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Macro Thoughts

''The really big contagion effect happens when people have to sell
good assets to cover losses on bad assets.”

If volatility spikes, positions are going to be reduced en masse. Or
to put it another way and to borrow the lyrics from the Eagles Hotel
California:

Mirrors on the ceiling,
The pink champagne on ice
And she said “We are all just prisoners here, of our own device” Last
thing I remember, I was
Running for the door
I had to find the passage back
To the place I was before
“Relax,” said the night man,
“We are programmed to receive.
You can check-out any time you like,
But you can never leave! “
What is clear is that we are at the fag-end of this party.

Home Thoughts

It is difficult to write in a world of such a violent and deep
transformation. Everything slips from underneath the feet, the symbols
change, signs are reversed, orientation points no longer have places
of permanence. The vision of the writer wanders over ever new and
unknown landscapes, and his voice is lost in the roar of the running
avalanche of history.

Velasco has been studying and photographing the Volcán de Colima,
which is one of the most active volcanos in Latin America and also
known as the “Volcano of Fire.” Before he captured this striking
photograph, Velasco had been carefully tracking an increase in
activity and closely watched the volcano for almost a month.

While shooting on a completely clear night just 12 kilometers away
from the crater, Velasco heard a booming noise and witnessed the
biggest volcanic lightning he’d ever seen. Until he reviewed the
photos he’d taken, Velasco had no idea if he’d actually captured the
spectacular event.

The resulting images astounded Velasco. He said in an interview with
National Geographic:

“What I was watching was impossible to conceive, the image showed
those amazing forces of nature interacting on a volcano, while the
lightning brightened the whole scene. It’s an impossible photograph
and my once in a lifetime shot that shows the power of nature.”

Xinjiang is at a special stage of development where there is no room
for destructive Western public opinions. Peace and stability must come
above all else. With this as the goal, all measures can be tried. We
must hold onto our belief that keeping turmoil away from Xinjiang is
the greatest human right.

Xinjiang is China's territory. It is led by the Communist Party of
China and operates according to Chinese laws. Whoever tries to incite
violent confrontation there will only head down a dead end and
national solidarity is the only way forward for Xinjiang's future.

More so than any other contemporary photographer, Salgado has come to
typify the genre of fine art documentary photography. Renowned for his
highly skilled tonality, the chiaroscuro effect of his dramatic black
and white images had contributed to the repositioning of photography
as ‘high art’. His success undoubtedly issues from both his political
insight and distinctive aesthetic that renders the world both
beautiful and humbling.

In January and February 1991, as the United States–led coalition drove
Iraqi forces out of Kuwait, Saddam Hussein’s army retaliated with an
inferno. At some 700 oil wells they ignited vast, raging fires,
sending billowing black clouds over the region and thousands of tons
of nitrous oxide and carbon dioxide into the atmosphere. As the
desperate efforts to contain and extinguish the fires progressed,
Sebastião Salgado travelled to Kuwait to witness the crisis firsthand.

Euro 1.1382
Dollar Index 96.27
Japan Yen 110.20
Swiss Franc 0.9931
Pound 1.2756
Aussie 0.7273
India Rupee 68.89
South Korea Won 1135.38
Brazil Real 3.8582
Egypt Pound 17.9140
South Africa Rand 14.6779

Harold Macmillan when asked what a prime minister feared most replied:
'Events, dear boy, events'."

President Erdogan of Turkey who you will recall cut short a State
Visit to Kenya a while back has been President of Turkey since 2014.
He previously served as Prime Minister from 2003 to 2014 and as Mayor
of Istanbul from 1994 to 1998. He founded the Justice and Development
Party (AKP) in 2001, leading it to general election victories in 2002,
2007 and 2011 before standing down upon his election as President in
2014. At an Exchange Rate of TRY 5.6 versus the Dollar Per capita GDP
is just under $8,000.00, the same as in 2006, which equates to 12
years of no growth, and down a 1/3rd since hitting a peak of more than
$12,000.00 in 2013 but still more than double the level when the AKP
took power in 2002. [Charlie Robertson via Twitter].

On Friday, The Turkish Lira death-spiralled lower at one point trading
an eye-popping -20% before recovering some of its losses to close
-10.00% on the day. The Turkish Lira has collapsed -16% over a week,
-20% over a 4 week period and -40% in 2018.

Turkey is now seen more likely to default on its debt than Greece,
which is rated four notches lower by @MoodysInvSvc

In 1998, Prime Minister Margaret Thatcher told the House of Commons:
"There is no way in which one can buck the market."

President Erdogan [Like Xi Jinping] finds himself caught in the Strong
Man Conundrum. If You are the Strong Man and have placed yourself on a
Pedestal then you own the problem. President Erdogan remains a limit
Short Trading position.

