Category Blogger Martin Armstrong

Jul 30 2026

The Fed Holds While Inflation Refuses to Die


Posted originally on Jul 30, 2026 by Martin Armstrong |  

Fed_Chair_Kevin_Warsh

The Federal Reserve voted to leave its benchmark interest rate unchanged at 3.50% to 3.75%, marking the fifth consecutive meeting without a change. Yet the 9–3 vote exposed a widening division inside the central bank, as Beth Hammack, Neel Kashkari, and Lorie Logan wanted a 25-basis-point increase.

This is no longer the Federal Reserve debating whether to cut rates. The debate is shifting toward when it will be forced to raise them again. Chairman Kevin Warsh insists that the Fed remains committed to its 2% inflation objective. “There is no soft inflation target,” he told reporters. “There is no soft implicit target, not on this committee’s watch. There’s only a target, and it’s 2%.”

Reducing inflation to 2% does not restore prices to where they were before the inflation began. It simply means that the cost of living continues rising at a slower pace from an already elevated level. Food, insurance, housing, electricity, transportation, and healthcare do not magically become affordable again. The purchasing power that was destroyed is gone.

Warsh acknowledged that reality when he said, “We’ve begun a new chapter and we understand that the five-plus years of inflation above target cannot be cured in nine weeks, or by a single month of modest price decreases.” He added that the Fed “will not waver” in its pursuit of the 2% target. Fine. But the Federal Reserve still refuses to admit that interest rates cannot repair supply shortages, end wars, produce energy, or reverse reckless fiscal policy.

The Fed’s statement conceded that inflation remains elevated partly because of supply shocks, including higher energy prices. The war in the Middle East has increased the cost of fuel and food, while the AI and data-center boom is driving enormous demand for electricity, construction materials, land, cooling systems, computer equipment, and skilled labor. Raising interest rates will not produce another barrel of oil, rebuild a damaged shipping route, or add electricity to an overloaded power grid.

This is why the belief that the Federal Reserve controls inflation with a single interest-rate lever is nonsense. Rates respond to economic conditions, capital flows, confidence, and risk. They do not command the economy like some thermostat.

The official statement claimed that economic activity continues to expand at a “solid pace,” while job growth has kept pace with the workforce and unemployment has changed little. If the economy remains solid and inflation is still above target, then the argument for cutting rates has evaporated. Financial markets had priced roughly a one-in-three chance of a July increase, and Reuters reported that markets were approaching a near-certainty of a September hike if the Fed remained on hold this time.

Half of the Fed’s 18 policymakers projected at least one rate increase during 2026 at the June meeting. Six anticipated more than one. Only one expected a cut. That was an abrupt reversal from only months earlier, when the political and financial establishment was still promoting the fantasy of endless rate reductions.

The three dissents matter because Hammack, Kashkari, and Logan are not demanding an emergency increase of 100 basis points. They wanted a modest quarter-point move. Their dissent signals that the internal argument has already moved beyond whether inflation is a problem. The dispute is now over how long the Fed can wait before responding.

Warsh refused to provide the usual forward guidance, saying only that the committee would “not hesitate to act” when necessary. Nevertheless, less communication does not cure bad policy. Warsh has established five task forces to examine the Fed’s communications, economic data, balance sheet, inflation framework, and the relationship between productivity and employment. Washington loves task forces because they create the appearance of action while ensuring that nobody accepts responsibility for the policies that created the problem.

The Federal Reserve’s balance sheet remains around $6.7 trillion. Since January, the System Open Market Account has purchased nearly $250 billion in Treasury bills, including approximately $160 billion in reserve-management purchases and $90 billion in reinvestments from agency securities. Bank reserves have climbed to roughly $3.1 trillion. They call this reserve management rather than quantitative easing, but changing the label does not change the mechanics.

The Fed is trapped between inflation and the sovereign debt crisis. Higher rates increase the government’s cost of servicing the national debt as old obligations mature and must be refinanced. Lower rates risk weakening confidence, reviving inflation, and punishing those who still save money. There is no painless solution because decades of borrowing and monetary manipulation have eliminated every painless option.

President Trump again demanded lower interest rates and declared that the United States “should have the lowest rates in the world.” The United States cannot order global capital to accept artificially low yields while Washington runs enormous deficits, fights foreign wars, and issues mountains of new debt.

Japan spent decades suppressing interest rates, and that policy did not abolish economic reality. It distorted the bond market, weakened the currency, and made the government increasingly dependent on perpetual intervention. Forcing American rates below global market levels would eventually produce the same disease on a far greater scale.

Trump may want cheaper mortgages and lower government financing costs, but the president does not control international capital flows. If investors demand greater compensation for inflation, political risk, and endless Treasury issuance, long-term rates can rise even while the Fed cuts its short-term target. The bond market is larger than any president, central banker, or political party.

The Fed is also confronting inflation that originates outside its domestic models. War raises energy costs. Sanctions disrupt trade. Tariffs alter supply chains. AI investment is consuming capital and electricity on a massive scale. Government deficits continue pumping demand into an economy already straining against supply constraints. None of this can be solved by crushing the consumer with more expensive credit.

The old Phillips Curve theory that inflation can be defeated by increasing unemployment was always morally bankrupt. Policymakers deliberately try to weaken labor demand and financially squeeze ordinary people because they refuse to confront the fiscal and geopolitical policies responsible for the price increases. The family struggling to finance a car did not create the Middle East war, the federal deficit, or the power shortage, yet that family is expected to absorb the punishment.

Warsh is correct that the Fed cannot quietly redefine its target above 2% simply because reaching that goal has become inconvenient. Doing so would destroy what remains of the institution’s credibility. But credibility will not be restored through speeches. It will require acknowledging that the central bank cannot maintain price stability while Congress spends without restraint and Washington treats war as a permanent economic policy.

The July decision merely postponed the confrontation. If inflation continues running above target and energy prices climb, September becomes a live meeting for a hike. If the economy weakens sharply, the Fed will face demands to cut even while prices remain elevated. That is the road toward stagflation, where the central bank is attacked regardless of which direction it moves.

The Fed held rates steady because it is caught, not because it has solved anything. Inflation remains above target, three policymakers demanded tighter policy, the federal debt continues compounding, and geopolitical pressure is feeding directly into consumer prices. Washington created a system dependent upon cheap money and endless borrowing, but the market is beginning to demand the bill.

