- "2023 Will Be Year From Hell" – Martin Armstrong Warns Europe 'Could Suck The Rest Of The World Down The Tubes'
“2023 Will Be Year From Hell” – Martin Armstrong Warns Europe ‘Could Suck The Rest Of The World Down The Tubes’
Via Greg Hunter’s USAWatchdog.com,
Legendary financial and geopolitical cycle analyst Martin Armstrong says nothing is going to get better by the end of 2022, and he is still forecasting “chaos” coming in 2023.
Armstrong says the plunge in the stock market last week is all because of “extreme uncertainty.” Armstrong predicted a stock market crash two months ago and contends, “It’s not over.”
Europe is in big financial trouble with Russian natural gas turned off as a retaliation from the sanctions. Armstrong explains:
“In Europe, I believe they are actually deliberately doing this, and this is Klaus Schwab’s ‘Great Reset.’
They know they have a serious problem.
They lowered rates to below 0% in 2014. They just started raising interest rates. Meanwhile, you ordered all the pension funds throughout Europe to have more than 70% in government bonds. Then they took it negative.
All the pension funds are insolvent. Europe is fiscal mismanagement on a grand scale. There is no way it can sustain itself, and we are looking at Europe breaking apart.”
So, could Europe suck the rest of the world down the tubes? Armstrong says, “Oh, absolutely. Europe is the problem…”
“The crisis in banking will start in Europe…The debt is collapsing. They have no way to sustain themselves.
The debt market over there is undermining the stability of all the banks.
You have to understand that reserves are tied to government debt, and this is the perfect storm.
Yes, the (U.S.) stock market will go down short term. We are not facing a 1929 event or a 90% fall here… Europeans, probably by January of 2023, as this crisis in Ukraine escalates, anybody with half a brain is going to take whatever money they have and get it over here.”
So, where is smart money going to go? Armstrong says, “Stocks are like gold, it is on the same side of the table and is opposite government debt…”
“People are not going to be buying government debt. They are going to be looking at anything in the private sector. . . . People are buying whatever they can to get off the grid.”
Armstrong says governments are borrowing and spend huge amounts of money. The Fed will keep raising interest rates to fight inflation, but Armstrong says,
“Raising interest rates will only make things worse. We have supply shortages, and raising rates will not fill the gaps.”
Armstrong has never been more positive on buying gold. Why? Armstrong explains,
“We are looking at a sovereign debt default. This is what’s going on. This is why Biden will spend whatever he wants because he knows he doesn’t have to pay it back. Eventually, this is what’s going to happen. This is Schwab’s agenda.”
Armstrong has predicted “2023 will be the year from Hell.”
Armstrong says, “Civil unrest will only get worse” this year, and he is predicting we will have full blown war next year.
Armstrong contends Democrats are desperate and will do things like granting illegal aliens citizenship so they can vote in the mid-term elections.
In closing, Armstrong says, “Something is going to spark a collapse in government again. It’s going to be something, I think, in Europe where they do something drastic because they have no other choice. . . . They need war as the excuse for the defaults of all the government debt.”
There is much more in the nearly 59-minute interview.
Join Greg Hunter of USAWatchdog.com as he goes One-on-One with Martin Armstrong, cycle expert and author of the upcoming new book “The Plot to Seize Russia, Manufacturing World War III” for 9.24.22.
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There is some free information, analysis and articles on ArmstrongEconomics.com.
Tyler Durden
Sun, 10/02/2022 – 09:20 - VPN Usage Surges Amid Protests, Conflict, & War In 2022
VPN Usage Surges Amid Protests, Conflict, & War In 2022
Iran has shut down WhatsApp and Instagram in an attempt to stifle the discontent growing across the nation, following the death of 22 year-old Mahsa Amini, who died in custody after being arrested by morality police.
Internet shutdowns are fairly commonplace in authoritarian societies on the eve of change, where governments may seek to gain control of the narrative by trying to stop communication and the sharing of information which can fuel protests and uprisings. After all, the internet can be a powerful tool for social mobilization, as shown by the Arab Spring movement of uprisings which began in the early 2010s.
