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Martin Armstrong Warns Of The Coming Crash Of All Crashes

Tyler Durden's picture




 

Submitted by Martin Armstrong via Armstrong Economics,

Why are governments rushing to eliminate cash?

During previous recoveries following the recessionary declines, the central banks were able to build up their credibility and ammunition so to speak by raising interest rates during the recovery. This time, ever since we began moving toward Transactional Banking with the repeal of Glass Steagall in 1999, banks have looked at profits rather than their role within the economic landscape.

They shifted to structuring products and no longer was there any relationship with the client. This reduced capital formation for it has been followed by rising unemployment among the youth and/or their inability to find jobs within their fields of study. The VELOCITY of money peaked with our Economic Confidence Model 1998.55 turning point from which we warned of the pending crash in Russia.

 

The damage inflicted with the collapse of Russia and the implosion of Long-Term Capital Management in the end of 1998, has demonstrated that the VELOCITY of money has continued to decline.

Long-Term Capital Managment

 

There has been no long-term recovery. This current mild recovery in the USA has been shallow at best and as the rest of the world declines still from the 2007.15 high with a target low in 2020, the Federal Reserve has been unable to raise interest rates sufficiently to demonstrate any recovery for the spreads at the banks between bid and ask for money is also at historical highs. Banks will give secured car loans at around 4% while their cost of funds is really 0%. This is the widest spread between bid and ask since the Panic of 1899.

We face a frightening collapse in the VELOCITY of money and all this talk of eliminating cash is in part due to the rising hoarding of cash by households both in the USA and Europe.

This is a major problem for the central banks have also lost control of the ability to stimulate anything.The loss of traditional stimulus ability by the central banks is now threatening the nationalization of banks be it directly, or indirectly.

We face a cliff that government refuses to acknowledge and their solution will be to grab more power – never reform.

 

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Sat, 05/16/2015 - 12:06 | 6100404 TomB
TomB's picture

He's bullish about the stock market though.

Sat, 05/16/2015 - 12:21 | 6100444 Shocker
Shocker's picture

Throwing all this money at the problem, and still no fix

Economic Job Situation: http://www.dailyjobcuts.com

.

Sat, 05/16/2015 - 12:38 | 6100476 SRSrocco
SRSrocco's picture

Martin is very clever about the markets.  However, he doesn't believe in PEAK OIL.  I find that quite interesting.  Anyhow, I believe the peak and decline of the U.S. Bakken & Eagle Ford Shale oil fields will signal the collapse of the U.S. Economy:

Peak Of Bakken Oil Production Will Signal The Collapse Of The U.S. Economy

http://srsroccoreport.com/peak-of-bakken-oil-production-signals-collapse-of-u-s-economy/peak-of-bakken-oil-production-signals-collapse-of-u-s-economy/

Sat, 05/16/2015 - 12:58 | 6100522 strannick
strannick's picture

This is 1933 all over.

Hoard cash, in anticipation of another Rooseveltian devaluation.

 

Sat, 05/16/2015 - 13:20 | 6100562 chumbawamba
chumbawamba's picture

...all this talk of eliminating cash is in part due to the rising hoarding of cash by households both in the USA and Europe.

Oh, really, Martin?  I could've swore that in one of your many recent other articles you said American households are broke.  So now they're hoarding cash?  But consistency in argument matters no to a little troll.

I am Chumbawamba.

Sat, 05/16/2015 - 13:33 | 6100585 Captain Debtcrash
Captain Debtcrash's picture

I'm pretty sure what he meant was what money Americans and Europeans do have they are attempting to remove from the banking system by going to cash.  There is no inconsistency in saying Americans and Europeans have less money but what they do have they are removing from banks and going to cash.

 

 

Though this is the result of low interest rates and a loss of trust the calls to ban cash really are just a necessity to be able to do what the banks really want to do...implement negative rates. 

Sat, 05/16/2015 - 13:47 | 6100626 Citxmech
Citxmech's picture

Well shit.  Nothing "stimulates spending" like hyper-inflation either.  The overnight devaluation of any cash holdings is quite a motivator, right?  Maybe that's part of the plan at some point too?

<sarc - sort of, it think. . .>

Sat, 05/16/2015 - 13:58 | 6100655 Haus-Targaryen
Haus-Targaryen's picture

They will come for the cash first -- and then for the Ag and au.

Plan accordingly.

Sat, 05/16/2015 - 14:02 | 6100665 Captain Debtcrash
Captain Debtcrash's picture

Sounds about right.

Sat, 05/16/2015 - 18:00 | 6101362 mvsjcl
mvsjcl's picture

Maybe it isn't so much the hoarding of cash as it is the distrust of banks.

Sat, 05/16/2015 - 20:02 | 6101618 philipat
philipat's picture

TPTB were never behind the curve because they ARE the curve. Isn't the explanation simply that CB's CAN'T impose negative interest rates and bail-ins on "Folks" if "Folks" can take their money out of Banks as cash in response to (or avoid) such further repression? In this sense, the (now semmingly) coordonated calls for a cashless society are more in anticipation of what they know is coming, not something which has already happened.

Either way, I agree that it is a desperate final power grab. And one which should be opposed just as desperately.

Incidentally, if it happens first in the US, it will be VERY bearish for the USD because all of that "grey" economy will now have to be funded in other money, probably real money= Gold because the criminals are not stupid, which will put further downward pressure on the Pig. This is an inevitable, and in macro terms, desirable consequence of too much debt and a much weaker dollar will allow the US to start catually manufacturing and exporting actual things again. So this might also be part of the reasoning of the "Elites".

This trend will, however, be offset as the Chinese take control of the price of physical Gold and allow its price to start rising in Yuan terms, because China will soon already possess most of the Gold. At that point, the paper marets in London and New York will have to allow the paper prices in USD to follow higher to allow the depreciation of the USD to continue. If not, the USD will again de facto begin to strengthen again (CNY via Gold = USD), which the Chinese want to maintain their export game and stop the US taking it all away. In this way, they can indirectly eliminate the USD peg without allowing the CNY to appreciate away their export advantage.

It's actually the Chinese (And Russians) who hold all the cards. It should get quite interesting quite soon........

Sat, 05/16/2015 - 20:43 | 6101771 Keyser
Keyser's picture

If these asshats think they can restrict cash on a global basis, they are more ignorant than even I feared... 2/3 of the world is on a cash basis... How do they plan on implementing these types of controls on those economies? 