President Erdogan said : "Don't get high on your ambitions. You won't
be able make money on the back of this nation. You won't be able to
make this nation kneel." [They have already made a ton of money and
You are kneeling, Mr. President]

And Then  ''Even if they got dollars, we got 'our people, our God'''
[In the markets that is called a ''Hail Mary'' Pass]

Erdogan repeated his call to Turks to sell dollars, euros and support
the Lira. Turks are doing exactly the opposite.

The proximate cause for this currency crisis has of course been the
detention of the U.S. pastor Andrew Brunson but Erdogan and his
son-in-law had already been advocating their own version of ''voodoo''
economics and to quote Sid Verma

Who would have thought that unhedged large foreign debt, politicized
monetary policy, soaring inflation, a current account deficit,
geo-political troubles, an autocratic lurch, and weak sentiment for
emerging markets could create a currency crisis.

President Trump an avowed linguistic warfare Specialist has embraced
coercive sanction and financial warfare. Look at Venezuela where the
Bolivar has cratered -2,000,000%, Iran -30% and China where his Tariff
warfare has Xi Jinping reeling. JP Morgan was reported as suggesting
there is a risk that Trump sells Dollars in order to damp down the
Dollar. In fact, if Trump wanted to press his advantage he should buy
the Dollar not sell it. The Dollar is currently seriously weaponised.

Late Friday Trump double-downed on his short Lira position via Tweet

@realDonaldTrump Aug 10 ''I have just authorized a doubling of Tariffs
on Steel and Aluminum with respect to Turkey as their currency, the
Turkish Lira, slides rapidly downward against our very strong Dollar!
Aluminum will now be 20% and Steel 50%. Our relations with Turkey are
not good at this time!''

President Trump seems to be relishing his financial warfare
strategies. He has Khamenei on the run, Maduro in Venezuela is being
attacked by remote-controlled drone, Xi suddenly looks ever so
fragile.

President Erdogan is a Shakespearean Figure, he has slayed Enemies
real and not real, his chest has been puffed up with Pride, he even
rescued the Emir of Qatar but he has now met his match, that match
being the markets. I hope he still has Madam Lagarde's number on speed
dial.

Such is the ultimate Bonfire of Populist Vanity. The Populist Leaders
with their cheer-leading claques have drunk their own Kool-Aid and
therein lies our ultimate salvation. They will be driven over the Edge

"The Edge...There is no honest way to explain it because the only
people who really know where it is are the ones who have gone over"

President Erdogan is right at the Edge.

The Sidi community, is a small ethnic group of African descent
concentrated in the mountainous regions of Pakistan. The group has
been largely overlooked in social, political and economic life in the
country. There are, however, small advancements being made towards
representation, and 39-year-old Sidi politicial Tanzeela Qambrani is
at the forefront of these changes.

Qambrani, whose ancestors came from Tanzania, has been nominated by
the Pakistan People's Party (PPP) to a women's reserved seat in the
regional parliament of southern Sindh province, reports BBC Africa,
making her the first person of African descent to hold a seat in
Pakistan's parliament.

"As a tiny minority lost in the midst of local populations, we have
struggled to preserve our African roots and cultural expression, but I
look forward to the day when the name Sidi will evoke respect, not
contempt," she told the BBC.

Qambrani, a computer science postgraduate with three children, is
dedicated to preserving the African roots of the Sidi community, which
has a population in the tens of thousands in Pakistan.

Frontier Markets

There are new guests at the ruined palace where Emperor Jean-Bédel
Bokassa once held court. During his rule over the Central African
Republic in the 1970s, Bokassa used a year’s worth of development aid
to stage an extravagant coronation, and he personally oversaw the
torture of prisoners. He fed some to his pet crocodiles and lions.But
the French government that helped install Bokassa in 1966 ousted him
in 1979, deploying paratroopers to prevent any countercoup. Now, four
decades later, it is Russian soldiers who mill around this crumbling
estate in Berengo—and the shifting power dynamic is raising concerns
in the West. President Vladimir Putin is pushing into Africa, forging
new partnerships and rekindling Cold War–era alliances. “There will be
a battle for Africa,” says Evgeny Korendyasov, head of Russian-African
studies at the Russian Academy of Sciences, “and it will
grow.”Russia’s economy is in long-term decline, and its reach has
diminished since the Soviet era. So the Kremlin is using ­diplomatic,
economic and military tools to prospect for political influence and
new markets in Africa—signing multibillion-dollar arms deals, bidding
for big construction projects, boosting space communications,
exploiting hydrocarbon reserves and launching publicized military
interventions, alongside more clandestine operations. “The Russians
want to implant themselves in the Central African Republic so they
have an axis of influence through Sudan in the north and southwards
into Angola,” says a senior United Nations security official in
Bangui, CAR’s capital, who requested anonymity as he wasn’t authorized
to speak with the media. “The French are hated as the old colonial
power. American troops have left. It’s a free country for the taking.”

