“The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him.” ~ Leo Tolstoy, 1897
Change Is Coming To America.
Every American regardless of their situation senses this reality and yet struggles in defining it. Attempting to actually paint a picture of what our nation might look like the years ahead leaves us frustrated and a bit anxious from all the uncertainty.
Compounding the problem we see an abundance of people who seem bent on scaring us about the ugliness to come and yet how many of them take time to define "ugly"? Such sources appear quite smart on the surface but pass by like a thunderstorm that leaves no rain, having no value, and serving only themselves.
In this series I will attempt to define what type of changes we can expect to see and where possible, to what degree.
This is not a topic to be taken lightly and so we will endeavor (as much as humanly possible) to avoid opinion and keep a focus upon history and the cycles that are silently bringing us to this historic point as a nation.
There is a convergence of many cycles taking place that simply must run it's course, a point of extremes at which point the pendulum will finally reverse course.
Extreme discussions (tho rarely manifested) are where I live as it allows discovery in finding the truth, the place of balance, but for purposes of today's discussion I should alert the reader that there will be some extremes playing out in the next 4-5 years.
There are many other points that can be brought out separately from a spiritual and biblical perspective however their value, their importance, varies greatly from person to person creating a dilemma for us; not wishing to venture into places that might offend.
As such there are possibilities that we will carefully avoid today as I wish EVERYONE to see what I am pointing at. So as we take this look out on the horizon ahead, from a position of reason alone, I am convinced that there is immense value to us all.
Thru discovery; by careful study of history and respecting the habits of man (which always repeat); we can thru observation have confidence in many things. If successful here then we will all walk away with a better understanding of the natural forces at work to then serve as an important foundation in the years to come.
AN OPPORTUNITY FOR US TO REFLECT
"An ignorant person is one who doesn't know what you have just found out!" ~ Will Rogers
In January 2013 I ceased all writing on middle eastern affairs and began sharing observations of the world at large as I was beginning to see some troubling signs.
Often in ignorance I then attempted to define the future based on our course and made vague references to many things including a possible depression but always leaving things open ended as I lacked confidence in understanding the world.
What was often quite cloudy to me a few years ago is much less so today. Most of what you will read here will ring true but some of it may challenge your position, your perspective.
That is a good thing as my intent is not to change or convince but to encourage reflection. Regardless of if we agree at the end you will at least have gone into those deep recesses and considered a new possibility even if your perspective, your perception, remains the same.
THE PRIMARY DRIVERS OF THIS CHANGE
I have concluded that we can reduce the discussion to just four (4) forces that are (and will be) driving some huge economic and societal shifts over the next several years.
Using my only known way of expression we will, thru observation and example, point to many concerns and try to determine the risks we face as a nation, their connection to one another, (and where history allows) the possible severity of their effects.
As we progress you will likely see these destructive forces (The 4D's) working silently, behind the scenes, and avoiding the light of day when possible. We will not dwell on them beyond this point where we will now simply state who they are, calling them by name:
WITH WHOM DO WE CONTEND?
DEPRAVITY: moral perversion; impairment of virtue and moral principles. Going beyond mere bad behavior — a total lack of morals, values, and even regard for other living things.
The key point is not that depravity exists for this has been true from earliest times. The concern here is that it's increase is a measure of, a marker towards, the fall of a society. Throughout recorded history a stage of moral decline precedes that of economic decline.
DEFLATION: A state of decline, of contraction. The absence of growth and expansion. That part of the business cycle which marks a correction as ALL asset classes are returned to levels that reflect equilibrium. As I will attempt to point out, the manipulations that central banks have employed in recent years are vain attempts to delay this force.
It's effects will now be felt all across the globe more fully than in many centuries past as we must fall (correct) from a much greater height than was necessary fully because of these measures that serve only to delay. As Martin Armstrong has said repeatedly for years: "You'll beg for inflation before this is over!"
DEBT: I have spoken so often to this that it seems redundant to even include it here. The greed of man never ends and the debt across the entire world (even relative to GDP output) is at a level never before seen in the history of the world.
Being careful here to point the finger PROPERLY, all the worlds ills are not to be placed at the feet of central bankers. Government debt has ballooned in recent years and is central to our understanding of what's coming.
We can make a case for debt when it is created for purposes of industry and expansion of business but that is not what we are addressing here as the entire globe has gone way past such healthy employments of debt and into the public sector.
The force of deflation now requires that the debt be dealt with. This will not end well folks and I am not even close to exaggerating here. The US is knee deep in the equation and all this leads us to our final point.
DEFAULT: A straight forward term referring to an event that follows from a debt that cannot be repaid. This term will be a commonly used one across the entire globe in the next few years and those at the top of the food chain will see to it that those at the bottom suffer a disproportionate amount of the pain. Nope, still not exaggerating.
[note: Some smart people are presently making the case that default is not going to be the outcome, that governments will monetize the money supply (increase it even further and thus debase it) in order to keep things propped up perhaps for years.
I obviously do not believe this to be the case EVEN THO it will be employed in various places and in some large measure with Japan as the poster child as they monetize 250% of all gov't debt issuances.
However this is not really a position of mine (opinion) for again we are respecting history in this exercise and historically nations (in the final analysis) always default; first on the obligations to citizens and then externally to other nations.]
note: for review of the relationship between debt and deflation see:
"The Rising USD - Look Out Below"
OPPORTUNITIES ABOUND FOR US TO HAVE - CONFIDENCE
"People's minds are changed through observation and not through argument." ~ Will Rogers
Opportunities lie in wait all around us, for us all to see clearly what lies ahead. In this blog we will look at the "how, why, and what" by looking back to history and respecting "the times in which we live"; the cycles that are at work.
