Manipulating the World Economy: The Rise of Modern Monetary Theory & the Inevitable Fall of Classical Economics – Is There an Alternative?
by Martin A. Armstrong 2021
About the Author
Martin A. Armstrong, the founder of AE Global Solutions Inc. and Armstrong Economics, is an internationally recognized economist and former hedge fund manager with over 40 years of experience monitoring and forecasting market behavior. Originating from his passion for researching monetary history and a determination to harness the power of computers and artificial intelligence, Mr. Armstrong has built an innovative collection of proprietary models that help identify market patterns in an unbiased, data-driven approach. His models are available to the public under Socrates – the first software-as-a-service platform offering unique perspectives and tools intended to help individuals and organizations better research and interpret the global economic and political environment. The models Mr. Armstrong has built, including the Economic Confidence Model, which establishes the basic units of a business cycle as waves that build in 8.6-year intervals, have consistently proven that the global economy is not random. This has become one of the most important long-term forecasting models available today. Over the years, Mr. Armstrong has built additional independent models, such as market Reversals, Forecast Arrays, and the Global Market Watch – each taking a slightly different view to pattern and cycle recognition. These models, while independent from each other, do have corollary benefits and are built from the ground up to consume mass amounts of information in order to continuously learn and adapt. In the past, Mr. Armstrong has been called upon by governments and major banking institutions to assist in the explanation of current events and their impact on the global economy. His forecasting has run in the face of traditional, narrow, fundamental views that fail to contemplate the business cycle and human behavior that drives it. Far too often, forecasting suffers from prejudice and preconceived notions. Analysts can manipulate data to paint just about any picture they want, whether consciously or subconsciously, rather than let the data paint its own picture. AE Global Solutions, Inc., Socrates, and Armstrong Economics were founded on the principles of observing history to understand the future.
About the Book
The economic theories that dominated the field during the 20th century have failed us and empowered government to believe they can manipulate the business cycle. Every economic theory presented post-Marxism has assumed that the complexity of the business cycle can be reduced to a single cause and effect. To date, no attempt to manipulate the cycle has prevented a recession or financial crisis. We now face a truly monumental crisis. Central banks around the world are trapped. Their attempt to stimulate the economy through Quantitative Easing and rate manipulation has disastrously failed.
The central banks have primarily purchased government debt, effectively keeping governments on life support by allowing them to issue new debt at substantially lower rates. In addition to catastrophic Quantitative Easing policies, political fiscal spending on various programs and agencies has burdened governments with a debt that they can never repay. The future crisis is one created by government. This time, we are not likely to fix the problem without major political reform, which all governments will resist. These policies have led many to assume that government can freely create money without inflation. After creating trillions of dollars to buy government debt with no appreciable inflation, many conclude that everything has changed.
They are calling this the Modern Monetary Theory. If they are correct, then why bother to have taxes or borrow money continuously with no intention of paying off national debts? Governments, in modern theory, can simply create an endless supply of money to create a new modern version of Utopia. Can we throw away all economic history for an experiment that could unravel civilization if the theory proves to be wrong? What are the risks? Can it really be that easy? Are there any examples from the past that we can look to for answers?
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