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'Dems Don't Give A Crap About The Country': Martin Armstrong Sees Very, Very Tight Midterm Election

Zero Rss
1 month 3 weeks ago
'Dems Don't Give A Crap About The Country': Martin Armstrong Sees Very, Very Tight Midterm Election

Greg Hunter’s USAWatchdog.com,

Legendary financial and geopolitical cycle analyst Martin Armstrong is out with a new report (more than 100 pages) that takes a deep dive on the “2026 Midterm Elections” in November. 

Armstrong says, “The computer is showing this is going to be a very, very tight election..."

"It’s a 50/50 deal where we didn’t see either party coming in with a landslide. 

The bottom line looks like the Democrats can take the House, but not the Senate. 

So, you will have a 50/50 divided government.  You are going to get a lot of the crazies on the Democrat side.  Even the conservative Democrats are getting very nervous. 

You recently had (Democrat) James Carville talking about how the party is going to split, which was our forecast in 2024.  So, this is where we are heading. 

By the Dems taking the House, you will see all kinds of investigations, there will be another impeachment of Trump, etc. 

They will be real obstructionists.  They don’t give a crap about the country. 

If Trump says the sky is blue, they have to say it’s red.  This is the way politics degenerated.”

The implications for the Democrats will be long lasting and not in a good way. 

Armstrong says, “If the Democrats take the House, they will basically make this a real shit fight..."

"Our computers show for 2028 something very, very interesting.  I have never seen it do this, and it’s showing the Democrats will lose dramatically. 

On the Republican side, it shows they win even slightly above 70%.  You take the two favorites from both sides, which would be Vice President Vance against AOC (Alexandria Ocasio-Cortez), Vance would blow her out, yes.  I think the Democrats need to take the House to show the world how screwed up they really are.  There will be a check against them from Trump and the Senate. 

They can do an impeachment, but the trial has to be in the Senate, and it’s not going to go anywhere.

...

It’s going to get much worse before the Midterms.  As I said, these people don’t care about the country.  This has turned into a bloodsport.  This is part of what the computer has been projecting. 

By 2032, we are looking at the collapse of Republican forms of government.”

On the war in Ukraine, Armstrong says,

“I am not optimistic.  It looks like it goes off the boards by 2030 or so. 

Even the EU looks like it’s going to collapse after 2029 and break up again.”

With the Iran war, Armstrong says, “China is using Iran to drain our resources, which has happened..."

"  It takes two to three years to replace the missiles.  Taiwan is up in arms saying to the US, you don’t have the fire power to protect us. . .. You see the same thing with Russia and Ukraine.  They say Russia is weak.  They can’t take Ukraine, and Ukraine has seriously weakened Russia.  That is what Ukraine is doing.  That’s the whole purpose of this, and that was to drain Russia.  Iran is doing the same thing to America.”

Armstrong says don’t expect the stock market to crash anytime soon as money is flowing into and not out of America. 

Armstrong also is forecasting a new gold bull market in 2027.

There is much more in the 48-minute interview.

Join Greg Hunter of USAWatchdog as he goes one-on-one with Martin Armstrong to talk about Iran, Ukraine, gold, oil and the 2026 Midterm Elections for 8.15.26.

Tyler Durden Sun, 08/16/2026 - 19:50
Tyler Durden

Apple Trains Custom AI Model For China With Alibaba's Help

Zero Rss
1 month 3 weeks ago
Apple Trains Custom AI Model For China With Alibaba's Help

Apple has trained a custom large language model specifically for the Chinese market, utilizing technical support from Alibaba Group, according to Reuters. 

Chinese flags hang from a lamp post in front of an Apple Inc. store in Shanghai. Photographer: Qilai Shen/Bloomberg

This arrangement would make Apple the first foreign company cleared by Beijing to offer a proprietary AI model in China.

The custom model is expected to power portions of Apple Intelligence when the AI suite rolls out to mainland China via an upcoming iOS update.

This marks a strategic shift from Apple's earlier plan to rely solely on third-party Chinese models for its regional generative AI features. According to the report, OpenAI's ChatGPT and Anthropic's Claude - which Apple pairs with its own technology in Western markets - are unavailable in China.

In July, China's Cyberspace Administration officially registered Apple's generative AI service, clearing the primary regulatory hurdle that had kept Apple Intelligence off local devices.

