Strong Dollar Could Cause Bond Market Crash-Martin Armstrong

By Greg Hunter’s USAWatchdog.com

Renowned financial expert Martin Armstrong says the biggest risk out there is the effect a strong U.S. dollar has on the global bond market. Armstrong explains, “There’s these people who keep saying the dollar is going to crash.  If the dollar crashes, the world is happier and basically celebrating.  You have half the U.S. debt equivalent in emerging market debt issued in dollars.  If the dollar goes up, they are in trouble.  Then you are going to see sovereign defaults. . . . The U.S. is not going to default, but as you start defaults elsewhere outside the country, it makes people begin to get concerned about sovereign debt.  Sovereign debt is the worst of all.  It’s not secured.  If the U.S. government defaulted on its debt, what would happen?  You cannot go down to the National Gallery and start lifting Picassos.”

So, a bond market crash is a distinct possibility? Armstrong says, “Yes.  All these things are contagions. . . . The real risk is coming from Europe and Asia.  That is the real risk. . . . There is no place to go but the dollar at this point.”

If and when a global collapse comes, it will come from China or Europe. Armstrong says, “Yes, because you don’t collapse the core economy.  It’s always the peripheral coming in.  It was the same thing in the Great Depression.  It wasn’t the fact that the U.S. defaulted.  The problem was the first bank that went down was in Austria, and it happened to be owned in part by the Rothschilds.  When people hear a bank owned by the Rothschilds went down, people started to sell off all other banks.  Then all the countries defaulted.”

Armstrong says there is going to be a major “monetary reform” in the not so distant future, and the U.S. will end up with a dollar for domestic use and a dollar used for international trade, sort of like a “domestic dollar” and an “international trade dollar.” Armstrong says, “Yes. All it is doing is replacing the dollar as the reserve currency.  That would satisfy China and Russia, and it would simply be maintained by an international board.  I strongly advise against the IMF.  It’s way, way too corrupt.”

So, is gold a good asset to have with a coming currency reset? Armstrong says, “Yes, at that point, you are talking about a hedge against government.  When you go through these monetary crises, effectively, all tangible assets rise in price, not just gold and silver. . . . Tangible assets have a value to everybody globally.  The downside is on real estate.  I would never put 100% of my money in real estate because it is not moveable.”

Fast-forward to now, and Armstrong predicts, “The economy is not going to come back. We are not going to see economic growth.”

Where is all this taking the world? Armstrong, who is an expert on economic and political cycles, says, “You have to understand what makes war even take place?  It does not unfold when everybody is fat and happy.  Simple as that.  You turn the economy down, and that’s when you get war.  It’s the way politics works.”

Join Greg Hunter as he goes One-on-One with economist Martin Armstrong of ArmstrongEconomics.com.

(Programing note: Because of the Easter weekend, there will be no Weekly News Wrap-Up and no Early Sunday Release.  The nearly 60 minute interview with Martin Armstrong will air instead.  Regular programing on USAW will start again middle of next week.  Happy Easter-Christ Has Risen.)

 

 

After the Interview: 

There is free information and analysis on ArmstrongEconomics.com. For more information about the new “Socrates” service that Armstrong will be offering, click here.  For more information about the “2017 World Economic Conference” Armstrong will be holding in both Hong Kong and Orlando, Florida, click here.

 

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Comments
  1. This sceptred isle

    Interesting that Armstrong predicts an international dollar and domestic dollar. Jim Willie has predicted the same. What would be the purpose ? Would I international dollar be strong and domestic dollar week? You still have countries such as russia and china who’s policy it is to diversify away from the dollar. Why continue to use the us dollar as the reserve currency when America derives its power from such an arrangement?

    • Hairy Herry

      WOW! You beat this Hairy Guy to that. Indeed, Jim has consistently brought this up, regardless of whom interviews him.