Sat, 05/16/2015 - 21:33 | 6101879 MonetaryApostate
MonetaryApostate's picture

Get sharp people, the system is not your friend...

http://galeinnes.blogspot.com/2015/04/a-rapidly-changing-world.html

Sat, 05/16/2015 - 23:57 | 6102089 hamstercheese
hamstercheese's picture

I read it, don't agree.  Reminds me of when the VCR starting hitting retail shelves and the prediction movie theaters would close.  Didn't happen - we are a hearding culture, we like to

socialize, to shop, to people watch, to get out once in a while.  Many good conversations are held at grocery stores, retail stores, etc.   And most of the transactions there are already cashless.

...

Why do people keep making paranoid predictions?  I don't think I've ever heard a prediction that was of good news, and good things keep happening.  Why?

Sun, 05/17/2015 - 10:15 | 6102730 sheikurbootie
sheikurbootie's picture

hamster, you need to travel a bit more.  Do you know any poor people in Merica?  Nearly all of the them DO NOT even have a checking account.  Those that do only use it to cash their meager check , not deposit.  What about the remaining 80% of the world's population?  They're surviving on a couple of thousand a year.  I met a family (beautiful daughter) in Panama while I was on assignment.  She told me that she lived with her family on the beach.  It sounded awesome,  until I visited and saw the "beach house" was a thatch shack with a sand floor.  The family's hut stored a years worth of rice in a open pile in the middle of the floor.  The shack only had one room.  The daughter was beautiful, but I couldn't handle the situation at the time (21).

Sun, 05/17/2015 - 10:21 | 6102750 FredFlintstone
FredFlintstone's picture

88% of US households had a checking account in 2013. If you believe government reports.

Sun, 05/17/2015 - 12:35 | 6103044 DutchR
DutchR's picture

Damn, sounds you left a part of your soul there,

 

Crash Of All Crashes  Meh, just the tale of our times.....

Mon, 05/18/2015 - 17:58 | 6107306 hamstercheese
hamstercheese's picture

Your response has NOTHING to do with my post, and everything about you wanting to voice an experience and make someone else feel bad.  I was responding to a blog link about how retail outlets will become ghost towns - I wasn't talking about cashless systems or thatch houses in Panama.

Sat, 05/16/2015 - 22:33 | 6101973 Squid-puppets a...
Squid-puppets a-go-go's picture

indeed. banning cash will further collapse the velocity of money. Its like coming up to an underpoerforming race horse, shooting it in the head and saying 'run faster you idiot!'

Sun, 05/17/2015 - 10:02 | 6102702 sheikurbootie
sheikurbootie's picture

Exactly Keyser, except from my travels it's nearer to 80% of the world lives in poverty.  Those same numbers reflect a cash society.  If the CB's ban cash, the poor resort to barter.  I'm ready and waiting for the crash!  Hurry the fuck up!  This economic death knell is killing me.  Business just keeps slowing and slowing.

Sun, 05/17/2015 - 09:53 | 6102677 spinone
spinone's picture

No one wants to be the next one who is Corzined

Sat, 05/16/2015 - 14:04 | 6100667 Headbanger
Headbanger's picture

This article means what I said here some time ago that the Federal Reserve is only out to protect its own ass now cause they KNOW the economy is fucked.

Sat, 05/16/2015 - 14:09 | 6100679 Creepy A. Cracker
Creepy A. Cracker's picture

Date please?  Any thinking person knows that a crash will occur, as history is replete with them and they happen regularly.  When will it happen?  Articles claiming that a crash will happen are dog-bites-man articles.

Sat, 05/16/2015 - 14:14 | 6100687 Headbanger
Headbanger's picture

Oh please.  Does the exact date really matter when the results will be so devastating and long lasting?

And THERE IS NO PLAN YOU MOOKS!

It's just all going to fall apart soon.

Sat, 05/16/2015 - 14:17 | 6100703 Waylon Bits
Waylon Bits's picture

Waylon Bits is also predicting the crash of all crashes!

So if you think we're going back to 1900 (and staying there) buy bullets, beans and gold.

If you think we're going back to 1900 and progressing again (as humans are wont to do) buy bullets, beans, gold and Bitcoin!

 

https://btc-e.com

 

Sat, 05/16/2015 - 14:25 | 6100726 DutchR
DutchR's picture

1900 hundred and bitcion, really?

 

If you don't hold it you don't have it, period.

 

Tampons are the new gold

Sun, 05/17/2015 - 07:24 | 6102497 Headbanger
Headbanger's picture

To follow up on my rant above:

The Federal Reserve will go into full defensive mode soon to save itself resulting in complete economic collapse.

Which forces the Federal Government to issue "Treasury Notes" to increase liquidity.

This move might also result in making possession of gold illegal again to have further backing of these new Treasury Notes

These actions will ultimately result in recognizing the Federal Reserve is not only useless but is the cause of the financial cataclysm and it will then be abolished.

So there's your Plan B!

Stacking TP, soap, shampoo, deoderant, Kotex and ammo for currency..

And watching "Book of Eli" again. 

Sun, 05/17/2015 - 10:44 | 6102784 usednabused
usednabused's picture

Well yes, banning gold for sure, but...only for the lowest 99% of the economic ladder. In other words just turn it over to wall street.

Sun, 05/17/2015 - 03:07 | 6102303 JustUsChickensHere
JustUsChickensHere's picture

If this 'anti-cash' movement does eventuate, it just makes Gold, Silver AND Bitcoin more attactive (they all have a zero interest lower bound - and Bitcoinn is more portable, private and has lower storage/security costs)

Anyone carefully managing a diverisfied portfolio likely to increase the percentages alllocated to each one.  (That is physical PM's of course, and Bitcoin itself not an ETF or similar)

Sun, 05/17/2015 - 04:44 | 6102377 Counterpunch
Counterpunch's picture

Nonsense. Sell any bitcoin you have when it starts going up swiftly.

Sun, 05/17/2015 - 20:57 | 6104340 TruthBeforeAll
TruthBeforeAll's picture

Bitcoin requires permissions to use. No thank you.

Mon, 05/18/2015 - 03:00 | 6104869 LikeyMikey
LikeyMikey's picture

How does bitcoin work when it is turned off by the FCC and other regulatory agencies or it is outrite banned due to the danger to National Defense?

 

Hmmmmm??   If you do not physically hold it then you don't own it!!

Sat, 05/16/2015 - 20:47 | 6101780 JoWazzoo
JoWazzoo's picture

Well, I want the date so I can buy some Puts without losing more money.

Sun, 05/17/2015 - 08:11 | 6102553 Arnold
Arnold's picture

 

 

 

November 2012.

That was the end of it.

Plan accordingly.

Sat, 05/16/2015 - 19:02 | 6101525 stant
stant's picture

Just have some resource available that fit your situation for where you live, if you think you can stay there

Sat, 05/16/2015 - 19:07 | 6101536 TheGreatRecovery
TheGreatRecovery's picture

This is what trend-following is good for.  When the trend changes, you sell.  You don't need to know a date in advance.  Martin Armstrong, of course, does work by dates. but I don't have his brain power.

