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09-JUL-2018 :: Tariff wars, who blinks first? @TheStarKenya
James Dean was an iconic American Actor, who tapped into the universal
yearning and Angst of nearly every adolescent human being with a raw
connection that has surely not been surpassed since. In one of his
most consequential Films, Rebel without a Cause, Two players (read,
teenage boys) decide to settle a dispute (read, teenage girl) by way
of near-death experiences. Each speeds an automobile towards a cliff.
A simple rule governs the challenge: the first to jump out of his
automobile is the chicken and, by universally accepted social
convention, concedes the object in dispute. The second to jump is
victorious, and, depending on context, becomes gang leader, prom king,
Jimmie (James Dean), to settle a dispute (read, teenage girl) with
Buzz, the leader of a local gang, agrees to a "Chickie Run." Both race
stolen cars towards the edge of a cliff. The first to eject out of his
car is branded a "chickie."
Seconds into the race, Buzz discovers that his jacket is stuck on the
door handle, making jumping out of the car somewhat difficult.
Jimmie jumps out an instant before the cars reach the edge of the cliff.
Buzz, still unable to free his jacket from the door handle, fails to
escape. While he won't be branded a "chickie," he suffers a worse
President Trump after bashing on Justin Trudeau of Canada and Mexico's
Enrique Peña Nieto [now upended, of course] and then firing a few
broadsides at Europe, has now turned his attention to Xi Jinping and
thrown him the Keys challenging him to a "Chickie Run." and also sent
Two US Destroyers Into the Taiwan Strait For the First Time Since
China has accused US president Donald Trump of launching the “largest
trade war in economic history”
President Trump has seemingly always fancied his chances in this Trade
War business and said as much. He is unhappy with America's $376
billion deficit in goods trade with China and a system of Trade which
he believes advantages China.Trump and his advisers argue the tariffs
are necessary to pressure China into abandoning unfair practices such
as stealing intellectual property and forcing American companies to
hand over valuable technology. Washington put tariffs on $34 billion
worth of Chinese goods on Friday, and Beijing immediately responded
with penalties of an equal scale. The cost of the new tariffs can be
found in the roughly 1,300 individual products that have suddenly
become more expensive. The Chinese Government has been quite surgical
in its response and is targeting the Farm Economy in particular.
Oxford Economics has estimated tariffs will knock around 0.1 to 0.2
per cent off each country’s growth rate this year which struck as a
complacent and very binary prediction. Oxford Economics' prediction is
assuming no further escalation and a correlation which is not proven.
The US is calculating that its Economy is blowing hot and it therefore
can make Xi Jinping jump.
Trump described the potential escalation to reporters aboard Air Force
One: "Thirty-four, and then you have another 16 in two weeks and then,
as you know, we have 200 billion in abeyance and then after the 200
billion we have 300 billion in abeyance. OK?" Trump said. "So we have
50 plus 200 plus almost 300."
That amount is higher than an earlier threat from Trump to target as
much as $450 billion of Chinese exports. It's also bigger than the
$506 billion of goods that the United States imported from China last
If we see such an escalation, Its a sure thing the hit to GDP is going
to be more than the 0.1% to 0.2% Oxford Economics' ''Don't worry be
happy'' prediction. In fact, I recall speaking to a Standard Chartered
Macro Economist who said the precursor to this Trade War was witnessed
in the 1930s and then the world Economy cratered. The global trade
wars that followed the harsh tariffs imposed by the Hoover
administration in the early 1930s following the stock market crash of
1929, deepened the trough of the Great Depression. Worldwide economic
hardship led to political restructuring and eventually to World War
This is a multi-dimensional Chess Board, however. China has yanked
PyongYang's Leash. The KCNA reported that Pompeo was sent packing with
a few choice phrases:
"The U.S. is fatally mistaken if it went to the extent of regarding
that the DPRK would be compelled to accept, out of its patience, the
demands reflecting its gangster-like mindset."
Emerging and Frontier Markets have surfed higher on lashings of cheap
money [now being reversed] and on expanding Global Trade and GDP.
Cheap money is being reversed.
''EM currencies need the liquidity that the big CBs are starting to
take back - buying EM into the teeth of this epic liquidity drain is
not a cute contrarian trade - it is suicide unless you think it is a
ruse and they all stay easy'' @pineconemacro
And if We get a fully blown Tariff War, its going to a double whammy
for the Emerging and Frontier Markets Universe.
Who will blink first?
Rebel Without a Cause is a 1955 American drama film
Rebel Without a Cause is a 1955 American drama film about emotionally
confused suburban, middle-class teenagers. Filmed in the recently
introduced CinemaScope format and directed by Nicholas Ray, it offered
both social commentary and an alternative to previous films depicting
delinquents in urban slum environments. The film stars James
Dean, Sal Mineo and Natalie Wood.
The film was a groundbreaking attempt to portray the moral decay of
American youth, critique parental style, and explore the differences
and conflicts between generations. The title was adopted from
psychiatrist Robert M. Lindner's 1944 book, Rebel Without a Cause: The
Hypnoanalysis of a Criminal Psychopath. The film, however, does not
make any references to Lindner's book in any way. Warner Bros.
released the film on October 27, 1955.