    • Tin foil hat

      This sceptred isle,
      “What would be the purpose ? Would I international dollar be strong and domestic dollar week?”
      The domestic dollar will be similar to the coal scrip in the old days. http://www.appalachianhistory.net/2015/09/company-store-scrip.html
      It would be back by or have the equal value of the international/trade dollar with 1:1 ratio (at least that is what the squids will want you to believe) initially. That ratio will likely get worse and worse as time progress since the domestic dollar is not back by assets.
      The international/trade dollar will be back by hard assets (non-perishable such as beach front properties or gold) and perishable assets (proven reserve of oils, foods, lumbers … ect).
      The domestic dollar will get you domestic products only. If you wanted imported goods, you would need trade dollar.
      If you don’t own an export business or a hotel caters to foreigners, you will have a hard time getting those trade dollar unless you are a banker.
      Basically, it’s just another way to screw the average folks with smoke and mirrors. The following article is more detailed in regard to the matter:

      http://www.economist.com/blogs/americasview/2013/10/cubas-currency

      “Why continue to use the us dollar as the reserve currency when America derives its power from such an arrangement?”

      Colonel Gaddafi, Saddam Hussein, Colonel Gaddafi, Saddam Hussein, Colonel…………….

      • This sceptred isle

        Ok, thanks for those articles. China and Russia will be tougher to push around though.

      • Paul ...

        Jim Willy says that one day we will have a domestic dollar and an international trade dollar … but we already have a two tier dollar system in the US … our one ounce silver coin has already taken on the role of our “international dollar” … while our fiat greenback is “the domestic dollar” … and just like in Cuba it takes about 20 domestic dollars to get one international dollar … the corrupt system here is as bad as in communist Cuba! … so what kind of dollar should people be storing under their mattress? … the domestic greenback or the international dollar? … the answer is obvious to me and JP Morgan Chase … but sadly the average American is putting the “domestic greenbacks” under their mattresses!!

        • Paul ...

          Soon the domestic “scheiss” dollar will be devalued by Trump (he wants a weaker dollar) … and it will take 760 “scheiss” dollars to buy one US Trade Dollar (the one ounce Silver Eagle)!

          • Tin foil hat

            Paul,
            ‘Everything Old Is New Again’
            Roosevelt made the dollar a two tier currency by confiscating gold.
            Nixon made the two tier currency back into one.
            The million dollar question is; will Trump return to the two tier currency system again?
            Hence, Trump will likely not confiscate gold. He may confiscate a portion of the dollar’s global reserve status to make room for the yuan.
            I don’t think the Deep State is willing to completely give up the reserve status yet.
            If we were going to have a basket of currencies instead of the SDR, we might as well use gold as the International Trade Currency.

        • Tin foil hat

          Paul,
          As long as the world continue to accept the domestic dollar rather than demanding the trade dollar. Owning PMs will be like having Marilyn Monroe as your wife in burka.

          • Paul ...

            Tin foil … If my wife was Marilyn Monroe … based upon how I hide away silver coins … I would probably convert to the Muslim religion … to keep her in a burka “just for myself ” … do you think perhaps I’m being too possessive?? … but I don’t leave my silver coins out in the open for everyone to see!!!

            • Paul ...

              Tin Foil … how about this 50-50 business proposition … we sell “burka bags” to the “closet Muslim stackers” who hide away their silver coins from public view!!

    • Wayne

      That was also my reaction when hearing this, that Jim Willie has been saying this for some time now about a domestic (what he calls a “Scheiss dollar”) and an international dollar. Bill Holter said something similar about this dichotomy in a fairly recent interview.

      If I understood Jim Willie’s reasoning, this is a way for the US to quickly (and repeatedly) devalue its currency domestically, despite the incredible hardship it will bring to citizens’ standards of living, but to maintain some semblance of “strength” in a dollar for international trade and commerce. Given what little the US has to offer in exports — except for financial weapons of mass destruction, military hardware and GMO-poisoned agriculture — I don’t see the latter having strength for very long.

      This is why we’re seeing the endless warfare reaching fever pitch now. The Petro-Dollar standard and global fiat reserve currency status of the USD are both in grave danger of extinction. So they are being defended to the death; unfortunately, the neocons want us (and US) to take this literally. If we can help it, let’s not let them play that game.