Sat, 05/16/2015 - 14:14 | 6100695 Captain Debtcrash
Captain Debtcrash's picture

Head banger, that is why I have my own site, with my own posts.  I use it as a journal, and if anyone questions when I made certain calls its all right there.  We are living through a fascinating times, it will be nice to have a record. 

 

Sat, 05/16/2015 - 14:32 | 6100744 DutchR
DutchR's picture

Bookmarked

 

Sun, 05/17/2015 - 00:56 | 6102188 takeaction
takeaction's picture

I have to say this...I first thought your site was going to be some "Make $9500 a month from home site.."  I have to say...Very well done sir.  Your site is great.  Thanks.

Sun, 05/17/2015 - 06:06 | 6102436 Captain Debtcrash
Captain Debtcrash's picture

Thanks, I appreciate it.  I certainly don't do it for the money since it doesn't make any :). 

Mon, 05/18/2015 - 08:35 | 6105158 ThanksChump
ThanksChump's picture

Excellent site! That "History and Introduction" piece should be required reading for students in every country.

 

Typo, "History and Introduction"

10th paragraph. "recipe" should be "receipt". Easy fix.

Sat, 05/16/2015 - 17:19 | 6101235 TeethVillage88s
TeethVillage88s's picture

Maybe getting the Front men to suggest Cashless society is what Janet Yellen and Christine LaGaurde were talking about at the BIS Meeting last Year.

Seems like they said they were concerned about QE, ZIRP, and high debt levels... but we don't believe everything since EU is now in QE.

Sat, 05/16/2015 - 14:28 | 6100735 GotNuttin'todo
GotNuttin&#039;todo's picture

Exactly. Martin Niemoller said it first, just substitute Cash for "Sociatists", Silver for "Trade Unionists" and Gold for "Jews", and All Other Tangible Assets for "me"

 

First they came for the Socialists, and I did not speak out—
Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out—
Because I was not a Trade Unionist.

Then they came for the Jews, and I did not speak out—
Because I was not a Jew.

Then they came for me—and there was no one left to speak for me.

Sat, 05/16/2015 - 19:09 | 6101541 TheGreatRecovery
TheGreatRecovery's picture

Correct.

Sat, 05/16/2015 - 20:48 | 6101783 Chandos
Chandos's picture

First they came for the Socialists, and I did not speak out—
Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out— 
Because I was not a Trade Unionist.

Then they came for the Jews, and I did not speak out— 
Because I was not a Jew.

Then they came for me— and we had a few beers...

Sun, 05/17/2015 - 00:23 | 6102140 TheRedScourge
TheRedScourge's picture

No, they come for the socialists lasts, because they ARE the socialists. Cannibalising their own kind is the last step, not the first.

Sun, 05/17/2015 - 18:58 | 6104059 logicalman
logicalman's picture

They are not socialists, they are psychopaths.

Please refrain from commenting until you have learned the difference.

 

Mon, 05/18/2015 - 00:25 | 6104732 rockface
rockface's picture

They are the Socialists...

Sat, 05/16/2015 - 15:22 | 6100905 Shawnee
Shawnee's picture

haus, after they grab the ag and au, they go for the s&w.45,  perhaps first makes more sense, but whatever. King hussein will get his fundamentally transformed america,

 

 

Sat, 05/16/2015 - 15:22 | 6100906 Shawnee
Shawnee's picture

haus, after they grab the ag and au, they go for the s&w.45,  perhaps first makes more sense, but whatever. King hussein will get his fundamentally transformed america,

 

 

Sat, 05/16/2015 - 16:25 | 6101074 JRobby
JRobby's picture

And you know how "They" are.

1. Down in a hail of bullets

2. On the train to camp

3. (there is no 3)

Sat, 05/16/2015 - 16:38 | 6101108 Haus-Targaryen
Haus-Targaryen's picture

If they ban the euro I'll be stacking up on cash in whatever form possible.

Swiss francs are the priority and then thereafter polish zloty.

Sun, 05/17/2015 - 14:20 | 6103334 Upset Your Worries
Upset Your Worries's picture

"They will come for the cash first -- and then for the Ag and au.

Plan accordingly."

 

Haus-Targaryen - It occured to me that someone could be asked to buy the Ag or Au for you from the bullion dealer for a small consideration; then it's their details that are recorded not yours?

Sat, 05/16/2015 - 14:02 | 6100663 Simplifiedfrisbee
Simplifiedfrisbee's picture

At this stage in Zero Hedges demise, it does not surprise me to read such uninformative posts. 

Listen. 

Who uses cash? The lower class! 

This is an attack on the small monetary independece the poor might have. Information is everything today. Cash evades the models of quantifiable data. Central banks need data. Corporations feed it to them. 

 

Sat, 05/16/2015 - 15:08 | 6100861 Thick Willy
Thick Willy's picture

There is some truth to this statement.  The reason FaceBook and other "information gathering" services have skyrocketed in "value" is because they obtain something that the people with infinite money do not have - information.  Money is nearly worthless to people who can conjure it up by the trillions, but information like that gathered by FaceBook, Twitter, etc. is highly valuable.

Sat, 05/16/2015 - 16:07 | 6101022 Simplifiedfrisbee
Simplifiedfrisbee's picture

So cash does not evade quantifiable data models? Cash users are the minority. And those who do use cash are the lower class. Get out in real life and observe the trends instead of relying on articles to form a perception of reality. 

Sat, 05/16/2015 - 22:56 | 6102010 Doña K
Doña K's picture

Maybe mostly the poor use cash, but have no cash to hoard.

We are talking about people who stuff cash in the mattress and keep some in the bank for the everyday buying using debit cards and online bill paying. Big difference.

Sun, 05/17/2015 - 05:13 | 6102400 winchester
winchester's picture

they cannot ban cash.

 

when you build a wall, you can hammer inside to remove some brick, the wall remain stable, only the very lower brick make the whole stable.

 

cash = money used by poor, ok with that, when a bitch come to buy dolce & gabanna 8000$ bag, it is credit card paid, not cash. 

 

BUT.

 

poor who buy food, such eggs and butter for extra parts of a meal, under certain amount of value  vendor refuse credit card, because of tax of the transaction. so many small amount are made by cash.

smartphone is the key of the transaction in europ actually, making touchless payment in the hype, like any idiot got a phone with rfid...this is not a bigdeal to implement.

 

but there is an irreductible utility of the cash, the undeclared jobs... all activity hidden to the gov, just because you not earn enough to be fine so you hide a part of what gov is claiming...

