The Democrats under Biden seem to believe that America and its government are so powerful that anything that they think and say must be the truth, and that any who disagree are wrong and must be cancelled. To fair there is a lot of disinformation and misinformation out there, but head space is a legally guaranteed free market in the USA. It occurred to me the other day that maybe part of the reason that vaccines prior to COVID have much lower adverse reaction rates is precisely because they weren’t mandated. There was no captive market and so a better product had to be made. It’s the same with ideas. If you shut down the free market of ideas, you get lower quality ideas. I suspect that is what has happened to the Democrats.
Zero has collected good links on this:
https://www.zerohedge.com/energy/russia-allows-chinese-banks-buy-oil-without-letters-credit-bypass-western-sanctions
https://www.zerohedge.com/geopolitical/india-mulling-rupee-ruble-payments-system-trade-russia
https://www.zerohedge.com/markets/biggest-commodity-trading-houses-west-continue-buy-russian-oil-and-gas
There are many ways the big players, India, Russia and China, can find to settle their transactions. Throw in most of central Asia and Iran. All have all been big gold accumulators. They may find ways to settle in gold without using London banks. They are looking at settling in each others’ currencies. I think it is conceivable that they could set up their own USD trading system so they can deploy their USD reserves. It could be bags of cash, local bank USD notes, or even something like Tethers. These guys together are huge. They need one anothers’ stuff, so they will find a way. The USA needs their stuff, particularly from China so they won’t be able to cut China out of SWIFT. And therein lies the stupidity of Biden’s move: it will be both ineffective and self-damaging. All the Chinese had to do was wait. I’m sure there’s a good Sun Tzu quote about that.
What are the consequences for Australia? Probably not much while commodity prices are soaring. The AUD may rise against the USD, but I wouldn’t trade it unless there was a firm break above 0.74. If we keep pulling in Indians and Chinese, you can expect our banks to participate in whatever new payment systems get set up. Union Pay is already pretty widely used here.
For trading, more gold price rises looks likely. I think the oil price will fall as the middle east ramps up production. They have no reason to add to electric vehicle incentives. The Chinese will buy as much Russian oil as they can get. Cross border oil volumes will increase which will feed through to less demand on the seaborne market hence lower prices everywhere. Crypto may benefit too particularly if there’s a deliberate loosening by the big Asian players, but I reckon that’d be a last resort if they can’t make a proper deal. They are the ones who’ve been toughest on crypto in the last few years. However, its already in use by the Russians in greater volumes that at first thought. I remain surprised how mute the impact has been on the BTC price. I note Monero is up 10% in the last week as I write.
Hopefully you have some ideas and links too.
So the world media is afraid that Russia will use bioweapons that were created in Ukraine. What a fucking joke.
https://www.news.com.au/world/europe/ukraine-russia-conflict-live-updates/news-story/62524dd6a2f2697f084aab61ac3e12f4
Remind yourself to avoid news.com.au in future?
That would be easier but I would then be unaware of their lies. These lies could be used as justification to send our young off to war so we need to be able to identify it.
Two interesting links I came across this weekend.
Firstly as I speculated last week, if the sanctions were too punitive then it might temp Russia to allow their citizens and corporations to ignore international patient laws and other intellectual property.
This has now come to pass, with Russia approving the use of IP from hostile nations:
https://www.washingtonpost.com/business/2022/03/09/russia-allows-patent-theft/
As I’ve pointed out before, another way to look at extreme sanctions is as a form of extreme protectionism – they both have the effect of stimulating internal manufacturing to replace the lost supply.
Russia has a closed economy of around 120m or closer to 170m if you now include the Ukraine and close to 200m if you also include Belarus. With a highly educated workforce, and complete self sufficiency in terms of oil, food and other natural resources, Russia is theoretically well placed to withstand the sanctions.
On the other hand I read an interesting thread on the structure and layers of corruption within the Russian economy:
https://twitter.com/kamilkazani/status/1501360272442896388
I recommend reading the thread, as it was one of the more interesting ones I came across over the weekend, however the TLDR summary would be that Russian Oligarchs are dominated by 3 categories;
i) The Putin Mafia (generally incompetent);
ii) The 1990’s Oligarchs (semi-competent); and
iii) The Nerds, like Anatoly Skurov, who are very competent.
If Russia is to overcome the sanctions, then the Oligarchs that Russia will have the most need of are the Nerds, however, in Russia those guys have the least political influence.
If the solution to Russia’s supply shortages are handed to the Oligarchs that make up the Putin Mafia, then the sanctions are most likely to be an utter disaster to the Russians.