Under this approved framework, Alibaba's Qwen model will integrate into Apple Intelligence across compatible iPhones, iPads, Macs, and Vision Pro headsets sold in China, while Baidu's technology will separately support search-related features.

It remains unclear exactly how Apple's proprietary model will divide tasks with Qwen and Baidu, as the technical breakdown between the systems has not yet been disclosed.

China remains one of Apple's most crucial markets. Until now, the lack of native AI capabilities on Chinese iPhones has put Apple at a distinct competitive disadvantage against domestic rivals like Huawei, which have aggressively marketed AI-equipped handsets.

Apple Intelligence began rolling out globally in October 2024, but Apple said at the iPhone 16 launch that September that mainland China availability was "subject to regulatory approval." The CAC's July 15 registration came roughly 22 months later, clearing Apple alongside six other on-device generative AI services from Huawei, Samsung, OPPO, vivo, Xiaomi and ZTE.

The wait proved costly in a market Apple has been winning back. IDC put Apple's China smartphone share at 18.1 percent in the second quarter, up from 13.9 percent a year earlier on 24.4 percent shipment growth - the strongest gain of any major brand, and enough to move Apple from fifth place to second. Huawei held the lead at 22.6 percent. They were the only two vendors to grow at all as overall shipments fell 4.3 percent to roughly 66 million units, a fifth straight quarterly decline driven by rising memory costs and fading government subsidies.

Apple's gains came from holding iPhone 17 pricing steady while Android rivals raised theirs, and from signaling second-half price increases that pulled demand forward - mechanics that flatter one quarter rather than establishing a trend. Domestic rivals shipped on-device generative AI features throughout the wait.

Reporting has indicated Apple evaluated Baidu, ByteDance's Doubao and DeepSeek before settling on Alibaba as its primary model provider. Apple has said nothing publicly about the arrangement - every confirmation to date has come from Alibaba and Baidu, or from the regulator's own filing. No mainland launch date has been announced.

Tyler Durden Sun, 08/16/2026 - 19:15
Tyler Durden

LeBron James spends day with former Lakers teammate Austin Reaves

NY Post
1 month 3 weeks ago
NBA superstar LeBron James may have left the Los Angeles Lakers’ organization in the rearview, but he’s still hanging out with his former teammates. James spent time with Austin Reaves at a golf course Sunday along with his son, Bronny James. The trio were filmed having a meal together with Bobby Fairways, Joey Coldcuts, Fat...
Valentina Martinez

Warsh's Mark Antony Moment

Zero Rss
1 month 3 weeks ago
Warsh's Mark Antony Moment

Submitted by Peter Tchir, Academy Securities — Macro Strategy

Warsh's Mark Antony Moment

I really wanted to go with Warsh is “puttin’ on the foil” as the title for our Jackson Hole preview, but I’m told the Hanson Brothers might not be as iconic as I thought. In any case, of all my failings as a parent, getting my kids to finally watch Slapshot is one of the easier ones to correct. I felt the “vibe” of Warsh “puttin’ on the foil” in the green room as he gets ready to speak to the Jackson Hole crowd was good, but today we’ll go a little more “highbrow.”

Friends, economists, central bankers, lend me your ears;
I come to bury inflation, not to praise it.

As you know we have been on the side of No Cuts:

  • We discussed this along with the danger of Cheap Chinese Compute on Thursday on CNBC.
  • On Friday, we discussed Iran, ProSec, and the Fed on Bloomberg TV (starts at the 2:19:40 mark, with Lisa giving her best Seinfeld impersonation of No Hikes For You (last weekend’s T-Report)). The segment before discusses why the Fed is still going to hike 75 bps, so the combination of the two segments makes for some interesting viewing.
  • The Path to a September Rate Cut (Despite AI Inflation). Restarting the conflict in Iran has not been good for this timeline, and the data task force is likely to take longer to come back with recommendations than I’d like, but the points, I believe, are still valid.

Arguing about what data the Fed uses and how they interpret the data is not new for the T-Report:

The role of a strategist is to determine what is likely to happen, not what one wants to happen. This report may skew a little to the “want” rather than “expect” side of the equation, but sometimes it is healthy to vent (and possibly influence policy).