As Statista’s Anna Fleck shows in the chart below, citizens tend to circumnavigate such crackdowns by downloading virtual private networks, or VPNs, which allows them to get around restrictions to certain blocked sites.
These do not work, however, when countries shut off basic internet completely.
You will find more infographics at Statista
In Iran, demand for VPN downloads increased by more than 3000 percent in September, according to TopVPN100.com.
Yet, other countries too have seen surges this year.
For instance, Sri Lanka saw a 17,000 percent increase in VPN downloads on April 3 2022, when social media platforms Facebook, YouTube, Twitter, Instagram and WhatsApp were banned.
The internet blackout came as the government enforced a curfew, attempting to keep protesters from hitting the streets over a disastrous economic downturn, mainly attributed to governmental mishandling, which led to major food and fuel shortages.
Azerbaijan and Armenia, which saw clashes erupt on the border earlier this month, have also seen people on both sides of the border seek out VPNs this year, with an increase of 751 percent and 84 percent, respectively.
Meanwhile, Russia saw an uptick of more than 2,600 percent of VPN demand and Ukraine saw a 600 percent increase since the war started in February.
In Russia, the BBC, Deutsche Welle, and Voice of America were among a number of foreign news organizations’ websites to be blocked for disseminating what it alleged was fake news. And so this chart visualizes just how crucial cyberspace is as a forefront for warfare today.
Tyler Durden
Sun, 10/02/2022 – 08:45 - Gold & Geopolitics
Gold & Geopolitics
Gold and silver dumped and pumped this week – after a week of consolidation – against a background of a rising dollar on the foreign exchanges.
As the chart below shows, silver is up around 6% since 1 September, while gold is down around 3%…
But as GoldMoney.com’s Alasdair Macleod details below, Silver is extremely oversold in illiquid conditions, illustrated by our next chart.
The level of open interest is probably the best indicator of market sentiment.
At under 132,000 contracts it is as oversold as it was in early May 2020, just before the price rocketed higher from under $15, doubling in only three months.
Being a far larger and more liquid market, the position in gold is less obviously oversold, as our next chart suggests.
Nevertheless, we can see that open interest refuses to fall below the 450,000-contract level, which suggests that a rally from here is a high probability, potentially taking out all-time highs.
This price resilience is in the face of severe weakness in the yen, euro, pound, and yuan. It is reflected in the dollar’s trade weighted index, which continues to power ahead.
Undoubtedly, there are very good reasons to get out of the other currencies and into dollars. But the dollar’s overbought condition must be extreme, exposing it to sudden and sharp bear squeezes.
Together with the deeply oversold position for gold and silver, undoubtedly mirrored in a raft of commodities and energy contracts, we can see how traders might become very badly wrong-footed.
There are other developments worthy of attention – this time in Russia. Following the referenda in Ukraine, Russia’s border marches westwards, and in the absence of a ceasefire, the Ukrainians supported by NATO will be attacking Russia directly. It would be an escalation into a direct conflict between Russia and NATO.
Putin probably expects an uneasy ceasefire to follow.
Meanwhile, his attention appears to be already turning to monetary and financial matters, centred on gold.
Together with the Russian Central Bank’s reserves, Russia’s state fund and its National Wealth Fund are believed to hold about 12,000 tonnes of gold.
Steps have been taken to “mobilise” the non-reserve gold.
This is not for emergency war funding as some commentators think, but more likely to be so that they can be included in central bank reserves.
Russia could then declare the largest monetary gold reserves in the world.
Together with the recently announced Moscow gold standard and plans for a new trade settlement currency to replace the dollar, enhanced gold reserves will provide support a new gold standard for cross-border trade.
It would replace payments to Russia for energy in weak Asian currencies, and probably force China to declare its true gold reserves as well.
If this is Putin’s plan, the consequences for Western fiat currencies are likely to be devastating – suffering the financial equivalent of a nuclear attack.
Tyler Durden
Sun, 10/02/2022 – 08:10 - Labour Opens Up Massive Lead In UK Polls
Labour Opens Up Massive Lead In UK Polls
After prime minister Truss and chancellor Kwarteng’s disastrous mini-budget announcement last Friday, followed by intervention from the Bank of England and a rebuke from the IMF, days of radio silence from the Conservative leader were broken with a string of car crash local radio interviews and a dogged defiance to row back on any of her government‘s latest decisions.
