Topic: No Money Exists Without the Majority - page 4. (Read 10254 times)

http://armstrongeconomics.com/2013/08/18/money-had-never-been-tangible-period-if-you-do-not-understand-what-money-is-you-will-lose-your-shirt-more/

At the above link, what Armstrong is trying to say that gold can't be the ONLY thing we use to measure value.

I had explained in past emails why we can't have the ONLY money be something that is very limited in supply growth because this would limit the rate that the economy can grow (due to prioritizing savers over at-risk investors). That is a difficult concept to understand and only 1-in-a-million will ever understand.

But even that is not a complete conceptualization. We can't have ONLY one thing be money, because never can one thing adjust to the dynamic changes in GDP, money velocity, etc.. This is why many different things are money, and they have different strengths and weaknesses (or lets just say different qualities or properties).

The economy trades between these different forms of money, because the business cycle exists. Business cycles MUST exist, because waves are a fundamental quality of inertia. Our universe is based on inertia.

So Armstrong's mistake is saying that gold is not money and trying to say that a store-of-value (wealth) is not a form of money. The reason Armstrong makes this SYNTACTICAL distinction, is because he is trying to say that money is the most liquid form of asset, i.e. the one the most people will accept in trade. It is true the dollar is more liquid than gold in many scenarios, but we are at a time where sometimes dollars are not liquid and gold is, due to capital controls and hunting down capital of all U.S. citizens.

What Armstrong is saying that is 100% accurate is that there isn't one form of base money that is tangible which everything else being not money. He is 100% correct about that.

Unfortunately this topic is above the heads of most people, so it doesn't matter how many times and ways Armstrong attempts to explain it, only a few people will truly understand.

I should keep an eye out for the possibility that Europe could bounce until 2014.675. I need to search for facts that can tell me how long this bounce is likely to last. I don't want to be too early again, as I was on China last July 2012.

As I've been expecting, looks like we will get that a deadcat bounce in capital fleeing Europe and developing markets into the USA, which may put a temporarily top on the USA equities. Safe haven bond yields in Europe are increasing (exodus from safe havens) and US Treasury yields are declining (from recent dramatic rise) which is a combination of capital coming out of USA equities taking a breather, capital coming out of safe haven European bonds, and lower PPI placing doubt on Fed's Sept. taper.

http://www.reuters.com/article/2013/08/14/markets-usa-bonds-idUSL2N0GF0OJ20130814

http://www.bloomberg.com/news/2013-08-13/germany-s-bonds-fall-for-second-day-before-zew-sentiment-report.html

China and Europe are both posting deadcat bounces from their declines.

Europe's bounce is all confidences increases and more debt caused by a strong Euro, very low interest rates in the safe haven countries (my Belgium friend says he can borrow 5000 Euros any time and pay 230 per month), and increased government spending.

http://www.tradingfloor.com/posts/french-gdp-soundly-beats-expectations-572561113

http://www.tradingfloor.com/posts/euro-area-businesses-upbeat-economy-59627692

A chart shows it is just one of those bounces in a persistent decline since 2009:

http://www.tradingfloor.com/posts/french-production-contracts-sharply-gdp-should-rise-anyway-1352928205

And the big picture is still weak:

http://www.theguardian.com/business/2013/aug/14/eurozone-recession-germany-france-crisis

But the most important datum is what likely caused strong Euro, how about $1.7 trillion dollars being converted to Euros by the USA Fed!

http://hat4uk.wordpress.com/tag/french-debt-174-of-gdp/


So the Fed is blowing another bubble in the Euro and Europe, which provides a temporary deadcat bounce, but what happens when this €1.3 trillion flees a renewed crashing Europe back to chase yield in the USA markets (either directly or via leverage as it allows Europeans to continue to borrow and access their deposits longer).

Aug. 7 was clearly the turning point where Europe has committed to crash and burn (with the help of the Fed pushing European confidence falsely up to increase debt levels on what is already an insanely insolvent Europe), and first we get a deadcat bounce through the September elections at least.

They likely did this to help get Merkel through the September elections in Germany.

