Monthly Archives: August 2017

Aug 10 2017

Trade War with Russia Disguised as Sanctions?


Armstrong Economics Blog/Energy

Re-Posted Aug 10, 2017 by Martin Armstrong

The US sanction voted on by Congress against Russia are outrageous and an act of War that history will write as this may have been the line in the sand crossed by the USA to punish Russia for Hillary’s loss. Clearly, the new sanctions have important implications for Europe because they target any company that contributes to the development, maintenance or modernization of Russia’s energy export pipelines. This sanction reeks of politics that is really a trade war disguised as national security and pride. We have to dig deeper to see who is getting paid by the American energy industry now and for the next election.

These sanction would surely affect a controversial pipeline project between Russia and Germany known as Nord Stream 2, which is owned by Gazprom but includes financial stakes from European companies. The project aims to carry Russian natural gas under the Baltic Sea, bypassing countries like Ukraine, Poland and the Baltic States. When US President Donald Trump visited Poland in July 2017, he said that the US would increase its liquefied petroleum gas supplies (LNG) to Europe, which was very enthusiastically supported by the Poles. This was obviously a statement that was a direct competition with Gazprom that would distort competition for the European energy market.

The entire Middle East Crisis is all about gas. It began with demanding to run a pipeline through Syria to compete with Russia in Europe. This has been the underlying nonsense from the start. Crimea was historically Russian territory and the Eastern Ukraine was settled by Russian who even speak Russian in the East. If Japan tried to kick the USA out of Okinawa, the USA would send troops. This is all about gas – let us not kid ourselves.

There are competing US and Russian gas suppliers in Europe. At first sight, Gazprom has an advantage: Russia has large gas reserves, low production costs and a developed energy infrastructure that supplies gas to Europe. The US producers, on the other hand, have to freeze the LNG gas, load it on ships and then ship it. LNG gas is more expensive than Russian gas and this is where the sanctions may be inspired.

This trade war disguised as sanctions will have a continued effect of fueling not merely Europe, but deflation. Russia must adapt itself to making decisions because of more competitors in the European. Russia must adjust to a price competition while defending the market position. The second alternative is that Russia is throttling its gas production in order to drive prices up. Yet that will open the door to American competition. So welcome to the trade war disguised as sanctions for helping Trump with something our computer projected would happen back in 1985.

Categories: Energy, Russia
Aug 9 2017

North Korea – Beware August 2017


Armstrong Economic Blog/War

Re-Posted Aug 9, 2017 by Martin Armstrong

I have warned in the Cycle of War reports that for whatever reason, August is always the number one period where war tends to begin. Indeed, the world is holding its breath as fears rise with the crisis over North Korea potentially escalating in to global war after Donald Trump and Kim Jong-un made threats to trade missile strikes. The two key dates on our war model with North Korea to watch are August 12/13, 2017 and September 11/12, 2017. We must be on guard for these are the prime periods where a confrontation could emerge.

Pyongyang’s volatile dictator Kim Jong-un has warned he was ‘carefully examining‘ plans to make ‘an enveloping fire’ around the US island of Guam which is home to about 163,000 people and an important American military base. He made these comments following Donald Trump’s apocalyptic warning that North Korea faces ‘fire and fury like the world has never seen‘ over its nuclear program.

The US then released images of supersonic bombers flying over the Korean peninsula.Then Kim Jong-un said the training mission ‘proves that the U.S. imperialists are nuclear war maniacs‘. Kim, loves to boast that his intercontinental rockets can reach the west coast of America declaring that the US would ‘pay dearly‘ for UN sanctions it successfully imposed with the support for the first time of China and Russia.  In fact, Trump has managed to do what no president has done before – get the cooperation of both China and Russia. Nixon opened the door to China as a counter-measure against Russia – the old divide and conquer tactic. But Trump has pulled off a real politic coup globally despite CNN and Congress.

