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Macro Thoughts

Home Thoughts

Asked if he would back calls made by others for May to resign, Corbyn
told Sky News: "Indeed I would. Because there have been calls made by
a lot of very responsible people on this, who are very worried that
she was at the Home Office for all this time, presided over these cuts
in police numbers and now is saying that we have a problem.

"Yes we do have a problem, we should never have cut the police numbers."

Conclusions

Corbyn is getting traction on this issue.

The three attacks carried out by Islamist militants in Britain in the
last three months have been largely domestic plots and the majority of
the threat facing the country is not directed from overseas, London's
police chief said on Monday.

"All the recent attacks I think have a primarily domestic centre of
gravity," Metropolitan Police Commissioner Cressida Dick told BBC
radio.

"There are in the five that we have foiled and these three recent
attacks, in some of them there are undoubtedly international
dimensions. We will always be looking to see if anything has been
directed from overseas but I would say the majority of the threat that
we are facing at the moment does not appear to be directed from
overseas."

The arrival of the asymmetric threat on the streets of Paris was
deeply unsettling and will surely keep Europe off-balance and presages
a ‘new normal’.

But Khurum Shazad Butt was not the typical resident of the East London
neighborhood of Barking. He dressed in the religious gown of a
conservative Muslim — with a tracksuit and sneakers underneath. He
turned up in a Channel 4 documentary, “The Jihadis Next Door.” And now
London’s Metropolitan Police have identified him as one of the three
men who carried out the deadly terror attack on Saturday at London
Bridge and Borough Market.

There are more than seven billion of us now in this c21st world of
ours. The long tail in a population of seven billion is not an
insignificant absolute number.

‘’In statistics, a long tail of some distributions of numbers is the
portion of the distribution having a large number of occurrences far
from the “head” or central part of the distribution.’’

Put in a different way, there are surely many Brothers Tsarnaev in
this new c21st of ours. And whilst I appreciate Osama Bin Laden is
being nibbled by the fishes somewhere in the ocean, he basically
inspired the likes of the Brothers Tsarnaev, i.e those disaffected
with the c21st. In truth, that disaffection might have any number of
reasons and I am reminded of my French O level where I studied Albert
Camus’ L’Etranger and Camus said;

“The byronic hero, incapable of love, or capable only of an impossible
love, suffers endlessly. He is solitary, languid, his condition
exhausts him. If he wants to feel alive, it must be in the terrible
exaltation of a brief and destructive action*.”

Don’t get me wrong, I do not think of these folks as byronic, not by a
long shot.

And when they meet their Maker what will their Maker say?

Yemen, Libya's eastern-based government and the Maldives joined in later.

Qatar denounced the move as based on lies about it supporting
militants. It has often been accused of being a funding source for
Islamists, as has Saudi Arabia.

Iran, long at odds with Saudi Arabia and a behind-the-scenes target of
the move, blamed Trump's visit last month to Riyadh.

"What is happening is the preliminary result of the sword dance,"
Hamid Aboutalebi, deputy chief of staff of Iran's President Hassan
Rouhani, tweeted in reference to Trump's joining in a traditional
dance with the Saudi king at the meeting.

Whenever crisis hits the West, the pint-sized yet deep-pocketed nation
of Qatar sails into view with the promise of cash lifeboats. Whether
it's the 2008 financial meltdown, President Donald Trump's
infrastructure plans or the British EU exit, the promise of Qatari
wealth is dangled as a way of keeping government finances and broader
investor confidence afloat.The irony now is that Qatar has its own
trouble. Saudi Arabia, Egypt, the United Arab Emirates and Bahrain
have severed most diplomatic and economic ties to their Gulf neighbor
to punish it for its ties with Iran and Islamist groups in the region.
The move is unprecedented, analysts say. Fears of a regional
choke-hold on a country that's the biggest producer of liquefied
natural gas sent Qatari stocks down and oil prices up.

It has been reported that Comey plans to testify to conversations in
which U.S. President Donald Trump pressured him to drop his
investigation into former National Security Advisor Mike Flynn, who
was fired for failing to disclose conversations with Russian
officials.

"The dollar is already on the defensive after Friday's jobs data, and
now it's facing potential geopolitical risk in the form of Comey's
testimony," said Bart Wakabayashi, Tokyo Branch Manager of State
Street Bank.

The dollar index .DXY, which tracks the greenback against a basket of
trade-weighted peers, fell to its lowest level since the November U.S.
election and was last down 0.2 percent at 96.623.

Euro 1.1267
Dollar Index 96.56
Japan Yen 109.65
Swiss Franc 0.9633
Pound 1.2924
Aussie 0.7465
India Rupee 64.345
South Korea Won 1116.53
Brazil Real 3.2976
Egypt Pound 18.1210
South Africa Rand 12.7457

Emerging Markets

When the tiny island nation of the Maldives prepared to make its
dollar-debt debut last week, it looked beyond more veteran
international arrangers to Bocom International Holdings Co., the
securities arm of China’s fifth-biggest bank. The firm was sole lead
on the $200 million, five-year bond, the latest in a slew of
frontier-market dollar offerings this year.