Over the years, the film has achieved landmark status for the acting
of cultural icon James Dean, fresh from his Oscar nominated role in
East of Eden and who died before the film's release, in his most
celebrated role. This was the only film during Dean's lifetime in
which he received top billing. In 1990, Rebel Without a Cause was
added to the Library of Congress's National Film Registry as being
deemed "culturally, historically, and aesthetically significant".
Jaron Lanier arrives a little late for our lunch at a Peruvian restaurant in London's Fitzrovia, having been distracted by a Ukrainian shepherd's flute via @financialtimes @FTLifeArts
Jaron Lanier arrives a little late for our lunch at a Peruvian
restaurant in London’s Fitzrovia, having been distracted by a
Ukrainian shepherd’s flute. As excuses go, that one is certainly
His polite minder had warned me of the delay, explaining that Lanier
had been “sucked into the vortex” of Hobgoblin Music, a shop for rare
musical instruments next door. When Lanier finally emerges, he says
the Ukrainian flute would be “disturbing if I were a sheep”, but is
still kind of interesting. “There are a few temptations there but I’m
undecided at the moment.”
Lanier is not the type to remain undecided for long. An imposing bear
of a man with long, tangled brown dreadlocks, Lanier rarely passes
unnoticed, even in an anonymous black T-shirt and black trousers. He
sends the cutlery flying on the adjacent table as he settles into his
seat but does not seem to notice.
As well as being an obsessive collector — and player — of several
hundred musical instruments (favourite: the Laotian khaen), Lanier is
a Berkeley-based composer, computer scientist, virtual reality
enthusiast, author, Microsoft-affiliated researcher and scourge of
social media. To revert to epithetic journalese, he is a one-man
In a Silicon Valley culture that mythologises youth and creative
destruction, the 58-year-old Lanier can sometimes seem like the
eccentric uncle in the room, worrying about the impact of technology
on humanity and determined to keep society in the loop. He was one of
the early pioneers of virtual reality, founding VPL Research in the
mid-1980s and developing VR goggles and gloves. But he never fully
bought into the tech sector’s “magical thinking” and later sold out to
Sun Microsystems. If you do not believe in the Silicon Valley myth of
the great man, he later wrote, it is hard to aspire to be one.
We would all have a clearer understanding of our world, he claims, if
we relabelled the likes of Facebook and Google as “behaviour
manipulation empires”. His argument is that “pervasive surveillance
and constant, subtle manipulation is unethical, cruel, dangerous and
inhumane”. In short, this weaponised form of advertising is polarising
society, destroying democratic debate, and turning us into “assholes”.
a lifelong fascination with performing music, which he describes as a
kind of “instantaneous creation of the future”. “For the most part,
the world of music is joyous and generous,” he says, noting that even
the Laotians indulge his idiosyncratic khaen-playing style.
His beloved mother, a piano-playing prodigy from Vienna and a
Holocaust survivor, was killed in a car crash in the US when he was
nine. He and his father then moved to the New Mexico desert, where
they lived in a tent for two years while they designed and built a
home in the form of a geodesic dome. Later, while studying at
university, Lanier paid for his tuition by breeding goats and selling
their milk and cheese.
According to a New Yorker profile, Lanier’s girlfriend was so
disconcerted by his disheveled appearance that she took him to a
laundromat on their first date. You can perhaps see why The New York
Times columnist Maureen Dowd has described Lanier as the “most unusual
person I’ve ever met”.
Pisqu is, however, well suited to cater to Lanier’s emailed list of
dietary restrictions: “No meat. No cephalopods. No sugar. No alcohol.”
Lanier has developed an obsession with the octopus, which he values
both for its intelligence and amazing ability to morph. We both order
the ceviche of sea bass, sweet potato, coriander, Inca corn and lime
tiger’s milk, a pleasing contrast of tastes and textures. Given that
alcohol is off-limits, we stick with tap water.
I am intrigued by how Lanier can be so productive across so many
different fields. He describes his work style as “compressed
procrastination”, switching from one activity to another, like
cross-training. “You can get away with feeling like you’re being lazy
all the time and yet at the end of the day all the things have gotten
done,” he says.
Sadly, the early libertarian idealism of the internet has resulted in
the creation of “gargantuan, global data monopsonies”. Like many
internet pioneers, Lanier wants to revive the technology’s original
promise. “I miss the future,” he says.
Lanier argues that these platform companies are using their colossal
computing power to gain a vast informational advantage, keeping the
economic rewards for themselves while radiating risk out to everyone
else. “It’s reminiscent of a gambling economy where the only sure
position is in the casino.”
He is particularly damning of social media companies, even if he
accepts that their services have real benefits: connecting patients
suffering rare diseases or helping users find lost pets. The trouble
is, as he puts it, that Facebook, Google, Twitter, YouTube and
Instagram all have a “manipulation engine” running in the background,
working to the advantage of unscrupulous advertisers, scammers or
“There’s never before been a society in which everybody is under
constant observation, constant surveillance and in which they’re
constantly receiving this stream of experience that is being
dynamically adjusted to find ways of manipulating them.”