The Warsh Reaction Function is Clear

Okay, that is probably an overstatement, but I think worrying about the reaction function is missing the main point. The main point is to figure out what data Warsh is going to react to. The “reaction function” consists of two parts:

  • The data that feeds into the equation.
  • The equation that processes the data to get an answer.

Why do so many people still think PCE or some other data point (that has likely led to bad policy decisions in the past) is what Warsh will use? I suspect his “reaction function” will be more or less “normal,” but what will be unusual is what data he uses to input into that function.

That is a key premise to my view on how he should attack his Jackson Hole Speech.

The Speech I Would Give

This is definitely a mix of what I’d say, what he may say, with a bit too much Shakespeare to keep the report aligned with the title. Mark Antony’s speech starts with one thing and ends with pretty much the exact opposite, which hopefully I’m able to replicate here (and I was tempted to put on the foil to help write this).

Friends, economists, central bankers, lend me your ears;
I come to bury inflation, not to praise it.

Inflation is Bad, But…

Step 1 — Argue inflation is bad, but it is at least a little unclear that this is always true, or if there is some scientific method to determine what level of inflation is bad.

Is inflation bad? Yes, some level of inflation, historically, has hurt a segment of the population. Do we know that exact level? No. Well, some say 2%, but why not 0%? Why not 4%? 2% seems like an awfully convenient round number. If we had rigorous scientific backing it would be one thing, but unlike “hard sciences” much of what we do in economics is conjecture. [Step 1a — inflation is bad, but how do we know 2% is the “right” target?]

Is inflation bad? Yes, but don’t we need to look at income growth as well? Inflation erodes purchasing power, but if wages are rising at or near the pace of inflation, should we be that concerned? If we had 4% wage growth, 1% real yields, and inflation running at 3%, should we try to stop it? Nominal is important but real numbers are important too. [Step 1b — inflation may be bad, but it needs to be thought of in an overall context.]

Is inflation bad? Yes, and Powell was an honorable man, but…

We’ve all agreed that inflation is bad, but yet, my honorable predecessor left rates unchanged even as inflation soared. Did this inflation in 2021 not seem bad? Surely the Fed must have been afraid of inflation above 4% using the auspices of the BLS data. While relying on the high priests to examine the entrails, could they have not looked for other signs that inflation was there? [Step 1c — hint at better ways to measure].

Then in 2024, just before an election, my predecessors were able to cut rates. Inflation must have been below 2%, no? No, inflation was above 3%, but we cut rates. Yes, I understand why everybody says inflation is bad, but did they act on it? [Step 1d — point out recent examples that don’t match the current angst on inflation].

Rate Hikes Quell Inflation, Except…

Step 2 — Argue that rate hikes are not always an effective tool against inflation.

Rate hikes will quell inflation. Yes, we have a conflict in the Middle East where the U.S., under the guidance of President Trump, is trying to make the world safe (I’m writing what he as an appointee might say). One offshoot of that conflict has been higher energy prices across the globe. The U.S. as a net exporter has weathered this better than other regions. Energy prices (including gasoline, jet fuel, and diesel) have risen, along with products reliant on oil and LNG as their feedstock. Will hiking rates cause oil prices to come down? Will people drive less because of a hike? How does raising the cost of funding help our great energy companies explore and produce more energy? Shouldn’t we be making it easier for companies to invest in energy production rather than the other way around? If we had a “natural” supply and demand imbalance, hiking rates might be effective. However, hiking rates due to a conflict, which could ultimately lead to lower energy prices, seems like the bigger mistake. [Step 2a — argue that hiking to offset inflation due to Iran is counterproductive].

Rate hikes will quell inflation. Yes, we have one of the largest capital investments this nation has ever seen! We are building data centers and AI processing power across the country! It is a “revolution” that is “transforming” the country. There are strong arguments that over time, this build out will increase productivity, thereby dampening inflation. Assuming that we think it is good policy to dampen future productivity gains (over today’s concerns), would it even work? Will a single “compute” project be put on hold because we raise rates by 50 bps? Given the profit potential being priced into the market, a 50 bp hike would be a mere blip for these companies regarding their willingness to proceed with projects. Yet every other part of the economy would be hurt. [Step 2b — argue that hiking to slow the “compute” spend is bad public policy and would not work anyways].

We will hike rates when inflation is too high (if we believe that hiking rates will not only act to lower inflation, but also serve the longer-term interests of the nation). The key sources of inflation that we are experiencing will not be impacted by hikes and it would be bad public policy, at the national level, to slow the “compute build.”

