Posted Apr 20, 2020 by Martin Armstrong
QUESTION #1: Dear Mr. Armstrong,
I’ve been following your blog for quite a while, and have a Basic subscription to Socrates. Wish I could have been able to attend a WEC, but so far that’s not been possible. Also wish I understood everything in Socrates so much better, but my old brain isn’t what it used to be, even tho’ I’ve learned a great deal.
I’m 72, retired, with a small pension, SocSec, and interest/dividends from the stock market. My home is free and clear. Investments are mostly Corporate Fixed Income and Municipal Bonds (for tax advantages), and a few stocks. I’m not an active trader, and have taken about a 16% hit so far.
Given that what I have is all I’ll have for the future, what is the best I (and other seniors essentially on fixed incomes) can do to protect ourselves for these next few years? Wish I could just pull it all out in cash and bury it in the backyard, but that isn’t a rational strategy, and likely not even do-able with the limits on cash withdrawals. I do have a fair amount of cash for “emergencies”, but certainly not enough for the next 10 years. It seems like I need to do something, but what?
Many thanks for all you do,
ANSWER: Probably your greatest risk will be the Municipal Bonds. I know they love to say no munis defaulted during the Great Depression. The city of Detroit “suspended” all payments in 1937 and eventually repaid in 1963. This lockdown has been either the most stupid decision ever made by any politician, or they have been the puppets of the Climate Change Socialists whose dream it has been to shut down the economy, nationalize industry, to reduce CO2. Even Bill Gates TED Talk was all about how do we get to ZERO CO2.
Because of this unbelievable wholesale destruction of the world economy, state, provincial, and local governments are going to be in major trouble. They cannot print money as can the Federal governments. They rely on taxes and these morons have shut down their local economies without even comprehending what they were doing to their local tax base. They cannot pay pensions without current revenue. They will try to raise taxes and will find revolts and people who will be unable to pay because they lost their job, probably healthcare insurance that went with that, and all their various loans from cars and mortgages, etc.
As far as corporate debt, stay away from consumer-oriented companies such as retail sales with brick & motor establishments. Take Neiman Marcus, for example, their biggest shareholder is the Canadian pension system CPPIB.
Keeping gold in safe deposit boxes will be risky. We have already witnessed some European banks using the virus as a justification to deny access. You then must provide the reason for your access and what you intend to take out. Remember that when gold was confiscated, it was whatever was on deposit in banks. They did not go door to door.
QUESTION #2: Marty I’m based in UK and have been reading your posts for a while about Central banks and the collapse of Europe. I have recently retired and am holding funds in cash in Banks and also have a deposit box with a bit of gold. I have 2 investment properties with mortgages. Would you recommend that I use my cash and repay the mortgages and withdraw the box as u were talking about banks confiscating gold. Very worried about the future.
ANSWER: Do not pay off the mortgages. Keep the cash. Be very careful about leaving gold or cash in a bank safe deposit box. Banks will not be trustworthy at this point. The governments can decree to seal all such boxes and they will do that in a split second.
COMMENT #3: Marty, Good morning. Been keeping an eye on things and also making analyses and forecasts. If this was a casino with sports betting odds, the Dark Age would be seeing better odds daily at a rapidly increasing rate and would soon be among the favorites, if not the odds on favorite.
Hope all is well in your area.
ANSWER: I am always amazed when Socrates makes such a bold forecast and I personally cannot find the words to articulate it. I wrote the report How Empires Nations & City-States Fall? The Dark Age Cycle and priced that at $29.50 for the average person because it was important to understand what makes such events unfold. I would have to confess, I underestimated the Climate Change contingent. They have persuaded many at the upper echelon of power and flipped even the wealthy into feeling guilty that they have so much to support this all-out assault on shutting down the world economy. I have inside knowledge that members were told to sell all stocks and bonds in January. They picked their favorites to protect.
I never imaged that the could shut down the world economy like this so fast. They have openly destroyed Capital Formation and have hurled society toward war and that certainly now raises the stake for a Dark Age coming post-2032. They have won. They are destroying civilization to save the planet. Nobody will bother to investigate – the question is WHY?