Question: Mr. Armstrong, your reputation precedes you. They call you the legend because you were the only analyst who predicted events years ago. Throughout the ups and downs of the stock market, I only required a two-year correction from 2000 to 2008 and the market would still be in an uptrend. I read the Barrows article about you where they seemed to laugh at your prediction I think in 2010 when you said the market was going to go up and make new highs. I did the same thing in 1987. My question is, do you have a specific indicator that allows you to see the long term like that in the stock market?
Answer: This is why I maintain that to be a successful trader you have to overcome your emotions. I’ve always been institutional. Our reports were very expensive for the retail world because they were used for telex, which cost only $75 per transmission at the time. That’s why we’ve opened offices around the world to reduce delivery costs. We will send one referral to that office and they will redistribute it to clients in that area. We’re collecting all of our old forecasts that were in stock and will try to compile them on a yearly basis for your reference.
When fax became popular we switched to this delivery system which brought costs down dramatically. Today, it’s an email and it’s all free. This is why we have become the largest corporate advisor. However, since our clients were institutional, we had to specialize in reliable long-term forecasting. Day traders were not the focus of our attention.
We have developed a very long term trend indicator. This succeeded in calculating that these corrections as everyone would call the next depression were just short term corrections. The calculations are extensive, but this indicator has been used by our institutional clients to provide basic confidence in what is Is that true It unfolds in the markets on a broader basis.
These are the charts I was showing at our institutional sessions around the world in 1985. This indicator started to go up on a quarterly level in 1982. And it was all the way up in 1984 on an annual level one year before the 1985 ECM turnaround. That’s why I ended up introducing Advice to a few buyout players at the time who ended up making a Wall Street movie with Michael Douglas and his famous character Talk about greed. What the movie doesn’t show is that book values have fallen so much that we can buy companies, sell their assets, and double or triple our money. I was warned that we are entering an acquisition boom.
We removed the back cover of The Economist in July 1985 for three weeks to predict that deflation was coming to an end and that a special new wave on our model of economic confidence had begun that would eventually culminate in 2032.
The ECM even picked the Fed’s highest interest rate in 1981. Our long-term outlook was amazing. They even liked me. As I said at the last WEC, no one has tried to defeat these models more than me. True, I don’t like their predictions until 2032. But this is my personal opinion, which customers do not rely on. We all know that predictions can only come from Socrates. These indicators were reliable and you cannot predict the future by personal feel.
You have people who will try to claim that all this is nonsense because they want to think, like Marx, that government is in control. They respond to events. At the bottom of the ECM in 1985, they formed the G5 at the Plaza Accord in response to a rising dollar that led to a surge in deflation. The government does not want to learn how to run the economy. They want to deceive the voting masses just to retain power.