So we should get that deadcat dip in the US equities now, until the above manipulation by the Fed works its way through the system.

Then rockets up on US equities and further collapse for and exodus of capital from Europe and developing markets. The fundamentals all over the world are that debt is increasing but marginal-utility-of-debt has gone negative globally, thus confidence bounces are volatilty noise and the trend is spiraling the toilet bowl, with the US dollar at the center of the vortex sucking everything until it collapses on itself.

Then and only then, will gold make new highs:

http://armstrongeconomics.com/2013/08/14/gold-outlook/

Remember on Exter's Inverted Pyramid, that US federal reserve notes are at the bottom just above gold. Patience goldbugs, patience...

http://finance.yahoo.com/blogs/the-exchange/bitcoin-money-just-terrible-205752180.html



Note I think Zerocoin would still be useful to break block chain analysis, even if one has perfect anonymity.

Thanks for making the point, but I think the high valuations are based on the same quantity of goods & services still being transacted in the economy and Bitcoin taking a larger share of that economy. So those high valuations reflect the relative rise in purchasing power.

However this (extreme valuation result) points to another flaw in Bitcoin, which is that only 21 million coins will ever be mined. Thus Bitcoin would crash the global economy (if it gained dominant share) as I explained already:

https://bitcointalksearch.org/topic/m.2881311
https://bitcointalksearch.org/topic/m.2892394

A fixed alternative to Bitcoin needs to have a persistent 5% per annum debasement in order to maximize economic growth and fairly balance the return of Bitcoin savers vs. business investors:

https://bitcointalksearch.org/topic/m.2895021

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-416


http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-434

I was reading the Philippines Inquirer news section on some days earlier this year, and nearly every time I read about some bond issue by a corporation denominated in dollars (e.g. MegaWorld, Ayala Land, San Miquel, etc). My hypothesis is that QE sat at the Fed but it raised the reserves of the banks allowing them to loan out more money, but this doesn't show up in Western credit increases rather somehow the loans are ending up in the developing world. Or it could just be investors seeking higher yield due ZIRP in the West. I read from Martin Armstrong that this was going on in Latin America too.

But now the Great Rotation has started and capital is rushing back into the dollar, USA housing, USA equities, and as this drive USA interest rates higher, then it has a spiraling upwards feedback because potential home buyers rush to lock in the rates before the rise more, international investors (escaping coming capital controls in Europe and depreciating Yen due Abeconomics) rush to grab higher rates with an appreciating dollar, and domestic investors jump on the bandwagon (noticing that the recovery in equities since the 2008 crash is now more than just a recovery given new all-time highs).

This rotation is also pushed by declining GDP in China, Europe, and thus rest of the developing world which feeds commodities and manufacturing inputs (notice a deadcat bounce in copper, gold, and stall in USA equities since China released better data past week).

This rotation thus reveals the developing world is short the dollar (they owe dollars) while their currencies decline relative to the dollar due to this shift in capital flows. This will bring the developing world to its knees between now and the end of 2015, while the USA non-bond (except high yield) assets and dollar will be skyrocketing. Yet simultaneously this rise in USA interest rates and dollar will be choking the real economy (along with Obamacare tax rises coming 2014 and plans for more increases), thus in 2016 we will likely see the USA economy roll over, as Europe, Japan, and the developing world will likely already be sinking into the abyss by 2015 (c.f. my upthread post on the net liabilities of Germany, France, USA, and UK greater than the PIIGS although this is hidden in accounting gimmicks, also German and French banks are bankrupt, again hidden in accounting gymnastics).

Michael offered his calculations on China in an email to Mish Shedlock. The problem is those calculations don't factor in a 30 - 50% contraction (contagion) in global trade.

Face it, the world is bankrupt financially (maybe not in human and real capital in the countries with much youth but the write-down can be chaotic). Fasten your seat belts. Giant Portobello ahead.