 

if you remove cash, and especially cash prior to pm : you are stuck with pm in hands, its like paying a 2 $ bred and eggs with a 1000$ bill ( gold ), vendor refuse, thinking the bill is fake...

in europ, france, vendor call police when a black pay with a 500€ bill...

i let you mentally project the mentality changing in society with the use of pm to pay, in any situation.... legal or not, this is insanity and mad max within weeks.

 

if you make a ban call on pm 1st you will force people turn pm to crash or electronic. this is better solution to let money surface again.

the ' i lost pm in boat journey" will mark you at the very using of the recovered pm, you would mark yourself as thief liar target to the gov.

 

but the main purpose of my comment was that ban on cash will prevent lower economy for those who survive "under the radar" completly discovered and without  mean at all.

so you hit the stomac zone, and a population starving is very much more dangerous than a nuke, especially on west countries.

 

finally, the ban might occur, but it will be veeeery slow, over a whole generation i think, just to let people used to pay with phone instead of bills and coins.

 

from that opinion, i do not see any longer a  brutal crash before 2025-30.

( just because we are actually in the crash, but every body forget it is a slow motion movement who slide over centuries for any civilisation. )

 

 

Sun, 05/17/2015 - 14:54 | 6103423 Upset Your Worries
Upset Your Worries's picture

"I have one question for goldbugs. Have you ever tested your theory that there will always be a physical blackmarket? I mean have ever really tried to sell some of your gold not at a dealer...If we are going to develop an alternative to Bitcoin which can be anonymous in spite of anything the authorities can do, then we need to do it now because we have to build use value in that coin before it is too late to..."

https://bitcointalk.org/index.php?topic=1049048.msg11351385#msg11351385

One anonymous asset is gold, but I raised an objection based on the theory that gold can't be assuredly anonymously traded in the future.

Thus I have my goals set on anonymous crypto-currency and an anonymous internet.

https://bitcointalk.org/index.php?topic=1049048.msg11379311#msg11379311

 

 

Sun, 05/17/2015 - 05:13 | 6102401 winchester
winchester's picture

they cannot ban cash.

 

when you build a wall, you can hammer inside to remove some brick, the wall remain stable, only the very lower brick make the whole stable.

 

cash = money used by poor, ok with that, when a bitch come to buy dolce & gabanna 8000$ bag, it is credit card paid, not cash. 

 

BUT.

 

poor who buy food, such eggs and butter for extra parts of a meal, under certain amount of value  vendor refuse credit card, because of tax of the transaction. so many small amount are made by cash.

smartphone is the key of the transaction in europ actually, making touchless payment in the hype, like any idiot got a phone with rfid...this is not a bigdeal to implement.

 

but there is an irreductible utility of the cash, the undeclared jobs... all activity hidden to the gov, just because you not earn enough to be fine so you hide a part of what gov is claiming...

 

if you remove cash, and especially cash prior to pm : you are stuck with pm in hands, its like paying a 2 $ bred and eggs with a 1000$ bill ( gold ), vendor refuse, thinking the bill is fake...

in europ, france, vendor call police when a black pay with a 500€ bill...

i let you mentally project the mentality changing in society with the use of pm to pay, in any situation.... legal or not, this is insanity and mad max within weeks.

 

if you make a ban call on pm 1st you will force people turn pm to crash or electronic. this is better solution to let money surface again.

the ' i lost pm in boat journey" will mark you at the very using of the recovered pm, you would mark yourself as thief liar target to the gov.

 

but the main purpose of my comment was that ban on cash will prevent lower economy for those who survive "under the radar" completly discovered and without  mean at all.

so you hit the stomac zone, and a population starving is very much more dangerous than a nuke, especially on west countries.

 

finally, the ban might occur, but it will be veeeery slow, over a whole generation i think, just to let people used to pay with phone instead of bills and coins.

 

from that opinion, i do not see any longer a  brutal crash before 2025-30.

( just because we are actually in the crash, but every body forget it is a slow motion movement who slide over centuries for any civilisation. )

 

 

Sun, 05/17/2015 - 19:02 | 6104069 logicalman
logicalman's picture

The 'trends' are what the herds are doing.

Your argument ranks along with 'eat shit, 100 billion flies can't be wrong'

Once 'money' is all digital, how much contro does the average Joe Have? - DICK.

Surely you don't think that's a good idea?

 

Sat, 05/16/2015 - 18:14 | 6101402 Freebird
Freebird's picture

Well you fucking know it all, why don't you enlighten all of us too regarding liquidity events & counterparty risk

Sat, 05/16/2015 - 21:45 | 6101891 Simplifiedfrisbee
Simplifiedfrisbee's picture

You want enlightenment? Sure. A bird has no conception of freedom because other birds are not attempting to cage it. 

Ponder that for a second or minute or hour.

Now to be clear, you want my advice simply to deconstruct it. So knowing that, I first have to say fuck you. 

With that out the way, did you not listen to old lady Yellen last week? "The federal reserve and other banking agencies have substantially increased capital requirements." Liquidity is guaraneteed now.

"Regulatory minimums for capital relative to risk weighted assets are significantly higher, and capital requirements are now focused on the highest quality capital such as common equity." My understanding is slightly uncommon as I attatch the equity as levered by the US government. No fucking shit it is of the highest standard. The cycle is now perpetual. Liquidity events are now contained in the Banking states of America according to Yellen and company. 

"This applies both to advanced and emerging economies. Emerging economies can learn a lot from the pitfalls of their advanced counterparts....The gains from growth and stability from, "financial deepening" remain large for most emerging markets, but there is limits on size and speed. When financial sector development outpaces the strength of the supervitory framework there is excessive risk taking and instability." Too big, too fast. This is the fucking year of sustainable development meaning this is the year they take on more risk than ever before in history. 

I wonder that the outcome is when the world has nothing more to give. 

 

Sat, 05/16/2015 - 23:01 | 6102018 Doña K
Doña K's picture

Paper game. When people either have no discretionary money to spend, and/or have money to spend but hoard it, will eventually result in a a deflationary depression, which could morph into a inflationary depression, depending which way the CB's will try to right the ship 

Sun, 05/17/2015 - 01:23 | 6102223 Simplifiedfrisbee
Simplifiedfrisbee's picture

I am a very polite man when I choose to be so don't take this personal.
FUCK NO.
Understand the current financial condition is not going to implode. It is slowly dissipating. Big difference

Sun, 05/17/2015 - 12:20 | 6103018 Freebird
Freebird's picture

Mmm...ok & a frisbee is a sphere which spins in the air when thrown...all very profound, but actually good on you with your expansion...you obviously not one dimensional. The point is exactly, when & how does it end..