One of his biggest critiques of social media is that it
de-contextualises and mashes up meaning. Every statement is chopped up
into algorithmic-friendly shreds and recontextualised, often
triggering a “cranky backlash” that renders it meaningless; the
election of Donald Trump was the natural outcome of this cognitive
confusion. Lanier says he has met Trump several times over the past
three decades and has always regarded him as a typical New York
conman. But, he argues, Trump has been reprogrammed by his
interactions with social media. “What has happened with Trump is that
he’s taking on a personality disorder that’s associated with social
media addiction, the snowflake personality, where the person is
super-insecure, super-ready to jump into a bizarre social pissing
In his darker moments, he wonders whether we might have lost control
to our digital creations. “I’ve started to think of social media a
little bit, you know, how Richard Dawkins suggested that we think of
the gene as if it had a will of its own.” Is it a coincidence, he
asks, that social media is trying to undermine the politicians who are
trying to tame it?
Just when European governments are moving to regulate social media and
data privacy, they are assailed by populist movements. The test case
may come in Germany, which Lanier describes as “the centre of
resistance to a lot of the madness” today. He sees evidence of the
same destabilising process at work in Italy, Poland, south-east Asia,
India and Africa. “If somebody wants to disrupt a particular area,
they just make everybody cranky and paranoid and cynical in the way
that you can using these tools because that’s what the tools are
precisely optimised to do. And so we’ve entered a world of insanity.
The Trump election is only one example. There will be many more until
we fix it.”
Since completing his book, he has come up with a new metaphor for the
interaction between social media and politics: toxoplasmosis, a
parasitic disease that rewires rodent brains to make them less fearful
of cats. Once the reckless mice are devoured, the parasite reproduces
itself in the cats’ guts. He suggests that Trump — or the Russians —
eat the metaphorical mice only because the social media parasite is
making people crazy. As I raise a sceptical eyebrow, he laughs: “I’m
expecting the metaphor commandos to fire into this restaurant at any
minute and put me under arrest.”
China - which was the puppetmaster behind and greenlighted the Trump-Kim summit @zerohedge
Law & Politics
Some speculate that today's news of North Korea's response to the
ongoing discussions with the US, in which an envoy said that North
Korea's "resolve for denuclearization may falter", is a direct
consequence of China - which was the puppetmaster behind and
greenlighted the Trump-Kim summit - urging Kim to fade Pyongyang's
eagerness to engage Trump as "punishment" for Washington's belligerent
attitude toward China. Alternatively, one can argue that China is
merely responding to the latest diplomatic escalation by the US, which
reportedly is preparing to deploy marines to the US embassy in Taiwan
for the first time in effect legitimizing the US negation of a "One
China Policy", a step which would further inflame tensions between DC
18 SEP 17 :: it is entirely unlikely that the West has anything to offer the Chinese that can compensate them for the loss of their hinterland, buffer and instrument of attack.
Law & Politics
one of those myths is that Xi Jinping with some cajoling can be made
to effect a clean break with PyongYang. Consider that PyongYang is a
buffer state between China and the US and that PyongYang is in fact a
near perfect (geopolitical) attack dog. The attack dog is not on a
Chinese leash but its surely aligned with a resurgent rising China
whose aim is to surely eject the US and its allies from what it
considers its sphere of influence. Just take a look at the South China
seas where the US and its allies have largely capitulated and the US
is now left performing some half-hearted and quite forlorn FONOPs once
in a blue moon. North Korea by lobbing those missiles over Japan is
seeking to prise Japan away from its US alliance, something that China
is surely trying to achieve as well. When you look at geopolitical
alignment, it is entirely unlikely that the West has anything to offer
the Chinese that can compensate them for the loss of their hinterland,
buffer and instrument of attack.
Musoni, a microfinance institution based in Nairobi, which targets small-scale farmers and the informal sector, has issued out Kshs 2.0 bn in debt notes through a private placement via @CytonnInvest
Musoni, a Kenyan microfinance institution, has issued out Kshs 2.0 bn
in debt notes. The financier, which has 25 branches across the
country, was founded in 2010 and focuses on funding small-scale
farmers and businesses in the informal sector. The issue mainly
targets asset managers, trust management funds, and high net-worth
individuals, and is part of the initiative by the institution to shift
from foreign-based funding to local financing. The change to local
financing is a move by the company to avoid the exchange rate risk it
will incur on paying back the debt to foreign investors in their
respective currencies. Details of the debt issue include:
The tenor of the debt is 2-3 years, and investors have a chance to
roll over instead of cashing in, and,
The issue of the debt notes is to take place in four tranches of Kshs
500.0 mn each.
Given that similar microfinance institutions are in the market raising
debt through 2-year and 3-year medium term notes at yields of 16.0%
and 17.0%, respectively, we are of the view that the Musoni debt
issuance will also be priced at around the same range, at 16% for the
2-year debt note and 17% for the 3-year debt note