Pi Waves and the Strange Story of Martin Armstrong
(And why he’s bracing himself for market meltdown – starting 1 October 2015)
I’ve just been reading about a market forecaster called Martin Armstrong…
Don’t be surprised if you haven’t heard of him before – he spent much of the last decade locked up in prison!
Some say he fell victim to a government ‘suppression’ campaign – he’d built a computer model that predicted turning points in the markets with uncanny precision and wouldn’t share his program with the big banks – but more about that in a minute.
First, let me tell you a bit about his methods and why you might like to keep a close eye on the markets in coming months…
Now, by all accounts, Martin wasn’t doing too badly for himself before he even started looking at the markets – he was a millionaire in 1965, before he’d even turned 16!
Rare coins and stamps were his thing. He says he dropped lucky on a batch of valuable Canadian pennies and they gave him his first taste of success. Over time he moved into gold coins, and then began to track the gold markets and other commodities in their own right.
One day, in a newspaper, he came across a list of market panics and crashes that had occurred over the last few centuries. Playing around with the dates he spotted a strange recurring pattern… There seemed to have been a bit of a calamity in the markets once every 8.6 years.
Was this just a quirk of fate or was there a bit more behind it?
The more Martin researched, the more be became convinced that this 8.6-year cycle was significant to the markets in some way. And he soon came to realise that 8.6 years is actually equivalent to 3,141 days: the mystical number ‘pi’ (3.1415) multiplied by 1000!
The ancient Egyptians left behind their knowledge of pi and it certainly occurs with elegant regularity throughout mathematics and geometry. Could it somehow map human behaviour too?
Martin seemed to think so. He finessed his analytical techniques, created a super-computer to crunch the numbers (it seems there’s a bit more to it than simply looking for the 8.6-year periods) and set about his business of forecasting the markets!
He’d been providing his market consulting services since 1983 but 1987 was really the year his methods jumped centre stage…
Using his computer models he predicted ‘Black Monday’ to the precise day – that was when the markets crashed in 1987.
He predicted the top of the Nikkei index before it tanked in 1989…
And by 1998 he was running his own hedge fund, correctly calling the Russian market collapse, and being named ‘Hedge Fund Manager of the Year’.
So where did it all go wrong?
Well first of all he was accused of running some kind of ponzi scheme that swindled Japanese investors out of $500 million.
And then he was held in contempt of court because he failed to hand over assets including $15 million worth of gold bars, rare coins and, bizarrely, a bust of Julius Caesar – most of which he claims he didn’t even possess.
His contempt of court meant he couldn’t face trial for the charges brought against him for the Japanese situation so he simply languished in jail for 11 years. It’s the longest anyone has ever been held for contempt in the US.
Of course, the conspiracy theorists have it that the source code to his forecasting software is what his pursuers were really after.
They claim a shadowy US Government organisation instructed him to hand over the software after he’d refused to work with them. And because he already knew ‘too much’ about their intended market manipulations, this was their way of silencing him and tarnishing his credibility.
Now this is all intriguing enough – in fact, a film about these events is scheduled for UK release in September and I’ll give you a link to it in a minute – but it’s what Martin’s model throws out for the first week of October 2015 that is of immediate interest…
His Economic Confidence Model calls a peak to current proceedings on 1 October 2015.
Martin defines the 1 October as a ‘turning point’ and a ‘directional change’ to the economy.
Here’s how he sees it playing out:
There is little doubt that the Euro Crisis will continue and there is zero chance that this will end nicely. Those in power just cannot conceptualise the sad fact that this is the total and complete failure of government from the outset. There is no hope of resolution for, precisely as Einstein warned, there cannot be a solution with the same line of thinking.
When it fails, the solution is always grab more power to force the economy to do whatever the politicians desire. This is how and why no empire has ever lasted, for they all crumble back into the ashes from where they originally sprang.
And his dramatic conclusion:
Expect the euro to enter a very bearish trend and we should now see a rise in volatility. It pains me to warn, but we are facing economic totalitarianism and the end of any democratic form of government.
Source: armstrongeconomics.com
Heady stuff, no?
He suggests an initial flow of capital from government bonds and euro funds into US stocks will actually produce a bull run in equities.
And it’s not only Martin who has these big changes on the radar…
Larry Edelson – senior analyst at Weiss Research – is another proponent of market cycles. He applies his analysis in a different way to Martin Armstrong but comes to an almost identical conclusion all the same.
He says we are already in the first phase of a coming crisis as Europe begins to disintegrate before our eyes…
Phase two will begin on or around 7 October this year – just a week after Martin Armstrong’s turning point – and this is likely to be a shock announcement that sounds the final death knell on the European Union.
And it’s all downhill from there as Japan and America begin to collapse under their unsustainable debts.
I suppose it’s a good job that film about Martin Armstrong’s fight is due out in September. At least we’ll all get to see it before the proverbial muck hits the fan!
Whether you follow the concept of market cycles or whether you take it all with a pinch of salt, it will certainly be interesting to see what events hit the news wires in October.
And just for a bit of background flavour while you’re waiting, here’s a link to the Armstrong film: The Forecaster – can a computer predict the world economy?
Be Prepared: Market Moving Data Coming This Week (London Time)
Wednesday 22nd July:
15:00 USD Existing Home Sales
Thursday 23rd July:
09:30 GBP Retail Sales
Friday 24th July:
08:30 EUR German Manufacturing PMI
15:00 USD New Home Sales
Monday 27th July:
09:00 EUR German IFO Business Climate
13:30 USD Core Durable Goods
Tuesday 28th July:
09:30 GBP GBP
15:00 USD CB Consumer Confidence
So we have quiet week ahead on the data front… the Greece situation has a temporary lid balanced on top of it and there are no show-stopping reports scheduled. It might be time for the big players to make their beeline for the beach!
