Economic News

Economic News

EU, NATO & Zelensky Plotting Against Trump

I am getting an increasing number of questions about how in the world our model forecasts war in advance and targets specific weeks like August 18th, 2025, a year in advance, and then Trump picks that Friday 15th for his peace conference with Putin in Alaska.  You NEVER make such a forecast using a single model. There is a battery of models, and in those arrays, there are 72 models. That top line we call the aggregate because that is the sum of all turning models that align for that target – it is NEVER just one. The computer is monitoring the entire world. You can see all the reports that Socrates is writing every day. There are not enough analysts in the world to cover so many instruments and statistics. On December 3rd, 2013, I formally posted that the tensions would erupt in Ukraine. Ukraine Maybe The Most Important Country To Watch Posted Dec 3, 2013 by Martin Armstrong “We will have the Cycle of War ready shortly updating this development as this cycle turns next year as well and we can see the rising tensions are brewing everywhere. Ukraine may become the focal point with Russia smelling the blood of a weak Europe and United States. This is like the barbarians smelling the weakness of Rome and knew it was time to strike. Russia is all about restoring its national honor. The USA has weakened itself like Rome by fiscal mismanagement.”   This is a model specificly between Russia and the United States. It starts with the 1962 target of the Cuban Missile Crisis set in motion by Nikita Khrushchev, who was overthrown on October 14, 1964, (1964.786) during a Politburo coup orchestrated by his political opponents, including Leonid Brezhnev and Alexei Kosygin, because of his reckless desire to spread communism to the world (We Will Bury You). That was 1.978 years from the Cuban Missile Crisis (721.97 days, 103.13 weeks, or about 24 months later). Here you can see this separate model targeted 2014.408, which was May 4th, 2014. This was the Odessa Genocide when Ukrainians killed Russians on the street and then burned them alive, and then ran into the Trade Union Building for shelter. This was what began the separation movement by the Russians in the Donbas because they were being hunted like animals, and the Western press had no problem with the resumption of Nazi Ethnic Cleansing because they were Russian. Neocons dominate the EU with personal hatred of Russians from generations before. They love to imprison people who just have words against migrants. Still, they have no problem advocating genocide of an entire ethnicity, following in the footsteps of Hitler all over again. May 2: Deadly clashes in Odessa between pro-Ukrainian and pro-Russian groups resulted in over 40 deaths, mainly in a building fire. May 11: Pro-Russian separatists held disputed independence referendums in the Donetsk and Luhansk regions. May 25: Presidential elections were held in Ukraine, with Petro Poroshenko winning decisively. Separatist-controlled areas largely boycotted or disrupted voting. Direct talks between Ukraine and Russia took place in Istanbul, Türkiye, on May 15, 2025, precisely on the turning point, marking the first potential face-to-face negotiations since 2022. However, there is conflicting information about whether the meeting occurred as planned. My sources informed me that both Russian and Ukrainian delegations were present in Istanbul, with the Russian delegation led by Vladimir Medinsky and the Ukrainian delegation headed by Defense Minister Rustem Umerov. The next major turning point is June 13th, 2026. We are now starting to see a Panic Cycle forming at this next Major Target of June 2026. Keep in mind that this ECM is NOT included in the arrays. The more separate models we have, the better the correlation, and we can then rely on these forecasts with more confidence. Russia also now occupies Kherson, Donetsk, Luhansk, and Zaporizhzhia, in the Eastern region, which Putin may ask for. So far, Ukraine’s leadership has opposed ceding any territory to Russia. Zelenskyy wrote on X, “Ukraine is not afraid of meetings and expects the same brave approach from the Russian side. It is time we ended the war.” The NY Post wrote: “European officials rejected Russian President Vladimir Putin’s calls that Ukraine give up territories annexed during the war — instead demanding Saturday an immediate ceasefire from Moscow and NATO membership for Kyiv.” This merely confirms my sources that warn the EU, NATO, and Zelensky want war and they are conspiring to create a false flag to invoke Article % to embarrass Trump into sending troops to Ukraine to annihilate Russia completely. They want to conquer Russia entirely, and they seek to steal all its wealth so that the EU, desperate to survive, will become the next Roman Empire, subordinating the United States once again to a mere colony. I do have contact with people close to Trump who I at least trust are NOT Neocons, which I cannot say for everyone surrounding him. Will they get Trump to listen? Probably not. The frustrating part is I tend to get called in when they F-up everything that I warned would take place, and then they expect me to be like Merlin the Sorcerer, wave my magic wand, and it’s all gone. If the EU had honored the peace deal that they signed and allowed the Donbas to vote and separate as took place in Chechoslovakia and Yugoslavia, which both split along ethnic lines, this war would NEVER have taken place. The EU has conspired from day one to sacrifice the Ukrainian people on the NEOCON altar of hatred for Russians who are no longer communists, and their hated leader, Stalin, was not even a Russian. He was from Georgia. It was all the cross-treaties that compelled nations to join World War I. NATO was established to result in the very same mistake that caused that war, and they are licking their lips, drooling over the thought of finally defeating and obliterating their enemy Russia, even though communism fell all by