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-437

Armstrong's ECM (Economic Confidence Model) is global (and based on time multiples of Pi, i.e. 224 yrs ≈ 78 yrs x 3.1459, 78 yrs ≈ 26 yrs x 3.1459, 26 yrs ≈ 8.6 yrs x 3.1459, 8.6 yrs ≈ 1000 x 3.1459 days) and it expected the turn downward and shift of exodus capital flows to accelerate Aug 7, 2013. Right on time on Aug 7, Europe decided that depositors will only be able to withdraw 100 Euros per day when a bank is bailed-in. Imagine the collapse in monetary velocity thus GDP upon widepread bail-ins. I've read that banks' trading losses have priority in bankruptcy ahead of bank investors and depositors.

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-438

Armstrong arrived at this ECM model with the scientific method by back testing the hypothesis to all recorded history (even spending $100 million to obtain the data and build the computer model) and then to the future, and has been more accurate than any other forecaster. I have not been able to find one forecast from him since the 1980s that didn't come true. Predicted the Sept 2000 market top, Nov 2002 market bottom, January 1st, 2005 yearly high for the NASDAQ to exact day in document that was published in 1997 which also predicted the 2007 market top and earlier had predicted the upturn in commodities in 1977. Predicted back in Jan. 2012 that gold would decline from $1600 to below $1200 before 2015 even while everyone was screaming he was nuts. This year he was writing a blog every few days shouting that gold was going to fall. The goldbugs hated him. He predicted the top in gold in 1980. He predicted the crash of 1987 (to the day!) and that bull market in Japan would continue until end 1989. His model predicted an event something like 9/11 would happen, etc, etc, etc..

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-439

Clif Droke wrote an article challenging the Great Rotation based on the Kondratieff wave, while explaining why the divergences in the USA equities are largely an exodus from low yield muni-bond funds. Thus the net capital ingress is much higher than he realizes as it is obscured by an egress which is funding the ingress. Kondratieff only used data from when the economy was primarily agarian and thus commodities. Unlike Armstrong who gathered data from 10,000 B.C. until now, the Kondratieff wave is only valid for commodities and thus yes gold won't likely bottom until 2014 (under $1050). Yet the ECM model sees the DJIA doubling (after a dip now due to deadcat bounce in China) by 2015.75.

I know this blog is not about speculation predictions, yet what I am writing about here is the model for the unraveling dominoes order of the coming global contagion, i.e. the international capital flows. Herbert Hoover wrote about the Great Depression, it was as if capital where chairs on the deck of the Titantic, rushing from side-to-side of the global economy unable to find a safe haven and real growth. This is what happens with ZIRP and sovereign debt end game all through out history. This pattern repeats as Michael wrote in his blog about "Globalization". The ECM quantifies the timing of the (business, political, technology) cycles.

Why does energy transfer in waves and why does human action occur in waves (i.e. cycles)? Michael possesses a physics background so he can readily appreciate inertia, acceleration and force. For example, if you push on a twig then you increase the force until it breaks. If you put too much force on a thick enough twig, you fall down as it breaks and your inertia pulls you forward. Then you recoil, i.e. a wave. Everything in the universe has an inertia, including every human and thus human action. My blog is linked on my name and I wrote more about this in The Universe.

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-395

1) I provided a link upthread about telcom monopolies give us slow internet in the USA. Regulation has multiplied and now touches every small business, as explained in the link I provided. Indeed, the New Deal launched many of the programs we have today, but now the programs are pathological, e.g. you can't build on your land because the federal government makes some environmental ruling about an insect or otherwise comes to steal your rural land. Google "sheriff stops federal government" and there is a lot more in that rabbit hole than I care to detail here.

2) The low property tax percentages (you've got state + local schools, etc) are mostly if you live far from civilization where the opportunities for employment are much less. And either property taxes and/or sales taxes will be skyrocketing because the state and local governments are under severe financial stress which will get worse (the demographics of the USA are not improving any time soon, and many retirements to pay).

3) In the 1950s, nearly no one paid capital gains, mostly only corporations. Now a significant percent of the population are investors, e.g. their 401k plan, etc.. I already provided a link in prior comment that capital gains is increasing from 15% to 18.8% under Obamacare, and dividends are no longer taxed as capital gains rather as income where the top rate is increasing from 33% to 35%. In 1950s, dividends were not taxed as income. Note capital gains on gold is taxed at 28% and you are going to need gold to maintain your net worth after 2016.

