muses of the moment

December 31, 2009

Martin Armstrong’s 2010 Predictions

Update December 29, 2010:

Since we are nearing the close of 2010, groovygirl thought she should revisit Martin’s 2010 predictions. He is on target.

(For Martin Armstrong’s 2011 predictions, click here.)

The USdollar has gone up, but not past 88 on the good days. We are ending the year closer to 80. Martin talked about volatility in the dollar (in his Jan. 2010 update) and we certainty have seen that.

DOW is still in Martin’s trading range for 2010, not able to break through the 11,800 resistance level, ending the year at 11,577.

Gold is up from $1100 in December 2009, ending the year at $1412. He called a very good year for gold, and it was. Nice!

Real estate still in freeze-frame since many defaults are unrealized in the market. New-starts are way down and the average sale price is down 30% from the 2007 peak and predicted to continue to fall next year. For the long-term real estate outlook, Martin calls for a low in 2012, and short rebound in 2015, and then a slow steady decline into 2033.

Way to go, Mr. Armstrong!

Update: June 10, 2010: since we are coming to the half-way point in 2010, groovygirl thought she should revisit Martin’s predictions. So far, he is on target.

The USdollar has gone up, but not past 88 on the good days. Martin talked about volatility in the dollar (in his Jan. 2010 update) and we certainty have seen that. If the euro recovers in the next 6-12 months, we could see the dollar fall very quickly. The dollar is up because it is the least worse of the global fiat currencies, not because it is stable.

DOW is still hovering around 10,000-10,500.

Gold is up from $1100 in December 2009, currently battling at $1200, expected to go up much more before year-end.

Real estate seems to be in a freeze-frame, and new-starts are definitely down.

And a round of applause for Martin Armstrong!

Actually, Martin Armstrong hasn’t made any predictions for 2010. But he has mentioned some “if, then” statements in his last few letters of 2009. Statements in quotes are from Martin Armstrong’s letters.

Let’s review.

DOW-neutral

“A close above 10,800 before year-end signals new highs sooner rather than later. A 12,500 resistance in 2010.”

We have not reached 10,800, only around 10,500, so the market will go along as it has for a while.

“DOW predictions from Fall 2009:

  • If DOW closes above 10,800 before year-end, inflation is coming faster than expected.
  • DOW below 10,800 is a neutral indicator for 2010.
  • Two yearly targets for yearly crisis are 2011-2012 and 2016.
  • DOW resistance is 11,800 and support 8,800-8,300.”

GOLD-up

“If we close December above 1033.90 per ounce for gold, 2010 looks very good for gold. We are closing the year at around $1100, so gold looks good next year. We need to break $730 to break the trend. There is major support at $800.”

Click here for the Gold $5,000+ letter. The last 3 pages are very informative!

He is more specific for the time period between now and 2012. “Watching the gold price for the next 2 months (this letter was on Nov. 12, 2009) will tell us if we should expect an up-trend in April 2010 or October 2010.” Because of the rapid rise in gold since that letter, although we have retraced, April 2010 is looking good for the next move. We will have to see what happens. Anything can happen within the long-term trend in gold in this unstable economic environment.

Gold is what investors buy when they are not confident in the economic climate. Groovygirl suspects that hedge fund and pension fund managers that have not purchased gold/silver in 2009, have it on the list to buy in 2010 at some point. This may drive price.

Martin sees the possibility for $5,000 gold by 2015. If that is the case, gold could rise in 2010 on its way to that number. But remember, expect volatility in the gold market, do not day-trade gold.

REAL ESTATE-neutral-falling

Martin is calling for a temporary bottom in 2012 and a rise in 2015. Then a slow, very bad decline into 2030. This is a 26-year decline in real estate. Not pretty. So this means that the housing market is not recovering and residential and commercial real estate will still be under pressure in 2010. This pressure is probably reflecting the continued frozen credit market.

Click here for Martin’s letter on the Real Estate cycle. (Real estate information starts on page 8 with a chart.)