There are cycles all thruout our world that repeat with great precision and trends that must (MUST) be factored in to our expectations. These cycles control war, civil unrest, the extremes of markets, demographic changes, the rise and fall of empires, temperatures, the list goes on. Within this discussion we have trends unfolding and these are VERY reliable in the macro (global) arena. Think of them as an unseen hand that is working in concert with the cycle.
For instance, is the global trend in commodities downward, a deflationary one? Then why do we jump when oil goes up for a day or two? If we seek confidence to "know when we are right" then we must maintain focus; the "The Trend is Your Friend" is not just a nice sounding platitude, it is a guide.
"It is easier to fool a man than to convince him that he's been fooled." ~ Mark Twain
Intent on following their old (linear) thinking, sometimes with the best of intentions, we will always have people who insist on telling stuff that simply ain't true; missing the great opportunity that is right there in front of them just waiting to be picked up. Looking in the mirror, I must add that if we are open to being wrong and truly in search for the truth? Then there is yet hope.
Let's pause for one example of trends: What should be our reaction if the G20 calls on nations to play nice and keep currency prices stable and stop currency devaluations? Shall we jump and call the end of currency wars? "It's over! We're almost there...!"
What (if anything) does the trend say? Is the business cycle now suddenly to be defeated simply because some politicians have decreed it? We must pause, take this news up into the macro (big picture) level and THEN examine it.
From here, above all the smog and noise, we then see clearly that government has always been the worst of all debtors; defaulting on their obligations (both internally to the citizens and externally in their debts) is the one thing they consistently do well.
Further, is the global deflationary trend to be stopped by the G20 (or any other voice)? Knowing that the forces driving this are debt and deflation globally, should we not conclude then that this TREND towards lower currency valuations will....continue?
Maybe not in the near term (as men continue to intervene, attempting to stop the business cycle) but the trend is our guide here. That's the key.
In order for history to hold true we can be assured that there will be further downward movements in currency and that the massive debt levels will slowly be defaulted on. THIS is the requirement for the remaining dominoes to then fall!
"You can ignore reality but you cannot ignore the consequences of ignoring reality." ~ Ayn Rand
WHERE IS AMERICA IN THE CYCLE?
By looking back into the history of major nation states, their rise to power and their eventual fall, a few smart people have mapped out (separately) the various stages of any nation state's life cycle.
The consensus is that a lifespan of about 250 years from rise to fall can be depended upon with some variance on the number of cycles involved.
All that I have seen are in agreement that America is entering the final stage; the stage of decline. This stage also has the unique trademark of unfolding much more quickly than others. Tho not a prerequisite for America, in the case of Rome it took only 8 short years for them to fall.
Further, by respecting some big cycles that are set to complete together as they come together converging into one narrow window of time, we can conclude that the next 4-5 years (thru 2020.05) America will be reshaped, remolded, redefined. Note here that I did not say "removed" as that point is not yet clearly defined.
Two of these cycles need to be called by name here. The cycle of civil unrest is unfolding over the next few years as is the cycle of war. These characters need mention because they do not often overlap each other and when they do history records a greater likelihood of major societal change.
The last time these cycles met one another was in the late 1700's when the world was met with revolution in both America and France. Due to their importance we will cover both of these cycles separately in part 3 of this letter.
[note: Please do not think lightly of these events, they are very real and deserving of study for those with interest. Armstrong was talking about these two cycles well in advance, alerting his readers to it even before it's kickoff in 2014 with global headlines that followed, falling in line perfectly (in some cases to the very day).]
On the backside of 2020 I can see blue skies reappearing but a new normal in place that invokes humility and a general attitude of "contentment with less". 2020 and beyond will not be marked by American dominance and I mean that in every sense of the word.
Our military might will no longer be feared and revered and our place in the world's economy will be secondary to other nations. Notice I did not single out China here?
The greatest economic growth in the world is decidedly in the east but India is actually poised to explode with growth much more so than China. This explosion will be a big thing and opportunity will likely abound there for decades.
[note: there are several cycles and indicators that tell this story but the greatest of all (the most telling) is demographics. We can be assured that India is set to enter the world in a big way simply because their population is perfectly poised for it in all respects.]
Given the many variables that have yet to take form I would further generalize the future for Americans like this; those entering retirement will face setbacks and change and a retirement that is different than was planned but the youth and young adults who are just setting out in the world will be a generation that sees great opportunity ahead.
[note: I stole that thought from Harry Dent, a well respected trends researcher, because it resonates fully with what I see.]
A TIME TO BE WATCHFUL
With each new turn in the cycle we see more clearly the things that lie still further ahead. This is not an excuse but an important point for us.
To have confidence [speculation or opinion has little value here] regarding the timing and the magnitude of any micro event requires patience for we must allow the complexities of man's interactions (both domestically and globally) to take shape and with each step we will then see the end (the future) more clearly.
An important near term marker that will be part of this "defining" of our nation will be the 2016 election. We'll speak to that later but for now let's expose some of the characters involved and correctly state what they have done, why and how they did it, and where it is now taking us.
If you have been patiently waiting to get into the "meat" of things then this is where we will be doing that having finally finished all introductions and preparations.
Comments may be made at the end of Part 3 Thank You Part 2