Already behind Labour in the polls since the turn of the year, Statista’s Martin Armstrong notes that the Conservatives now suddenly find themselves second to a Labour party enjoying the largest lead recorded in any published poll since the late 90s.
You will find more infographics at Statista
One projection estimates a general election victory on this scale would equate to a loss of 304 seats for the Conservatives, and a Labour gain of 296.
Tyler Durden
Sun, 10/02/2022 – 07:35 - The War Has Just Begun
The War Has Just Begun
Via ‘Big Serge’ Thoughts Substack,
The Winter of Yuri
I have been attempting for several days to collect my thoughts on the Russo-Ukrainian War and condense them into another analysis piece, but my efforts were consistently frustrated by the war’s stubborn refusal to sit still. After a slow, attrititional grind for much of the summer, events have begun to accelerate, calling to mind a famous quip from Vladimir Lenin: “There are decades where nothing happens; and there are weeks where decades happen.”
“You should know, by and large, we haven’t even started anything yet in earnest.”
This has been one of those weeks. It began with the commencement of referenda in four former Ukrainian oblasts to determine whether or not to join the Russian Federation, accompanied by Putin’s announcement that reservists would be called up to augment the force deployment in Ukraine. Further excitement bubbled up from the Baltic seabed with the mysterious destruction of the Nordstream pipelines. Nuclear rumors circulate, and all the while the war on the ground continues.
In all, it is clear that we are currently in the transitional period towards a new phase of the war, with higher Russian force deployment, expanded rules of engagement, and greater intensity looming. Season 2 of the Special Military Operation looms, and with it the Winter of Yuri:
Let’s try to process all the developments of the past few weeks and get a handle on the trajectory in Ukraine.
Annexation
The keystone event at the heart of recent escalation was the announcement of referenda in four regions (Donetsk, Lugansk, Zaporizhia, and Kherson) to determine the question of entry into the Russian Federation. The implication of course was that if the referenda succeeded (a question that was never in doubt), these regions would be annexed to Russia. While there were some rumors circulating that Russia would delay the annexation, this was never really plausible. To allow these regions to vote in favor of joining Russia only to leave them out in the cold would be monumentally unpopular and raise serious doubts about Russia’s commitment to its people in Ukraine.
Formal annexation is a certainty, if not on September 30th as rumored, then within the next week.
All of this is rather predictable, and completes the first layer of annexations which I noted in previous analysis. The reasoning is not particularly complex: clearing the Donbas and securing Crimea were the absolute minimum Russian objectives for the war, and securing Crimea requires both a land bridge with road and rail connections (Zaporizhia oblast) and controlling Crimea’s water sources (Kherson). These minimum objectives have now been formally designated, though of course Ukraine maintains some military activity on these territories and will have to be dislodged.
The Big Serge Annexation Map: Phase 1 Complete
I think, however, that people lost focus as to what the referenda and the ensuing annexation means. Western talking points focused on the illegitimacy of the votes and the illegality of any annexation, but this is really not very interesting or important. The legitimacy of annexation is derived from whether or not Russian administration can succeed in these regions. Legitimacy, as such, is merely a question of efficacy of state power. Can the state protect, extract, and adjudicate?
In any case, what is far more interesting than the technicalities of the referenda is what the decision to annex these regions says about Russian intentions. Once these regions become formally annexed, they will be viewed by the Russian state as sovereign Russian territory, subject to protection with the full range of Russian capabilities, including (in the most dire and unlikely scenario) nuclear weapons. When Medvedev pointed this out, it was bizarrely spun as a “nuclear threat”, but what he was actually trying to communicate is that these four oblasts will become part of Russia’s minimum definition of state integrity – non-negotiables, in other words.
I think the best way to formulate it is as such:
Annexation confers a formal designation that a territory has been deemed existentially important to the Russian state, and will be contested as if the integrity of the nation and state is at risk.
Those fixating on the “legality” of the referenda (as if such a thing exists) and Medvedev’s supposed nuclear blackmail are missing this point. Russia is telling us where it currently draws the line for its absolute minimum peace conditions. It’s not walking away without at least these four oblasts, and it considers the full range of state capabilities to be in play to achieve that goal.