Jul 29 2026

The Student Loan Crisis Is Exploding


Posted originally on Jul 29, 2026 by Martin Armstrong |  

Student Loans

Student loan defaults have surged to 9.2 million borrowers, representing roughly one in every five people with student debt. What is astonishing is the speed of the deterioration. There were approximately 6 million borrowers in default last August. That figure jumped to 7.7 million by December. By April it had reached 9.2 million. Another 3 million borrowers are reportedly at least 90 days delinquent and appear headed in the same direction.

The government suspended reality for years through payment pauses, forbearance programs, and emergency measures that temporarily masked the problem. Now collections have resumed. Wage garnishment is returning and borrowers are once again being confronted with debts that never disappeared. Politicians celebrated the pause as though the crisis had been solved. All they really did was postpone the reckoning.

What nobody wants to admit is that the student loan system became fundamentally broken the moment the federal government guaranteed virtually unlimited lending. Once colleges realized that students could borrow almost any amount with government backing, tuition exploded. Universities had no incentive to control costs. They built lavish facilities, expanded administrations, hired armies of bureaucrats, and continuously raised tuition. Students were told that any debt was acceptable because a degree would guarantee future prosperity. The numbers tell a different story.

Tuition costs have risen by hundreds of percentage points over the past several decades, vastly outpacing inflation and wage growth. Yet many graduates entered labor markets where earnings never remotely matched the debt burden they accumulated. Entire generations were encouraged to believe that college was the only path to success. Many emerged with degrees carrying little market value but very real financial obligations.

Borrowers are returning to repayment obligations while facing some of the highest living costs in decades. Housing costs remain elevated. Insurance premiums continue rising. Food prices have increased substantially. Many young Americans are already delaying homeownership, marriage, and family formation. Now millions face renewed collection efforts and potential wage garnishment on top of those challenges. The economic pressure is becoming overwhelming.

Bill Clinton

The roots of this disaster go back decades to the Clinton Administration. In 1998, Congress made federally guaranteed student loans virtually impossible to discharge in bankruptcy, and in 2005 that protection was extended to most private student loans as well except under the nearly impossible “undue hardship” standard. At the same time, Washington dismantled the old restraints that once separated commercial banking from investment banking by repealing Glass-Steagall through the Gramm-Leach-Bliley Act, signed by Bill Clinton in 1999. Wall Street suddenly had access to an endless stream of federally protected student debt that could be packaged, securitized, and sold to investors while taxpayers ultimately carried much of the risk. This was no longer simply about helping students attend college. Education had become another financial product. Banks could lend aggressively because the debt was uniquely protected, universities could raise tuition knowing the money would always be available, and students were left holding obligations they could rarely escape even through bankruptcy. Washington socialized the risk while privatizing the profits, creating precisely the type of moral hazard that has repeatedly produced financial crises throughout history.

From a broader perspective, this is another symptom of the debt-based model that has infected virtually every aspect of society. Governments encouraged borrowing to finance education, homes, consumption, and economic growth. Debt became the solution to every problem. Eventually the bills come due. Student loans are particularly dangerous because they directly impact younger generations who are supposed to form households, buy homes, start businesses, and drive future economic growth. Instead, many are trapped servicing debts accumulated years earlier.

This is why I continue to stress that confidence is the real issue. The student loan crisis is not merely about missed payments. It reflects a growing realization that many of the promises made to younger generations were never realistic. They were told education guaranteed prosperity. They were told debt was an investment. They were told the economy would provide opportunities sufficient to justify the cost. Millions are now discovering otherwise. That loss of confidence has consequences far beyond student loans. It affects housing, family formation, consumer spending, and ultimately the broader economy itself.

Note: Armstrong stopped allowing “some” of his videos to be copied. You can see them if you go to his blog.

Jul 29 2026

Garbage Trucks Surveillance Florida Neighborhoods


Posted Jul 29, 2026 by Martin Armstrong |  
More Perfect Union | Cape Coral is planning to roll out AI-powered cameras on garbage trucks in order to surveil neighborhoods and homes for "bad roofs and... | Instagram

Governments never seize freedom all at once. They chip away at it piece by piece, each new program marketed as a way to save taxpayers money or improve efficiency. The latest example comes from Cape Coral, Florida, where city officials are considering equipping sanitation trucks with AI-powered cameras to scan neighborhoods for potential code violations as they make their normal garbage collection routes. Officials insist the technology is simply another tool that could reduce costs and help the city’s 31 code enforcement officers identify violations more efficiently. That is always how surveillance begins, with promises of convenience rather than control.

The city manager argued that artificial intelligence could perform the same work as additional code officers while saving taxpayer dollars. Residents, however, immediately raised the questions governments rarely answer. Who controls the data? How long is it stored? Who has access to it? Could it later be used for purposes never originally disclosed? Those are legitimate concerns because history demonstrates that once governments collect information, they rarely surrender the ability to collect even more. Every database eventually finds a new purpose.

I have warned repeatedly that society is drifting toward a surveillance state where governments monitor virtually every aspect of daily life. License plate readers were introduced to catch criminals. Smart utility meters were sold as a way to improve energy efficiency. CCTV cameras appeared for public safety. Smartphones track our movements, financial transactions leave permanent digital records, and now artificial intelligence is being proposed to examine residential neighborhoods automatically. Every individual system may appear harmless in isolation. Combined together, they create a government that knows where you travel, what you purchase, where you live, and now potentially the condition of your property every single week.

Cities move closer to putting cameras on garbage trucks.

This is the same progression we have watched unfold across the world. Artificial intelligence is no longer confined to helping businesses improve productivity. Governments increasingly see it as a force multiplier that allows fewer employees to monitor far more citizens. Bureaucracies always seek greater efficiency, but efficiency without limits inevitably comes at the expense of liberty. Once an AI system is installed on every sanitation truck, what prevents the next software update from identifying unregistered vehicles, unauthorized construction, political signs, or anything else officials decide they want to monitor? Every man, woman, and child will be tracked in real-time, as governments eagerly watch for a misstep.

The greatest danger is not the camera itself. It is the normalization of constant observation. Children growing up under these systems will eventually believe it is perfectly ordinary for government cameras to document neighborhoods every day. Future generations may never question whether privacy was once considered a fundamental right rather than an obstacle to administrative efficiency. Governments rarely surrender powers voluntarily. Every emergency, every budget crisis, and every technological advancement becomes another justification for expanding their reach.