Chinese banks also popped up in Sri Lanka’s blowout dollar-bond sale
last month, with Citic Securities Co. and ICBC International
Securities Ltd. -- a unit of the world’s largest lender by assets --
part of a syndicate marketing the $1.5 billion issue. Their
involvement comes as China ramps up its Belt and Road initiative, with
almost $80 billion in financing to be doled out to developing nations
participating in President Xi Jinping’s globalization push.

The cheapest borrowing costs in four years are luring smaller,
lower-rated countries to the dollar bond market, with frontier
issuance in Asia already at $1.8 billion so far this year, more than
triple what it was in the same period of 2016, data compiled by
Bloomberg show.

“Under the Belt and Road initiative, I won’t be surprised to see more
and more Chinese investors and banks involved in frontier markets who
have good relationship with China,” he said.

At the national level, President Joseph Kabila is clinging to office
after 16 years in power, despite the end of his legal mandate last
December. His actions have triggered a political and constitutional
crisis, with elections delayed and protesters shot dead by police. The
political stalemate, combined with weak prices for Congo’s mineral
exports, has left the economy in disarray. Congo’s currency has
plummeted, food prices have soared, and public-sector salaries are
deteriorating in real terms.

The national crisis has raised tensions across the country. A recent
poll of 2,301 people in Congo, conducted by a U.S. research group and
a Congolese polling agency, found that a strong majority expects
strife in the country within months, and 69 per cent believe Mr.
Kabila should have resigned in December.

“The combination of political uncertainty, predatory state
institutions and low commodity prices is contributing to an
increasingly toxic situation,” the International Crisis Group, an NGO
based in Brussels, wrote in a recent commentary.

DR Congolese opposition leader Moise Katumbi filed a legal complaint
with the UN Human Rights Committee, in the hope of international
protection if he returns to run in a future presidential election.

"The reason I've come to make this complaint is to alert the
international community, because President (Joseph) Kabila is going to
organise elections without Moise Katumbi," he told Reuters.

"Despite the risk I have to go back because I'm a candidate and I will
remain one. If the election timetable begins I have to back."

Paul Virilio and his extraordinary book – Speed and Politics. “The
revolutionary contingent attains its ideal form not in the place of
production, but in the street, where for a moment it stops being a cog
in the technical machine and itself becomes a motor (machine of
attack), in other words a producer of speed.’’

In fact, the numbers were building and Katumbi must have been thinking
this might just turn into a Tsunami. President Kabila, however, out-
witted Katumbi by removing him from the street and the Congo entirely.
This might well prove a cleverly administered technical knock-out. Of
course, the precursor was the Burkina uprising in Ouagadougou in 2014
which terminated ‘’beautiful’’ Blaise Compare.  The street is a
tinderbox and it has become a major area of (political) contestation
across the continent.

It may rise another 60 percent to as much as $90,000 a metric ton in
the next 18 months or so, said ERG Chief Executive Officer Benedikt
Sobotka. He said clients are already asking to pay fixed prices for
supplies from the mine, which isn’t due to start until late 2018.

Barclays Africa Group Ltd., South Africa’s worst-performing bank stock
in 2017 and 2016, has risen for three straight days after Barclays Plc
sold its controlling stake in a share sale in which demand exceeded
supply. The gains are paring year-to-date losses and narrowing the gap
with its Johannesburg-based peers. Three analysts have rated Barclays
Africa a buy since the stake sale was announced on May 31, with HSBC
Holdings Plc analyst Henry Hall saying in a June 1 note that the stock
could gain 17 percent.

Dollar versus Rand 6 Month Chart INO 12.75 [ZAR is right up
against resistance]
http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d6&t=c&a=50&w=1

Egypt Pound versus The Dollar 3 Month Chart INO 18.0515
http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Nigeria All Share Bloomberg +21.22% 2017 [23 month highs]
http://www.bloomberg.com/quote/NGSEINDX:IND

Ghana Stock Exchange Composite Index Bloomberg +13.62% 2017
http://www.bloomberg.com/quote/GGSECI:IND

China has downplayed concerns on Kenya’s ballooning standard gauge
railway (SGR) loans whose next phase is expected soon.
China awarded Kenya Sh294.3 billion or 90 per cent of the Sh327
billion spent on constructing Mombasa-Nairobi SGR line.
It is also financing 90 per cent of the Sh150 billion Nairobi-Naivasha
section and has since been approached for an additional Sh370 billion
for the Naivasha-Kisumu line.
Overall loans extended by the China Exim Bank have concessional and
commercial portions.
Apart from the SGR loans, China is already the single-largest
bilateral lender owed $3.5 billion (Sh361.6 billion), or 19.4 per cent
of total external debt by end of the second quarter of the 2016/17
fiscal year.
Chinese vice Foreign minister Zhang Ming said the size of the loans
should not be an issue “since the money is being put in a project that
will benefit Kenyans”.
“When a debt is put in the right project, it is not a burden,” said he
said in a statement last week.
“The investment will give the money back since SGR is the largest
infrastructural project in Kenya and it will lead to economic growth
of the whole region which means that the debt will be paid.”

Nairobi All Share Bloomberg +12.22% 2017
http://www.BLOOMBERG.COM/quote/NSEASI:IND

149.63 -0.45 -0.30%

Nairobi ^NSE20 Bloomberg +9.25% 2017
http://j.mp/ajuMHJ

3,480.78 +7.59 +0.22%