Force Generation
The move to hold referenda and eventually annex the southeastern rim was accompanied with Putin’s long-awaited announcement of a “partial mobilization”. Ostensibly, the initial order calls up just 300,000 men with previous military experience, but the door is left upon for further surges at the discretion of the president’s office. Implicitly, Putin can now ramp up the mobilization as he sees fit without needing to make further announcements or sign more paperwork. This is similar to American Lend-Lease or the “Authorization for Use of Military Force” in America, where the door is opened once and the President is then free to move at will without even informing the public.
It was increasingly clear that Russia needed to raise its force deployment. Ukraine’s successful drive to the Oskil River was made possible by Russian economy of force. The Russian army had completely hollowed out Kharkiv Oblast, leaving only a thin screening force of national guardsmen and LNR militia. In places where the Russian Army has chosen to deploy sizeable regular formations, the results have been disastrous for Ukraine – the infamous Kherson Counteroffensive turned into a shooting gallery for Russian artillery, with the Ukrainian Army haplessly funneling men into a hopeless bridgehead at Andriivka.
A Shooting Gallery
So far in this war, Ukraine has achieved two big successes retaking territory: first in the spring, around Kiev, and now the late summer recapture of Kharkov Oblast. In both cases, the Russians had preemptively hollowed out the sector. We have yet to see a successful Ukrainian offensive against the Russian Army in a defensive posture. The obvious solution, therefore, is to raise the force deployment so that it is no longer necessary to hollow out sections of the front.
The initial surge of 300,000 men is being a bit muddled. Not all of the men being called up will be sent to Ukraine. Many will remain in Russia on garrison duty so that existing ready formations can be rotated to Ukraine. Therefore, it is likely that we will see more Russian units arriving in theater much sooner than expected. Additionally, many of the units originally committed to Ukraine have been off the front for refitting and resting. The scale and pace of Russia’s new force generation is likely to shock people. On the whole, the timing of Russia’s manpower surge coincides with the depletion of Ukrainian capabilities.
Ukraine spent the summer sending its 2nd tier conscripts to the front in the Donbas as it lovingly collected NATO-donated weapons and trained units in the rear. With generous NATO help, Ukraine was able to accumulate forces for two full scale offensives – one in Kherson (which failed spectacularly) and one in Kharkov (which succeeded in pushing past the Russian screening force and reaching the Oskil). Much of that carefully accumulated fighting power is now gone or degraded. Rumors circulated of a third offensive towards Melitipol, but Ukraine does not seem to have the combat power to achieve this, and strong Russian forces are in the region behind prepared defensive lines.
On the whole, therefore, Ukraine’s window for offensive operations has closed, and what remains is closing quickly. The last zone of intense Ukrainian operations is around Lyman, where aggressive Ukrainian attacks have so far failed to either storm or encircle the town. It is still possible that they take Lyman and consolidate control of Kupyansk, but this would likely represent the culmination of Ukrainian offensive capability. For now, the area around Lyman is a killing zone that exposes attacking Ukrainian troops to Russian air and ground fires.
The large scale view of force ratios is as follows:
Ukraine has spent much of the combat power that they accumulated with NATO help during the summer, and will have an urgent need to reduce combat intensity for refitting and rearming at precisely the same time that Russian combat power in the theater begins to surge.
Simultaneously, NATO’s ability to arm Ukraine is on the verge of exhaustion. Let’s look at this more closely.
Depleting NATO
One of the more fascinating aspects of the war in Ukraine is the extent to which Russia has contrived to attrit NATO military hardware without fighting a direct war with NATO forces. In a previous analysis I referred to Ukraine as a vampiric force which has reversed the logic of the proxy war; it’s a black hole sucking in NATO gear for destruction.
There are now very limited stockpiles to draw from to continue to arm Ukraine. Military Watch Magazine noted that NATO has drained the old Warsaw Pact tank park, leaving them bereft of Soviet tanks to donate to Ukraine. Once these reservoirs are fully tapped, the only option will be giving Ukraine western tank models. This, however, is much harder than it sounds, because it would require not only extensive training of tank crews, but also an entirely different selection of ammunition, spare parts, and repair facilities.