4) You fail to assimilate that most Americans weren't paying much tax back then. Did you just ignore the data in the link I provided as quoted below?


Nearly no one paid the top bracket income tax rates in the 1950s. There wasn't an Alternative Minimum Tax as we have now at 20%, so used loopholes to avoid paying any tax. And the middle class was only paying 2%.

Also the regressive sales taxes we have today were progressive back then, meaning again that most people didn't pay them (or the top rate). And the highest rate I've found is 3% with most at 2% or less (and most weren't even paying that) and some locales have over 10% now.

Although it is true that we have a huge underbelly that pays no tax (used to support leftist arguments that taxes are low), that socialism is exactly what it going to tax the middle class into extinction over the next decade as the fiscal situation deteriorates as more boomers retire and interest rates rise.

When Reagan lowered taxes, they also closed many of the loopholes and deductions that were available to the middle class.

A google search for "Hauser’s law" brings up a relevant historical chart showing that those top tax brackets in the 1950s weren't being paid.

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-339


Sorry, you couldn't have been more wrong.

I was including Europe, which has insanely high rates of taxation.

USA income and capital gains taxes are on the way back up (and that doesn't include that caps on FICA do not adjust higher as fast as true inflation), the investment tax and regulation costs (hidden tax) in Obamacare starts next year, and Obama wants more. Property taxes so high, you can't own your house (property taxes were minuscule in the 1950s). There are many hidden taxes due to regulation that did not exist in the 1950s. There has been a 1250% increase in taxation for a family of 4 since 1948.

Pottery records indicate that production continued to increase into 5th century, but then the rate of clearing and expedient farming methods to keep up with the tax and debt reached the point where soils collapsed, irrigation was polluted, and the economy collapsed. We will know the true condition of the USA when interest rates rise several percentage points (by 2016) and then eventually to double-digits. Don't forget a $quadrillion in interest rate swap derivatives, and those have been moved in front of bond holders and depositors when bankruptcy hits. Note the Fed is privately telling banks there will be no more bailouts. Ditto Europe is preparing for bail-ins, over $100,000 is gone (and if you take it out now there will be clawbacks), and under $100,000 will be limited to 100-200 euros withdrawal per day. After that reduction in money velocity crashes Europe, they will have to make the capital controls even more severe.

No it is not. Top-down is never the same result as free market decentralized, c.f. my prior link to Some Iron Laws of Political Economics.

If I ignore your future posts, you know why.


Absolutely not, the difficulty scales to the ROI on the hardware and electricity.


Expiration of the 5% debasement needed by economic growth is a big mistake and is why I will be making a better Bitcoin. See my posts upthread.

I probably won't reply to you again, because you have so many misconceptions and I am lacking time. No personal insult intended.


False. We need ever higher difficulty to prevent a 51% attack.


We've got to have 5% debasement, else you can't get 5% growth over the long-term trend.

Who else is going to manage that distribution better? Again see the Some Iron Laws of Political Economics.


Socialism already failed every time. Sorry.

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-304


http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-329

New York did not become the financial capital of the world until after WW2. As you know, this was because Europe imploded and capital fled to the new frontier. The Florida land bubbles were caused by gold fleeing Europe into the USA. The same is about to happen to the USA going to Asia circa 2033, but first we have one last hurrah for the dollar as the emerging markets are short the dollar (either bond issues or China's dependence on exports) and capital will rush back to the core economy as global socialism implodes (again, which is what caused prior world wars).

Note the Asian crisis at the turn of the 21st century was caused by capital rushing back to Europe for the launch of Euro (and we see how that speculative capital flow into PIIGS ended up now).

Although Asia is not #1 per capita, they have several times more population. And if valued on a PPP basis including TRUE health care and social services costs NOT SHIFTED INTO THE FUTURE BY BEING OFF BALANCE ENTRIES, then Asia is already ahead of the West in aggregate (perhaps not per capita but we really don't know until the write-downs come). One can argue that Asia will have to pay for their elderly one day, but that is not a significant balance sheet item now or anytime in next few decades. The Japanese throw their 50+ off the job bus.