Beijing has joined Trump and staged ‘large-scale‘ military exercises with dozens of  warships, fighter jets and submarines adjacent to the Korean Peninsula on Monday. They have also moved 150,000 troops to its border with North Korea. Meanwhile, Russia moved military equipment including helicopters and combat vehicles to its southern frontier with North Korea. Putin has displayed its own massive military strength at a war games event in Siberia with a huge Navy Day parade in Vladivostok – about 100 miles from North Korean territory.

So why are these two dates coming up on our computer? The division of Korea between North and South Korea was the result of the allied victory in World War II in 1945, ending the Empire of Japan’s 35-year rule of Korea. The United States and the Soviet Union occupied the country, with the boundary between their zones of control along the 38th parallel. The United States supported the South, and the Soviet Union supported the North, and each government claimed sovereignty over the whole Korean peninsula. American troops occupy southern Korea, while the Soviet Union occupies the north, with the dividing line being the 38th parallel of latitude, which was established on September 8th, 1945 (1945,68). This arrangement proves to be the indirect beginning of a divided Korea which will lead to the Korean War in 1950.

The Korean War (1950–1953) left the two Koreas separated by the Korean Demilitarized Zone (DMZ) in the later part of the Cold War and beyond. However, the collapse of the Soviet Union in 1991 deprived North Korea of its main source of economic aid. Without Soviet aid, North Korea’s economy went into an economic free-fall in 1992 pretty much in line with the Economic Confidence Model calculated from the birth of the 38th Parallel.

 

At our Hong Kong WEC I went through the markets are illustrated that August would be the key turning point. The computer need not comprehend the fundamentals. It interlaces everything globally to product the result for turning points. This is just a time we need to be on guard about market reactions. (see private Blog Post later today)

Aug 9 2017

The New Russian Conspiracy – Moving the North Pole to Freeze Europe


Armstrong Economics Blog/Nature

Re-Posted Aug 9, 2017 by Martin Armstrong

Believe it or not, the latest conspiracy brewing is that the Russians not only defeated Hillary, they have figured out how to shift the planet and weather and have manipulated the planet so that the North Pole is headed to London to freeze Europe so they will have to buy more gas, and they are creating a warmer climate in Siberia to exploit the natural resources there.

Well it is true that Europe is turning colder and government have invested so much into this Global Warming they cannot now admit that all this propaganda is just that – propaganda. And yes, Siberia is experiencing record warming. They are wearing bikinis in Siberia!

Obviously, the Russians have devised a way to shift the pole, reverse its direction in 2000, send it to Europe, and then made sure Hillary lost and Trump won the White House who knows what the Russians have so so that is why he is against the Global Warming propaganda since he too wants to sell gas to Europe as it freezes. They also wanted to see girls in bikinis in Siberia. That was also part of the conspiracy. Not sure where it ranked be it number one or number ten on the list of motives.

Great Conspiracy theory – those clever Russians. As long as Florida stays warm I’m OK with it a

Aug 9 2017

North Korea & Pushing the Button


Armstrong Economics Blog/War

Re-Posted Aug 9, 2017 by Martin Armstrong

The United States for the first time in a very long time, won a major victory in the United Nations.  The Security Counsel unanimously approved sanctions against North Korea. Typically, Russia and China have opposed to such sanctions in the past. This is demonstrating that the North Korean problem is serious. Despite all the doom and gloom about nuclear war, China and Russia have no interest in actually pushing the button.

Some think that winning the sanctions at the U.N. removes the possibility of some kind of US attack on North Korea in the near future.  This is wishful thinking for as always, the sanction will NEVER work. The whole idea is you punish the people and they will rise up and overthrow the government. That failed with Russia and all sanctions have ever done is stiffen the opposition. If any such political leader yielded because of sanctions, he would be seen as ineffective and weak. That would open the door to them losing power. It is no different than the Democrats admitting that Obamacare raised the cost of healthcare for everyone. No matter what the issue, politicians will NEVER admit they made a mistake.