  2. Charles H

    Greg,

    When “currency” becomes something conjured out of thin air to infinity: which it is close to being done now – the ‘go to’ perception of value will be abandoned. Historic rarity of precious metals will have to be re-established as a final and universal or worldwide standard. I think Mr. Armstrong proposed the tail to wag the dog. Or maybe mankind CAN be conditioned to infinite stupidity to accept whatever the ‘Powers That Be’ want to offer us?

    • This sceptred isle

      Our capacity to create money out of thin air is frightening and the main cause of rising inequality. Money is created and distributed unevenly throughout society. The Darwinian law of survival of the fittest is turned on its head as the weakest banks and poorest companies are saved as long as they are too big to fail. We will either have an official or unofficial precious metal standard.

      • Corleone

        According to Darwin, humans and apes are brothers. He forgot to say that apes do not use fiat currency to cheat each other.

    • Tin foil hat

      Charles H,
      I concur with your sentiment. Mr. Martin Armstrong’s excellent track record is back by the U.S. military, his prediction would have been disastrous if we were honorable.
      I disagree with Mr. Armstrong regarding his reasoning behind the gold confiscation. Roosevelt didn’t have to confiscate gold because the dollar was too high. He could have let the gold price float in accordance with the strength of the dollar.
      Gold is the natural global reserve currency but the squids will not allow that. I wouldn’t be too surprised if we had a domestic (dollar) currency and a trade (dollar/yuan) currency in the near future – that I partially agree with Mr. Armstrong.

    • Wayne

      If a currency is to be truly backed by a tangible asset, say Au for PM, would it be redeemable by the bearer on demand for that asset? Just like in the US when one *used to* be able to go into a bank with a dollar bill (a paper gold certificate) and receive 24.75 grains of pure gold for it? We could be Waiting For Godot on that one.

      TPTB received considerable confirmation that their playbook was on target when Einstein remarked: “Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.”

      • This sceptred isle

        Armstrong is right about the gold standard. America only officially came off the gold standard in 71. In reality they had been clandestinely coming off it since Inception of the FED.

        • Charles H

          Bingo!

        • Wayne

          When the Federal Reserve Act became “law” in 1913, yes, we can say that the gold standard’s erosion began clandestinely. The stealth tax that is inflation – which is its true definition as a currency-based event – was then baked into the cake. Hence the currency’s purchasing power would continually depreciate. And today we see its decline is ~97%. But the 100% of that last 3% might be here before we know it.

          Many would say we functionally severed the tie to the gold standard in 1933, with its official termination in 1971 as you noted. My main point, which I posted as a general comment for this interview, concerns whether or not any fiat currency, allegedly backed by something tangible or not, is tied to a debt-based banking system or not.

          • Charles H

            Wayne,

            1) If the structure of the Money Supply is not exclusively of the government…
            2) AND the fiat issued is not directly tied to verifiable presence of Precious Metals…
            Then the System was hijacked and nation betrayed – just that simple. All that followed is milking.

            • Wayne

              Yes, we agree that the nation was hijacked and its Constitution betrayed. That is why I put “law” in quotation marks. Yes, the stealth tax of inflation is part of the milking.

              As for the verifiable presence of PM in the US, allegedly residing in Fort Knox and West Point, good luck confirming that. Unless Bix Weir et al. are correct in asserting that the Grand Canyon and Chocolate Mountains hold *millions* of tons of gold, the US likely has nowhere near its claimed 8,000+ metric tonnes.

          • This sceptred isle

            The antimatter counterpart of currencies, debt, is expanding faster than the growth of the money supply due to interest due on the original credit. So even if all the currency is used to pay off the global debt you are still left with debt. So obviously you have to default to achieve equilibrium. Unfortunately, this wipes out all the debt based assets. Theoretically you can use the same dollar to pay off several dollars of debt by re-earning it but in the real world this rarely happens. Under a true gold standard there is a limit on debt as there is a limit on Money supply.

      • Corleone

        Marilyn Monroe: “Let us marry and have a daughter whose brain like yours and face like mine.”.

        Albert Einstein: “What if she has a brain like yours and a face like mine ?”.

