As global stock markets are seemingly slipping back into crash mode, imprisoned global forecaster Martin Armstrong suggests that not everything is as clear cut as we may think.
Most of our readers understand that the economy is in shambles, and consequently, stock markets shouldn’t be at the high levels which they recently achieved. The US government is printing trillions of dollars, but the dollar is still holding its own, especially now that crisis contagion is spreading throughout Europe. The only asset that seems to be doing what it’s “supposed” to do is gold, which happened to reach an all-time high on June 8 in terms of nominal dollar value.
For those who believe the economy will continue to deteriorate, and the Federal Reserve will continue to debase the dollar, the outcome is, arguably, pretty clear: Stock markets will crash, the dollar will crash, gold will rise, and economic and financial panic will ensue in short order.
What if, however, we were misinterpreting the signals – or at least some of them?
Martin Armstrong has some different ideas on what may play out:
When a major pattern such as a critical one as this WATERFALL EVENT is concerned, it begins to show up in short term levels of activity before the big one happens. The pattern of May 6th is the same pattern as the decline and fall of Rome. This is showing we are acting in the same manner and just as people panic intraday, this is how they will eventually act on the monthly level that is on the horizon.
Capital is confused because of all the bullshit spun by the various news services. They try to relieve everyone by claiming somebody had entered trillions instead of millions. But these type of explanations are designed to eliminate the truth. What is taking place is that capital is moving faster and faster in this global economy. VELOCITY is increasing and eliminating that ability of nations to even control their money supply. International capital can effect the money supply by at least 25% and when leveraged on a fast-track, who knows the real effect. The driving force behind this is CONFIDENCE and that is the key to everything. It is the key that will wipe-out the plans of all Western governments and is going to force a complete restructuring worldwide. There is NO intention of paying off any debt by any nation. It’s just one big joke.
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WE WILL SEE NEW HIGHS AND NO DEPRESSION!
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This is a DEBT CRISIS and you better start understanding what the hell that truly means. Capital is confused. The market made its crash because at first blush capital in domestic hands listens to the nonsense spun by the shill for the government. This is an INTERNATIONAL DEBT CRISIS and that means we are facing a crisis in international capital that will fly instantly to quality. That is why the dollar and gold will rise, and why YES, the stocks will rise as well!
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The doomsday boys who only see the Dow falling to 1400 – 2000 are lost in crevices of their own mind. This is an international conflict. This is not domestic. The talking heads will confuse more people than anyone and what they speak is the same old bullshit over and over again.
The fact that we have seen a WATERFALL EVENT intraday, warns that this pattern is going to manifest itself in higher levels of economic activity. Capital will at first rush into America for it can absorb it. This will swing the treasury bears who see only domestic inflation into losing positions. As they are forced into becoming bullish, then the capital flows will reverse once more and then we will see an outflow.
The stock markets are supposed to go down, but let’s remember what happened at around the time of the March 2009 stock market lows: stimulus. As Dr. Marc Faber has suggested, the government will do whatever it takes in an attempt to keep the economy from falling apart – and the current Keynesian policy of printing as much money as possible and infusing it into the system seems to be the trend going forward. Thus, as stock markets collapse, we can expect more of the same on this front.
In addition, there are millions of panicky Europeans worried about debt problems and Asians on the brink of a bubble-popping. Recent Treasury bond prices suggest that the safe haven assets of choice for the entire world is the US Dollar and will remain so until something happens to cause a loss of confidence in the United States’ public sector (i.e. government).
We’ve suggested before that the US dollar may continue to rise or remain strong until such time as the rest of the world realizes that our currency really is worthless. It doesn’t seem like they have yet come to this realization. After states across the Union start facing the serious prospect of debt default, and the US government has to print trillions upon trillions just to keep the public sector afloat, money will continue to flee for safety in the US.
But make no mistake, at some point in the not-so-distant future, confidence in the US government will be lost as well, and we will have a debt crisis of unprecedented proportions, at which point we will likely see a flight of capital out of US dollars and likely to the last remaining safe haven asset – gold.
The main takeaway: Expect the Unexpected.
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So over the long haul it’s screw the stock market, screw the dollar, screw the federal government, screw the FED, screw Obama.ÂÂ
Buy gold.  Got it.ÂÂ
LOL.
I guess I could have just titled this piece “Buy Gold” and used that sentence for the content of the post, because that sounds about right 🙂
I concur with Armstrong. I think this “downturn” has just about run its course. We will make new highs end of this year into early next year. Of course, that won’t mean squat when everything else doubles in price.