Sun, 05/17/2015 - 16:54 | 6103759 Simplifiedfrisbee
Simplifiedfrisbee's picture

Cmon birdman. It is not going to end. It is going to start over. The goal is to always invent a new game with the same rules. For instance, soccer players have a difficult time becoming jockeys. So bankers as a collective group are going to internally stuggle to manage the new power sytem.

The power struggle of evil men is insatiable and to transition out of the current power paradigm will cause conflict. These peasants are not resiliant. Internal power collapses have occurred in every advanced government in history. The wealthy, powerful, evil men of advanced societies destroy themselves time and time again. The bothersome reality is the innocent people who are slaughtered as a result of these men.

Transition is beautiful to the men of virtue who can persevere through difficult times. Men who consider freedom a natural right like yourself and many here will do fine in any transition. It is evil to bring everyone down around you when you are meant to fall alone. Banks must fail and receive no help.     

Sat, 05/16/2015 - 19:49 | 6101636 buyingsterling
buyingsterling's picture

Bollocks. We already know what the poor spend their money on. They have a subsistence diet and the rest goes to meth or crack. This is about anyone who has any extra money after they've bought their meth or crack.

Sat, 05/16/2015 - 14:14 | 6100693 ThroxxOfVron
ThroxxOfVron's picture

The devaluation has been ongoing.  The dredit/money supply has been growing at an astonishing rate compared to real GDP. 

 

http://www.federalreserve.gov/Releases/h6/current/default.htm

https://research.stlouisfed.org/fred2/series/MSIM3P

 

This IS a devaluation.  The classic definition of inflation is the amount of new money introduced into the system in aggregate.  In a credit/debt-based fiat system this would include all laons and leverage.

Derivatives leverage aren't even considered in these series or calculations!

 

http://www.bis.org/statistics/derstats.htm

Also, see page 2 below: 

http://www.bis.org/publ/otc_hy1311.pdf

 

Unpayable unsustainable debt is being temporarily papered over by a panicked torrent of un-backed -counterfeit- emission.

Of course people are ploughing into equities, cars, art, real estate, etc.: these are real assets, inflated by  a stampede of moneyness -no doubt; but, thee is still underlying real value of some kind that cannot be defaulted outright or vaporized in a cascade of counterparty defaults, dilutions, outright nominal FX devaluations, etc...

Sat, 05/16/2015 - 15:36 | 6100846 Urban Redneck
Urban Redneck's picture

That big move upward in the "velocity of money" was the adoption of plastic (ATM & Debit cards) but the "velocity of money" actually has nothing to due with velocity or speed of transactions.  It is simply a measure of the efficacy of the money supply in generating GDP (or an inverse of the level of finacilization).  

Reread those 2 sentences several times, or to help Marty with his deficient Socratic reason I'll simply rephrase -  ATM & Debit cards increased efficacy of the money supply in generating GDP.  Correlation (to "speed velocity") is not causation.  

Marty should know better, since he has actually written of the BS that the BLS describes as GDP.  And as the G in Y = C + I + G + (X ? M) grows and transfer payments increase elements of Y are double counted, and that's before global corpratists ensure that X never reaches the the D in GDP.  

Devaluation is a feature of the product.

Sat, 05/16/2015 - 15:40 | 6100962 bbq on whitehou...
bbq on whitehouse lawn's picture

debit / credit and other electronic transactions are not money. Just account transactions on the ledgebooks of the large familes. Like one slave trading with another slave on the same plantation. Meaningless as long as you do it all on the masters books.
Cash, script and other printed tokens still need to be printed and accounted for. They can also be exchanged to any slave on any plantation. So they are transactions that cant be forged. Did the transaction take place? If it was with cash then yes it did for slaves work hard for that script.
Point is once you have to account for something it exists, that means hyper-inflation as the accounts that exist grows beyond the ability to hide them.
Moving cans of beans around in the store is one thing, once those beans leave that store, its another.

Sat, 05/16/2015 - 15:48 | 6100981 Urban Redneck
Urban Redneck's picture

GDP has nothing to do with money either, or even actual goods for that matter.  (Except in the narrow definition of money strictly as a unit of account.)   However, actual goods can, and do, leave the store on credit.   

Sat, 05/16/2015 - 13:52 | 6100645 TeethVillage88s
TeethVillage88s's picture

I guess now that there are few us banks left, they can do it. Not sure what Credit Unions will do, they would have to be hit with a big fee or tax to force them... maybe.

- 5,500 banks

Commercial Banks in the U.S., 2015:Q1: 5,501 Number (+ see more), Quarterly, End of Period, Not Seasonally Adjusted, USNUM, Updated: 2015-05-11
http://research.stlouisfed.org/fred2/series/USNUM

Sun, 05/17/2015 - 13:41 | 6103222 Raging Debate
Raging Debate's picture

Debtcrash - Negative rates is a form of indirect taxation. Cashless means hoovering up some extra nickels from tax dodgers mainly in small business.

We're already at NIRP if inflation is factored in though that is slowing quite a bit now. I give it about five years as government cuts more in defense and health spending while beggining to focus on fiscal policy rather thab be fully reliant on monetary policy. Boomers are going to see very lean Medicare services.

I agree also with another poster about a big round of currency devaluation too, especially as Yuan further positions itself as GRC. I think some here are rightfully concerned about a false flag for public consumption to restructure the government, default on debt and cut pensions (likely by 40%).

Sat, 05/16/2015 - 16:56 | 6101168 MASTER OF UNIVERSE
MASTER OF UNIVERSE's picture

It is pretty pathetic that he states people are hoarding cash when he knows main street is boarded up everywhere but New York City where it's a prosperous enclave compared to everywhere else. He is not a good prognosticator, agreed. Unfortunately, he is right about the cliff all the Lemmings are about to find themselves staring at.

Sat, 05/16/2015 - 20:54 | 6101794 hungrydweller
hungrydweller's picture

Chumba,

The website will not let me rate you.  I give you +many.

Sat, 05/16/2015 - 16:37 | 6101097 rbg81
rbg81's picture

Once all $$ is in electronic form, they can compel you to spend it.  How?  By making it disappear after a certain period of time.  If you have above a certain amount in the bank, say $50K for a year or more, it may start disappearing unless the excess is spent or "invested".  Invested meaning stocks, corporate/municipal bonds or (best of all) US Gov debt instruments.  In short, the Powers-that-Be think this will open up a torrent of demand.  And they may be right, but we will be stuck buying shit-we-don't-need.  