  3. Paul ...

    Armstrong says, “When you go through these monetary crises, effectively, all tangible assets rise in price, not just gold and silver” … so if Goldman Sachs can’t get a war started in the Middle East … they can still hope for a monetary crisis to bail them out of their oil contracts (sending the price of oil to $200 dollars per barrel) … since both precious metals and energy prices can go crazy when things fall apart monetarily … lets look at the silver to oil ratio … history shows it can get as high as 3.8 during “extreme events” … so lets see just how high silver can get using the following silver to oil ratio equation (silver/200 =3.8) … we find that it shows that a price spike in oil to $200 dollars per barrel can result in a significant silver price gain to $760 dollars per ounce … exactly in line with what Cliff High is projecting!!!

    • This sceptred isle

      All physical assets rise during a monetary crisis but surely precious metals would rise disproportionately. The average person cannot store oil in their garage which would explain silver gaining relative to oil in your example.

      • Scot

        DOW stocks will outperform most assets, including gold, because the big money does not park in gold, and when the govt bond bubble pops, stocks are the only market deep enough, plus they are backed by real assets. Stock certificates can also pass through metal detectors and can’t be confiscated.

    • Paul ...

      So those who were thinking they could invest in oil and follow GS lead … think again … oil increasing from $50 dollars per barrel to $200 dollars per barrel only gives you 4x your money … silver increasing from $20 dollars per ounce to $760 dollars per ounce gives you 38x your money … Happy Easter everyone!!!!

      • Paul ...

        Here is my simple Easter prayer …
        Dear Lord … Let this Easter Season be one of Renewing and the Bringing back to life of Peace and Goodwill toward all Men, Women and Children of our world … let us put down our weapons of war for at least one day and abide by the Mercy and Humanity Jesus taught to all God’s children … let us find it in our hearts (for at least one day out of 365) “a smigin of restraint” from making God’s children into “burnt offerings” to the anti-god Satan!!

      • Frederick

        Paul 760 dollars? Id be very happy for it to get back to 50 dollars

    • Alex Mumm

      If you go to http://www.usdebtclock.org, they list the Dollar to Silver ration in 1913 at $2.65. The Dollar to Silver ration now is $872. The Dollar to Gold ratio in 1913 was $28.91. The Dollar to Gold ration today is $7315. These figures continue to rise on a regular basis along with the national debt.
      JP Morgan who controls 51% of the warehouse stocks at the CME – Comex exchange could be in for a windfall should there be a re-evaluation.

      • Frederick

        Yup and for some reason I believe JPMorgan might just get its way

  4. Dan

    SGT Report: 10 REASONS TRUMP’S ATTACK ON SYRIA WAS A BAD IDEA & BASED ON LIES — James Perloff
    https://www.youtube.com/watch?v=ottC-2QbTIo

    There are 3 people I watch ‘religiously’ more than once a week – Greg Hunter, Greg Mannarino, and Sean from SGT Report, as they are all true patriots who unswervingly exposing and fighting the scum to restore the USA from the evil scum elite.

    Greg, I’ve been quite impressed by this James Perloff fellow. Perhaps you could consider him as a new guest.

    • Allen Starr

      Greg
      I just finished listening to your interview with Martin Armstrong. I want to commend you for asking him the question about war with Syria, Ukraine, and North Korea. When he said the war in Syria is all about a pipeline, I couldn’t stop laughing as he is telling the absolute truth. The US, Saudi Arabia, Qatar, Jordan, Israel, and Turkey have killed over a half million Syrians for a pipeline that Russia will not let them build. I know a lot about oil and gas pipelines and Russia should go nuclear to protect it’s interests so that pipeline can’t be built and probably won’t be built because the EC is going to allow the Nord Stream 2 to start laying pipe within the next two months. Don’t know about the Turkstream being built because Erdogan is such a snake. I didn’t listen to your interview very closely so I must listen to the whole thing again to see what I can learn. This is the first time I’ve ever listened to Martin Armstrong but it appears he is someone that should be listened to. I did listen to this James Perloff interview with Sean at SGT Report and it was worth listening to.