He is referring to “depression” in deflationary terms. This does not make it good news.
“New Highs” mean inflation, which means a weaker dollar. In historical view, a weaker dollar means more foreign investment in the stock market.  In fact, most contrarian economists are calling for, as what Armstrong is without saying it,  an inflationary depression. This is just another Wiemar or Zimbabwe prediction, nothing new.
Who cares if the Dow goes to 20,000 if a loaf of bread costs $100?ÂÂ
Or if the Dow goes to 20,000 and a six pack of beer goes to $500.00 !!!    Got gold? Got beer?
PR…..better yet, learn how to brew beer, you can sell it for gold….
It is not just gold.
It is the 3 B’s
Bullets, Beans & Barb Wire.
Remember gold in it’s self really does not have much use other than a trading medium. I good friend once told me if you can’t
Eat it.
Shoot it.
Live it or screw it it is worthless.
Red
By the end of 2011, the first stimulus will be dry, oil will be higher, europe will be in deeper trouble, and the Obama tax hikes will begin to sting.ÂÂ
Look for a huge event around that time.
Wow, dead wrong! Chris C and MA that is!
The Greatest Depression is still dead ahead. The worst is in front of us, not behind!
Brian, you’re a funny guy. Any evidence to back up your claims? I have plenty to back up mine, but I don’t care to list all of it here right now. Besides, I think you misunderstood me. I wasn’t saying things were going to improve, merely that prices (including the markets) would rise. Quite the opposite my friend.
Inflationary depression is the name of the game, because it suits the banks best and punishes the people the most.
Deflationary depressions are so old school.
Lets all of us just go to our happy place……..
Don’t forget silver. Think of silver and gold like thumb drives and disk arrays. You trade thumb drives with your neighbor or you plug them into their computer so they can copy pictures or documents off onto it or from it. As raw storage, its not big enough to be very efficient. Thats silver.
A disk array, however, could hold terabytes. You’d never unhook a 5 terabyte array and take it over to your neighbors house so he could see your pictures or print off a document. No! Its a dense storage medium. Thats like gold.
If you have 5,000 dollars to store, a few hundred ounces of silver and you’re good to go. Great for trading too. An ounce or two for some groceries or a shovel.
Gold might be great if you were going to trade for a house or a car, however, when you evoke your best SHTFPlan, will you really be buying houses or cars? Probably not. Unless you have 10K or more to store, stick with silver. Its much better trading material. …and right now, its way undervalued.
…and don’t forget other things too! After all, everyone has to eat. What if you invested a few thousand dollars in canned goods, rice, beans and wheat and started using them and rotating them? Not only would you stave off inflation, but, in a full on collapse, you’d be covered for a long time. This should be a big part of your SHTFPlan to keep you alive. And, in the event of a full on collapse, you can bet those canned goods will appreciate in value much more than silver. A pound of rice might get your a shovel and it only costs you about a dollar now. However, at current prices, a good shovel will cost you an ounce of silver at about $18. After TSHTF, it may be 2 oz of silver.
The dynamic and worth of things change when conditions and interests change.
Brian & Chris
I don’t think its going to be a question of inflation or deflation, its going to be biflation. Its going to be like a rip saw cutting a nasty gash in the country. When it happens lead will be worth more then gold. So, if you can’t afford gold or silver stock up on lead (ammo) while its still cheap.
When the SHTF people will give up the gold for security, food and water. The one who can protect from the ones who would take will thrive in the new economy. Its a classic battle of good vs. evil
Patriot One,
I am quickly becoming a fan or your frankness and wisdom.
You’ve been thinking about this for quite a while, haven’t you?
Frankly, all the comments as of late have been very helpful and insightful. Thank you everyone for all your advice and cordiality.
Mr. Armstrong says money fleeing to the safety of US bonds is mistaken. The US too will default on its debt and that would make stock markets a better store of value than bonds. He specifically mentions the Australian stock market.
Timing is everything.
NetRanger
I started having bad feelings back in 2006 when I felt we were going to see all kinds of unintended consequences from government regulation.
Back then I couldn’t put my finger on it, but I started to try to sell hard assets. I even changed most of my cars to diesels and took all my hunting rifles out of the closet and sold them to buy battle rifles.
I don’t think we will get hit with a NBC attack so I don’t store years worth of food. My plan is 90 days of food just to get me into a growing / production cycle and refresh my hunting and fishing skills.