Sat, 05/16/2015 - 18:16 | 6101408 cynicalskeptic
cynicalskeptic's picture

It's more about CONTROL of ALL transactions and making the 'money' you have easier to confiscate (blatantly or via fees and taxes.  Cash held outside the banking system is invisible (though it can be 'destroyed' via new currency issues that supercede previous ones - you have to 'prove' you  r currency is 'valid' before it can be exchangd for new issues)

Before the FDIC when banks could and DID go broke - people would pull their money out of a bank that was perceived to be at risk.  THAT was why people put cash in mason jars and buroied them in their yards.  This was a big problem in the 1930's - so much cash was removed from circulation it made what commerce was left harder to conduct.  Money literally 'disappeared' into mattresses and the ground and government could NOT simply 'print more' without haveing the gold to back it (albeit frsactionally).  THAT was why FDR confiscated and then revalued gold - to create more money for government to spend.   But now money can be created out of thin air with computer keystrokes - by the TRILLIONS.  

We have a screwed up ecpnomy that depends on continual and increasing SPENDING - penalizing SAVING.  But you can't have continual and increasing spending when people are unemployed.   REAL wealth is created when value is created or increased (usually accompanied by the expenditure of labor).  You mine oresmelt it into metal, make things from tha tmetal.  You grow grain, mill it into flour, make brad from the flour.  You cut down trees, mill them into lumber and make things from the lumber.  In some ways you can create 'abstract' value - intellectual property of varying kinds but that type of value will go unsold if the more fundamental type of 'value and wealth creation' does not occur first to give others the money to spend on such things.  

Used to be that  'finance' existed to allocate capital to productive endeavors.  Now 'finance' is an ever larger massive casino that sucks the wealth created by others into a black hole.

 

Sun, 05/17/2015 - 01:05 | 6102200 Which is worse ...
Which is worse - bankers or terrorists's picture

This already exists in India. It is called wealth taxes. Over $50k, you owe the government 1% of what you have unless you invest it. 

Sun, 05/17/2015 - 08:23 | 6102569 rbg81
rbg81's picture

How brilliant!  We can follow India's lead because it's all worked out so well for that Shithole.

Sun, 05/17/2015 - 11:09 | 6102841 TeethVillage88s
TeethVillage88s's picture

Hey Indian peoples can easily trace languages back 2000 years with little change. The Indus valley is one of the oldest places where people have lived continuously.

But... The British were there spreading Ideas of Regimes and Empires.

Could be the British taught Indians Western politics.

Sun, 05/17/2015 - 13:36 | 6103206 rbg81
rbg81's picture

Didn't the Indians practice Sati (e.g., burning a window in her husband's funeral pyre)? That is, until the British put an end to that practice (though rumors are it persists to this day). And then there is the cow worship thing, which persists to this day.  I could go on and on.

As I said, it's a shithole.

Sun, 05/17/2015 - 14:26 | 6103352 TeethVillage88s
TeethVillage88s's picture

Yes I think they still burn the surviving widow and even put corpses on platforms for birds to eat.

Have to admit that my info is that Buddha recognized the corruption of the Hindu Temples and this was a reason to seek other Truths about Life.

Sun, 05/17/2015 - 17:07 | 6103784 TeethVillage88s
TeethVillage88s's picture

Or I might have been thinking of the burning of Virgins actually. But if they burn virgins to please a god, then they probably burn surviving widows some place too.

Sun, 05/17/2015 - 06:45 | 6102476 explosivo
explosivo's picture

Thank you for providing me with another nightmare. 

Sun, 05/17/2015 - 20:39 | 6104300 Oldwood
Oldwood's picture

Not much different than when FDR proposed the "retained Earnings tax" that was going to tax already taxed earnings if they didn't get spent quiet soon enough. There is absolutely nothing that they are not willing to do to keep this sucker afloat, regardless of how many they must bury to do it.

Technology, and most specific, our mindless love affair with anything new, especially if it affords the beloved convenience, will enable them to impose the most controlling and tyrannical social structure in history.

We have been willing to surrender our liberties and lives (as well as others) for the sake of convenience. A little less labor, a little less conscience and always, a little less freedom with each step towards hell.

I don't need to know where I'm at or where I'm going because I have GPS in my phone. I don't need cash because a simple retina scan will be all that I need to access my vast stored wealth (or that which my EBT account provides access to). I don't need to watch my diet because they are monitoring everything I eat and drink. And best of all, I really don't need an education as they will tell me everything I need to know.

The absolutely stress, worry and labor free life....for those who are selected to survive,

Sun, 05/17/2015 - 15:06 | 6103457 Upset Your Worries
Upset Your Worries's picture

 

An interesting essay:

"Demise of Finance, Rise of Knowledge"

"The economic plague besetting the globe can be entirely explained by the cycle of failure of passive capital, which repeats throughout history."

http://www.coolpage.com/commentary/economic/shelby/Demise%20of%20Finance...

This too if you have time:

"Understand Everything Fundamentally
The entropic force is fundamental." "Did Adam Smith know entropy?

Free market (i.e. anarchist) capitalism didn’t fail, rather the world has been doing collectivism, which leads to socialism as we now see occurring. Adam Smith was advocating collectivism when he wrote in the Wealth of Nations, that tax should be apportioned relative to income.

Perhaps Adam Smith was blind to the mechanism of his “invisible hand”. This fundamental concept is the entropic force, that 99.9% of the people in the world don’t grasp..."

http://www.coolpage.com/commentary/economic/shelby/Understand%20Everythi...

 

Sat, 05/16/2015 - 14:04 | 6100668 indygo55
indygo55's picture

Yeah I don't/can't know about now all this other shit will pan out or exactly why. I just know it's all going into a steaming pile of shit and that I/we need to prepare in every way possible. Physically, financially, emotionally, etc. 

Sat, 05/16/2015 - 14:38 | 6100765 DutchR
DutchR's picture

Relax, Breathe In Breathe Out

Not much you can do but enyoy the moment

Relax

Sat, 05/16/2015 - 16:46 | 6101137 TeethVillage88s
TeethVillage88s's picture

Buy cases of cheap booze for barter and sanitation of wounds...

Sun, 05/17/2015 - 12:40 | 6103050 DutchR
DutchR's picture

Tampons, but you allready new that.

 

Distill is the magic word

Sat, 05/16/2015 - 14:27 | 6100731 Rearden-Steel
Rearden-Steel's picture

Maybe if interest rates were determined by the market, people wouldn't be hoarding cash.  What a crazy idea.

Sun, 05/17/2015 - 00:03 | 6102104 ThirteenthFloor
ThirteenthFloor's picture

Not cash. Liquid assets. They will declare cash illegal this time.