Aug 9 2017

AI – Beyond Complexity – 11 Dimensions within our Own Mind


Armstrong Economics Blog/AI Computers

Posted Aug 9, 2017 by Martin Armstrong

QUESTION:

Hi Martin,
First, thanks for this article (on Facebook shutting down AI). It is the first non-sensacionalist and serious post I read on this topic. Although, I found it somehow contradictory.  Your main statement is that all the history is cyclical. But in this post you say “Therefore, we can create a computer that remembers the past like a dog and projects into the future without actually conceptualizing what the future might truly mean as is the case with a dog.” Why this fact would make AI weaker? Isn’t it your future forecasting obtained from “the data from the past you collected”?
Thanks so much in advance,
Regards from Spain
F
ANSWER: The computer can determine the cycle from all the collective data interlaced from around the world. It can forecast turning points decades in advance. But that does not mean it comprehend what the future really is as to a human being. It may seem to be a subtle distinction, but it is the difference between a computer and a conscious being that also knows it has a shelf-life and will grow old and die. I am working hard to deliver Socrates because I have a shelf-life. It is the only way to allow such research to continue beyond my life-span. I do this for posterity for it has taught me so much. It will most likely only be recognized by mainstream after my death and then they will try to discredit it by crafting stories about me personally attacking the creator because they cannot dispute the research Socrates reveals. That is simply how human nature operates historically. Someone one day will quote this very line I just wrote. That is inevitable. Welcome to humanity.
The concept of the future is hard to express in words but I can say to you  let’s go to dinner next Tuesday. You can conceptualize the future and say yes or you will be busy can we make it Wednesday? That is a dynamic conception laced with many aspects in our mind. A dog has no concept of tomorrow. A computer can project turning points into the future from the past, but it does not have a concept of the future. It is very black and white void of emotion.

There is another hidden order of dynamic multi-dimensional structure we do not understand yet with the human mind. The formal link between neural network structure and how the brain actually functions in processing information does not truly exist and anyone claiming to have some neural net to predict the future is just nonsense. Those claiming to have created AI programs using a neural net to forecast markets is more-likely-than-not just a consumer fraud or simply another model destined to fail. We do not yet understand neural networks in our own brain so we cannot duplicate it in programming. On top of that, neuroscientists have used a classic branch of math in a totally new way to peer into the structure of our brains. What they’ve discovered is hard for us to even visualize that the brain is full of multi-dimensional geometrical structures operating in as many as 11 dimensions.

We live in a 3-D world perspective. We are not yet capable of understanding how there can be 11 dimensions all interacting. What is the structure? How does this even function? The results of this new study is the next frontier in trying to understand the fabric of the human brain which somehow is the machine used by our mind that is our consciousness The human brain, by the way, is the most complex structure we know of no less an amazing super-computer. And someone wants to claim they have an AI computer neural net to forecast markets? Good one. How can you create a neural net we do not yet understand to forecast something that is so complex, it defies description? If we do not yet understand how such a neural net functions in our own brain, how can you write as computer program to mimic such a neural net? How can some neural net suddenly evolve and become conscious if we do not even understand the structure at the core level?

This latest brain model was produced by a team of researchers from the Blue Brain Project, a Swiss research initiative devoted to building a supercomputer-powered reconstruction of the human brain. They used algebraic topology, a branch of mathematics used to describe the properties of objects and spaces regardless of how they change shape. They found that groups of neurons connect into ‘cliques’, and that the number of neurons in a clique would lead to its size as a high-dimensional geometric object (a mathematical dimensional concept, not a space-time one).

“We found a world that we had never imagined,” said the lead researcher, neuroscientist Henry Markram from the EPFL institute in Switzerland. “There are tens of millions of these objects even in a small speck of the brain, up through seven dimensions. In some networks, we even found structures with up to 11 dimensions.”

We live in three spatial dimensions plus one time dimension, which we have yet to fully understand as well. Here, the 11 dimensions are how the neuron cliques are connected. Networks are viewed in a structure in terms of groups of nodes that are all connected, which is known as cliques. The number of neurons in a clique determines its size or dimension. The human brain is estimated to have 86 billion neurons, which is a stunning number in itself. These then have multiple connections from each cell webbing in every possible direction. This structure forms a vast cellular network that somehow makes us capable of thought and consciousness that we do not understand.