This proposal may save Cape Coral some money in the short term. That is not the question citizens should be asking. The real question is what kind of society we are building. Throughout history, governments have consistently expanded surveillance first and established meaningful safeguards later, if ever. Technology itself is neither good nor evil. The danger lies in believing that governments, once given new powers to observe their citizens, will somehow choose not to use them. History says otherwise.

Jul 29 2026

The Dark Side of Washington – Money Before Country


 

Posted Posted originally on CTH on Jul 29, 2026 by Martin Armstrong |  

I cannot express how dirty things have gotten in DC over the years. The Biden/Hunter Ukraine scam was blocked from investigation when Ukraine is known as the MOST corrupt nation-state in the world.

Ukraine Corruption PaNDORA pAPERS

Ukraine remains the most corrupt government in the world, and they are selling the Ukrainian people for personal wealth and greed with ZERO remorse for their nation or their people. Ukrainian politicians topped all other countries for corruption. Even in the Pandora Papers, 38 Ukrainian politicians have to hide cash offshore – the largest number of corrupt politicians in any other country.  Zelenskyy’s office tried to justify his use of offshore companies for himself as protecting him against pro-Russian forces, following leaked revelations in the Pandora Papers.

Huma Abedin Weiner

Hillary Clinton‘s own right-hand woman, Human Abedin and alleged lover, had revealed under oath in a deposition that the would-be president refused others access to her emails and lied to congress about Benghazi. That I had heared from sources that the Benghazi incident was a Neocon operation filtering in arms to overthrow both Libya and Syria.

Stevens Christopher Abassador

The region has been flooded with weapons supplied to rebels initially in Libya that have flowed to Syria, Mali, and even back to the streets in the USA. Nothing but nothing is what it appears. There is way too much bullshit for we are far beyond a shovel – we now need full blown mining equipment to get to the truth about anything.

Stevens Christopher Abassador Tortured

John Christopher Stevens (1960–September 12, 2012) was the American diplomat and lawyer who served as the U.S. Ambassador to Libya from June 2012 until his murder on September 12, 2012. The entire Benghazi incident is far deeper than most people would ever dream. True, the Obama administration is covering up the incident as 22 CIA agents were present at the time.

One source has reported that the CIA has been subjecting operatives working in Libya to frequent polygraph tests to make sure they are not leaking information about Benghazi. Why? What is lurking in the shadows? The real reasons why and the connection to Syria today are discussed behind-the-curtain – not in the open.

Clinton’s long-time aide and rumored lover said in a shocking deposition that the presidential candidate never asked permission to use her private email for government business. Another major revelation from the testimony transcript, released on Wednesday, was that Clinton demanded that the private emails she mixed with State Department emails not be accessible to “anybody,” AP reported. Abedin testified that she did not know if Clinton had personally deleted emails while secretary of state, but said she assumed it was acceptable to use an email on Clinton’s server for government business.

Hillary refused to answer any questions about this Neocon operation that led to the Benghazi incident. The entire Russia Gate affair was where Hillary blamed Putin claiming he interfered in the 2016 election, which was also a fraud. Hillary stated that Russian President Vladimir Putin directed the cyberattacks because he had a “personal beef” with her. She claimed this grudge back to 2011 when, as Secretary of State, she publicly criticized Russia’s parliamentary elections as fraudulent. She framed this personal vendetta as part of a larger Russian strategy to undermine American democracy and the integrity of the U.S. electoral system.

But the real reson was the Neocon attempt to rig the Russian election of 2000 by blackmailing President Yeltsin in their attempt to take over Russia installing their favorite son, the oligarch Boris Berezovsky. I was asked to put in $10 billion into Hermitage Capital Management operated by Edmond Safra and Bill Browder and I would get $100 billion back because installing Berezovsky, all Russian commodities would then trade through the NY dealing desk. I refused. Yeltsin turned to Putin installed him and his last words to Putin were “protect Russia.”

The Ukraine war has been instigated by the Neocons in their endless hatred of Russians. Hillary was fined over the fake Steele dossier, which was a key part of the “Russiagate” allegations to influence the 2016 election against Trump. Hillary Clinton’s 2016 presidential campaign was fined by the Federal Election Commission (FEC) for a mere $8,000, which was a joke. It is worth noting that the $8,000 fine represents a “double standard” compared to other cases involving falsified business records or election-related actions, pointing out that the purpose of the dossier was to influence the 2016 election. This perspective frames the action as a form of election interference that would be criminal for anyone else.

Arthur Andersen was criminally charged and initially convicted for its role in the Enron scandal, although the conviction was later overturned by the U.S. Supreme Court. Nevertheless, in March 2002, Arthur Andersen was indicted by a federal grand jury on a single count of obstruction of justice claiming they destroyed documents the same as Hillary did with her emails, which showed all of these Neocon operations. The law is applied to us, but never to those in power.

War-Destabilizing-Middle-East

Hillary was alleged to be behind the US/Neocon funded attempt to conquer the Middle East. The very rebels and the whole Benghazi Affair was a Neocon operation to overthrow Syria, Libya, and Iraq with the long-term goal of conquering seven (7)  Middle East countries. Even General Wesley Clark was told the same plans I was told years before.

V

General Clark directly blamed this strategy on the Neocon “policy coup” executed by prominent figures in the George W. Bush administration. He named Vice President Dick Cheney, Secretary of Defense Donald Rumsfeld, and Deputy Secretary of Defense Paul Wolfowitz as key architects.

In a 2007 speech and interviews, Clark detailed the list of countries, saying:

“We’re going to take out seven countries in five years, starting with Iraq, and then Syria, Lebanon, Libya, Somalia, Sudan and, finishing off, Iran.”

Cheney Dicj 1941 2025 weeks not months

Many have linked this alleged Neocon/Pentagon strategy to a 1996 policy paper called “A Clean Break,” written for the Israeli government by American Neocon. This paper advocated for the removal of Saddam Hussein and the containment of Syria and Iran. Sources had revealed to me that the assumption was that Iraq would fall in just weeks and they would then invade Iran and take out the Ayatollah.

Wolfowitz Doctrine

General Clark recounted that he also learned of this strategy during a visit to the Pentagon shortly after the 9/11 attacks. An officer there showed him a memo from the Office of the Secretary of Defense outlining the plan. Clark stated he did not read the memo because it was classified. He also connected this plan to a conversation he had with Paul Wolfowitz in 1991 after the Gulf War, where Wolfowitz argued that the United States could now use its military freely in the Middle East because the Soviet Union’s collapse meant “the Soviets won’t stop us“.