      • Greg Hunter

        Allen< Lavrov said the same thing a few years ago. Russia wants to be the only supplier of Nat Gas to Europe. Greg

        • Charles H

          That’s the nutshell.

        • Allen Starr

          Greg
          Russia may want all of it but they are living with reality and are pressing to keep their share of it. That’s for sure. Even when Nord Stream 2 comes on line, they still need Turk Stream or revive South Stream to keep their share. Then they can stop shipping to the Baltic countries, Belarus to Poland, and all pipelines through Ukraine. They will save billions in transit fees also by cutting these countries out. Most of this gas is coming from the Yamal-Nenets area. There is another huge gas deposit between me and Lake Baikal and that will feed both of the gas pipelines to China. There are huge deposits of gas and oil in the Russian Arctic and they have actively been building military bases there to make sure that resource is protected. They have filed claims for additional territory that they deem is theirs and the military will not allow some international court to steal their property which is another US trick. The Russians have spent a lot of money doing the things required to protect their Arctic property. They have many ice breakers and are building 4 new huge ones.

          • Charles H

            Wow, Allen – pretty astute. That’s a real piece of the puzzle.

        • Frederick

          Better Russia supply the gas than the Arabs or the Israelis I’ve also heard that the US is planning on exporting LNG to Europe Guess Russia will be forced to diversify its economy away from so much dependence on energy exports Could actually backfire on us and especially Europe

          • Greg Hunter

            Yes Frederick,
            Never let go of the evil Jew theme. Never a word about the atrocities of radical Islam–not a word and yet it happens almost everyday. It’s documented here: http://thereligionofpeace.com/ Enjoy!!
            Greg

            • Mohammad

              There is NO RADICAL ISLAM.
              There are radicals from every belief.

              Mohammad

            • Frederick

              Radical anything is wrong and I think we all know that Greg I just have a hard time getting past 911 and want those responsible brought to justice And please don’t read me the official storyline

          • Allen Starr

            Frederick
            The NG fields of Norway and Great Britain won’t last much longer. Russia is partnering up with Norway in developing new fields in the northern seas that border their two countries. The EU needs to replace that NG and is the reason that the EC has finally gotten out of the way of the Nord Stream 2 pipeline project. The US has been doing everything it could do to screw Russia through the EC but the EU needs this NG so the US was finally told to get lost. LNG can’t compete with pipeline gas in price so the only way to screw Russia is to not let them build a pipeline. The only question left is what pipeline will supply NG from the southern part of the EU. The EC and the US killed the South Stream pipeline from going through Bulgaria so now Russia tries to do the Turk Stream. Russia, Syria, and Iran stop the Qatar, Saudi Arabia, Jordan, Syria, Lebanon pipeline from being built. Israel would have a feeder line into this pipeline and the US meddles also. So we have the Syrian war where 500,000 Syrians have been murdered by the US and it’s allies to force Syria to allow them to build their pipeline. Russia will never allow this pipeline to be built after screwing them on building South Stream. Going forward, 25% of Russia’s GDP will come from oil and gas and transportation over the Arctic route.

            • Mohammad

              Ditto…!

              Mohammad

      • Scot

        Don’t forget about the huge oil find in the Golan Heights.

    • This sceptred isle

      I noticed in UK that trump could do nothing right in the eyes of the mainstream media. Now after the attack on Syria the personal attacks on trump have declined a lot.

      • Greg Hunter

        TSI,
        I wonder if this is a negotiation tactic. What has really happened since the strike. Apparently THE Russians are not that upset.
        Greg

        • This sceptred isle

          Maybe he gave something to get the neocons off his back without starting a war with Russia.

          • Greg Hunter

            TSI,
            Who knows but the attack was not a game changer. If Trump wanted to change the game he would have attack the Tartus naval base or the Russian air base.
            Greg

            • Allen Starr

              Greg
              You are correct and understand. Russia is still running on auto pilot and won’t change their strategy because they can’t. Be afraid if the US tries to partition and it interferes with what Russia must do in Syria. I fully believe the US will push Russia again because they are insane and the Russians don’t want a war. If we are lucky enough to get through this shit storm, we will be in even worse shape when the US actually tries to put missiles into Poland. That will be a game changer. To Russia, this is no different than when Russia tried to put missiles into Cuba.