My main focus is my family and friends. Can I provide security, food, shelter and water? Can I minister to them and care for them medically? If I can achieve these basics, we will survive and thrive in the new economy. If God is for us, Who can stand against us.
Knowing what is going on now with the financials will only help to manage the effects of the crash on my family and friends. Knowledge and wisdom are power. We are in very short supply of both at this time.
Comments…..here is a couple of things we might want to discuss …… ÂÂ
Protect and Preserve Your Free Speech Rights
The Left’s New Threats to Silence the Right
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http://www.mrcaction.org/517/petition.asp?Ref_ID=3548&CID=517&RID=21249560#J1
Obamacare ends Insurance for one million poor in September…
http://capoliticalnews.com/blog_post
 There is No Will to Grow the Free Market Economy beyond what Government is allocating . The Environmental Impact is stalling the will of Government to override the will of Environmentalists and the Voting block this represents . They Now control the use of Resources in the world or the distribution of them through court actions . They can alter the means in which the needs are financial distributed . This has World Governments printing their own operating capital because there is not enough revenue streams coming out of the private sectors as they are locked out of private capital by the various means imposed through the systems the Marxist Environmentalists have designed through the courts creating a risk / reward stall on capital placements worldwide because of the environmental impacts they fear to the earth , and you can see this by the way the Cap and Trade legislation is designed and the way it is effecting the will of private enterprise to risk capital on durable equity development , a direct extraction of earths finite resources , something the environmentalists have said the earth has reached its end capability . Read this website to understand what is being said on the Progressive side of the environmental movement , this is a Marxists approach and we all need to understand where the power lies within the influence over Governments now and the voting block this represents ;  http://dieoff.org/   and see the ” New ” designs for the role of Government they have designed here ; its called ” America 2.0 ” , http://www.warsocialism.com/America.htm ÂÂ
 If this were not true then private capital would be financing the recovery , not Government Monetization , and if you think they are not monetizing the debt to run Government , you must be in orbit , because the only thing thats separating the fact of Government Monetization  is the independent phone Federal Reserve acting as the funding agent , take them out of the picture and you have a Monetization by the Government pure and simple . ÂÂ
 The Free Markets are going to Have to Debate this group and sell them on why the Free market Concept is better than the Government control ideology .
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Most everyone these days is hoping that there’s a person out there that knows more than all the others, and many are following them.
No one including Martin Armstrong knows what’s going to happen least of all to any of you in your particular and uniquely individual situations.   Don’t lose sight of that.  Everyone can conjecture, everyone can state they know more than the other opinionator, everyone can type in words and send them off into the internet-verse.  And that’s about all it really is: a multitude of opinions trying to predict the future with no real skin in the game as far your skin is concerned.     They owe you nothing if you lose.
What I’ve concluded is that the only truly viable act anyone can do to bolster their chances of comfortable survival these days is not to put too many eggs into any one basket based upon someone else’s vaunted opinion no matter how respected or convincing that they know how the future is going to precisely play out.     During uncertain, volatile times as these, having your eggs spread around increases your odds of being right at least some of the time which is mathematical fact.    Having your eggs in only one or two places increases your odds of being wrong most of the time.   Waringly place them in those baskets accordingly.
IMO, I would not blindly and  trustingly follow, any person’s advise, prognostication, forecast, prediction, or educated guess as to what is going to happen and much less when it’s going to happen.
In these uncertain times what I’m saying is that most likely what your heart, your gut – those  ‘little voices ‘ you at times hear – that tell you in what direction to go needs to be heeded above all the din from all other voices – many of them conflicting and overwhelming you.   You have to first follow yourself here.   If that happens to follow an Armstrong’s opinion, then fine, follow that.        But ultimately it’s going to be everyone for himself when you really think about it.    Armstrong will not be there to help you if it goes the other way.
Now, if you’re wrong, you’re wrong.  But at least you will not have followed someone else’s opinion to your downfall.     Again, never forget that ultimately these are just opinions you’re hearing and no one knows better what’s best for you than yourself if you first listen to yourself and heed.
Although I’m sure there’s some truth in what an Armstrong says, I am always cognizant that he is seeing things from a different place, and therefore he is not me.    I am here, he is there.  I try and do what’s best for myself if I can in light of where I am and most importantly who I am.   I may not be as financially smart as Armstrong, I may not have the command of history that he has nor the perspective experience, but what I do have again is that inner voice.
Listen to it.
RH
http://www.moneynews.com/StreetTalk/Economy-Shrank-Obama-Stimulus/2010/06/09/id/361476?s=al&promo_code=A0AD-1