All we need to look at is the subsequent U.S. military actions in Iraq, Libya, and Somalia, as well as the destabilization in Syria and Lebanon, as evidence that this plan was at least partially executed. The Neocons, who control the press especially through the Institute for the Study of War which was founded by Victoria Nulan’s sister-in-law Kimberly Kagan . She serves as the organization’s president and is a prominent military historian. Each new intervention is claimed to have its own justification, but collectively they followed the path of what I was told and what General Clark described.

During an interview with CNN’s Wolf Blitzer appears to have protected the Neocons claiming it wasn’t a plan but more of a concept. Weather it was a strategy, crafted by influential Neocons, to use the post-9/11 environment to topple seven Middle Eastern governments, was simply convenient. I have stated definitively, that the first World Trade Center terrorists drew the Twin Towers on the wall of their cell in the Metropolitan Correctional Center (MCC) showing two planes flying into them. It was Mr. Kumb, the MCC recreation direction, who gave them the drawing materials and would openly talk about how they drew the Twin Towers on the wall of their cell. Of course, they scrubbed and reference to this because it confirmed that they knew the attack would take place.

Stewart Lynne Irene 1

The lawyer Lynne Stewart was prosecuted and convicted for handing notes and messages to a terrorist client. However, the specific charge was not simply “handing notes” to the terrorists, she was prosecuted for providing material support to a terrorist organization by acting as a conduit for messages from her client. She was sentenced to 10 years in prison and died in 2017.

Cheney Speech

Dick Cheney repeatedly emphasized an association between Saddam’s regime and al-Qaeda. For instance, he framed the success in Iraq as a blow to the “geographic base of the terrorists who have had us under assault for many years, but most especially on 9-11.” He deliberately pushed the fake news of Weapons of Mass Destruction  (WMD) soon after taking the position of Vice President Dick Cheney in 2001. He made that famous speech to start the war on August 26, 2002 at the Veterans of Foreign Wars (VFW) National Convention in Nashville, Tennessee. Well Russia, China, Israel, France, India, Pakistan, and North Korea have nukes. Why not invade them as well?

He cited unsubstantiated evidence to support this Neocon agenda. Cheney referenced an alleged meeting in Prague between lead 9/11 hijacker Mohammed Atta and an Iraqi intelligence officer, calling it “pretty well confirmed.” This claim was later discredited by the CIA and the 9/11 Commission, which found no evidence of collaboration between Saddam and al-Qaeda on attacks against the USA.

It was Cheny who used 9/11 to create a misleading impression for the justification of invading Iraq. Netanyahu was part of that agenda testifying before Congress that Iraq had a nuclear program with weapons of mass destruction. When asked about a poll showing nearly 70% of Americans believed Saddam was personally involved in 9/11, Cheney said, “It’s not surprising that people make that connection.” Cheney ruthlessly employed his rhetoric, combined with administration claims about al-Qaeda ties, to imply a connection to justify the war. This was the very agenda I was told about to secure the safety for Israel.

Powell Colin WMD at UN

Worse still, in February 2001, early in George W. Bush’s presidency, Secretary Colin Powell said in Cairo that Iraq had not developed “any significant capacity” in WMD and was unable to threaten its neighbors. This shows the administration’s public position evolved significantly after the 9/11 attacks. Colin Powell and Dick Cheney, developed a history of intense friction and disagreement between the two over the Iraq War. Cheney deliberately exploited Powell as someone whose credibility he used to sell a case to the UN to justify Cheney’s war to conquer the Middle East, and who later expressed deep regret over his role in that presentation.

Public statements made by Dick Cheney prior to the 2003 Iraq War indicate he asserted that Iraq possessed weapons of mass destruction. The Bush administration later was forced to acknowledge those assessments were incorrect.

Nuclear War

They are lying about the Ukraine War. They keep claiming Ukraine is winning and about to destroy Russia. Ukrainian official have eben come out and claimed that Moscow will fall. If Russia is on the edge and is about to collapse, they willo push the button. Every military source I have ever spoke to said that they would push the button if the USA was about to fall. They can be as corrupt as ever and look to line the pockets of their entire family, but have lost sight of what they are cheering for.

Note: Armstrong stopped allowing “some” of his videos to be copied. You can see them if you go to his blog.

Jul 28 2026

Canada’s Unique Energy Crisis


Posted originally on Jul 28, 2026 by Martin Armstrong |  

Refinery

QUESTION: Mr. Armstrong, thank you very much for that global overview of the energy market on your private blog. You’ve connected the dots in a way no one else seems to, just as you mentioned at your Tampa conference. I also appreciated your distinction between Eastern and Western Canada, could you elaborate on that a bit further?

And thank you again. My children’s eyes were truly opened by your insights.

FG

ANSWER: A refinery isn’t a one-size-fits-all machine. It is a complex industrial facility designed to process a specific type of crude oil efficiently. Hence, many refineries in Eastern Canada are configured to run on the lighter, sweeter crude oil typically imported from places like Saudi Arabia and Nigeria, rather than the heavier oil from Alberta’s oil sands or Texas. Therefore, refineries are designed for different grades of crude oil.

This introduces another dimension to the energy crisis. Also become of regulations in some provinces, pipelines have been blocked. Pipelines primarily move oil from Alberta to the U.S. and to British Columbia. There is no direct pipeline connection from Alberta to the Atlantic coast. Without this pipeline access, Eastern refineries rely on tankers for their crude supply. It has been simply more economical for them to import light crude from the Middle East that construct pipelines. Thus, Irving Oil’s large refinery in Saint John, New Brunswick, imports virtually all of its crude by tanker.

This energy crisis has another dimension whereas you simply cannot substitute crude oil that is heavy when the refinery can only handle light crude.

Categories:EnergyCanada

Jul 28 2026

The H-1B Visa Scam: Importing Cheap Labor While Americans Are Laid Off


Posted originally on Jul 28, 2026 by Martin Armstrong |  

H-1B Visas: What's new? What's next? Updates for 2021 - Goldstein & Associates

The H-1B visa program was sold to the American people as a narrow pathway for importing rare talent that supposedly could not be found in the United States. We were told these were the “best and brightest,” possessing exceptional skills needed to keep America competitive. That sales pitch has collapsed under the weight of fraud, corporate abuse, and government negligence.

