Glenn Diesen - Greater Eurasia Podcast Martin Armstrong: How Europe Destroyed Itself & What Comes Next
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Feb 25, 2026 Martin Armstrong, economist and founder of Armstrong Economics known for forecasting sovereign debt crises. He discusses how sovereign debt and flawed monetary design destabilized Europe. He describes capital flows exposing weak states, the political incentives blocking long-term reform, migration and integration challenges, and the risks of sanctions, de-dollarization, and regional fragmentation.
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Sovereign Debt Is Driving Geopolitics
- Martin Armstrong argues the core driver of current geopolitics is a sovereign debt crisis as governments borrow without intent to repay.
- He cites U.S. interest payments now exceeding military spending and warns interest costs will eventually consume budgets.
Euro Failed From Unconsolidated Debt
- Armstrong says the euro failed because debt was never consolidated across members when the currency formed in 1998.
- He recounts advising euro architects to consolidate debt and criticizes Kohl for forcing Germany into the euro without a vote.
Economic Theory Misses Global Capital Flows
- Armstrong critiques mainstream economic theory as domestically focused and outdated, failing to account for global capital flows.
- He explains QE and modern monetary claims ignored cross-border behavior like China selling long-dated Treasuries.