The U.N. ranks CAR as the least-developed country in the world—rich in
minerals but fragmented and poorly governed. Conflict erupted here in
2013 when a mainly Muslim coalition of rebels called the Seleka
toppled the government. Widespread atrocities prompted Christian
communities to form vigilante militias known as the anti-balaka.
Thousands died in clashes. A brief calm followed the election of
President Faustin-Archange Touadéra in 2016, but violence broke out
later that year between rival Seleka factions and has continued to
escalate. The decades following independence were marked by coup and
instability, and international deployments have failed to create a
sustainable peace. The Kremlin sees an opening.

Touadéra and Russian Foreign Minister Sergey Lavrov met in the resort
of Sochi last October. Then, despite a U.N. arms embargo on the
war-wracked country, Moscow successfully lobbied for permission to
donate weapons and ammunition to CAR’s weak military. This arsenal
reportedly amounted to thousands of assault rifles, handguns, rocket
launchers, machine guns and anti-aircraft guns. Accompanying this
haul, according to the Russian Foreign Ministry, were 175 instructors
to train CAR’s armed forces at a makeshift academy installed at the
Berengo palace, outside Bangui.Although bankrolled by Western
institutions and propped up by peacekeepers, CAR’s government wields
minimal power beyond the capital and wants to expand its control of
the country—about  three-quarters of which is held by rebels. So it
has welcomed Moscow’s help.Keep Up With This Story And More By
Subscribing NowRussia’s Foreign Ministry says its assistance is “in
line with general efforts of the international community.” But its
growing involvement has spooked Western players in the region. Senior
officials tell Newsweek the initial arms donation has expanded into
front-line patrols, nationwide convoys, potential mining concessions,
powwows with rebels and the suspected deployment of mercenaries.
Touadéra is thought to have Russians in his presidential guard, as
well as a Russian security adviser who enjoys close access to Bangui
government policymakers.

Washington hopes to counter this with the recent arrival of a new
military adviser at the U.S. Embassy in Bangui. Lieutenant Colonel
Mark Choate now serves as Washington’s “uniform at the table,” says a
senior U.S. official, speaking on condition of anonymity. “He can
ensure that...our equities in regards to CAR are both defended and
pushed forward.”Equities means “stability,” the source explains,
allowing the U.S. government to focus on counterterrorism operations
around Lake Chad and East Africa. “Any other policy initiatives from
other countries that may impede that are not in our interests.” (But
even as Choate is deployed, the U.S. military is looking to pull back
hundreds of troops from the continent, according to General Thomas
Waldhauser, leader of the U.S. Africa Command. “We’re not walking
away,” he assured The New York Times. The U.S. would “reserve the
right to unilaterally return.”)

The U.S. now trains police officers and donates military vehicles to
the CAR armed forces, but the Russians have begun deploying units deep
into the field. Kenneth Gluck, the U.N.’s deputy chief peacekeeper in
the country, says about 10 Russian military instructors are in
Bangassou—a lawless town on the border of the Democratic Republic of
Congo—to help personnel from the national army set up a base and to
boost their confidence in the field before taking on rebel groups.
Another unit is understood to be in Sibut, a key town near rebel-held
territory, where three Russian journalists were killed at the end of
July while investigating the presence of Russian mercenaries. (Though
armed bandits do plague CAR’s provincial roads, a colleague has cast
doubt on the theory that they were killed in a robbery, suggesting the
killings could have been an act of reprisal. “This was done in a very
demonstrative fashion,” the Associated Press quoted Andrei Konyakhin,
head of the investigative reporting group supporting this politically
sensitive assignment, as saying. “If they could have just taken
everything from them, why kill them?”)CAR has declined some overtures.
Earlier last month, Touadéra rejected a Russian offer to mediate talks
with armed rebels in neighboring Sudan. But Russia’s dealings don’t
stop with the country’s West-anointed leaders. Reports have emerged of
military emissaries flying into a remote northern region for talks
with rebel leaders, as well as a meeting with former chief rebel
Michael Djotodia, a Russian-educated former resident of the Soviet
Union who seized power in 2013 to become CAR’s first Muslim president.

As the world’s second largest arms exporter after the U.S., Russia’s
CAR strategy fits its larger goal of using its weapons industry to
reinstate Moscow as a key player, especially in places with Western
power vacuums. War zones featuring Russian guns are a showroom for
courting prospective buyers. “The Syrian war has ­reinvigorated
Russian arms exporters, as their weapons have proved their reliability
on the battlefield,” says Nikolay Kozhanov, a former official at the
Russian Foreign Ministry.Wooing lawmakers in CAR could also help
Russia drum up contracts in neighboring Chad, Cameroon, the Democratic
Republic of Congo, Sudan and South Sudan, where civil strife and
Islamist insurgencies make rulers hungry for military hardware. For
Putin, booming arm sales help tighten his grip at home, reinforcing an
important backer of his rule: the Russian military-industrial complex.