Indian investigators seized nearly 100,000 counterfeit degree certificates and forged academic records linked to at least 28 universities. One institution allegedly issued more than 36,000 fraudulent degrees. Authorities are investigating whether some credentials were used to obtain jobs in medicine, nursing, engineering, and technology, including employment supported by H-1B visa applications.

The fraudulent packages allegedly included counterfeit university seals, fabricated transcripts, and forged certificates. Some degrees reportedly sold for as little as $1,400. The United States created a visa system that places enormous weight on educational credentials while often relying on foreign institutions and overwhelmed bureaucrats to authenticate those documents. Criminal organizations naturally recognized the weakness and industrialized the fraud.

Former U.S. Foreign Service officer Mahvash Siddiqui, an Indian-American who worked at the American consulate in Chennai between 2005 and 2007, described an extensive network of fraudulent documents and visa consultants. She estimated that 80% to 90% of the applicants she encountered across certain nonimmigrant visa categories were using the pipeline to enter the United States, obtain employment, and remain.

It is Siddiqui’s assessment based on the cases she personally encountered roughly two decades ago. It is not a current USCIS finding that 90% of all H-1B petitions are fraudulent. There is more than enough documented abuse to condemn the program without converting an eyewitness estimate into an official nationwide fraud rate.

The government’s own older compliance work was already disturbing. A 2008 USCIS assessment found fraud or technical violations in approximately 21% of the H-1B cases it examined. Among petitions involving workers with bachelor’s degrees, the violation rate was 31%. Computer-related occupations, which represented 42% of the sample, had a violation rate of 27%. That was not 90%, but one questionable case in five should have triggered an immediate overhaul.

The Department of Labor reportedly processed 6.9 million H-1B-related labor filings between 2015 and 2025. Around 70% involved workers from India and approximately 12% involved workers from China. A labor condition application is not the same as an approved visa, since one filing can cover multiple positions and not every certified position results in employment. Nevertheless, the volume reveals the scale of the pipeline corporations have constructed.

Indian nationals have accounted for more than 70% of approved H-1B beneficiaries consistently since 2019, up from around half during the early 2000s. There is nothing inherently wrong with hiring a qualified Indian engineer, physician, or scientist. The issue is whether employers are recruiting genuinely scarce specialists or using a government-created visa category to obtain workers who possess less bargaining power than Americans.

The statutory H-1B cap is 65,000 new visas annually, with another 20,000 positions reserved for applicants holding advanced American degrees. Universities and certain nonprofit research organizations are exempt from the cap. Renewals, extensions, and changes of employer also cause total annual approvals to greatly exceed the 85,000 headline limit. More than 400,000 petitions were reportedly approved in 2025 when continuing employment and other non-cap cases were included.

USCIS reported that 58% of approved H-1B beneficiaries in fiscal 2025 possessed a master’s degree as their highest qualification. The median compensation for approved beneficiaries was $120,000 in fiscal 2024. Defenders present these figures as proof that the system primarily admits elite workers.

Those aggregate numbers conceal how the program operates. An employee does not need to be a world-class innovator to qualify. The position generally needs to be classified as a “specialty occupation” requiring at least a bachelor’s degree or its equivalent. That definition includes thousands of ordinary corporate positions that Americans already perform.

The relevant question is not whether $120,000 sounds like a respectable salary. The question is whether an American with the same education, experience, and location would command more, and whether the foreign worker’s immigration status gives the employer leverage to suppress wages.

The Department of Labor admitted in March 2026 that existing prevailing-wage levels had “for too long” been set dramatically below the market rates received by many American workers, particularly recent graduates seeking entry-level STEM employment. The department proposed revising its wage methodology because the system had been distorted by employers using foreign labor to replace American workers at lower cost.

That is an extraordinary admission. The federal agency responsible for protecting wages acknowledged that the government’s own benchmarks enabled corporations to undercut Americans.

Employers are legally required to pay an H-1B worker the higher of the applicable prevailing wage or the actual wage paid to similarly qualified employees. Yet employers may select among several wage sources, rely on occupational classifications that do not accurately reflect the job, and assign positions to lower experience levels. A rule written to prevent wage suppression became a compliance exercise managed by lawyers and human-resources departments.

The program also ties the employee’s legal status to the sponsoring employer. This creates an imbalance that does not exist with an American worker. The visa holder may technically change employers, but the process carries legal, financial, and immigration risks. That worker is less likely to demand a raise, organize coworkers, report abusive conditions, or walk away from an unreasonable manager. Corporations are not merely importing labor. They are importing dependence.

The young American graduate cannot compete with that arrangement. He emerges from college carrying debt and is told that entry-level experience is required for an entry-level job. The company simultaneously claims it cannot locate qualified Americans and petitions the government for a worker whose ability to remain in the country depends upon keeping the sponsoring employer satisfied.

Representative Riley Moore cited an analysis of 2022 Census data finding that more than 11 million working-age Americans with STEM degrees were not employed in STEM occupations. Not all of those individuals are available, appropriately trained, or willing to relocate, but 11 million is incompatible with the blanket claim that America has exhausted its domestic supply of technical talent.

Corporations do not want to acknowledge a labor shortage of their own making. They want experienced workers at entry-level prices. They refuse to train American graduates, eliminate jobs during mass layoffs, and then insist that foreign recruitment is necessary because no suitable applicants exist.

This is especially offensive when a company dismisses thousands of American employees while simultaneously pursuing additional H-1B workers. If an employer is conducting mass layoffs in the same occupational categories, it should not be permitted to claim an immediate shortage of domestic labor without undergoing a serious investigation.

H-1B defenders always point to the genuine scientist, surgeon, or engineer performing advanced work. Those people exist, and America should welcome exceptional talent. But exceptional talent does not require a lottery dominated by outsourcing firms, ordinary corporate positions, questionable wage classifications, and document mills selling counterfeit degrees.

A legitimate high-skill program would prioritize compensation, experience, patents, advanced research, independently verified qualifications, and demonstrable scarcity. It would not select applicants randomly after allowing employers to define their own need. A wage-ranked system would immediately expose whether companies truly require rare talent or merely want cheaper labor.