Tanks are not the only problem, however. Ukraine is now staring down the barrel (heh heh) of a serious shortage of conventional tube artillery. Earlier in the summer, the United States donated 155mm howitzers, but with stockpiles of both guns and shells dwindling, they’ve recently been forced to turn to lower caliber towed trash. After the announcement of yet another aid tranche on September 28th, the USA has now put together five consecutive packages which do not contain any conventional 155mm shells. Shells for Ukraine’s Soviet vintage artillery were running low as early as June.
In effect, the effort to keep Ukraine’s artillery arm functioning has gone through a few phases. In the first phase, Warsaw Pact stockpiles of Soviet shells were drained to supply Ukraine’s existing guns. In the second phase, Ukraine was given mid-level western capabilities, especially the 155mm howitzer. Now that 155mm shells are running low, Ukraine has to make do with 105mm guns which are badly outranged by Russian howitzers and will be, in a word, doomed in any kind of counterbattery action.
As a substitute for adequate tube artillery, the latest aid package does include 18 more of the internet’s favorite meme weapon – the HIMARS Multiple Launch Rocket System. What is not explicitly mentioned in the press release is that the HIMARS systems don’t exist in current US inventories and will have to be built, and are thus unlikely to arrive in Ukraine for several years.
The increasing difficulties in arming Ukraine coincide with the rapid closing of Ukraine’s window of operational opportunity. The forces accumulated over the summer are degraded and fought out, and every subsequent rebuild of the Ukrainian first tier forces will become harder as manpower is destroyed and NATO arsenals are depleted. This depletion comes precisely as Russian force generation is surging, foretelling the Winter of Yuri.
The Winter War
Anyone who expects the war to slow down during the winter is in for a surprise. Russia is going to launch a late autumn/winter offensive and achieve significant gains. The arc of force generation (both Russia’s increasing force accumulation and Ukraine’s degradation) coincide with the approach of cold weather.
Let’s make a brief note about combat in the cold. Russia is perfectly capable of waging effective operations in the snow. Going back to World War Two, the Red Army was more than capable of offensive success during the winter, starting in 1941 with the general counteroffensive at Moscow, again in 1942 with the destruction of the German 6th Army at Stalingrad, and in 1943-44 with two successful large scale offensives beginning in the winter. Now, of course World War Two is not directly applicable in all ways, but we can establish that from a technical standpoint there is a clearly established capability to wage operations in cold weather.
We also have more recent examples. In 2015, during the first Donbas War, LNR and DNR forces launched a pincer operation which successfully encircled a Ukrainian battalion at the Battle of Debaltseve. And, of course, the Russo-Ukrainian War begin in February, when much of northern Ukraine was below freezing temperatures.
Nice Move
Winter weather actually favors a Russian offensive for multiple reasons. One of the paradoxes of military operations is that freezing weather actually enhances mobility – vehicles can get stuck in mud, but not on frozen ground. From 1941-43, German troops celebrated the arrival of spring, because the thaw promised to bog the Red Army down in mud and slow their momentum. The winter death of foliage also reduces the cover available to troops in a defensive posture. And, of course, cold weather favors the side with more reliable access to energy.
As for where Russia will choose to commit its newly generated forces, there are four realistic possibilities, which I will enumerate in no particular order:
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Reopening the Northern Front with an operation around Kharkov. The attractiveness of this option is clear. A Russian move in force towards Kharkov would immediately collapse all of Ukraine’s gains towards the Oskil by compromising their rear areas.
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An offensive on Nikolayev out of the Kherson region. This would move further towards the goal of a landlocked Ukraine, and would take advantage of the fact that Ukrainian forces in this region are badly chewed up after their own failed offensive.
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Massive commitment to the Donbas to finish the liberation of DNR territory by capturing Slovyansk and Kramatorsk. This is less likely, as Russia has demonstrated comfort with the slow tempo of operations on this front.
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A push north from the Melitopol area towards Zaparozhia. This would safeguard the nuclear powerplant and end any credible threats to the land bridge to Crimea.