Economic News

Marcus Vetter on War

A German INTERVIEW of Marcus Vetter on War If you look back today: What has become of Angela Merkel’s statement “We can do this”? Has this vision been fulfilled or has it fractured? Unfortunately, in my view, today this vision lies completely in ruins. It was the last stand of a truly humanistic approach, one that deeply divided Germany. Those who viewed the statement critically were often unfairly labeled as “right-wing” by those who applauded it. But a societal challenge of such magnitude can only be mastered together, because the truth, as always, lies somewhere in the middle. Both sides had a point, and should have approached the motto “We can do this” with much more prudence and solidarity. Today, we are faced with a social landscape in shambles. A large part of society supports an unprecedented rearmament of Europe. Those who warn against it are often silenced. War rhetoric is now coming from parties that once had a pacifist orientation. The world is upside down and hardly recognizable anymore. In your films you often talk about reconciliation, identity, and social change. What stories should be told today to rethink integration and social cohesion? We should tell the same kinds of stories. Stories that show the cycle of violence can be broken. On an individual level, people are still open to such stories and can still be moved by them. At the same time, they are influenced by seemingly convincing arguments – for example, that a Russian war of aggression can only be decided on the battlefield and that one can only respond to it with strength. Other opinions are no longer truly allowed in the media. In my view, this is fundamentally wrong. War itself is the greatest war crime, as Ben Ferencz – once the youngest prosecutor in the Nuremberg Trials – put it. And he was right. In war, there is no morality, no humanity. Truth is the first casualty of any war. Through propaganda slogans we are conditioned to believe that strength is the only answer, because otherwise the enemy will overrun us. When Hermann Göring was asked in Nuremberg how they had managed to unite all of Germany for a war of aggression, he said: “Of course, the people don’t want war… But… the people can always be driven to the bidding of the leaders. That’s easy. All you have to do is tell them they are being attacked and denounce the pacifists for lack of patriotism and for endangering the country. It works the same in every country.” It is very hard for me to endure the current developments. We are ready to take increasingly extreme positions. Some want to raze Gaza to the ground and root out evil entirely, others place all the blame solely on Israel and are just as extreme in their rhetoric. There are only a few left who are willing to build bridges. That is why I have re-edited a trilogy of films I shot in Palestine and Israel between 2008 and 2012, and expanded it with a fourth film about the International Criminal Court. This last one – WAR AND JUSTICE – is a profoundly pacifist film. When people see it, they are often willing to rethink their stance on war. https://www.war-and-justice.de THE HEART OF JENIN tells the story of Palestinian father Ismael Khatib from Jenin, whose son was killed by Israeli soldiers and who, despite his deep grief, decided to donate his son’s organs to Israeli children as a gesture of peace. CINEMA JENIN – THE STORY OF A DREAM tells how hundreds of volunteers from all over the world came to Jenin to join Ismael Khatib – from The Heart of Jenin – in restoring an old cinema that had been closed during the First Intifada. Cinema Jenin opened in the summer of 2011 and was operated as a cinema for 5 years before being demolished in December 2016 and replaced by a shopping mall. AFTER THE SILENCE tells the story of Israeli Yael Armanet, who lost her husband in a suicide bombing carried out by a Palestinian from Jenin. Inspired by Ismael Khatib’s gesture, she sets out to visit the family of the attacker in Jenin to find answers to what happened. The film was made possible and co-produced by the Palestinian cinema Cinema Jenin. https://marcus-vetter.com/product/trilogie-der-hoffnung

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“And you want to be my latex salesman?” (BLS edition)

I hear that Bannon is pushing Heritage Chief Economist EJ Antoni for BLS Commissioner. EJ Antoni: Source: Heritage Foundation, accessed 8/7/2025.  If he is nominated, I’ll just observe that he declared (with St. Onge) a recession starting in 2022 [1]. And another recession in starting in July or August 2024 –[2], [3]– without ever having declared the recession of 2022 ended. Taken literally, he believes we have been — and remain even today — in recession.   For the record: EJ Antoni/Heritage: “Back from the Brink: Trump’s Economy Soars Instead of Crashing” The Great Replacement “Theory” * Comes to Economics at Heritage                  

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Manufacturing on the Ropes?