Appeals court rejects Trump bid to halt $100,000 H-1B visa fee ruling | Reuters

Every academic credential submitted from abroad should be verified directly with the issuing institution and cross-checked against accredited databases. Employers using fraudulent applications should lose access to the program, face substantial financial penalties, and be required to compensate displaced workers. Visa brokers and staffing companies caught submitting forged records should face criminal prosecution rather than another administrative settlement.

Congress should prohibit companies conducting large domestic layoffs from obtaining new H-1B workers for comparable positions during a defined cooling-off period. Employers should also be required to disclose the number of Americans displaced, the wage offered to the foreign worker, the prevailing-wage source used, and the precise reason no American could perform the job.

The visa should be portable enough that the worker is not effectively bound to one corporation. That would prevent employers from using immigration dependency as a weapon while forcing them to compete honestly on wages and conditions.

This is not an attack on Indians or any other nationality. Foreign workers did not write the legislation, establish the wage levels, or order American corporations to eliminate domestic jobs. The responsibility belongs to politicians who created the loopholes, agencies that failed to verify applications, universities that produced questionable credentials, brokers who monetized fraud, and corporations that learned how to manipulate the system.

Legal immigration becomes indefensible when legality is treated as nothing more than a stamped form. If the supporting degree is fraudulent, the labor shortage is fabricated, or the prevailing wage is deliberately understated, the process is not legitimate simply because a bureaucracy approved it.

America does not need to close itself to exceptional talent. It needs to stop confusing exceptional talent with cheap, controllable labor. The H-1B program was supposed to fill genuine gaps in the American workforce. It has instead become a mechanism that too often allows corporations to avoid investing in Americans while the government provides the replacement worker and calls it innovation.

Jul 28 2026

New Jersey Bans Grocers From Building a Surveillance Economy


Posted originally on Jul 28, 2026 by Martin Armstrong |  

How do Digital price tag Work?

New Jersey has become one of the first states to draw a line against what may be one of the most disturbing developments in modern retail. Governor Mikie Sherrill signed the Fair Price Protection Act, banning grocery stores from using a shopper’s personal information to determine how much that individual should pay for the exact same product. The law also places a one-year freeze on installing new electronic shelf labels while the state studies whether the technology can facilitate individualized pricing. Retailers that violate the law can face lawsuits, refunds, permit suspensions, and fines reaching $20,000 for repeat violations.

Government is acknowledging that the technology exists to charge two people standing side by side different prices for the same loaf of bread simply because an algorithm has determined one of them is willing or forced to pay more. That is data exploitation masquerading as innovation.

The legislation targets what has become known as “surveillance pricing.” Companies collect information from loyalty programs, online searches, purchase histories, location data, and in some cases even biometric or genetic information, allowing artificial intelligence to estimate the highest price each consumer is likely to tolerate. The objective is no longer to determine what a product is worth. It is to determine what you are worth.

E-Paper Digital Price Tags & ESL Benefits | Pervasive Displays

This is precisely why I have warned that data has become the most valuable commodity in the world. Everyone is obsessed with artificial intelligence replacing workers. That was never the real issue. The real prize has always been the collection of information. Once corporations and governments know where you go, what you buy, what you search for, who you associate with, and how much money you make, pricing becomes individualized. Insurance becomes individualized. Credit becomes individualized. Taxes eventually become individualized. We are constructing an economy where every citizen receives a different reality based on an algorithm.

Notice how quickly digital shelf labels entered this discussion. Retailers insist they merely make price updates more efficient. That may be true today. But efficiency is not why legislators paused their expansion. They recognize that once every price tag becomes a networked computer, nothing prevents prices from changing every minute or second based upon demand, inventory, weather, neighborhood demographics, or even the profile of the person standing in front of the shelf. The infrastructure comes first. The software always follows.

What New Jersey has effectively admitted is something many dismissed as a conspiracy only a few years ago: technology has advanced to the point where companies can quietly charge different customers different prices without anyone realizing it. If lawmakers believed this capability did not exist, there would have been no reason to prohibit it.

This debate extends far beyond grocery stores. We already see artificial intelligence determining insurance premiums, mortgage approvals, hiring decisions, credit scores, and even apartment rents. Every new data point collected about your life becomes another variable that can be monetized. The distinction between marketing and surveillance has largely disappeared.

The larger concern is that once consumers become accustomed to individualized pricing, the same philosophy inevitably migrates elsewhere. Governments are racing toward digital identities, central bank digital currencies, biometric verification, and AI-driven public services.

People keep asking where all of this ends. It ends when prices are no longer determined by supply and demand but by who you are. The computer already knows where you shop, what you earn, what medications you take, how often you travel, and increasingly what you believe. Add digital currencies, biometric identification, and artificial intelligence together, and you no longer have a free market. You have a surveillance economy where every citizen lives under a different set of rules determined by an algorithm. That is a future no free society should ever accept.

Categories:USA Current Events

Jul 27 2026

Japan Is the First Domino in the Sovereign Debt Crisis


Posted originally on Jul 27, 2026 by Martin Armstrong |  

Japan_Debt_Crisis_2025 6 5 25

Japan recorded a 1.01 trillion yen ($6.2 billion) trade deficit during the first half of 2026, according to preliminary government data. This does not mean that Japan will collapse tomorrow, but it is another crack in the foundation of a debt structure that can no longer withstand rising interest rates, a collapsing currency, and imported inflation.

Japan’s exports increased 13.7% during the first six months of the year to 60.66 trillion yen. Imports rose 10.7% to around 61.9 trillion yen. Yet Japan still imported more than it exported despite a yen so weak that Japanese products should be extremely competitive abroad.

The June figures reveal exports rose 19.3% year-over-year, marking the tenth consecutive monthly increase. Imports, however, surged 25.4% to a record 11.3 trillion yen. That left Japan with a 406.9 billion yen deficit for June, more than three times the 120 billion yen shortfall economists had expected. Japan had recorded a 122 billion yen surplus during June 2025.

Japan depends heavily on imported energy. The conflict with Iran and disruptions around the Strait of Hormuz have raised the cost of oil while forcing Japan to seek supplies from more distant sources. Japan’s oil import volume actually declined 13.7% in June, but the value of those imports increased 59.3%. Japan bought less oil and paid far more for it.

That is the consequence of a weak currency colliding with an external energy shock. The yen has fallen beyond 163 to the dollar, its weakest level since 1986. It stood near 140 a year earlier. Every barrel of oil, shipment of natural gas, imported food product, and foreign industrial component becomes more expensive when priced in yen.

