries. You are talking about the most ruthless people in the country. You cannot get there if you have morals. I have stated before, the ONLY way Trump can win is with a huge turnout that is so overwhelmingly against Hillary. The press is now pushing the Libertarians because they believe that those who would vote for Trump will turn to the Libertarians and that will be a victory for Hillary. Our models have been showing a huge 3rd Party spike for 2016. The Press will now push the Libertarians to try to stop Trump and we should see that this election will produce the biggest percentage take of the vote for the Libertarians so far.

If Hillary wins, everything will begin to collapse much more rapidly and this may be part of the cycle since we are showing the earliest point for a monetary crisis reform in 2018. Hillary may be what is needed to push us over the edge. Hillary will approve all tax increases and send the economy down really hard especially since Social Security goes bust next year with medicare. Hillary’s Billionaires will be fine, but the rest of us will get royally screwed.

Hillary is owned by the NY Bankers. My own case began under the Clintons and I can tell you that Goldman Sachs ruled the court. The receiver Alan Cohen ordered all my lawyers to turn over all tapes I had documenting EVERY market manipulation from the early 1980s. They threaten to throw my lawyers in contempt with me unless they turned the tapes over to the court’s receiver. Then, all the evidence that would have been enough to hang many bankers in New York City, mysteriously was destroyed in the World Trade Center according to the SEC. Alan Cohen, the court receiver, was then hired by Goldman Sachs and placed on their Board of Directors. He worked for the Court and Goldman Sachs simultaneously and would never resign from the court. I believe Cohen refused to resign because someone else would have began to investigate what was going on and this huge conflict of interest between the Court and Goldman Sachs would have been exposed.

When Bush was elected in 2000, only then did the government offer me a deal to drop all the charges if I plead to some conspiracy with Edmond Safra, to which I declined. I stood up in court and objected to the seizure of all the tapes on the market manipulations to no avail. It did not matter. The federal court in New York City protects New York Banks. The corruption is pervasive.

Transcript of my Objection to the seizure of all my evidence against the bank manipulations

(see Goldman Sachs v Armstrong)

Goldman Sachs is under criminal investigation right now for the whole Malaysia deal and is being sued for $510 million currently because of their dealings. This is just the tip of the Iceberg. They set up Greece and Iceland. The trade deal  TTIP is to protect Goldman for anyone who wants to sue them must do so only in New York City. Goldman Sachs would be prosecuted under a Trump White House for it would be pay-back time. You can bet that EVERY mainstream media supports Goldman Sachs and is fighting very hard to make Hillary the president selling out the nation long-term to maintain everything as is.

So I do not expect a FAIR election. There is way TOO MUCH at stake here and you can see it with Paul Ryan coming out against Trump to protect the status quo. Handing Trump’s wife a plagiarized speech was a deliberate attempt to make Trump look like a fool. Trump did not fire the speech writer warning that he has people inside his campaign that are Trojan Horses for Paul Ryan and crew. These people are against the country and will fight as dirty as they can and I would not expect the press to expose any truth about Hillary but to now try their hardest to stop Trump. Just watch the news and everything negative they can possibly do to Trump mainstream media will now unleash. Paul Ryan and other elite Republicans have surrendered to Hillary to keep the corruption in place. The computer projects a Republican victory on 3 out of 4 models, and this trend is global as shown in BREXIT. Nevertheless, the corruption is so pervasive in Washington, both Democrats and the establishment Republican led by Paul Ryan will not tolerate any outsider coming in and taking the money out of their hands. The game is just rigged and they will rob the people of their vote any way they can. This is an outright political war – POLITICIANS v PEOPLE. Trump will not win if it ends up as a close count.

As a result, I will say this. If Hillary wins, I would then fear the government because it will be controlled 100% by Goldman Sachs. My battle was against those in New York. But now, New York will seize control of Washington. I personally would have to consider leaving the United States for I do not believe there would be any hope left and the nation will fall into total corruption. Our models shows that the West will fall and the Financial Capital will shift to China for the next wave starting in 2032.95. Hillary may be that final straw to help push Western society over the edge.

Would Trump be any better? I believe he is too independent to allow such corruption and that independence is what Paul Ryan fears. Goldman would probably be prosecuted under Trump, but the damage is far too great for this to be reversed where we save Western society. Hillary’s policies would just destroy the United States and Western Society as a consequence for we are already collapsing under socialism with massive unfunded pensions. Trump may put up a good fight, but he either surrenders to the elites naively or they will assassinate him because there is just too much at risk from their perspective to allow him to really change Washington.

Hillary is a hard-core feminist and that is the only reason she has put up with Bill to win the White House for herself. No other female head of state or politician I have ever met was such a feminist. The audacity that women should just vote for her because she is a woman is a warning sign that she is taking the 1960s bra-burning war against men to the White House. Such a gender war is inappropriate for a head of state. Nevertheless, this has always been her agenda and with Hillary in the White House, these types of women are normally harder than men to deal with because they often feel they have to prove themselves. Hillary would be more prone to war because she feels she needs to prove a woman can be tough. So the future under Hillary will be much more chaotic. We already have Black Lives Matter rather than ALL LIVES MATTER and this helps to keep society fragmented. Turning the White House into a feminist agenda will surely achieve Julius Caesar’s policy to win – Divide & Conquer. Hillary’s quest for the White House knows no bounds. Her motto is indeed – Veni Vidi Vici (I came, I saw, I conquered)

 

 

$278bn and the market is still disappointed! Despite the package provided by the Japanese government today late futures trading has followed the weaker cash market and extended losses by another 2%. Confidence is slightly dented as the market was hoping we would see the helicopter approach and that is why the market continued to sink and the JPY approaches the 100 level given there is no bazooka to be seen. China was really a side story today, together with the expected RBA rate cut but given all the action concentrated within Japan with Hong Kong restricted by adverse weather conditions.