Sun, 05/17/2015 - 12:43 | 6103060 DutchR
DutchR's picture

Liquid assets

literally

Say like, Old No.7

Sat, 05/16/2015 - 13:38 | 6100599 worbsid
worbsid's picture

Like all oil production, the easiest and least expensive oil is produced first.  Peak oil is not now nor ever has been about running completely out of oil. Another field or a dozen fields will be discovered in the most ungodly places, think artic or antartic or the Mariana's trench.  A hundred years from now you will be ble to buy petroleum fuels if you are rich enough. IMHO the real calamity will be when the water level reaches up to the horizontal superstraws in Saudi Arabia and SA folds in a shark's fin of production.

Sun, 05/17/2015 - 15:39 | 6103551 SilverDoctors
SilverDoctors's picture

Perhaps Steve, but with reverse repos going parabolic (indicating a massive string of derivative defaults behind the scenes is causing an unprecidented liquidity crisis), the USEcomony might not make it till Bakken & Eagle Ford peak...

Sat, 05/16/2015 - 12:38 | 6100479 Oh regional Indian
Oh regional Indian's picture

I like Martin A just for his decimalization of years.

Clearly a man comfortable against the tide.

Sure is a crashy feel in the air.

Sat, 05/16/2015 - 12:53 | 6100516 bonderøven-farm ass
bonderøven-farm ass's picture

It's not about volume; it's about flow.

 

Sat, 05/16/2015 - 13:31 | 6100583 AIIB
AIIB's picture

Fuck MA ~ He sold out to the dark side to get out of jail, and now plays the role of controlled opposition (for profit)

Sat, 05/16/2015 - 13:54 | 6100648 Lore
Lore's picture

Nailed it. Notice how he continues to pander to the "recovery" narrative, never mind the bold-faced absurdity of referring to QE as somehow "stimulative."  It's TIRED, Martin. We're not STUPID.

Sat, 05/16/2015 - 16:39 | 6101116 Bay of Pigs
Bay of Pigs's picture

I have to agree. Some of his views are outrageously way off the mark. Especially on gold and silver suppression and manipulation. He's like an ostrich with his head in the sand.

Question is, why?

Sat, 05/16/2015 - 21:45 | 6101893 buyingsterling
buyingsterling's picture

His point about gold is that confidence in govt. and investor momentum determine price. When there is a swing in either, no amount of manipulation can change the direction of the market. I think he unfairly discounts the fact that maipulation can put a damper on the market day to day.

The other shot is unfair, IMO. He's written repeatedly that govt. statistics are BS and that there is no real growth. I don't think he's an enemy of freedom.

Sun, 05/17/2015 - 01:28 | 6102228 Bay of Pigs
Bay of Pigs's picture

Ridiculous. True price discovery has been smashed to bits. Investor momentum and confidence in govt have nothing to do with it.

How he ignores the data and evidence shown here and elsewhere repeatedly is the question Armstrong needs to answer.

Sat, 05/16/2015 - 21:13 | 6101832 WillyGroper
WillyGroper's picture

Said the teenage boy after the prom.

Sat, 05/16/2015 - 13:57 | 6100653 TeethVillage88s
TeethVillage88s's picture

wow, Update: US Steel - Layoff Notices Rise to 9,000

Sat, 05/16/2015 - 16:04 | 6101013 Tinky
Tinky's picture

No rust for the weary.

Sun, 05/17/2015 - 09:40 | 6102649 Oh regional Indian
Oh regional Indian's picture

*Golf Clap* Tinky....

Mon, 05/18/2015 - 00:24 | 6104731 Redneck Hippy
Redneck Hippy's picture

The velocity of money is not a real thing.   It is just a computation.  If the supply of money goes up, and the economy doesn't change, velocity goes down.  It means nothing.

Sat, 05/16/2015 - 15:00 | 6100832 R-502
R-502's picture

Just crash already.... We're waiting :P

Sun, 05/17/2015 - 20:47 | 6104311 Ginsengbull
Ginsengbull's picture

R-12 dichlorodifluoromethane was way cooler than 502.

Sat, 05/16/2015 - 15:05 | 6100849 j reuter
j reuter's picture

My last pay check was $9500 working 12 hours a week online. My sisters friend has been averaging 15k for months now and she works about 20 hours a week. I can't believe how easy it was once I tried it out. This is what I do... www.jobs-review.com

Sat, 05/16/2015 - 16:13 | 6101037 Lore
Lore's picture

Your mother makes at least that much lying on her back.

Sat, 05/16/2015 - 21:08 | 6101819 LooseLee
LooseLee's picture

ALL Pinko Fascist Commies are..

Sun, 05/17/2015 - 10:19 | 6102745 spinone
spinone's picture

People arent hoarding cash.  They are living hand to mouth, spending every cent they have.  They have no money in the bank and no retirement savings.

 

Corporations are hoarding cash.

Sat, 05/16/2015 - 12:07 | 6100406 J S Bach
J S Bach's picture

* Yawn *

Who won the ball game last night?

Sat, 05/16/2015 - 12:11 | 6100409 Rektors
Rektors's picture

Constant battle trying to convince the wife to buy more physical silver....sigh.

Sat, 05/16/2015 - 12:19 | 6100440 besnook
besnook's picture

i buy gold and silver jewelry for my wife. she picks out what she likes and wears it. bullion and coins didn't do anything for her but she likes my monthly shoppinng sprees now. the rest is buried in the woods.

Sat, 05/16/2015 - 13:36 | 6100593 Automatic Choke
Automatic Choke's picture

oh cool.  exactly where do you have it buried?  got any gps coordinates?

Sat, 05/16/2015 - 23:08 | 6102026 newworldorder
newworldorder's picture

You mean - the rest you lost in a boating accident. Dont you?

Sat, 05/16/2015 - 12:29 | 6100459 realmoney2015
realmoney2015's picture

Yup. Luckily I'm in control of how I spend my money (I'm not married). I do try to convince my friends and family to start buying silver. Most ignore the advice and stick their heads in the sand. That's why I started making candles with real silver coin prizes: www.etsy.com/shop/ScentSavers. It has helped people realize how valuable a little coin is. 

I also give them an informational flyer that talks about the federal reserve. Lots of them are waking up. Some now have more silver stacked than I do!!

Sat, 05/16/2015 - 15:10 | 6100867 Thick Willy
Thick Willy's picture

Yea, buy silver so you can lose 60% of your capital like everyone else.

Sat, 05/16/2015 - 16:36 | 6101096 LoneCapitalist
LoneCapitalist's picture

Man, that Willy sure is thick!

Sat, 05/16/2015 - 12:39 | 6100481 crazytechnician
crazytechnician's picture

Tell her to buy some bitcoin instead.

Sat, 05/16/2015 - 12:44 | 6100496 realmoney2015
realmoney2015's picture

I'm not 100% against bitcoin. I'd start with silver, however. If you can't hold it, you don't own it. Maybe after you have a decent stack, then you could take a gamble in the digital currency markets.