Japan: Japanese rates soar...

Japan accumulated the largest sovereign debt burden in the industrialized world while interest rates were held artificially near zero. Government debt exceeds 200% of GDP by virtually every major international estimate, while broader measurements place the burden above 230%. Politicians convinced themselves that the debt did not matter because Japanese institutions held most of it and the Bank of Japan could always purchase whatever the private market rejected.

The Bank of Japan held approximately 485.4 trillion yen in Japanese government bonds as of March 2026, representing 47.9% of outstanding JGBs under the government’s calculation. This is not a free market. The central bank became the market because the government could not have financed this mountain of debt at normal interest rates. That arrangement worked only while inflation remained subdued and the yen retained public confidence. Both conditions are now breaking down.

The Bank of Japan raised its policy rate to 1% in June, the highest level in 31 years. Under ordinary circumstances, raising rates would help support the currency and contain inflation. Japan is not operating under ordinary circumstances. Every increase in rates gradually raises the government’s cost of refinancing debt that was accumulated under zero-rate policies.

Japan’s fiscal 2026 budget totals a record 122.3 trillion yen. Debt-service expenditures, including interest and redemptions, have jumped 10.8% to 31.3 trillion yen. That means more than one-quarter of general government spending is already being consumed by past borrowing.

The Finance Ministry estimates that debt-service costs could reach 40.3 trillion yen by fiscal 2029, representing roughly 30% of total government expenditures. Annual bond issuance is projected to rise 28% from its 2026 level to around 38 trillion yen by that time. The government will be issuing additional debt primarily because servicing the existing debt is becoming more expensive.

That is the sovereign debt spiral. New bonds must be issued to pay the interest and redeem the old bonds. As rates rise, the government requires still more borrowing. As borrowing increases, investors demand higher yields to compensate for fiscal and currency risk. The process feeds upon itself.

Global debt is climbing. In many nations, countries' total debt compared to the size of their economy now exceeds their annual output. The 2026 Snapshot: Critical (200%+): Japan, Singapore High (100%-140%): USA,

Japan’s 10-year government bond yield reached approximately 2.74% on July 22, more than one percentage point above where it stood a year earlier. Japan constructed its fiscal system around rates close to zero. A yield of 2.74% may look insignificant to an American investor who remembers much higher Treasury yields, but that comparison is meaningless. The danger depends on the size of the debt relative to the government’s tax base, not simply the nominal interest rate.

The Bank of Japan is trapped. If it raises rates aggressively to defend the yen, it increases government debt-service costs and inflicts losses on banks, insurers, pension funds, and other institutions holding government bonds. If it keeps rates too low, capital continues to move away from the yen, the currency declines, and imported inflation accelerates. If it resumes massive bond purchases, it confirms that the debt cannot be financed naturally and further undermines confidence in the currency.

Tokyo has already spent an estimated $215 billion intervening in currency markets, yet the yen has still fallen to a 40-year low. Currency intervention cannot repair a structural fiscal imbalance. A government can buy its currency temporarily, but it cannot force global capital to trust policies that no longer make sense.

This is incredible: The Bank of Japan owns 52.0% of all domestic government bonds. : r/economy

Japan can no longer defend the currency without threatening the bond market, support the bond market without weakening the currency, subsidize energy without issuing more debt, or raise taxes without damaging an already strained population. Japan’s aging population makes the situation even worse. The tax base is shrinking while pension, medical, and social-service obligations increase. Social-security expenditures in the fiscal 2026 budget reached approximately 39.1 trillion yen. Debt service and social security together consume an enormous portion of government spending before politicians fund defense, infrastructure, education, energy subsidies, or anything else.

The $6.2 billion trade deficit is modest compared with Japan’s total economy, and by itself it is not a sovereign default signal. Anyone claiming that one trade report proves Japan is bankrupt is exaggerating. The importance of this report is that it shows the mechanism tightening: war raises energy prices, the weak yen magnifies those prices, imports overwhelm export growth, inflation pressures the Bank of Japan to raise rates, and higher rates increase the cost of servicing the world’s largest developed-market debt burden.

Japan is the first domino because it pushed modern monetary experimentation further than any other major economy. It normalized zero and negative interest rates, allowed its central bank to dominate the government bond market, and assumed domestic savings would finance public deficits forever. Europe and the United States followed the same path later, believing they could avoid Japan’s fate.

Fitch now projects that developed-market government debt will reach a record $75.8 trillion by the end of 2026, equal to 104% of global GDP. The ten largest developed economies will account for $69 trillion of that total. Japan may remain the most extreme example, but it is not an isolated case.

The Japanese trade deficit is another warning shot. The sovereign debt crisis will not necessarily begin with a formal announcement from the Ministry of Finance. It will begin through currency weakness, failed interventions, rising bond yields, imported inflation, captive domestic capital, and an increasing share of tax revenue diverted toward interest payments.

Japan is not merely experiencing a weak yen or a temporary energy problem. It is approaching the point where every available policy creates another crisis somewhere else. That is how confidence begins to fracture, and once confidence turns against government debt, no central bank can restore it by simply creating more money.

Note: Armstrong stopped allowing “some” of his videos to be copied. You can see them if you go to his blog.

Jul 27 2026

America’s Local Police Are Becoming Intelligence Agencies


Posted originally on Jul 27, 2026 by Martin Armstrong |  

One of the most revealing investigations this week did not come from Washington. It came from Forbes, which uncovered how an Israeli surveillance company is quietly marketing intelligence-grade technology directly to American police departments. The story is not about another patrol vehicle or upgraded communications equipment. It is about bringing tools originally developed for intelligence and national security operations onto the streets of the United States.

According to Forbes, Texas has purchased four specially equipped Chevrolet Tahoes from Israeli surveillance firm Cognyte in a deal worth roughly $4.5 million. Hidden inside these vehicles is a system known as FalcoNet that functions as a cellular interception platform. The technology imitates legitimate cellphone towers, causing nearby mobile phones to connect to the police vehicle instead of the carrier’s network. Once connected, investigators can identify devices, determine their locations, and gather other cellular information. Forbes also reports that the same technology can be carried in a backpack or mounted on helicopters, allowing surveillance to expand far beyond a single vehicle.