        • Mohammad

          TO THE CONTRARY GREG:

          https://www.alarabiya.net/ar/arab-and-world/syria/2017/04/14/لافروف-كل-أسلحة-النظام-الكيمياوية-قد-تم-تدميرها.html

          They are warning US from another likewise strike.

          Mohammad

          • Arthur Barnes

            Mohammad, Trump was the “establishments choice”, you may have to think twice about reducing your medications LOL. The Neocons wanted Hillary as well as all the MSM. Still Mo I always enjoy your posts even if they are getting more imbalanced each week, just take a double dose of your meds and see if rationality comes around again.

            • Mohammad

              Empty, air filled, rude…
              no gain engaging you with a dialogue.
              my last comment to you…
              Carry on dude

              Mohammad

    • Mohammad

      Dan,

      He did not fool me.
      I am here on the record said before, that he is the establishment’s choice from day one, you can go back to my posts and read it.

      Mohammad

      • Dan

        I assume you are talking about Martin Armstrong and not James Perloff. By the way, it’s always good to provide supporting arguments to such kinds of general statements so people more clearly know where you are coming from.

        • Mohammad

          Am talking about Trump.

          Mohammad

          • Beligarant

            @Mohammad
            You sir are a wise man. Its obvious Trump was their pick from day one and just needed the alternative media crowd to shuffle around him. If their Trump didn’t win then the backup Hillary was there in the wings.

            Regarding Armstong I’m still baffled why people want to interview this person. After all he defrauded investors and spent years in prison. I will agree he’s a genius but doesn’t make him honest nor anyone you should trust for investment advice. Might as well bring on Madoff next time for a little fire side chat.

            • This sceptred isle

              Did anyone let Hillary is on the plan or was it done on a need to know basis? Simpsons has an uncanny ability to predict the future.

            • Frederick

              Belligerent I totally agree He’s not to be trusted and a flip flopper

    • Paul ...

      Dealing with lies is just the half of it … the other half is blackmail … I hate to say this … but could Trump’s recent flipping on important issues be related to the MOSSAD getting “blackmail control” over him … did Trump’s son-in-law Jared Kushner ever visit Jeffrey Epstein’s “Lolita Island” like Trump did (when he went with those “nice people” the Clinton’s)???
      http://www.dailywire.com/news/5749/both-trump-and-clinton-went-jeffrey-epsteins-sex-amanda-prestigiacomo
      If the above is true … the American people really didn’t get a choice to have “their own” President in 2016 … the MSM tells us it was the Russians who interfered … could it have instead been the MOSSAD? … in any case it looks like we will now have to wait for 2020 to elect someone like Robert David Steele “to be our” President!!!

      • Tin foil hat

        Paul,
        “the MSM tells us it was the Russians who interfered … could it have instead been the MOSSAD? ”
        Hmmm…. That actually makes a lot more sense than the Russian’s interference. Netanyahu is very close to the Kushner family.He knew Jared Kushner since he was a little boy.
        It’s funny I never thought of that or connected the dots.

      • Paul ...

        Even if the above “Lolita Island” hypothesis is not what flipped Trump … 666 Kushner “is still very much compromised” by the fact that his real estate empire is failing and thus he would likely do anything to save it … the American people should not have to be put in such a dangerous position … Kushner must resign and leave now!!

        • Frederick

          Exactly Paul He really needs to go home to Jersey asap

    • john duffy

      Yes James Perloff is the best {next to Greg of course). He completely exposes evolution as the nonsense it is. His take on economics is second to none also.

    • Dan

      DONALD TRUMP DROPS MOAB! 100% PROOF HE IS WORKING FOR THE NEW WORLD ORDERS GREATER ISRAEL PLAN!
      https://www.youtube.com/watch?v=Sdw36x715hU

      Something to consider very seriously folks…

      • Greg Hunter

        Dan,
        This is 100% opinion Not “proof” that is being passed of as proven fact.
        Greg