In Europe it was banks that were again centre-stage. BMPS down 16%, Unicredit down 7%, UBS down 6%, Commerzbank down 9%, and Deutsche Bank -4% these make Barclays, RBS, and HSBC down between 2 and 3% look good! Coupled with the price decline in oil today, around 1.5% and through the $40 level, confidence and summer trading is having a larger impact on sentiment than would otherwise have. When Europe closed the US markets were playing around the days lows and so we close core European indices 2% lower DAX and CAC, with a 3% decline in IBEX with UK’s FTSE marginally holding just 0.8% off due to currency movement.

US markets attempted early session to hold small losses but as oil continued to decline, Personal Consumption released below expectation and Bond yields rising across the globe it should be no surprise that nerves start to hit the stock market. All core indices closed off of their lows but still in negative territory of around -0.6% lower on the day and with the VIX climbing over 8% to 13.5. We still have plenty to play for this week with ADP released at lunchtime tomorrow with the Non-Farms expected on Friday.

US Bonds saw a steepening theme throughout the day with safety sort in the front-end (as stocks declined) whilst 10’s and Bonds suffered from liquidation. The 2/10 curve steepened 4bp to 88.5bp ending with 2’s 1bp lower at 0.67% whilst 10’s gained 3bp to close 1.56%. European bonds wee all under pressure today with the German Bund price falling and gaining 3bp to close -0.03%. This closes the US/Germany spread at +159bp. Italy 10yr closed 1.21% (+3.5bp), Greece 8.08% (+5bp), Turkey 9.51% (+4bp), Portugal 2.90% (+2bp) and UK Gilt 10yr at 0.8%.

Private Blog Update on Gold

Well, home ownership in America is falling to a 51.6-year low. The actual share of Americans who own their homes fell to 62.9% in the second quarter, which was the lowest since 1965, according to a Census Bureau report.

What is happening is two-fold. Net real wages after taxes have been declining. Combine this with rising property taxes because states are dead broke. This is turning into a battle between government workers and the average citizen. Consequently, this is the number one hurdle that is now suppressing the average home value.

Affordability will be a huge issue, so the average home remains below that of 2007. Many real estate agents I have spoken to just in New Jersey warn of the same problem. They say that if housing prices returned to their former highs of 2007, the supply on the market would dramatically increase.

The property that has risen in the recovery from 2011 has been the high-end, which is driven largely by foreign capital inflows. However, there too, excluding the foreign capital, the trend is starting to reach its crest for right now.

The National Oceanic and Atmospheric Administration is engaged in outright fraud, just like the IMF, to further their agenda. Real science has exposed the fact that they do not have the historical data they pretend to have, on top of the fact that the two satellites they claimed collected data were mysteriously destroyed when it became a question. One must wonder why government is becoming the least trustworthy organization within society.

The head of the national conservative Polish ruling party PiS, Jaroslaw Kaczynski, has called on Germany to be fair and cooperative with its neighbors. He has said that while all Europe speaks of a German leadership within the EU, he said that Germany is not the United States and “does not come close to the former and current superiority of the Americans.” He highlighted the refugees from Syria and rejected Merkel’s policy saying “I would like to hear from Ms. Chancellor, what she was thinking when she opened the borders.“

The EU Commission law case against Poland is simply a “creative pleasure of the EU Commission” which “amuses me. Because this criticism has nothing in common with the current state of our country.” The EU is ignoring his words and cannot grasp that as Poland turns to the United States, more and more member may end up creating the isolation Germany and the EU. He explained that the BREXIT means that the EU has lost an integral part of the market liberalism that was necessary to create within the European economy.The relationship with Turkey, he point out, is on the brink of collapse and only the plight of the refugee crisis has prevented the final break. The relationship with Russia is at best frosty since the NATO-reorientation and the EU sanctions.

It is becoming clear that Poland and the United States are far more than just strategic partners, they have become close friends and allies with a common history and values. Many banks have moved their back offices to Krakow in Poland. Following the attacks of 9/11, Poland sent one of the largest military contingents of the NATO mission to Afghanistan.

The Polish Foreign Minister stressed that NATO stepped up its presence in Poland and in the region. Poland needs the US to make the forward presence on the eastern flank of NATO for a multinational affair. Poland and US together could make Europe a more stable area. This is not offered by Brussels.

The Poles know that Germany and Russia may change its regime and strategies with frightening speed. A conservative strategy requires a bilateral relationship with the US according to its top officials. Poland has announced that they will buy dozens of helicopters from US manufacturer Sikorsky and not from the French company Airbus turning to the United States rather than Europe. The refugee crisis is actually tearing the EU member states apart from the EU and Germany.