Manufacturing employment, hours, capacity utilization down since March 2025 (pre-“Liberation Day”); manufacturing production (Fed index) flat since March. Figure 1: Manufacturing employment, all employees (brown), manufacturing aggregate hours (green), manufacturing production (blue), real value added in manufacturing (blue bars), all in logs,  2025M01=0; manufacturing capacity utilization (bold black line, right scale). Aggregate hours calculated by multiplying average weekly hours times employment of production and nonsupervisory workers. Source: BLS, Federal Reserve, BEA, and author’s calculations.  Notice that since we are indexing to 2025M01=0, the fact that it’s difficult to see the value added series over the last two quarters means that value added has been essentially flat over that period. These are all backwards looking indicators. The ISM manufacturing PMI – new orders component doesn’t look too promising. And all this is before the tariffs take full effect, and retaliation (aside from China). Source: ISM, accessed 8/7/2025.

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CalculatedRisk (Still) on Recession Watch

Bill McBride’s assessment here. In early April, I went on recession watch, but I’m still not yet predicting a recession for several reasons: the U.S. economy is very resilient and was on solid footing at the beginning of the year, and perhaps the tariffs are not enough to topple the economy. In the short term, it is mostly trade policy that will negatively impact the economy. However, there other aspects of policy that bear watching – especially immigration. Yesterday, Mark Zandi was stating his case for being wary: Moody’s Analytics chief economist Mark Zandi said the U.S. economy is “on the precipice of recession,” citing indicators from last week’s economic data releases. In a social media post Monday, Zandi pointed to stagnant consumer spending, contracting construction and manufacturing sectors and projected employment declines. Rising inflation makes it difficult for the Federal Reserve to provide economic stimulus, the economist said While unemployment remains low, Zandi attributed this to declining labor force growth rather than economic strength. “The foreign-born workforce is shrinking and labor force participation” is falling, he wrote. Here’s my picture of the state of the economy, with series not restricted to NBER BCDC’s key indicators, and substituting in final sales to private domestic purchasers for GDP: Figure 1: Nonfarm payroll employment (bold blue), personal income excluding current transfers (bold light green), civilian employment, experimental series with smoothed population controls (orange), industrial production (red), S&P Global monthly GDP (pink), and final sales to private domestic purchasers (teal bars), all in logs 2023M01=0.  Personal income, consumption, civilian employment, and monthly GDP are all below recent peaks. Industrial production is up, but nonfarm payroll employment is essentially flat over the last three months (33K/mo). NBER BCDC places highest emphasis on employment (presumably NFP) and personal income. Because the Sahm rule hasn’t been triggered and nonfarm payroll employment continues to rise, I — like CR — don’t think the downturn has arrived as of July (recalling we’re in August, and all the July numbers will be revised).  

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Even *More* Depressing Pictures from the Labor Market

You think the official BLS NFP series is worrying, consider the alternatives: Figure 1: BLS establishment nonfarm payroll (NFP) July series (bold blue), Jun series (light blue), Philadelphia Fed early benchmark (green), and experimental BLS household series adjusted to NFP concept, with smoothed population controls, centered 3 month moving average (tan), all in logs 2024M10=0. Source: BLS via FRED, BLS, Philadelphia Fed, and author’s calculations. Figure 2: BLS establishment private nonfarm payroll (NFP) July series (bold blue), June series (light blue), and ADP series (tan), all in logs 2024M10=0. Source: BLS, ADP via FRED, and author’s calculations. Finally, the household series: Figure 3: Experimental BLS household series, with smoothed population controls, (bold black), and centered 3 month moving average (tan), all in logs 2024M10=0. Source: BLS via FRED, and author’s calculations.

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How Are Wisconsin Exports, Manufacturing Doing under Trump Trade War 2.0?

Discussed the employment numbers on WPR this morning. One question came up, which inspired this post – how’s Wisconsin doing, tradewise, given the states’ trade/manufacturing dependence. Figure 1: 12 month trailing moving average of Wisconsin goods exports deflated by US goods export price index (red), imports deflated by US goods imports price index (blue), both in millions 2000$, monthly. Source: Census, BLS, via FRED, and author’s calculations. Real exports were declining even before the election, but showed a drop in in November, onward. Imports started dropping in March. Note that for a variety of reasons, the state level imports and exports are subject to some additional error (e.g., grain exports might be attributed to Louisiana rather than Wisconsin because that’s where they’re exported from; still, there’s little reason to believe the bias has changed since before “Liberation Day”. What about manufacturing? Figure 2: Wisconsin manufacturing employment,000’s (black line, left log scale), Wisconsin real manufacturing value added, mn Ch.2017$, SAAR (blue bars, right log scale). Source: BLS, BEA. We don’t have value added – the most comprehensive indicator – for the 2nd quarter, which would include post-“Liberation Day” data. However, growth seems to have tailed off. Manufacturing employment is now declining in June (preliminary). Since (3 month) changes in Wisconsin manufacturing employment are correlated with changes in US manufacturing employment with a coefficient of 0.91 (R2 of 0.48, 2022-2025), it’s likely that

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