Topic: Martin Armstrong Discussion - page 332. (Read 647196 times)

http://armstrongeconomics-wp.s3.amazonaws.com/2015/09/FEDFOR-M-9-28-2015.jpg

Guys, how the above can be interpreted? The way I see it, FEDs would rise the rate in October, but not quite in a small step.
E.g. maybe 1% or 2%, and then in November in December trim it down for, let's say around 0.25%, and then up for around 0.25% in January??

32k is the number i got too without armstrong.. never know timing.

No one's right every time. The 32000-35000 thing was predicated on some sort of "phase shift" IIRC which hasn't happened.

The statement I just made highlighted in red above merits more explanation.

Declining interest rates benefit NEW BORROWERS at the expense of previous ones.  Think of it this way: A business last year borrowed at 5% to fund a project.  They are now (presumably) locked into that 5%.  Another business THIS YEAR borrows at 4%.  This new business now has an advantage in their debt vs. their competitors who borrowed at 5%...

But, there is always much more "old debt" than new debt.  So, the lucky ones who borrow at the lower rate then get a competitive advantage vs. those who borrowed at the older, higher rate (and which many more also borrowed at).  Thus, older capital is destroyed, and again there is more old capital than new.  Net: capital destruction, less efficiency.

The inverse would be true in raising rates (at least within reason, raising rates slowly).  In a rising rates environment, it PAYS to NOT borrow money if possible.  If money must be borrowed, it will be more expensive than "everyone else" who borrowed at a lower rate.  While it would be harder for new borrowers to get funding, a rising rates environment nets out as saving more capital (old capital) than destroying (new capital).

Fekete explains this better than I can...

 The fractal nature of reality is quite beautiful. I'm starting to think that Martin Armstrong's cyclical models are a subset of the larger evolutionary and developmental cycles of the Universe.

Perhaps! Are you familiar with the Transcencion Hypothesis by John Smart? He speculates that this Singularity or Infinity Point is only the first of many such paradigm shifts. It could be that what we see an an economic collapse is actually a vision of world currencies falling to zero while crypto begins it's true journey into price discovery.


From: http://brighterbrains.org/articles/entry/the-transcension-hypothesis-an-intriguing-answer-to-the-fermi-paradox

"It is these developmental processes in biology that govern cycles of birth, growth, maturation, reproduction, senescence and death that Smart seeks to apply to the possible development of the universe as a system. If the universe can be described as existing within a life cycle, then it becomes feasible to ask which aspects of the observable universe are attributable to evolutionary processes and which to developmental ones. If quantum mechanics, chaos, non-linear dynamics can be described as fundamentally creative and unpredictable then the laws of classical mechanics, conservation and entropy can adversely be seen as conservative and predictable.

It is Smart’s contention furthermore that if we could witness the evolutionary development of two parametrically identical universes from birth to death we would expect to see huge differences in terms of the creation of internal structure, the evolution of life, emergence of intelligence and the application of technology within such civilisations whilst at the same time observing deep commonalities in terms of historic processes, as well as biological, cultural and technological convergence. Species convergence in the sense of a non-identical, dynamic progression towards universal milestones is of critical importance to Smart’s next suggestion; rather than advanced civilisations seeding the galaxy in a process of expansion, evolutionary development guides intelligent life increasingly into inner space and what is referred to as STEM, small scales of space, time, energy and matter that eventually lead to black hole like domains.

The reversal of scale from the very large stellar engineering projects predicated on the expansionist model to the very small atomic and subatomic realms offered by the transcension model would certainly explain why no evidence so far exists of galactic intelligence despite the relative lateness of humanity’s arrival on the scene, particularly as the universe seems to many cosmologists as a life friendly environment. But what evidence is there that transcension is a feasible developmental trend?"

Here Smart turns to the history of structural complexity and argues that much in the same way that cosmological superclusters gave birth to the first galaxies, which in turn created the first stars that lead to stellar habitable zones, the evolution of planetary life and the emergence of localised human cultures, so to do human societies develop increasing specialisation, the construction of industrial cities which have become the leading edges of our civilisation, one that now stands on the brink of creating localised self aware technology. This great leap downwards will represent a further order of connectivity and miniaturisation as intelligent computers will have access to micro-realms and nano-computational domains currently beyond present technology. While expansions do occur such as the colonisation of the land by marine life or the future colonisation of the solar system by robots, Smart maintains that these events are limited, temporary phenomena compared to the predominant trend of increasing locality of the spatial domain within complex systems.


According to the hypothesis, the reasons for this trend are fairly simple; compression and energy rate density (energy flow per unit mass or volume) leads to increasing efficiency and computational capability:

‘Energy efficiency acceleration has also been shown to be smoothly logarithmic for at least the last few hundred years, across a broad variety of lighting, power, computation, and communications technologies and nanotechnologies. Note also that the higher the energy flow density of any system, the closer the system approaches the universal density limit—a black hole.’

Following this train of thought the growth in computational capability as measured by information creation, processing speed and connectivity, would appear to progress exponentially at the leading edge of complex systems with each medium being replaced by more STEM efficient substrates. The idea of accelerating complexity as a universal developmental process will not be new to anyone familiar with the concept of a technological singularity. But where transcension is unique is that it offers a framework by which people can examine the possibility within the context of an, at least partly, predictable cycle.