The Blue Brain Project team focused on the neocortex, which is thought to be the most recently evolved part of our brains, and the one involved in some of our higher-order functions like cognition and sensory perception. Algebraic topology provides mathematical tools for discerning details of the neural network both in a close-up view at the level of individual neurons, and a grander scale of the brain structure as a whole. Connecting these two levels, the researchers could discern high-dimensional geometric structures in the brain, formed by collections of tightly connected neurons (cliques) and the empty spaces (cavities) between them.

What they discovered was amazing structural dynamic complexity, which is really what I discovered taking place with the interconnections globally within the world economy. “It is as if the brain reacts to a stimulus by building [and] then razing a tower of multi-dimensional blocks, starting with rods (1D), then planks (2D), then cubes (3D), and then more complex geometries with 4D, 5D, etc,” according to mathematician Ran Levi from Aberdeen University in Scotland.

What I find so fascinating is that the very same structure emerges at a higher level whereby all human interact globally in the same manner dynamically shifting and reorganizing structures. Socrates is now beyond 150,000 possible daily patterns in the Global Market Watch. This is just stunning. It is like building a sand castle on the beach creating an elaborate structure which is washing away by the sea in the morning. Both in our mind and within Socrates, we have human thought and action capable of creating dynamic structures to solve or react to some event and then vanish awaiting the next problem to rebuild a completely new structure. This multi-dimensional ability to respond to stimuli is just amazing.
How do we dream in concepts that are very imaginative abstracts of reality? We can imagine in a dream concepts and objects that could not exist in the real world. Such as this classic drawing of something that could not exist in reality. We know that the rear portion of our brain gets pretty active during REM sleep, when most dreaming occurs. Some believe that it’s just the brain winding down for the night and that dreams are random and meaningless firings of the brain that we don’t have when we’re awake. There is  simply no answer to the question: Why do we dream? I can personally attest to it is not random nor is it just meaningless firings of the brain that we don’t have when we’re awake. There have been complex problems I have thought about with no answer when awake. Yet it is “on my mind” still when I sleep. Suddenly I have woke up in the middle of the night saying “eureka” that’s the answer. This has happened way too many times to support a theory of meaningless randomness.

Take this picture of a girl in the water. Your mind will fill in the blanks as to what you think she looks like. Your mind will create an image that pleases you yet you have not seen her (her picture is at the bottom). Why does the mind fill in the gaps? To the right is another famous drawing. How old is the woman that you see? Is it the mother-in-law or the pretty girl. Which did your mind see first? The mother-in-law with the big nose looking down or the young girl wearing a necklace turned away?
Here is another famous drawing. What animal do you see? The duck with its beak slightly open or the rabbit with its ears pointing to the left? Our mind is capable of creating images from fragments.
To add to all this stunning complexity, we can access data we have stored in our brain for decades from all the five senses. You may hear a song and that will access some event in our past where you perhaps had dinner with someone you fell in love with at least temporarily. Then again, you may return to the place you had that event and suddenly remember that dinner. You might have had some food that night and suddenly you will remember that same event. We can access a memory from any of our senses for our brain is recording everything even if we do not realize it.
There is significant evidence demonstrating that we possess “core object recognition” which is the ability to rapidly recognize objects despite substantial appearance variation. Our brain will engage in reflexive feed-forward computations which will produce a powerful neuronal representation in the inferior temporal cortex. Precisely how our brain creates an algorithm that produces this solution remains a mystery. Nevertheless, we have evidence ranging from individual neurons that build into neuronal populations creating a behavior evolving into computational models. We seem to dynamically create computational models, each based on building blocks of small, canonical sub-networks with a common functional goal. Our sand castles that dissolve and then regroup to solve the next problem.
So sorry, I do not buy that consciousness will suddenly emerge and a computer will be endowed with an evil soul out to rule the world. In my opinion, the complexity is far too extensive for us to understand how our own mind works yet in order to build some neural network that will turn against us. My suggesting is that Elon Musk and crew should stop worrying about AI and start to try to comprehend what we are all about first.
Categories: AI Computers
Aug 8 2017

Mitch McConnell Complains President Trump Has “excessive expectations” of Republican Congress (video)…


Re-Posted from The conservative Tree House on August 8, 2017 by

During a Monday Rotary Club meeting in Kentucky senate Majority Leader Mitch McConnell took questions from audience members who asked McConnell to explain why Republican lawmakers have been unable to deliver major legislative accomplishments for the president.