The USA was importing immigrant labor so labor was not in oversupply as is the case in Asia. So we shouldn't be comparing wages, rather social balance sheets (c.f. Michael's astute blog about "social capital").

Again my theme has been that socialism's peak also corresponds to some massive technologically induced unemployment in the former dominant economies (this corresponds every 78 years to the collapse of real estate in the dominant economies), e.g. the factories disrupting cottage industry going into the 20th century and now computers and internet with outsourcing, robotics, automation (even accounting and POS system integration, etc).

====================

http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-305


http://blog.mpettis.com/2013/08/the-changing-debate-over-chinas-economy/#comment-333

Didn't verify so I will take your word for it. And indeed this is why I had been bearish on China, because I didn't see how it could become more open without a complete change of political and philosophical culture. I even criticized their top-down educational culture, population-wide (cultural) disregard for intellectual properties rights, etc..

Then Armstrong made some valid points that shocked me-- points we all probably know but didn't bring to our conscious mind yet (i.e. cognitive dissonance).

1. The West is less open. Shocking but true. We have the illusion of free speech, but in the Wallstreet protests they just arrest you for stepping on the grass. A recent news story reveals anti-terrorism forces are showing up at individual homes 100 times per day, e.g. a husband did an internet search for "backpack" and the wife searched for "pressure cookers". Consider the relative level of regulation and government share of GDP. Even California has made it a criminal offense not to comply with Obamacare.

2. Some claims the Chinese don't have true private land ownership (the man who blocked a highway disagrees), yet in the USA we don't own our house.

And I add my own point:

3. Although we can view Asia as top-down managed, in reality there is massive choice and competition, but as a Westerner you might not see it because you expect it to take the same forms you know at home. Some claim that China doesn't have private health care, but I bet they have ubiquity of private folk medicine-- there is a "quack doctor" in every community in the Philippines. James White wrote about this w.r.t. to manufacturing diversity, and alibaba.com is evidence of that. In the Philippines I can choose from three (or five) nationwide PREPAID cell phone networks (so I need at least a dual-simm phone) meaning I can buy a new simm in 30 seconds have a new number. In the west, you nearly have to give a blood sample to get a phone number and USA has much slower internet because of telcom monopolies. The list goes on and on...

=======
Its depressing that the world is moving to a lower common denominator of liberty, with Asia's top-down systems as the best we have to look forward to, but actually what appears to be happening from my perspective is we are moving to anarcho-capitalism where an alternative Bitcoin will make it nearly impossible for the nation-states to tax and spend. The frontier of freedom appears to be on the digital highway. There is actually technology for all of this, e.g. Chaum's high-latency mix-net, dc-net, OTR, and the Socialist Millionaire algorithm.

http://armstrongeconomics.com/2013/08/09/what-can-we-do/

http://armstrongeconomics.com/2013/08/09/email-service-used-by-snowden-shuts-itself-down-warns-against-using-us-based-companies/

I suspect he may be reading my emails, because he nearly copied some of my recent statements verbatim:

That decentralized inflation is not bad:




On how empires end with police state and not hyperinflation:




http://armstrongeconomics.com/2013/08/09/is-hyperinflation-associated-only-with-revolutionary-new-governments/

A direct quote of my "to a hammer everything is a nail" statement I have made 3 times recently:






http://armstrongeconomics.com/2013/08/08/pakistan-bans-gold-imports/



http://armstrongeconomics.com/2013/08/09/crime-is-also-rising-in-europe-among-the-youth-solution-more-police-restore-border-checks-not-lower-taxes-to-create-jobs/



My point about demographics is the key distinction for the west:

http://armstrongeconomics.com/2013/08/08/the-next-generation-pensions-r-vanishing-why-the-dow-may-yet-double/

i think he's just now exclusively talking to himself mate.

probably best to just quietly walk away?

