'There's potential for a British Pound collapse in 2016' - Martin Armstrong


Current Job: Economist at Armstrong Economics
Career: Developer of the Economic Confidence Model based on business cycles and pi. Former chariman of Princeton Economics International Ltd.

Armstrong Economics View profile at FXStreet

Martin Armstrong is an economist and financial strategist known for his economic predictions based on the Economic Confidence Model, which he developed. 

Once a financial strategist and advisor to over one trillion dollars of asset, Armstrong developed a computer model based on the number Pi and other cyclical theories to predict economic turning points with eerie accuracy. He is the person behind the “Princeton Economics International” think tank. He is known to have predicted the crash of 1987 to the very day.

1. What will 2015 be remembered for? 

I believe 2015 will be remember for the crash in the Euro which broke the Swiss peg and has placed at risk the political landscape of Europe as a whole.
2. Which were your most important achievements this year?
Getting our Socrates system actually started. This will really open a lot of people’s eyes with respect to the fact that the world is truly interconnected.
3. What emerging issues or trends should traders prepare for in 2016?
The final decline in commodities and wild ride in the currency markets that will swing in both directions as we approach 2017 which will be political chaos globally from election in USA, France, Germany, to the EU vote of exiting the Euro and a likely uprising in Greece.
4. Which will be the best and worst performing currencies in 2016 and why?
We are likely to see the dollar still strengthen and the shocker could be the collapse of the British pound to eventually retest the par level of 1985.
5. Which under-the-radar currency pair do you expect to make a big move in 2016?
The potential for the biggest move will be the British pound if it closes below the 14050 level at the close of 2015. However, a closing even below 14615 will be a warning that there may be a serious crack on the horizon.
6. Which macroeconomic events will have the biggest impact on the FX markets in 2016?
That still appears to be a combination of sovereign debt and taxes. While government are trying to “stimulate” they are also becoming aggressive in hunting for taxes. Starting in 2017, G20 national will be reporting on all movement of money. As government continue to borrow, they are raising taxes and become confused why the economy continues to implode. It was the free movement of money post-WWII which rebuilt the world economy. Now they are doing the exact opposite because they are desperate for money.
7. Which asset class will cause the next financial crisis?
That appears to be the debt markets. Capital will begin to shift from public to private as they see the risk is with governments poorly managed and no hope of correcting the problem. We are likely to see the US share market rise sharply only everyone starts to realize government are fiscally in serious trouble.
8. What will you be focused on next year?
Debt, shares, currency, and commodities in that order. Currency will be the key to global capital flows.
9. Who are the people to watch in 2016 in terms of impact on the industry?
The politicians in Brussels and the antics of the ECB. Neither will admit a mistake so they will only press current policies even harder.
10. What are your New Year's resolutions?
Look for a reasonable place to live that is perhaps not in the direct path of the political chaos and economic insanity that lies ahead and seems to burst in the air starting in 2017.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex Analysis

Latest Forex Analysis

Editors’ Picks

EUR/USD recovers within range, lacks follow-through

Encouraging macroeconomic data from the EU and the US boosted risked sentiment, which in turn, helped EUR/USD to advance, currently nearing the weekly high at 1.2075.


GBP/USD trades around 1.39 after a choppy reaction to the BOE

GBP/USD is trading around 1.39 after an 80-pip move around the BOE's "Super Thursday." The bank announced a slowdown in buying bonds but no change to the overall scope. US jobless claims and elections in Scotland are awaited. 


Gold Price Analysis: Gold bears seeking a correction to test bullish commitments

Gold has broken above the $1,800 mark, hitting the highest levels since February. The Confluence Detector is showing that XAU/USD has very few barriers through $1,850. Bears are lurking at resistance structure, eyeing a correction ahead of NFPs.

Gold News

Dogecoin price targets $1 as the chase for high-yielding cryptos accelerates

Dogecoin price strength combined with the complementary volume highlights the continued fascination in the digital token, portending further gains in the days ahead.

More Dogecoin News

US Nonfarm Payrolls April Preview: When the economy booms, its all about rates

The US labor market’s stars appear aligned for April.The economy is expanding rapidly, employers are confident and consumers eager to throw off the restraints of the past year.

Read more