By Greg Hunter’s USAWatchdog.com
Global economic expert Martin Armstrong says two big violent cycles are happening for the first time in 300 years. Domestic and international unrest is consuming the world. Armstrong contends, “Both of these cycles are converging at the same time, and this hasn’t happened since the 1700’s. That was the American Revolution, the French Revolution and etcetera. That was the revolution against monarchies, so to speak. This is not just Ukraine, Russia and the U.S. You have the Middle East going crazy. Gaza is starting up again with Israel. You go over to Asia and you have civil unrest in Thailand, and the overwhelming part of the population in China wants to go to war with Japan as payback.”
Why all the violence around the world? Armstrong contends, “When everyone is fat and happy, nobody cares. Everybody lives together peacefully. When you turn the economy down, that’s when people start getting mad. They lost something, and they want to blame somebody else for whatever injury they suffered. We look at the entire world . . . what you are looking at on a global scale is the emerging markets: China, Russia, South America, Brazil, South East Asia, their stock markets peaked in 2007. They have been in a declining economic trend . . . so you have the economic pressure building. This is what’s going on in Russia as well. We are making a serious mistake by thinking that Russia can’t fight. My sources say that they anticipated the sanctions on Putin would make the oligarchs turn against him and force him to back out. That’s not going to happen. We are going into a period of economic decline, and whenever that happens, government needs an external enemy.” So, when markets crashed in 2007, what did Congress do? They did investigations and went after Wall Street. They never admit it has anything to do with them. . . . If Putin were to back off, they would eat him for lunch. He would be overthrown within Russia.”
On the subject of new sanctions from the U.S. and EU, Armstrong says, “Europe is already in an economic decline, and it is a very, very serious one. Even the IMF has come out and said there are major problems with deflation, which is what you get from a Great Depression, and that is really what the EU is going through. I don’t see any hope of the EU bottoming out before 2020. It’s going to get worse.” So, is this going to lead to war between NATO and Russia? Armstrong says, “That seems to be what’s happening.”
On the Middle East, Armstrong charges, “The United States has made a complete mess of the Middle East. The real truth behind the Benghazi affair, that ambassador that was killed . . . he was effectively an arms dealer. They were providing all the arms in Libya to overthrow Gadhafi. When that was done, those same arms were sent to this group called ISIS who was against Syria. You have to realize that Saudi Arabia was really the one behind the funding of all of this. Why? They wanted a pipeline through Syria. The problem now is that everyone was trying to fund somebody else to do their dirty work, and now you have an Islamic State that is rising and it is taking territory from both sides.”
On the direction of the price of gold, Armstrong predicts, “I personally think you are going to see gold emerge as a currency of the underground economy. It’s not a hedge against inflation, and we have done every study imaginable. So, why are countries like China buying all this gold? Armstrong says, “People are buying gold, not because they think it will be going up, but simply as a hedge against government.”
On the recent strength of the U.S. dollar, Armstrong says, “The central banks only have the dollar, that’s it. It is the reserve currency. We had a former Obama economist who just came out a few days ago and said the risk to the United States is a strong dollar, and we should give up the reserve currency position. Why? Because they realize there is no other choice. What are you going to do, put your retirement money in rubles? How about Yuan? There is no place you can go. It’s only dollars.” So, is the dollar is not going to fall out of bed anytime soon? Armstrong says, “Not yet. You have to take the dollar up, and that will bring gold down short term. Also, as war begins to happen, you have to realize that capital flees from wherever conflict is. The more conflict you have in the Middle East and Europe, the more money is going to come this way (to the U.S.)”
In closing, Armstrong gave an ominous prediction and said, “The next decline we will see is going to be far worse than the last one. Each one is building in intensity.”
Join Greg Hunter as he goes One-on-One with Martin Armstrong of ArmstrongEconomics.com.
(There is much more in the video interview.)
After the Interview:
Martin is a prolific writer and has many free articles and information on his website, ArmstrongEconomics.com. He also has research and analysis for sale on many different individual markets. For ArmstrongEconomics.com subscription services, please click here.
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Replies
Kunstler; " There are times when events are in charge, not personalities. The unseen forces that hold the affairs of nations and economies in equilibrium dissolve, particles fly out of the many centers, and things heat up toward criticality.
Glance in the rear-view mirror and say goodbye to the Era of Wishful Thinking. This was the time when the USA was inspired by its Master Wish: to be able to keep driving to Wal-Mart forever. Looked at closely, the contemporary idea of Utopia was always a shabby package. On one side, all the pointless driving. For most Americans it was nothing like the TV advertising fantasy of a lone luxury car plying a coastal highway in low, golden light. More like being stuck near the junction of I-55 and I-90 in Chicago at rush hour in July in an overheating Dodge Grand Caravan with three screaming ADD kids whose smart phone batteries just died — plus your fiercely over-filled bladder and no empty Snapple bottle to resort to.
On the other side, there’s the Wal-Mart part: the unbelievable cornucopia of insanely cheap plastic goodies, like, somewhere in the 1990s America became one giant loading dock for nearly free stuff. Wasn’t that fun? Now, everybody has got the full rig, from the flatscreen to the salad shooter, but we’re tired of seeing Kim Kardashian’s booty, and nobody really liked salad, even when you could shoot the stuff into a bowl. The thrill is gone, and so is the paycheck that was your ticket to the orgy. It’s especially gloomy over in the food department, where the boxes of Lucky Charms are suddenly half the weight and twice the price. And that was going to be the family dinner! Must be Nature’s way of telling you it’s time for a new tattoo.
In this weird liminal time since the so-called Crash of 2008 leadership has depended on lies and subterfuges to prop up the illusion of resilience. One biggie is the shale oil revolution, kind of a national parlor trick to wow the multitudes for a long enough moment to convince them that their troubles with the national energy supply are over. Even people paid to think were hosed on this one. Wait until they discover that the shale oil producers have never made a buck producing shale oil, only on the sale of leases and real estate to “greater fools” and creaming off the froth of the complex junk financing deals behind their exertions. Expect that mirage to dissipate in the next 24 months, perhaps sooner if the price of oil keeps sinking toward the sub $90-a-barrel level, where there’s no economically rational reason to bother drilling and fracking.
The lies, frauds, and cons run between the axis of Wall Street and Washington had two fatal consequences with still-lagging effects. 1) They destroyed the capacity for markets to establish the real price of anything — rendering markets useless. 2). They disabled capital formation to the degree that we might not have the money to rebuild an economy to replace the “financialized” matrix of rackets that currently pretends to function. A lot of observers like myself have been waiting for the moment when the fog of pretense lifts and exposes all the broken machinery within. We may be so close now that you can smell it.
Change is in the air, literally, as we wake this still-summer morning with the thermometer so low you wish the furnace was prepped and ready to run. Much is in the air, too, where the news of events near and far provoke swirls of transformation in the disposition of people, nations, and affairs. Who would have guessed a few years ago how nervous Scotland would make the whole Western world? The sharpies at the Pentagon, and the White House, and the CIA may be waiting with indigestion and palpitations for the next ISIS decapitation video, but maybe you have to wonder instead which of five thousand shopping malls across this land will be visited by black-flagged desperados armed with automatic rifles and RPG’s.
Finally, there are the people themselves of this sclerotic polity: too dumb and distracted to help themselves, full of inchoate grievance and resentment, tending ever deeper into darkness. Welcome to the season of the witch in the Era of Bad Feeling. Somewhere “out there” there is a light of virtue waiting for us, but we are a long way from finding our way to it."
James Howard Kunstler
James Howard Kunstler