make sure he does not have any sharps nearby.

this is sometimes called "new world depression"  its generally the associated effect of finding out that the world is actually run by some scammers that run into a "legal tender" issuance scam in the early 1800's (or there about) then proceeded to discover that if they purchased the control of the new invention called "Television" they could also control most peoples minds.

what occurs is that the victim discovers that the flimsy reality in which their whole world was built , is a complete sham, it typically effects not the Baby boomer demographic as they actively "choose" to keep believing in the fake fork of reality until entity death.

its the people caught right in the middle , not the net generation but the somewhere between X and y generally.  

it can manifest itself in many ways , all the way from violence to apathy , to furiously studying a specific subject.

** i will add there is an overall economic effect here that is somewhat out of control of the victim also. **

most psychologists will try to focus on "self" and "now" and "thoughtfulness"  as they will say that looking towards the past will cause depression as it can't be changed and looking towards the future will cause stress as the future has infinite possibilities .

this is how i would treat it:

stop caring , and make your own life better.

when you wake up Anony ask yourself  "what can i do with some of this knowledge to make my life better" , start thinking about "yourself" , not just "self" .


** note

When I say the baby boomer reality is a "fake" fork its fake to me but completely real to them, as they are the observer its a completely valid from of reality fork,  unfortuatly its the short one - this is why "TV" is doomed to become a multidimensional form of information , as i theorized many years ago .

the short fork is that older reality as the observers of it stop observing, it will simply go away , and the prevalent much more complex fork will exist , this fork is multidimensional in nature and will bring many advancements.

****

hilariously i can simply prove this correct , there is a funny and specific effect that an observer can note from a different fork,  ready for it:

An observer of an alternate reality fork, should notice that the short fork is becoming less and less credible to you as an observer , this could manifest itself in strange and "unreal" occurrences that you would observe by looking at that reality, as all reality can be observed, as less people observe that reality should look generally thinner and thinner , more and more strange/"unreal" if you like.

And the data from 1790 to 2012 says:

http://www.measuringworth.com/growth/

http://www.measuringworth.com/growth/growth_resultf.php?begin%5B%5D=1790&end%5B%5D=2012&beginP%5B%5D=&endP%5B%5D=&US%5B%5D=UNSKILLED&US%5B%5D=MANCOMP&US%5B%5D=NOMINALGDP&US%5B%5D=NOMGDPCP&US%5B%5D=SAP&US%5B%5D=POPULATION&UK%5B%5D=GDPC&UK%5B%5D=GDPCP&UK%5B%5D=POP&gold%5B%5D=NEWYORK&gold%5B%5D=SILVERRATIO

The average annualized values from 1790 - 2012 are as follows.

3.26% - Production Worker Compensation
5.24% - Nominal GDP   
3.18% - Nominal GDP per capita
1.99% - Population (millions)

3.26 + 1.99 = 5.25 which is very close to 5.24%

In other words, the increase in nominal GDP was spread proportionally to the workers, diluted by the increase in the population.

So the only problem was if the money supply was increasing faster than the nominal GDP, i.e. if the velocity of money was declining. Indeed the velocity of money is declining now, because the bastards have their hands on the levers of money supply creation and are hoarding it for themselves.

Here is the same data again 1970 - 2000:

5.46% - Production Worker Compensation
7.82% - Nominal GDP   
6.68% - Nominal GDP per capita
1.07% - Population (millions)

So we see that lately the workers have been cheated.

5.46 + 1.07 = 6.53, which is 1.5% less than 7.82%.

M2 increased only 7.12% from 1970 to 2000, so velocity was increasing:

http://www.economagic.com/em-cgi/data.exe/frbH6/m2

So it appears the bastards were able to steal about 1.5% per year from the working class from 1970 - 2000. Hopefully we could eliminate that by eliminating their control over the printing of money.


So ideally we want to scale the money supply by the optimum nominal GDP growth rate. That appears to be 5% historically. Bitcoin will not scale its money supply after 2033, and thus MUST be debased by external credit else the economy would stop growing if Bitcoin was the only currency.