Sat, 05/16/2015 - 13:14 | 6100550 crazytechnician
crazytechnician's picture

If you own your private key , you hold the asset registered to it.

Sat, 05/16/2015 - 13:50 | 6100640 Citxmech
Citxmech's picture

You hold something. . .

Sat, 05/16/2015 - 14:43 | 6100781 Nimby
Nimby's picture

You stupid nigger - if there is no electricity then there is no bitcoin.  If electricty is so expensive that that people with whom you'd trade can't afford to accept your bitcoin, then there is no bitcoin.

Sat, 05/16/2015 - 14:47 | 6100796 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Pathetic inbred.

Sat, 05/16/2015 - 15:06 | 6100852 crazytechnician
crazytechnician's picture

LOL another fucking redneck eejit - wihout gravity there is fuck all as well.

Sat, 05/16/2015 - 22:44 | 6101990 Nimby
Nimby's picture

I can hear it now: "If you just sell me a gallon of gas first, I can run this generator and access my bitcoin and then pay you."

Bitch, you're going to be sucking my dick for a gallon of gas, and I'm going to be thinking about baseball the entire time.  And you'd better swallow. 

Sun, 05/17/2015 - 15:35 | 6102985 shouldvekilledthem
shouldvekilledthem's picture

Man, I highly respect your determination to open the eyes of the ZH retards, but it's completely futile.

 

Let them be. They shouldn't buy any bitcoin, they couldn't even keep it safe.

Sat, 05/16/2015 - 15:18 | 6100891 Thick Willy
Thick Willy's picture

I think you silverbugs are all like my grand dad back around 1990.  Had a bunch of silver, coin collection, "junk silver" etc.  He was "just a collector" by then, 'cause he'd lost so much buying at the peak.  Passing it onto the grand kids trying to teach them "what real money is."  Sounds familiar....

 

Silver won't be back to $35 an ounce for 20 years.  If ever.

Sat, 05/16/2015 - 15:40 | 6100964 stacking12321
stacking12321's picture

"Silver won be back to $35 an ounce for 20 years.  If ever."

 

silver will far surpass $35 an ounce in the near future as the dollar collapses, is replaced as the world's reserve currency, and is rejected world-wide.

the dollar will go to its intrinsic value (zero) and you won't be able to buy an ounce of silver for $USD, not even for $1,000,000 an ounce.

Sat, 05/16/2015 - 16:07 | 6101020 crazytechnician
crazytechnician's picture

Hilarious.

Sat, 05/16/2015 - 19:35 | 6101594 stacking12321
stacking12321's picture

how so?

Sun, 05/17/2015 - 12:23 | 6103028 shouldvekilledthem
shouldvekilledthem's picture

We only buy gold and silver, everything else sucks. Diversification is idiotic, when the fiat system fails we are going to revisit the dark ages but gold and silver will make us rich and more likely to survive.

Technological adavancements are all shit and worthless like the internet. 

For this reason I am not willing to open my mind to potentially beneficial and empowering technology.

To ease my mind, I just ordered an other pack of golden eagles (over the internet).

Sun, 05/17/2015 - 18:36 | 6104009 stacking12321
stacking12321's picture

sounds like you are making a sarcastic comment, but a pointless one.

this is called a straw-man argument - you are mis-characterizing the views of others that you think you disagree with.

you are being dishonest - i'm not against diversification, not against the internet, and not against technology - in fact, i'm firmly in favor of these things.

feel free to try again, though.

Sat, 05/16/2015 - 22:05 | 6101918 Not My Real Name
Not My Real Name's picture

Silver won't be back to $35 an ounce for 20 years. If ever.

By your own admission on another thread today, you said you went all in on Au at $1600 and Ag at $30 -- and yet, somehow you think you're still smart enough to know the future price of precious metals? Do you have a newsletter too?

Sat, 05/16/2015 - 13:41 | 6100606 Fate
Fate's picture

Buy it, anyway.  If it's not a strain on your finances, and you still have to ask, then you have a bigger problem.

 

 

Sat, 05/16/2015 - 16:03 | 6101011 tarabel
tarabel's picture

 

 

50-50 split.

PM jewelry for her.

Coins for you.

Sat, 05/16/2015 - 12:11 | 6100416 I Write Code
I Write Code's picture

Gibberish.  M2 cash is down because of ZIRP and credit cards, it's eliminating itself.

Sat, 05/16/2015 - 12:38 | 6100480 GotNuttin'todo
GotNuttin&#039;todo's picture

Anyone have a graph of M1 as a measure of velocity? M1 does not include savings deposits so would not be as influenced by ZIRP.

Sat, 05/16/2015 - 12:48 | 6100503 SWCroaker
SWCroaker's picture

ShadowStats.com, click on "Chart Library", then look for "Money Supply".   Has both shorter term charts (2006 onward) and long term (1960 - onward) for M1, M2, and M3.  M3 from '06 is recreated using old formulas as gov decided to stop publishing it back then.

Sat, 05/16/2015 - 14:07 | 6100674 GotNuttin'todo
GotNuttin&#039;todo's picture

The Shadowstats charts are of money supply which is a measured amount. Velocity is a calculated amount VOM=GDP/Money supply (don't mean to insult anyones' intelligence, just making sure we are on the same page). Armstrong's chart looks nothing like shadowstats chart of M2, which is a bit surprising as GDP has seen only a slow steady growth. Part of the problem with all this stuff is that no one ever defines what they are talking about.

Sat, 05/16/2015 - 14:13 | 6100689 GotNuttin'todo
GotNuttin&#039;todo's picture

Thanks. That chart looks much more like Armstrong's chart. Kind of refutes the ZIRP idea, unless I am missing something.

Sat, 05/16/2015 - 14:26 | 6100725 El Vaquero
El Vaquero's picture

No problem.  Even with the cheerleading and bogus definitions, the data still looks shitty.  M2 velocity also sucks.  U3 and U6 unemployment look good, until you look at their definitions, then you realize that, even if they are accurately measuring what they claim, it's still bullshit, because the way it works, people are out of work, but they're not counted as unemployed.  There are lies, damned lies, then there is the Bureau of Labor Statistics. 

 

As for the velocity, it's more than just ZIRP.  TBTF is getting paid to hold excess reserves with the Fed.  That has provided incentive for that counterfit to not flood into the real economy.  The denominator for the velocity has been increasing, but spending hasn't to any appreciable degree.

Sat, 05/16/2015 - 15:23 | 6100909 Urban Redneck
Urban Redneck's picture

M1V is an utterly useless datapoint, but in a discussion of the elimination of fiat FRNs, M1V is actually less utterly useless than M2V.

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