Flight of Capital from
Public to Private, by Martin Armstrong, 9/7/18.
COMMENT: Mr.
Armstrong; The chart you posted on the Venezuela share market really made me
see what you have been saying. Collapse the confidence in government and
capital flees to the private sector. This is never taught in school! You have
to write a book for posterity. Please! RW
REPLY: The Venezuelan
share market has soared in terms of local currency. This does illustrate the
entire point. When a currency collapses, the value of tangible assets rise. In
the case of Venezuela, you have a socialist government that refuses to
relinquish power in fact of a complete economic disaster with millions of
people fleeing the country. Here we have a double hit. The currency normally is
sufficient to bring about regime change. In this case, the army is still
willing to kill its own people to support a leftist regime. This is the
profound difference that concerns me about leftist governments. They are filled
with such hatred and propaganda that killing anyone who disagrees is seen as
justified because THEY are the people who have ruined the state – never the
leftists who seek to vindicate their victimization.
In the case of
Venezuela, the last check against the leftist government will be capital. They
will be unable to borrow ANY money and they will not be able to offer fixed
assets because there is no rule of law and they can then nationalize whatever
stupid Western fund manager buys thinking it is a cheap deal. Just look at such
revolutions in Iran and Nigeria. Whoever invested in those countries their
assets were just confiscated. By no means invest in ANY fund that invests in
Venezuela. Get out before you lose 100%.
In March 1951, the
Iranian parliament (the Majlis) voted to nationalize the Anglo-Iranian Oil
Company (AIOC) and its holdings, and shortly thereafter the Iranian public
elected a champion of nationalization, Mohammed Mossadegh, Prime Minister. You
cannot trust such regimes. Mossadegh was the head of an ostensibly
democratically elected government that simply sought to confiscate foreign
assets. He was eventually removed in a CIA coup in 1953 and the United
Kingdom’s Secret Intelligence Service.
I have stated numerous times, my deep concern is what comes AFTER Trump? There is no question they will seek to stuff a career politician into office be it Democrat or Republican. As the debt crisis expands, they will turn to raise taxes. They will in the process destroy the very democratic process and we will witness rising taxes quite dramatically until the entire political system breaks apart.
This is simply the
pattern throughout history. I do not see anyone who would stand in the way of
this trend among the ranks in Washington. Nobody from the private sector will
dare step forward again. Any career politician will defend their own
self-interest and raise taxes trying to hold on to power regardless if they are
Democrat or Republican. This is simply how the West enters its Decline and Fall
and China will emerge as the sane economy after 2032.
You can see the policy
already in Europe. Brussels will defend the Euro at all costs even if it
suppresses the people because now it is just about their pensions and jobs. The
Euro fails and there goes Brussels and its bureaucracy off the edge. There is
no hope on the horizon of a knight in shining armor to come to save the day.
Norb Leahy, Dunwoody
GA Tea Party Leader
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