Rejecting the Kardashev scale as a meaningful measure for civilisation Smart goes on to support John D. Barrow’s scale of particle manipulation as a more appropriate indicator. In the Barrow scale a civilisation is assessed based on the spatial localisation of their engineering; the ability to miniaturise increasingly dense, efficient and complex structures down to Planck-scale limits. STEM compression rather than energy consumption becomes the key factor in judging the level of development, from the manipulation of genes and molecules down to the level of elementary particles and the fabric of space time itself. That seemingly magical capability may in fact be closer to reality than people imagine. For the human species it is estimated that if Moore’s law continues to hold, within 600 years a physical limit to computational acceleration will have been reached, leaving only one remaining domain to utilise. The energy dense environment of a black hole."

Looks like the retailers that followed armstrongs advice and shorted are about to be taught another lesson.. pigs gettin slaughtered

Well, most mainstream economists seem to think that raising rates will cause something bad.  But, as Armstrong has shown (and we learned that via TPTB's posts), it is unusual in history to have interest rates so near zero, especially for the rather extended time we have had them during our "recovery".

Interest rates, and their effects, can be subtle.  When rates are near zero, each move of 0.25% is actually a LARGE percentage change, this is not well understood, not even by economists.

Also, Dr. Antal Fekete has shown that declining rates are destructive to capital.  I wonder if Armstrong has explored that notion...  TPTB?

A return to a positive interest rate is welcome to me as a saver.

Yeah got somethings in my mind about the discussion he made and it is very reasonable in a way.

http://www.theguardian.com/business/2015/sep/29/imf-warns-new-financial-crisis-interest-rates-rise

His just brilliant and an eye opener to all of us. I guess this time we have to be courageous enough to stand up for what we believe in.

Indeed, the total economic collapse of 2032 could be the emergence of shared global consciousness which renders all notion of an economy obsolete.  
  
It's hilarious that we may indeed become the wealthiest humans in history just as all notions of wealth cease to mean anything.  

I was reading about the exponential acceleration of technology and stumbled onto this essay that outlines some compelling arguments as to why this "Singularity event" or "Infinity point" will occur by 2035 (at the latest). 2032.95 would fit almost precisely with what the the model in this essay predicts as an extrapolation of Koomey's Law

http://hplusmagazine.com/2013/12/23/infinity-point-will-arrive-by-2035-latest/

http://www.armstrongeconomics.com/archives/37527




I interpret that the collapse of every where outside the USA (which begins in earnest 2015.75 and is driving everyone back into short-term bonds for the final peak in government) relative to the lack of full speed stampede into the US dollar and stocks, will have reached its maximum apex by Oct 28, 2016 (2016.825). Hence to Nov. 24, 2017 (2017.9) the rally in the US markets will outweigh the collapsing markets outside the USA, such that we get a net turn up on the ECM and this will reverse the trend back towards private assets from 2016.825 - 2017.9, with the US dollar and stocks behaving as private assets (along with Bitcoin, gold, etc). After 2017.9, the ingress of international capital into the USA will have peaked, the US stocks will have peaked. From 2017.9 to 2018.528 will be mass confusion because no one will know which assets to turn to (or the government will be expropriating capital potentially under the guise of forced investment in bonds). From 2018.528 to 2018.98 will be the realization they have to turn to gold and cryptocurrencies. Thus subsequently from 2018.89 forward people will start to forsake government and separatists movements will really accelerate. From 2018.89 to 2020.05 all hell will break loose that will toast the West and give rise to the bottoming of Asia by 2020.05 as the smaller governance as a share of GDP there will step into the vacuum of power created by the collapse of (confidence in) Western governance.

Remember that since we are on a 51.6 year Private Wave (which ends 2032.95), then all upturns on the ECM are moves to private assets and downturns are moves to public assets (e.g. bonds) except the last down moves will be more of confusion (or capital controls forcing people into bonds against their will!!).

MA suggests that there will be a rush of money into USA due to the sovereign debt big bang. That would mean the stock market pushes to higher highs, yes? What sector stands to gain the most during this rush of funds? Blue chip stocks?

In general the lower the taxes, and the less complicated they are, usually yield the best results for societies.  High taxes, complicated taxes and big government yield tyranny.


"Corruptissima republica, plurimae leges"

- Tacitus

Shortcovering? Right on cue

http://www.forexfactory.com/news.php?do=news&id=559706

It's somewhat expected for quite sometime now, following the chain: No sales ->No need for production -> No need for commodities. Australia is one of the largest exporters of metals worldwide; after the VW/Audi/BMW/(who's left?) scandal the investors righteously concluded that the sales of those cars will go south. So no need for commodities, so the respective companies' stocks go down the drain.

Here it comes (for AUST anyway)

http://www.abc.net.au/news/2015-09-29/glencore-could-be-the-resource-sector-lehman-brothers/6812682
http://www.abc.net.au/news/2015-09-29/australian-shares-tumble-on-steep-overseas-declines/6812472

Interesting to see carl Icahn supporting Trump's bid for president and giving the US a warning. Whatever his rep is, he seems like a smart guy. He is also advocating dropping the "repatriation tax" that effectively double taxes companies that produce & sell overseas if they wish to bring the profits back to the US.

Imagine dropping this tax and seeing billions of $ flow back into the US, on top of what is already occurring.


http://carlicahn.com/