Understanding How Things Must Function

美元須先升才可以俾人推去崩潰的田地 !

armstrongeconomics.com

QUESTION:

I can follow the reasoning for some of the capital flows into the U.S. now and a bit longer. But eventually much of this capital is going to leave the U.S. correct? Besides some off the grid investing, is China and Asia looking like the most promising economies to attract the future change in capital flows? I know you will most likely cover specifics in your conference but was hoping you could perhaps set the broader picture your forecasts are showing

Thanks

Bill

ANSWER:

The capital inflow to the USA is what completes the Phase Transition. When oil was in the $10 range in 1998, We put out a forecast that oil would rise to $100 by 2007.15. Even in court, the Department of Energy wanted us to develop a model and Alan Cohen of Goldman Sachs blocked that project.

At the time, comments were we are crazy that the world economy would collapse with $100 oil. That is opinion which proved worthless. It also demonstrated that the vast majority of people are clueless as to how things function. Crude oil HAD TO rise to make it worthwhile to create other alternative technologies. You have electric cars today only because of that price action.

The capital flows MUST push the dollar higher and that will then set the monetary reform and dethrone the dollar. Until that happens, things do not shift. Eventually, China and India will rise because the West will destroy their economies with this constant attack of rising taxes to keep their failed system in motion. That is unsustainable.

You MUST move to extremes to create the change. Change will never come without motivation. The crude oil fell from 1997 to nearly $10 going into that ECM turning point 1998. Our forecast for $100 was met. Yes, oil exceeded that intraday. It could not close any year above $100 stopping at the $98-$99 level. That was the FALSE MOVE – the drop to $10 into 1998 getting everyone believing oil was going back to a few dollars. On the upside, all we have heard is how the dollar will crash for it is losing the fight against oil. Opinion ALWAYS mirrors the current trend.

So yes. We are now entering the interesting phase and that is what this World Economic Conference is all about. This is the START of a wild period and it will take two days to reveal everything. If you do not see the world unfold before your eyes, you will not have the confidence to invest or trade. That is just human nature.