DOLLAR-falling

Back in May 2009, Martin said:

Martin suggests from the graphs that the USDollar continuing to close in the range of 81-82 for the rest of the year would signal a stable dollar until 2011. “However, if the USD closes consistently below 79, the dollar could reach a crisis point earlier than 2011.” The dollar has jumped the last month, but it is still below 78, so the dollar is under extreme pressure for more devaluing in 2010. He also notes that gold could rise significantly as the only viable option to the USDollar. Update: January 21, 2010, Martin has released a letter on the floating currency system and USDollar predictions. Click here (last few pages have specifics). His conclusion, extreme volatility and then a currency crisis in the USDollar in 2015.

groovygirl’s conclusion

Mainly, more of the same in 2010. We will see if Martin is right. Groovygirl will keep a look out for Martin’s next letter to see if there are any updates/modifications to the information presented here.

This information is not to be used to trade short-term and groovygirl reminds you that you invest at your own risk. This is the information that groovygirl is using to prepare her investments for the coming currency crisis. It lets her know how much time she has to prepare and nothing else. The time to trade was 3 years ago, now it is time to preserve the purchasing power of your savings/capital/retirement.

Side musing: click on the Martin Armstrong tag to the right to view all the posts about his letters. There are links to all the original letters under moregroovyresources.

Click here for Jim Sinclair’s thoughts on all the “bull market” talk at year-end.

John Williams’ latest update from shadowstats.com (you pay for the detail), but here is the headline:

– Tumbling Real M3 Promises Intensified Depression
– Major Double-Dip Downturn Should Be Obvious by Mid-Year 2010

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8 Comments »

  1. Hi GroovyGirl,

    Your blog rocks! I thought Martin Armstrong prediction for Gold @ 5K will happen in 2015 not 2011….

    HAPPY NEWS YEAR EVE!
    Rob

    Comment by Rob — December 31, 2009 @ 9:58 am

  2. Thanks for reading, Rob. You are correct. GroovyGirl is so excited about gold, she is getting ahead of herself 🙂 I will correct the post.

    Happy New Year!

    gg

    Comment by totallygroovygirlfriday — December 31, 2009 @ 10:12 am

  3. I am wondering when Armstrong says Real estate is going to go down, is he talking in nominal terms or in real terms?

    I can see Real estate going down in real terms (against Gold) but nominally stay even or move up.

    This is part of the great inflation vs. deflation debate – what unit of measure do you use?

    Comment by David — January 4, 2010 @ 1:57 am

  4. David,

    Martin Armstrong doesn’t say specifically, so we don’t know his thoughts. It is groovygirl’s opinion that for the first part of the 26-year decline, we will more than likely experience deflation in housing prices in real terms (even if there is inflation in other parts of the economy). With the credit market frozen and unemployment still at 20% (real number), I don’t see how they could rise. Even if the gov prints free money (Fran and Fred now have “unlimited” bailout amount from Treasury, nothing is fixed) for people to buy houses, they can’t do that for everyone, it can only impact a small portion of the market. When a currency crisis is upon us, that could change. Where prices rise, but adjusted for inflation, housing prices are really lower.

    I would focus on Martin Armstrong’s timeline more than price. Martin is a master timer. Price would be impacted by the local market anyway.

    I personally am using the tax assessed price from December 2006 as the top end. I am looking for 10%-20%-30%-50% (90% in CA and FL) below that price. (Depends on how much the real estate market in your area was inflated.) In this environment, I would not look at a house that was asking for more than the current (2010) tax assessed value.

    I would rather wait to buy and risk having interest rates higher than be upside down in a house within 2-5 years.

    Thanks for reading,
    groovygirl

    Comment by totallygroovygirlfriday — January 4, 2010 @ 5:35 am

  5. I have followed Martins work over the years. I even reproduced portions of his PI cycle in software several years ago. I have developed my own fractal based on the law of octaves and their harmonic relationships.

    Here is a link to my papers:

    http://www.classicsoftware.com/signalspace/civilizationsfuture.htm

    The big shift underway is described in http://www.classicsoftware.com/signalspace/newcycle.htm

    The law of Octave fractal is described in http://www.classicsoftware.com/signalspace/westerncivilization.htm

    It is in agreement with much of Martins work. This is about civilization.

    Ed Moran

    Comment by Ed — February 16, 2010 @ 1:27 am

  6. […] Click here  for a popular post about Martin Armstrong’s 2010 predictions. Leave a Comment […]

    Pingback by Where is Martin Armstrong? « muses of the moment — August 10, 2010 @ 1:32 am

  7. This is awesome post

    Comment by Apoorva — August 27, 2010 @ 2:35 pm

  8. thanks

    Comment by toc — December 10, 2010 @ 5:00 pm


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