Yet if the solution to Russia’s supply shortages are handed to the Nerds, than that will weaken Putin’s power base and increase the likelihood of long term political change.
I’m glad the Russians removed all patent protection. These corporate cunts think they own the world.
Yeah – the US has been among the worst at allowing patient evergreening and preserving the intellectual property of what would otherwise become our commonly owned cultural heritage.
But then that is the goal with all our social settings, turning every aspect of our society and social capital, into wealthy businessmen’s rental income.
Love the doublespeak! Russia’s patent theft, but US freezing or sanctioning bank accounts of a number of nations!
On the twitter feed, first let’s see who Kamil Galeev is – need to understand any motivations or interests behind the information that is presented, and any angles of the presentation of this information. Galeev works for Woodrow Wilson Center: https://en.wikipedia.org/wiki/Woodrow_Wilson_International_Center_for_Scholars
It is a US-oriented think tank, that has Anthony Blinken, current Secretary of State, as one of its public members.
Galeev himself is closely associated with Russian opposition: He is an activist of political opposition, briefly incarcerated for participation in the 2020 protests. https://www.wilsoncenter.org/person/kamil-galeev
On the twitter feed itself, it was an entertaining read, but some of the things are presented in a very simplistic way. Yes, oil and gas are extractive industries, but they have a heavy reliance on metallurgical and machinery centres – the gas don’t pump itself, the pipes to pump it do not appear out of thin air, and the new locations for wells are not revealed by a divine intervention. There is a very close correlation between all three groups involved: the Putin mafia, the 1990s oligarchs, and the nerds. Galeev also conveniently leaves out the fourth part of the equation – agriculture – which is significant. As a matter of fact, if we compare countries by their largest export, Russia is not that different from US, Canada, or Australia (if you consider coal to be energy, like O&G)
https://www.visualcapitalist.com/mapped-top-export-in-every-country/
I think there is a more complex way that this needs to be looked at: O&G occupy an important part of Russian economy, because it has the highest profit margin, and they can be considered “price makers”, especially over the last 10 years. Yes, the price of hydrocarbons does fluctuate on the open market, but if it goes down, it affects all of the major producers, so they turn off the valve for a while, and the price goes back up.
Metallurgy is the next level of complexity, as they process their own ore to make product – be it rolled steel or similar. But the market there is more saturated, and the ability to control the price depends on other actors around the globe, even those that do not have a steady supply of its own ore – case in point Thyssen Krupp gigantic steel mill in Alabama, that ships ore from Brazil.
Machinery is another level of competition altogether. Russia has established itself as a world leader in some areas: rocket engines, military hardware, but can’t make a decent car to save its life.
Final point. To quote Galeev:
“Mafia is quite simple. It can’t administer something complicated without either destroying the production completely or evolving to something that wouldn’t be a mafia anymore. If they entered machinery production for example, they would either go bankrupt or stop being a mafia”
If Putin and his mafia are akin to Mexico’s avocado cartels, then they must be well on their way towards transforming into something else, given the last 20 years of Putin’s rule.
Collapsing the US dollar is the intentioned goal as I understand it. The “powers that be” have decided to move office – from USA to Israel as part of the next move on the grand chessboard.
AUD should have been getting close to parity with the USD the way commodities have moved but a lot of money has been moved into safe haven of the USD in recent weeks.
what’s funny is a lot of these sanctions against russia are more the west kicking itself in the teeth, or consolidating putin’s power even more. all the oligarch yacht seizures you keep hearing about all over europe? russians are celebrating it. the oligarchs being deprived of their wealth is christmas come early for putin, it’s removing the power of all of his rivals and enemies. i have no idea what the fck this stuff is supposed to be achieving lmao.
I am sure there are some interesting conversations in very private clubs in the collective west contemplating what would happen to them if they happen to fall out of favour with the political power. After all, UK had destroyed Chelsea for all intents and purposes! I have read somewhere that Abramovich under sanctions, cannot sell, the club has a 90-day window t obtain a license to continue playing, and cannot get it if is still owned by Abramovich. The club is also banned from selling tickets to its games.
What’s happened to all the recent content? Is someone deleting it or is it just my browser?
Not just you. Last month of posts are missing.
Looks like the technical gremlins are continuing.
in answer to someone’s (possibly Robert2013’s) earlier question about the level of service that might be expected for any given level of contributions – the answer seems to be that given the current level of contributions ($nothing) the service that can be expected is somewhere between profoundly shit and somewhat woeful. 😞