Posted Apr 6, 2015 by Martin Armstrong
Mr. Armstrong; I have read theories that this wave of economic evolution you displayed as the sixth wave at the Solution Conference is the transformation from the industrialized world that was based upon commodities to the new age of intellectual development necessitates a new deflationary age in commodities. Some seem to be even delusional claiming that a cryptocurrency can defeat government itself yet overlook the fact that such technology survives only thanks to the power grid. Turn that power grid off and we crash back to a dark age of barter.
While all of these wild ideas are based on only what they see in their little bubble, most of the world is still based back in the agricultural age as you pointed out of the pre-19th century. This I believe is what you are talking about when one segment of the global community accelerates too far beyond the rest making it actually vulnerable since they have lost the knowledge of the basics. Some believe this has happened before in the past in Asia. Others point to the Nasca Lines in Peru that lead them to claim they were the first to invent air travel sometime around the 200BC era and that civilization collapsed into a Dark Age and knowledge evaporated. No one has proof as to who built the Nasca lines and what their function was, but they too have inspired fantastic explanations from ancient gods to a landing strip for returning aliens.
So is this how knowledge just vanishes through these types of crash and burns?
QUESTION: (2) Marty,
I think you should explore how humans are losing their mental ability with the advent of the digitalization.
Just the fact that we are using less and less the ability to write with the hand and a pen is synonimous of a lesser mental ability.
There are countless other examples.
Learning a REAL Musical instrument,a foreign language,painting etc…..are MUCH more important to make our brain more evolved than stupidly spend our lives on facebook and associated useless
I think this is one of the most important in today’s rapidly de-evolving human behaviour.
A German neuroscientist called Manfred Spitzer wrote a great book about this issue : Digital Dementia
This digitalization is making brains less and less able to understand how the world really works and it is making these brain ready to be enslaved.
What do you think about this devolution of human brains?
ANSWER: Yes. I always found it interesting that the ancient Greeks understood the structure of an atom. Yet somehow knowledge vanished with the fall of Rome. Jews were tolerated for only they could be the captain of the ship because mathematics was seen as the devil’s work that no Christian would dare play with. Bathing stopped because they associated a Roman bath house with prostitutes so bathing vanished until the Crusades. The knowledge that the world was round vanished with the fall of Rome. When Constantinople fell in 1453, scholars fled to Rome and opened schools bringing with them lost knowledge pre-Rome. Columbus did not wake up with a vision the world was round. He was taught that and had Greek maps. This is how you reach a peak in knowledge and then it collapses into ignorance. This is the essence of a Dark Age.
So yes, those who think some new horizon of an age of knowledge will solve all our problems, well sorry – been there done that many times before in human history. Just because the core economy of the West is moving toward electronic currency does not mean the entire world will be there. You always have several stages of the economy historically still present simultaneously. In parts of Africa, money is still cattle.
This economic evolution is like a drop of water hitting a still pool. The waves of innovation move from the center outward. So we may have a highly advanced economy moving into this technology age, but this is the Sixth Wave so there is a real risk that this may be the peak that rise to a fall of Rome event. The evolution of the economy spreads outward always from the center precisely as a real estate boom begins and evolves. This is why we need a reserve currency for not all nations will be at the same economic evolutionary stage. It is impossible to buy something from a less developed nation with electronic money when people there do not even have a computer. They will need some form of tangible money to convert to the electronic reserve.
This is part of the danger when these waves of economic evolution and innovation begin to outpace the majority of the population. You cannot somehow have a two class system that will survive with those who are in some new age of technology and everyone else starving effectively unemployable. This is the struggle of class warfare, which historically never ends nicely. When this epic struggle unfolds at such extremes that is really skill base rather than monetary differences, that is when the classic collapse erupts. This is like the bankers thinking they can just screw society for the rest are too stupid to climb out of the bucket and they rule the world. That is when the lower classes kick the buck and everything goes nuts. This is not truly a monetary struggle, it is driven at the core by their inability to participate in the innovation.
We are on the one hand progressing to technology, but simultaneously we leave behind fundamental skill sets. This leads to the Dark Age – the control-alt-delete sequence when you become over-extended and too remote from the fundamental skill sets. You cannot graduate to the next level which is a technology innovation so great that the bulk of society lacks the skills to make that leap. Technology replaces the low-level jobs and can replace police and military. Manufacture jobs can be replaced which are simply repetitive. What is left for humans? Too big of a gap in skills has always led to disaster. That becomes the Phase Transition where Government usually aggravates the situation. This is when heads come off.
Even the struggle over the liberating power of the Internet is based on its freedom and statelessness. Yet governments are fighting back and seek to regulate this freedom to primarily control free speech, but also taxes. What was an emancipation then conflicts with a government’s foreign policy objectives as well as domestic policy objects to maintain control and taxes. The noble goal of connecting non-Western countries to Western companies and markets that emerged from business, becomes exploited for political purposes of entities like the NSA.
This is the Sixth Wave and the danger of moving into such a new technology age is the deflationary aspect we inject into past technologies. This is one factor why commodities do not keep pace with stocks over long periods of time. There are those who claim gold should be $50,000 based upon such disparities. The Dow low was 42 in 1932 and at 18000 that is a 428% advance. Sure, if you take gold which was $20.67 then, it shoulld be priced at $8.858. The reason it is not there is the result of these waves of economic innovation. Too many people keep judging the world by the last wave.
Copper has not advanced percentage-wise from the Great Depression the same as equities. As we move toward the computer driven era and the age of wireless communications emerges, we need less and less copper wire to connect people. In 20 years, land-lines to homes will become obsolete entirely. Many now use cell phones as their primary phone eliminating land-lines.
No matter what commodity we look at the same result jumps out. Everything from wheat to silver has not appreciated in value in proportion to equities. This is all part of the different focuses we move through with each progressive wave of innovation.
We can see what has happened to agriculture as a industry. Where physical labor was once the core of the economy, the Great Depression altered that and forced a change in skills. Our danger today in this Sixth Wave is that we are collapsing the need for labor, which contributes to the extraordinary high in youth unemployment in Europe. Education is also far behind the technology curve and 65% of graduates cannot find employment in what they have a degree. So what is the point of education?
The Sixth Wave presents tremendous challenges. This is not a walk in the park to some glorified new age of knowledge driven economies. You cannot leave behind the majority. There has to be backward compatibility for the economy must relate backwards to the other types of economies which will still dominate the outward circle of economies the further you move from the center. Backward compatibility is critical in software. Windows 8 was a disaster. Windows 8.1 had to return the familiar menu system. We cannot leap forward disregarding the last innovation. When you do, you get tremendous conflict and the control-alt-delete reset.