I will be proposing for my new alternative to Bitcoin, that the mining of new money follows a similar curve to Bitcoin but never declines below 5%. That way it can support an economy whose average annual growth rate is 5%.

Note the growth rate can go higher or lower, because the velocity of money can change, but over time it will have to average the same as the growth rate of the money supply.

Indeed no one knows every individual action, and Armstrong doesn't attempt to predict what his model does not model.

The misconceptions of the British in 1781 have nothing to do with the validity of Armstrong's Pi model. His model was found by inputting $100 million in data from the history of the world into a computer which then searched for repeating patterns. Thus it was discovered that Pi is fundamental. Well that makes plausible sense, since The Universe is composed of frequencies which are multiples of Pi (in the Fourier domain of
spacetime).

I am searching for one instance since 1970 where Armstrong's prediction of trend and timing was grossly incorrect. Have you found one? I haven't found one yet.

His computer validated that the Pi cycles were always correct since the beginning of recorded time.

It is difficult for me to deny the scientific method. How about you, you prefer to believe in the tooth fairy?

Can you shorten down those posts or use better formating? I might actually be able to read them :S

http://pro.contrarianprofits.com/Cameron49/LJMTP800?h=true

(click close on your browser tab for the above link, then click "stay on page", then the transcript will appear so you don't have to listen to the whole video)

That came from a link in a Casey Research post:

http://www.caseyresearch.com/cdd/how-to-invest-to-avoid-a-chinese-slowdown

Here is more about it:

http://stockgumshoe.com/reviews/macro-trader/whats-the-mysterious-400-billion-cameron-parish-project/

There is no problem for workers when their wages keep up with inflation.


Exactly. Who is receiving the QE?

With Bitcoin mining, the elite don't receive the printing.

:wink:


Inflation rises faster than wages because the elite are wasting the printed money, i.e. capital misallocation, thus causing economic decline.

Without inflation, the economy can't grow. I already explained why in my prior email where I explained that the investors who fund a project need to get back more than they put in. But this can't happen with a strict gold standard where only gold is the money, because money supply is limited to 2 - 3% per year.

I am sorry if you can't grasp this. It is exclusively to be understood by people with an IQ above 140. Most can never get this.

In the Quantity Theory of Money:

M x V = P x Q

The investor could be paid by increasing V, but we can't just keep increasing the velocity of money forever. M has to increase.

If you can't grasp that, I don't know how else to explain it to you, that you could grasp.

The problem is top-down control over money printing. Decentralized money printing is absolutely necessary, else the economy can't grow.

Only people with very high IQ are going to understand this.


Incorrect. It was built on fractional reserves by the private banks all through the 1800s at least.


The printing is given to those who mine the Bitcoin. And now I will be proposing that the M scales with the P x Q. Completely decentralized. No one can steal. Money supply will grow with the economy. No central bank needed.


You deny the facts above.


Interest goes to the lenders and savers. Giving it away to all the people is stealing via socialism.


You propose more top-down statism, which leads always to socialism. Top-down organization is not decentralized. It always leads to politics and vested interests.

Iron Law of Political Economics:

http://esr.ibiblio.org/?p=984


Have you not learned anything in 3000+ years of recorded human history?

The moneychangers buy the government and the politics.

You propose more of the same.

"The elite are planning to use the hitech community in the USA as slaves, while keeping Asia as slaves by controlling key inputs such as energy."

I'm bored Anony what's the news?

How will Asia be kept slaves with energy ?

tell me all about it>

Roll tape......

bcc: Kristen Linton @ Solari to pass on to Catherine

Three more points of evidence that seem to argue that Catherine's optimism is unrealistic:

1. Obama's Health Care plan is going to significantly impact to the negative any business where labor is a significant component. How do we get widespread recovery of the economy without widespread involvement of labor?