Other possibilities I regard as unlikely. A second advance on Kiev would make little operational sense, as it would not support any of the existing fronts. I would expect action around Kiev only if the new force generation is significantly larger than the headline number of 300,000. Otherwise, Russia’s winter offensives are likely to be concentrated on mutually supporting fronts. I think some movement to reopen the northern is likely, as it would completely compromise Ukraine’s gains in the Izyum-Kupyansk direction. There are rumors that forces are being moved into Belarus, but I actually think the Chernigov-Sumy axis would be more likely than a new Kiev operation, as it could be supportive of an offensive on Kharkov.
Potential Axes of Winter Advance (Base Map Credit: @War_Mapper)
On the broadest level, it is clear that Ukraine’s window to conduct offensive operations is nearing its close, and the force generation ratios on the ground are going to swing decisively in Russia’s favor through the winter.
Nordstream and Escalation
As we were pondering these developments on the ground, yet another plotline emerged underwater. The first hint that something was amiss was the news that pressure in the Nordstream 1 pipeline was dropping mysteriously. It was then revealed that the pipeline – along with the non-operational Nordstream 2 – had suffered serious damage. Swedish seismologists recorded explosions on the floor of the Baltic Sea, and it was revealed that the pipelines are heavily damaged.
Let’s be frank about this. Russia did not blow up its own pipelines, and it is ludicrous to suggest that they did. The importance of the pipeline to Russia lay in the fact that it could be switched on and off, providing a mechanism for leverage and negotiation vis a vis Germany. In the classic carrot and stick formulation, one cannot move the donkey if the carrot is blown up. The *only* feasible scenario in which Russia might be responsible for the sabotage would be if some hardliner faction within the Russian government felt that Putin was moving too slowly, and wanted to force an escalation. This would imply, however, that Putin is losing internal control, and there is no evidence whatsoever for such a theory.
And so, we return to elementary analysis, and ask: Cui bono? Who benefits? Well, considering Poland celebrated the opening of a new pipeline to Norway only a few days ago, and a certain former Polish MP cryptically thanked the United States on Twitter, it is fair to make a few guesses.
The first lesson of doing crimes is not to brag about it on twitter
Let us briefly meditate on the actual implications of Nordstream’s demise.
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Germany loses what little autonomy and flexibility it had, making it even more dependent on the United States.
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Russia loses a point of leverage over Europe, reducing the inducements to negotiation.
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Poland and Ukraine become even more critical transit hubs for gas.
Russia clearly perceives this as a bridge burning move of sabotage by NATO, designed to back them into a corner. The Russian government has decried it as an act of “international terrorism” and argued that the explosions occurred in areas “controlled by NATO” – the concatenation of these statements is that they blame NATO for an act of terrorism, without explicitly saying that. This precipitated another meeting of the Russian National Security Council.
Many western nations have advised their citizens to leave Russia immediately, suggesting they are worried about escalation (this coincides with Ukraine’s unhinged claim that Russia may be about to use nuclear weapons). For the time being, I expect Russian escalation to remain confined to Ukraine itself, likely coinciding with the deployment of additional Russian ground forces. If Russia feels compelled to undertake an out of theater escalation, targeting American satellites, digital infrastructure, or forces in Syria remain the most likely option.
On the Precipice
I am fully cognizant that my views will be spun as “coping” after Ukraine’s gains in Kharkov oblast, but time will tell out. Ukraine is on its last legs – they drained everything usable out of NATO stockpiles to build up a first tier force over the summer, and that force has been mauled and degraded beyond repair just as Russia’s force generation is set to massively increase. Winter will bring not only the eclipse of the Ukrainian army, the destruction of vital infrastructure, and the loss of new territory and population centers, but also a severe economic crisis in Europe. In the end, the United States will be left to rule over a deindustrialized and degraded Europe, and a rump Ukrainian trashcanistan sequestered west of the Dnieper.
For now, though, we are in the interregnum as the last flames of Ukraine’s fighting power flickers out. Then there will be an operational pause, and then a Russian winter offensive. There will be several weeks where nothing happens, and then everything will happen.
During that operational pause, you may be tempted to ask – “is it done, Yuri?”
No, Comrade Premiere. It has only begun.
Tyler Durden
Sun, 10/02/2022 – 07:00 -
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