Guest Post by Martin Armstrong
The distortion in the yield curve is building with tremendous force. There are vast bids for US 90-day T-Bills from around the world and no offers. The shortage in US government paper is now being reported to us from repo desks around the world. There is a MAJOR PANIC in to the dollar as emerging markets come under a financial crisis, in part, instigated by Turkey. The government simply trapped investors and refuses to allow transactions out of the Turkish lira. Turkey’s stand-off with investors has unnerved traders globally, pushing the world ever closer to a major FINANCIAL PANIC come this May 2019.
There is a major liquidity crisis brewing that could pop in May 2019. European Banks have loaded their portfolios with real estate loans thanks to quantitative easing and negative interest rates, and emerging market debt. Spanish banks are especially invested in Turkish debt where they hoped to get the highest yields expecting that the IMF would never let Turkey default. On top of this, banks have been lending to each other to also avoid parking money at the European Central Bank where they would be charged with a negative interest rate.
Currencies from South Africa’s rand to Brazil’s real are witnessing a spike in their expected volatility, signaling concern they may weaken the most along with the Turkish lira going into May. The price swings have evoked sudden deep-rooted fears that there may be an emerging market crash before the end of the year.
We will update on the private blog in more detail. However, keep in mind that this Inverted Yield Curve is by no means reflecting a US recession. This is a global financial panic unfolding on a grand scale. This is why we selected May for the WEC in Rome. This is far more than just politics. This is beginning to evolve into a serious liquidity crisis where we may yet see more countries try capital controls to save the day.
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Is it real this time?
Armstrong once predicted gold will hit $5,000 …. nine months later he revised it to $960.
You can read about his spectacular failures here;
https://talk.newagtalk.com/forums/thread-view.asp?tid=536207&mid=4397050
But, I’m sure he’s correct this time. heh heh
Above my pay grade but Yikes!
This blogger doesn’t think too highly of Mr. Armstrong.
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The Enigma of Martin Armstrong
Some memories fade, but are not forgotten. The same holds true for certain personalities, particularly the bizarrre and eccentric. One such notorious individual is Martin Armstrong a.k.a. Princeton Economics a.k.a. self-professed expert in the history of money and things gold, and of course, true to my theme of things Japanese.
He was accused of Ponzi fraud and the purveyor of the notoriously unvaluable “Cresvale Bonds” that besotted Japanese corporate investors and populated their portfolios, much to their eventual chagrin. Coincidentally, in a bout of synchronicity, I was wondering only a few weeks ago what’s become of him and was preparing a post, so it is timely indeed that after languishing for six and a half years in a Manhattan jail cell, he finally pleaded guilty to charges fo Fraud on Thursday, August 17th 2006.
In a nutshell, Martin Armstrong was a confidence trickster, if not a fraudster for which he was accused. Martin Armstrong was also a bad trader. A very very bad and inept trader. And Martin Armstrong committed fraud to cover up his bad trades. And then he committed more trades to cover up his fraud. Most in Nikkei and Gold.
Despite the laughable ineptitude with which he implemented his “strategies”, by most accounts he was smooth, suave and authoritative, in a way that encouraged people to entrust to him their money. Which he duly lost. Many many hundred of millions of US doillars. Perhaps billions. The official court dockets (available on-line) from his 1999 indictment in the Manhattan district of US Federal Court read like a Shakespearean comedy.
The more he traded, the more he lost. So much and so bad were his trades that his colleagues, and brokers mercilessly joked about it behind his back. He was so consistently wrong-footed in his bets that he would have done far better flipping a coin to decide whether or not to be long or short. Or use the infamous “8-Ball” method. Or consult Nancy Reagan’s financial astrologer, or ask the advice of Paul Wolfowitz. Anything but use his own judgement.
Rest of article here —> http://nihoncassandra.blogspot.com/2006/08/enigma-of-martin-armstrong.html
Thanks Stucky, I never knew that martin was a wanker. I’ll be sure to ignore his diatribe from now on.
There my be one more dip, but I guarantee there will be a trade deal well before election night and all this economic drama will evaporate like the morning dew. As man does not live by bread alone, Trump can’t live on just a Mueller report alone. “It’s the economy stupid”. Trade deal soon. Plant your seeds and get into reaping profits position.
I’m guessing around Labor Day. “Sell in May & go away” followed by the 2020 election kicking off this fall. A trade deal will be another thing to tout even if it isn’t that great.
That sounds about right.
When I lived in Turkey 1974-76, people couldn’t take anything of value out of there; this is a return to normal that Investors should have expected. The World’s Economy was going down without this finance barrier; it’ll just go down sooner. The author didn’t put a value on the Turkey problem; the US Western Flood will cost US $1B just so far, but a huge problem will result if 2019’s food production worldwide comes up short; you can’t just print more food.
Coincidently , I recently overheard a strange conversation between Powell and Bullwinkle Moose. Bullwinkle said,”Look, nothing up my sleeve and Powell said to Bullwinkle’s friend, “Hey Rocky, watch me pull another rabbit out of my hat. I’m guessing it will be just in the nick of time, too. You know, every once in awhile the catastrophists are correct, but those who own the casino can always count on another way to suck the chumps into playing the same old shell game. I doubt Armstrong would recognize a financial crisis if it bit him in the ass, let alone predict one.