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January 16, 2020 | Capital Flows & the Next ECM

Martin Armstrong

Martin Arthur Armstrong is the former chairman of Princeton Economics International Ltd. He is best known for his economic predictions based on the Economic Confidence Model, which he developed.

QUESTION: Sir,
You have advised us to avoid sovereign debt after the ECM date. I imagine that the crisis will affect nations unequally. It seems obvious that money would leave bonds in the more challenged, negative rate countries (EU and Japan). Might these flows come into US Treasuries, thereby stabilizing US rates, at least short-term? Could this be a trading opportunity (long) in our Treasuries? Thank you.
PK

ANSWER: So far, it appears that the capital flows will continue pointing to the USA going into 2022. Thereafter, we should expect a change in that trend in the same position of the ECM, which created the 1987 Crash also due to a capital flight from the dollar.

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January 16th, 2020

Posted In: Armstrong Economics

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