2. Catherine's model of individuals and small (rural!) communities reinventing themselves is precisely what happens when empires fail. The cities become empty and only those who fend for themselves in the rural areas survive. It is not a model for society wide recovery, rather it is THE model for collapse:

http://blog.jim.com/culture/radish-explains-what-racism-means.html/comment-page-1#comment-345588


3. What Catherine describes as a slow burn (e.g. the now sick small farmers in her region being turned into welfare dependents eating GMO by the greed of the fascism which outlawed their organic farming in favor of GMO, Monsanto, and corporate farming) is analagous to how the end came about in Rome:

http://blog.jim.com/culture/radish-explains-what-racism-means.html/comment-page-1#comment-344589



My further comments are interleaved within yours below.


Even if the elite were entirely in control (which Armstrong argues is impossible and I agree), why would they want to hold interest rates down? The ROI on each new dollar of debt has reached a few pennies in China and just about every where in the world. There is overcapacity in every sector, e.g. even here in the Philipppines they are building a shopping mall on every corner while the people still only earn $200 per month.

If they continue pumping more debt into the global economy, they will cause massive social unrest because of the waste. They have to move now to next stage which is defaults, which will bankrupt everyone but themselves. They can use the Public sector to hunt down all the remaining capital and assets that isn't theirs (so they will own the growth phase that comes after this wipeout). They got their $40 trillion and have it positioned. For example, they are building pipelines across the USA to carry natural gas to new export terminals so they can export to Asia which they keep dependent on imports, because for example they come to the aid of Japan Senkaku islands and Philippines Spratly islands to keep China from developing these huge natural gas fields.

They have given Dept of Homelove (hands down kid's pants) Security the right to purchase billions of hollow point bullets (which are illegal in war because they are so gruesome) and 2714 tank-like vehicles. Does that sound to you like they are preparing for a subtle slow down and
slow-cooked frogs in the boiling pot?

Nothing every crashes like that. In nature, all exponential phenomenon have a long period of exponential gestation, a phase-shift blow off where the nominal change is now large, an then a waterfall collapse that is much shorter than the gestation period.


Exactly. And now the Fed and the Treasury Dept is telling all the banks that their derivative books won't be bailed out in 2016 and that they need to start unwinding. This is another reason we are seeing the interest rates going up radically since May. The derivatives will take priority to the bond holders and the depositors, e.g. bail-ins are coming.

They are getting ready to default the global economy and they will be the only ones left standing after the dust clears.

They will use this leverage to force the developing world to follow their aims. But remember, they are not entirely in control. And their plan will leak. For example, I am creating the better Bitcoin that will enable private capital to run and hide (and still be liquid unlike gold in large size will be trapped by taxation, but the better anonymous Bitcoin will not be).


You know I have been calling for that too for past several months.

The point is that the elite will own this sector. The proprietor's capital won't survive the coming wipeout unless they play ball with the elite, except for the leakage I am talking about above.

Also this sector will either be very low labor (thus not a big impact on the general economy in the USA), else they will play ball with the elite (e.g. to get a waiver from the Obama administration on health care or otherwise not abused by the IRS).

Fascism 101.


China and Asia will still win on anything that is labor intensive. This is why Asia will be #1 as we come out the crisis.

The elite are planning to use the hitech community in the USA as slaves, while keeping Asia as slaves by controlling key inputs such as energy.

In addition to mining, other than risky personal meetups, one can be paid anonymously, i.e. only known by their private key, e.g. license some digital works where the author is only identified by the private key.

Fitts and you (and everyone else too) are being fooled to some degree by the international capital fleeing Europe and the developing world into the dollar assets forming a bubble. This is a deadcat bounce.

This will drive capital out of bonds (so it can chase also these higher returns) and these high interest rates will choke off the US economy (and globe) by 2016.

Be aware that many people are locking in 5/1 ARMs because they are still 3% while fixed mortage rate loans moved to 4+% recently. Thus this boost in the economy is going to get killed by the higher interest rates coming with those ARMS adjust in 5 years. Many other examples like that of why this bounce is going to collapse.

Armstrong is always correct, because he does not do analysis based on fundamentals which are always questionable. Rather his timing models relate how international capital looks at relative opportunity cost OVER TIME:

http://armstrongeconomics.com/2013/08/07/fundamental-analysis-always-questionable/