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Armstrong.EconomicsForecasting
th~
World
TheWorldRevolution
andtheMarkets
By:
MartinA.ArmstrongCopyrightAllRightsReservedFeb~y
17th,2011
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ThisRepor~maybe.forwardedasyoulike~ithoutchargetoindividualsorgovernmentsaroundtheworld.Itisprovided
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ACKNOWLEDGEMENTSIwouldl,iketothankall'theformeremployees,associates,sources,andcontactsfor'theirongoingsupportandefforts'tocontributetothewritingsIhavebeenabletocontinue'throughtheirgreatefforts.Iwouldalsolike.to'thankthosewhohavelookedafter'notJustmyself,butmyfamily,andshownthemsUPP9ttandkindness..Thepurposeofthesereportsistobradentheunderstandingthatissovitaltoourpersonalsurvival.Governmentcannotsaveus,andwillonlyassist·~theveryeconomicdisasterweface.ThisisaSovereignDebtCrisisthatthreatensourcoresurvival.Thereisnoplantoeverpayoffdebts.Themajorityofdebtincreaseispayinginterestperpetuallytorolloverwithout'anylong-termplan.WhatyouseeinGreeceandintheStates,wehaverunoutofotherpeople'smoney.Thesocialistskeeppointingtotherich.Buttofundthedeficits,weneedtoborrownowfromforeignlands.WeranoutofmoneydomesticallyandtosupportthecurrentsxstemlikeGreece,weneedforeigncapital.But
aU
governmentsarefacingthesamecrisisandweareonthevergeofanotherwidespreadgovernmentdefault.AdamSmithwatnedinhisWealthofNationsthatin1776,no
gevernment:
paidofftheir
debt
andhadalwaysdefaulted.Wewillhavenochoiceeither.Thereisnohopethatpoliticianswillsaveus,fortheyonlyformcommittees'toinvestigataftertheshit-hits-the-fan.TheywillNOTrisktheircareerforafutureproblemthatmayhitonsomeoneelse'swatch.TherewasapoliticianandaaveragemanstandingontopoftheSears'Towerwhenagustofwindblewthemoff.Theaveragemanbeingarealistic-pessimist,immediatelyseesheisabouttodieandbeginspraying.Thepoliticians,theultimateoptimist,canbeheardsaying"Wellsofarsogood!"ashepassesthe4thfloor.AtPrincetonEconomics,ourmissionwassimplytogatherglobaldataandtobringthattogethertocreatetheworld'slargestandmostcomprehensivecomputersystemandmodelthatwouldmonitortheworldcapitalflows.Bycreatingthatmodel,allthefallacies,ofmarketandeconomictheorieswererevealed.Theworldisfarmoredynamicand'everychangeeveninadistantlandcanalterthecourseoftheglobaleeconomy.JustashasbeenshownwiththeturmoilinGreece,aCONTAGIONtakesplaceandnowcapitalbeginstolookaroundatallcountries.Wecannomorecomprehendthefuturebutlookingonlyatdomesticissuestodaythanwecandosoineveryotherarea,suchasdiseaseandthespreadofflus.WeliveinaNEWDYNAMICGLOBALECONOMYwherecapitalrushesaroundfleeingpoliticalchangesandtaxesjustasitisattractedbyprosperity.AllthepeoplewhomigratedtotheUnitedStatesinthe19thand20thCenturies,cameforthesamereasonsasthosestillcomingfromMexico-jobsandprosperity.Inthe19thCentury,Americawassaidtohavesomuchwealth,itsstreetswerepavedingold.Wemustnowlooktoboththepastandtheentireworldtounderstandwherewenowaretoday,
,.
.
TheWorldRevolution
andthe
Markets
By:MartinA.ArmstrongFormerChairmanofPrincetonEconomicsInternational,Ltd.andtheFoundationForTheStudyofCyclesHATGOESAROUND-COMESAROUNDisanoldsayingthatembracesthefactthatlifeingeneraliscyclical.Weareborn.grow,mature,anddie.Yetsomehavewrittentoask(1)whyisChinabecomingthelargesteconomyintheworldsofast,and(2)isthisdrivenbyPUBLICvPRIVATEcontestthatisbecomingaWORLDREVOLUTION?Weindeedliveininterestingtimes.NONATIONRETAINSTHATTITLEOFTHEWORLD'SLARGESTECONOMYnorTHEFINANCIALCAPITALOFTHEWORLDforever.WeareindeedenteringaperiodofaWorldRevolution•.Economiesarethesameaspeople.Indeed,BabylonyieldedtoPersians,whopassedthetorchtoAlexandertheGreatandtheGreeks,thenthatdistinctionwastakenbytheRomans,stolenbackbytheByzantineGreeks,andtheneventuallytotheFranks.Withtheriseofmercantilism.thattitlepassedtotheItalians.TheSpanishborrowedextensivelyasdidtheEnglishandFrench,sothattheirmanysovereigndefaultsledtodestroyingthefinancialsysteminItaly.ItmigratedbrieflytotheGermans.buttheSpanishdefaultednumeroustimesandthenthefinancialcapitalmigratedtoAmsterdam.WhenWilliamofOrangemarriedMaryandbecameKingofEngland,hebroughtwithhimtheDutchfinancialexpertise,andthusEnglandbecametheFinancialCapitalofEurope,andthentheworldpeakingby1913,asitthenpassedtotheUSA.Yet,throughallofthis,Asiaisignored.IndiawastheWORLD'SLARGESTECONOMYbyIOOOAD,andthattitlethenpassedtoChinabytheearly19thcentury,abdthenitmigratedtoEuropeand~
to
hrerica.Governments,betheycity,state,nationorempires,alsodiejustasdopeople.Theyarecollectiveliving~that'evolveandchangewithtime.JustaswearewatchingtheuprisingsintheArabworldspreadlikeacontagionfromonestatetothenext,thisishowallcollectiveorganizationsevolve.Everythingiscyclicalinnaturefornothingisstatic.Thetwodistinctionsof
(1)
largesteconomyand,(2)theFinancialCapitaloftheWorldareseparateandquitedifferentinnature.Thefirstcanbebasedupontrade,whereasthelatterisbaseduponeconomicandfinancialsophistication.WhileAsiaheldthefirsttitle,Europethelatter.
1
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