Senator McConnell responded by saying President Trump’s expectations are too high.

“I’d ask for a show of hands, but I know everybody’s saying, ‘been there, haven’t done anything,’ which I find extremely irritating — and I’m going to tell you why. A Congress goes on for two years. Part of the reason I think that the storyline is that we haven’t done much is because, in part, the president and others have set these early timelines about things need to be done by a certain point.”

“Our new president, of course, has not been in this line of work before, and I think had excessive expectations about how quickly things happen in the Democratic process.”

Fortunately, this ridiculously elitist and arrogant establishment tone will likely not play well. This, along with a host of other ridiculous comments and realities could doom Luther Strange in the upcoming Alabama special election. Luther Strange is the loyal Decepticon favorite of Mitch McConnell and Karl Rove.  Mo Brooks and Roy Moore are more aligned with President Trump.

Aug 8 2017

Red Dragon Plays Panda: China States It Will Enforce U.N. Resolutions Against North Korea….


Re-Posted from The Conservative Tree House on August 7, 2017 by

We’ll see.  The red dragon has a tendency to say one thing publicly and manipulate another thing privately.  However, the baseline for China to take the role of Big Panda is the reception of Secretary Rex Tillerson’s “Four No” remarks on North Korea during his State Department briefing.

TILLERSON”S FOUR NO’S: The United States does not seek •regime change, •the collapse of the regime, •an accelerated reunification of the peninsula or •an excuse to send the U.S. military into North Korea.

So long as the ‘four-no’s’ remain visible and discussed in the international dialogue, the options for China are to comply or to be called out as a deceiving enabler.  The economic consequences for China to break the sanctions are looming and severely consequential.

BEIJING (Reuters) – China will pay the biggest price from the new United Nations sanctions against North Korea because of its close economic relationship with the country, but will always enforce the resolutions, Chinese Foreign Minister Wang Yi said.

The United Nations Security Council unanimously imposed new sanctions on North Korea on Saturday that could slash its $3 billion annual export revenue by a third.

Speaking at a regional security forum in Manila on Monday, Wang said the new resolution showed China and the international community’s opposition to North Korea’s continued missile tests, the foreign ministry said in a statement on Tuesday.

“Owing to China’s traditional economic ties with North Korea, it will mainly be China paying the price for implementing the resolution,” the statement cited Wang as saying.

“But in order to protect the international non-proliferation system and regional peace and stability, China will as before fully and strictly properly implement the entire contents of the relevant resolution.”

China has repeatedly said it is committed to enforcing increasingly tough U.N. resolutions on North Korea, though it has also said what it terms “normal” trade and ordinary North Koreans should not be affected.

The latest U.N. resolution bans North Korean exports of coal, iron, iron ore, lead, lead ore and seafood. It also prohibits countries from increasing the numbers of North Korean laborers currently working abroad, bans new joint ventures with North Korea and any new investment in current joint ventures.

Wang said that apart from the new sanctions, the resolution also made clear that the six party talks process, a stalled dialogue mechanism with North Korea that also includes Russia and Japan, should be restarted.

That was promise that all Security Council members made, including China, Russia and the United States, and which ought to be carried out, Wang added. (read more)

Aug 8 2017

California Voter Fraud – 11 Counties Posted Votes in Excess of their Population


Armstrong Economics Blog/Politics

Re-Posted Aug 8, 2017 by Martin Armstrong

Judicial Watch has filed a letter of intent that reflects a very serious problem in California voting. Eleven California counties posted more votes for Hillary than the population. We are looking at massive voter fraud in California that could serious rock the nation when we consider that if we eliminate California, Trump won the majority of the vote everywhere else. This is not about supporting Trump. That is long since done. This is about going forward. Can any election be trusted any more?