Texas police bought four surveillance-equipped Tahoes using technology from Israeli intelligence firm and Palantir rival Cognyte

Cognyte is not an ordinary technology company. It was spun off from Verint Systems and built much of its reputation supplying intelligence, counterterrorism, and surveillance capabilities to governments around the world. The company has longstanding roots in Israel’s security sector, where these technologies were developed for national security and intelligence collection. Today those same capabilities are being marketed to sheriffs’ departments, state police agencies, and local law enforcement across America. That should concern anyone who still believes there is a meaningful distinction between intelligence agencies and neighborhood policing.

There was a time when police investigated crimes after they occurred. Increasingly, departments are investing in systems designed to gather enormous quantities of information before anyone has been accused of committing anything. Cellphone interception systems, automated license plate readers, facial recognition software, artificial intelligence, drones, predictive policing algorithms, and massive databases are steadily becoming standard equipment.

Cognyte reeling after being dropped by Norway sovereign wealth fund | Ctech

This transformation has accelerated with remarkable speed. Only a few years ago many Americans had never heard of license plate readers. Today millions of vehicles are photographed and cataloged every day. Artificial intelligence is reviewing surveillance footage. Local governments are installing AI-powered cameras to monitor neighborhoods and code violations. Police departments increasingly rely upon drones instead of patrol officers. Every advance is sold as a way to improve efficiency, yet every advance also expands the government’s ability to collect information on people who have never been charged with a crime.

Technology developed overseas for counterterrorism is now becoming part of routine domestic policing. Whether one supports or opposes these tools is almost beside the point. The public deserves to understand exactly what is being purchased, where the technology originated, how the information is stored, who ultimately has access to it, and what limits actually exist once these systems become permanent fixtures inside law enforcement.

Supporters argue that criminals have become more sophisticated and that police must modernize to keep pace. Nobody disputes that law enforcement should have effective tools to investigate violent crime, terrorism, or organized criminal networks. The concern begins when extraordinary capabilities quietly migrate into ordinary policing. Once agencies invest millions of dollars in surveillance technology, there is constant institutional pressure to justify those expenditures by using the equipment more frequently and in a wider range of investigations.

The United States has spent years watching the line between military equipment and civilian policing gradually disappear. Armored vehicles once reserved for combat zones now appear in small-town police departments. Tactical equipment designed for battlefields has become routine. Intelligence software originally built for national security is now being sold to local governments. Surveillance platforms once reserved for counterterrorism are increasingly marketed as everyday policing tools. None of these developments occurred overnight. They arrived one contract at a time.

Imagine if these police vehicles came from a nation aside from Israel? Both China and the US have prohibited smart vehicles from entering one another’s military bases. A foreign government will now have the ability to compile more information on American civilians. Let us not forget that the Pentagon came out earlier this summer and admitted that Israel has been spying on the US, as all governments tend to do.

The broader trend should not be ignored. Governments facing rising debt, political polarization, economic uncertainty, and declining public trust almost always seek greater visibility into society rather than less. Modern technology makes that objective easier than at any point in history. A surveillance camera never calls in sick. Artificial intelligence never sleeps. Cellphone tracking can monitor thousands of devices simultaneously. The temptation to expand these systems inevitably grows as their capabilities improve.

Welcome to the surveillance state where your every move is tracked, not just by your own government, but by whoever has access to the technology.

Note: Armstrong stopped allowing “some” of his videos to be copied. You can see them if you go to his blog.

Jul 27 2026

The Random Walk Theory


Posted originally on Jul 27, 2026 by Martin Armstrong |  

Random Walk Theory bogus

The Random Walk Theory has probably done more damage to economics and finance than almost any other academic theory ever introduced. It gave governments, central banks, and universities an excuse to dismiss the study of market behavior altogether. According to this theory, markets move randomly and future price movements cannot be forecast because all available information is already reflected in current prices. If that were true, then every financial panic, every boom, every sovereign debt crisis, and every capital flow throughout history would simply be a coincidence. That has never been the real world.

The theory became popular because it was convenient. If markets are random, then nobody can consistently forecast anything. Every successful trader becomes “lucky,” every market crash is an accident, and every government failure is impossible to anticipate. That has been the foundation of modern academic economics for decades. Universities teach equilibrium models where human behavior supposedly follows rational assumptions, yet history demonstrates repeatedly that people behave emotionally, politically, and cyclically. Markets are driven by confidence, not equilibrium.

When I built the Economic Confidence Model and later developed Socrates, I was approaching markets from the opposite direction. Human behavior is not random. Capital moves according to confidence, fear, opportunity, and political risk. We have seen capital flee Europe into the United States during debt crises, rush into precious metals during geopolitical uncertainty, and abandon governments that lose credibility. These movements occur repeatedly because human nature has never changed. Technology evolves, governments come and go, but the emotional responses driving markets remain remarkably consistent throughout history.

People often confuse unpredictability with randomness. Those are not the same thing. We cannot predict every individual transaction any more than a meteorologist can predict the exact path of every raindrop. Yet we can identify larger cyclical trends because collective human behavior produces recurring patterns. The mistake made by the Random Walk Theory was assuming that because individual decisions vary, the aggregate outcome must also be random. History demonstrates precisely the opposite.

This is why I wrote my seminar book, “The Random Walk and Cycles.” I wanted people to understand why the academic establishment has consistently failed to anticipate the biggest turning points in history. They missed the 1987 crash. They missed the collapse of the Soviet Union. They missed the Asian Currency Crisis, the Dot-com Bubble, the 2008 Financial Crisis, the European sovereign debt crisis, and countless other events because their models begin with the false assumption that markets fluctuate around equilibrium. They ignore confidence, political change, and the cyclical nature of human society.

Cycles exist everywhere. They exist in economics, politics, war, weather, demographics, and even biological systems. The idea that financial markets alone should somehow be exempt from cyclical behavior has always been absurd. Our computer does not forecast because it possesses magical insight. It analyzes enormous amounts of historical data without political bias and identifies recurring patterns that repeat across generations. That is the very opposite of guessing.

The greatest danger of the Random Walk Theory is not that it is academically wrong. It is that it teaches people to stop looking for causes. If every market movement is random, then there is no reason to study history, capital flows, or the rise and fall of civilizations. That is precisely why governments and central banks continue to be blindsided by crises they insist were impossible to foresee. History is not random. Human behavior is not random. Confidence is not random. Once you understand that, you begin looking at the world through an entirely different lens.

Note: Armstrong stopped allowing “some” of his videos to be copied. You can see them if you go to his blog.