Task Forces Are Ambitious, Or Just Common Sense?

Step 3 — Changing the Fed is “ambitious” but necessary.

Is a Balance Sheet Policy Task Force ambitious? Yes, but how did something that was once considered “extraordinary” become a basic part of the tool kit? The most recent Quantitative Easing ended in March 2022. We continued to buy bonds up until the day we first hiked? It is unclear why we waited so long to hike with inflation spiking, but to still be buying bonds right up until that moment in time seems wrong. If QE is “extraordinary,” that makes no sense. The 10-year Treasury was 1.5% in December 2021, with inflation soaring, and the Fed kept buying bonds?

Going back to COVID, we saw “near panic” in corporate bond markets. The need to raise money was overwhelming the ability to support prices. The “carnage” in ETFs attracted the Fed’s attention. A short-dated corporate bond ETF was trading at an extremely large discount relative to NAV, which was causing the ETF Spiral™ to play out (according to the T-Report at Academy Securities (wishful thinking plug on my part)). On a Sunday night, in conjunction with Treasury, the Federal Reserve announced programs to not only purchase corporate debt in the secondary market and to buy corporate debt new issues, but also to buy corporate bond ETFs. The result was instantaneous and markets recovered before the announced programs ever bought a single corporate bond or ETF. It in fact took weeks, or longer, to develop the protocols and piping to execute the plan, but we went ahead with the purchases, even though the announcement had done the heavy lifting. [Step 3a — is it ambitious to question how we use the balance sheet? Yes, but it seems like an extremely useful exercise].

Is having an Inflation Frameworks Task Force ambitious? Yes. Why weren’t we hiking earlier? Why were we cutting when inflation was well above target? Why would we hike (or cut) when many entities (including every person and corporation locking in long-term low yields during ZIRP) would not respond to that simple decision?

Is having a Data Sources Task Force ambitious? Actually, no, it is not ambitious, it is common sense! It has been a long time since anyone at the Fed used a slide rule, so why would we not reassess what data we look at? Businesses have been built around processing, analyzing, and procuring data in a timely fashion. These businesses only survive if they are useful. The Fed itself publishes a swathe of data that seems to be largely ignored by the Fed (at least at FOMC meetings — Cleveland Fed Tenant Repeat Rent). Let’s examine what we already have at the Fed and BLS that can be used. Let’s examine other outside sources. Let’s create a “best of breed” dashboard. I cannot even fathom why some view this as “ambitious” instead of standard operating procedure!

Bottom Line

If I were Warsh, I’d take the gloves off and come out swinging!

Hammer home the point that while “inflation is bad,” the exact level that is “bad” is difficult to determine. There have been inconsistencies in the application of interest rate policy with inflation readings. Get people to question the status quo on what data is useful or not.

Argue that not all sources of inflation would be impacted by raising rates. That understanding the drivers of inflation is key to effective policy — not a “knee jerk” reaction to a number.

Highlight how we have an opportunity to rethink much of the Fed policy making process from the ground up with these task forces, and that these task forces should be the “norm” and should have been in existence already.

I wouldn’t weigh in on jobs (recent data supports the cuts, but this is already getting too long).

I wouldn’t weigh in on the neutral rate — far too wonky and will let Miran or someone else champion that part of the argument on why policy is too restrictive.

Probably far too aggressive on my take (and use of Mark Antony), but I expect that by the end of Jackson Hole, we will see rate hike expectations continue to drop.

I’m not as bullish on rates out the curve, as global sovereign bond issuance (to support defense spending and infrastructure spending) and ongoing corporate debt issuance are likely to keep pressure on the longer end of the yield curve. It doesn’t help, at least for now, that traditional buyers like Japan and the Middle East are likely not buying as much of our debt as they once did (for different reasons).

Rising bond yields and a “hawkish” Fed are something that should not be a concern for equity markets!

Cowards die many times before their deaths; the valiant never taste of death but once.

That seems like a good quote from Shakespeare’s Julius Caesar as it is the approach I’d like to see Warsh take (he will emerge victorious, if this is done well).

Have a great weekend, and at least now I won’t have to write about Jackson Hole next weekend.

Tyler Durden Sun, 08/16/2026 - 18:40
Tyler Durden

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