If we can buy goods online in a secure manner, we can also vote on line. Even those who do not have a computer posses usually a smart phone which can also be used to vote. For those people who do not have either, then they can go to the public library or town hall to vote. Voting online will eliminate voter fraud for you cannot vote without a Social Security card. Plain and simple.

Aug 8 2017

Obamacare is Officially Destroying the Economy & Has Reached 60% of total Retail Sales


Armstrong Economics Blog/Corruption

Re-Posted Aug 8, 2017 by Martin Armstrong

The retail sector has been stagnant and most people are blaming AMAZON. A closer look is really required rather than the typical superficial analysis. Today, online sales represent only 8.5% of total retail sales. Amazon comes in at $80 billion in sales, but this merely amounts to just 1.5% of total U.S. retail sales, since 2016 total retail sales were around $5.5 trillion. What John McCain did to kill the repeal of Obamacare is devastating to the economy. The Democrats refuse to review what they have done and cannot see past their ego that Obamacare is destroy the economy.

The health-care inflation is the greatest rising cost to everyone and the proliferation of high-deductible plans has devastated Millennials. Some are paying $300 a month yet have $3,000 deductibles. In effect, the cost of health-care has been one huge fraud that is enriching the insurance companies who are major contributors to the Democrats. Obamacare has drastically increased consumer direct health-care costs and further chipped away at discretionary dollars far more than AMAZON. Health-care spending in the U.S. is $3.3 trillion, and even a 3% rise in costs would be close to $100 billion. With total retail sales at $5.5 trillion, heath-care now consumes 60% of retail sales and it is retail sales that are the backbone of the US economy that is holding up the entire world economy. What John McCain has done is far worse than anyone in the media is even contemplating.

While politics just basks in the corruption and the Democrats will not review what they have done, from 2018 to 2021, the future is looking darker and darker. Heath-care is single-handedly destroying the entire world economy.

Aug 8 2017

Climate Change & How It Has Made Us Who We Are Today


Armstrong Economics Blog/Nature

Re-Posted Aug 8, 2017 by Martin Armstrong

All we ever hear is how Climate Change is caused by humans and it will destroy the world. They have been yelling that New Orleans and Miami will be UNDER WATER within the next century as rising sea levels put more than 400 US cities ‘past the point of no return’ unless we suddenly raise taxes and hand the power to government to change the climate.  In Princeton, New Jersey, the actual construction of the Harvey S. Firestone Memorial Library was set in motion at the University. Excavation begun January 2, 1946, and the building opened for use on September 7, 1949. This was where I conducted my research that produced the Economic Confidence Model.

The excavation for the underground floors of Firestone was difficult. In the spring of 1946, a group of Princeton geologists found fossils from fish of the late Triassic Age in a section of shale. The fossils, which had been buried there for 175 million years, were amazingly well-preserved and revealed new details about the prehistoric fish. This site proved one of the richest grounds for finding Triassic fish fossils in the world. The fossils were sent to museums. Clearly, most of New Jersey was under water before. The Global Warming crowd make it seem that we are responsible for everything – not nature.

An interesting book Climate Change in Prehistory: The End of the Reign of Chaos, is documenting how humankind dealt with the extreme challenges of the last Ice Age and climate change the Global Warming people ignore. Climate Change has affected the evolution of humankind and is responsible for spreading humanity across the globe. Our genetic history in the context of climate change during prehistory, reveals another dimension to the argument. The origin of many features of our modern world are identified and presented in this work which reviews the aspects of our physiology and intellectual development that have been influenced by climatic factors. Climate Change has impacted our diet, language and the domestication of animals thereby changing our lives. Modern humanity is a product of the Climate Change. Climate Change in Prehistory brings together studies of the climate with anthropological, archaeological and historical studies to paint the full picture.