But flooding failed states with weapons can have catastrophic
consequences. A 2017 report by Oxfam warned that the estimated 100
million uncontrolled arms in Africa—often of Chinese or Russian
origin—prolong conflict and intensify poverty while displacing
civilians on a huge scale. “This brings devastating costs to families
and communities,” wrote report author Adesoji Adeniyi.CAR is no
exception. In July, a U.N. panel of experts warned that Russian
weapons deliveries to the country’s security forces have encouraged
rebel groups to bolster their own stockpiles. The monitors said
militants wanted “to be prepared,” as the CAR government “had opted
for the military option…instead of the political process.”

Moscow’s influence in Africa was at its peak during the Soviet era, as
Russia jostled with Western powers for dominance, posting KGB agents
across the continent and sending weapons to Communist insurgents in
Cold War proxy conflicts. But the collapse of the USSR triggered a
decline in influence in the 1990s. ­Economic chaos forced Russia to
wind down its overseas activities. The country has rebounded, but its
moribund economy equals fewer resources and no marketable ideology.
“We can’t just order anyone to do anything over there, as we once
could in Soviet times,” says a Russian diplomat with experience in
Africa, speaking on condition of anonymity. “For our leaders, Africa
was a battlefield of influence with the Americans. We used to be big
patrons, but our government doesn’t command the same kind of financial
resources.”As the Trump administration reduces America’s diplomatic
and military footprint, Putin’s vision for Africa expands. Moscow
seeks to become a major security partner to counter international
isolation, to combat a growing jihadi threat and to profit from the
continent’s natural resources. There’s potential to increase its naval
foothold and foster support among leaders there for its global
actions, undermining the U.S. and limiting the West’s ability to
maneuver.

From the shores of the Mediterranean Sea to the veld of southern
Africa, Russia’s moves disrupt a status quo that has existed since the
early aftermath of the Cold War. NATO began ­partnering with nations
around the Sahara Desert from the mid-1990s to combat terrorism and
strengthen the borders of NATO-aligned countries. Among these partners
are Morocco and Algeria, which, ­after past strains with Russia, are
seeing relations warm. Russian Prime Minister Dmitry Medvedev has
hailed deepening energy and military ties as “a new phase.”Even more
significant is Russia’s renewed relationship with Egypt, another
regional NATO partner, which turned its back on the Soviet Union in
the 1970s to become Washington’s closest Arab ally. But as U.S.
influence there fades, Cairo and Moscow are getting cozy. In April,
Putin congratulated his autocratic counterpart in Egypt, Abdel Fattah
el-Sissi, on his controversial landslide victory. The pair have
overseen preliminary plans for Russian-built nuclear power facilities
in Egypt, as well as an industrial zone that could give Russian
companies a gateway to Europe and Africa.This renewed partnership has
led to a draft deal that lets Russian military jets use Egypt’s
airspace and bases, giving Russia its largest military presence in
North Africa since Leonid Brezhnev ruled the ­Soviet Union. Cementing
these ties, Russia and Egypt have signed off on a $3.5 billion package
to supply Cairo with strike helicopters, missile complexes, a coastal
defense system and 50 MiG fighter jets—the largest post-Soviet order
of the military aircraft.

Collaboration between Egypt and Russia ­extends into the turmoil in
neighboring Libya, now wracked by a civil war in which foreign powers
back oppos­ing forces—Putin and Sissi support General Khalifa Haftar,
Libya’s eastern strongman, who is at odds with Tripoli’s
Western-backed government. The Russian military has a presence in
Egypt’s western desert near Libya’s border and could use air bases
there to launch airstrikes that entrench and expand Haftar’s gains.
The probable goal? To secure future economic deals in Libya’s oil-rich
desert while promoting Russia’s role as a resurgent world power.Andrei
Kemarksy, director of the Russian Foreign Ministry’s Africa
Department, says the Kremlin’s African partners view ­cooperation with
Russia as a means of “countering the pressure of Western countries.”
And American military leaders are worried. “Our concern would be [the
Russians’] ability to influence and be on the southern flank of NATO
and [to] squeeze us out,” Waldhauser told the House Armed Services
Committee in March.Moscow is seeking to establish more
footholds—particularly among old allies of the Soviet Union—and create
a crescent of influence stretching from the Sahara to the south. One
of these is Angola, which received military support and technical
know-how from the Soviets, while sending hundreds of its students to
universities in Russia. Having emerged from civil war to become one of
the region’s more politically stable countries, Angola is a prime
target for Russia’s expansion. Angola’s substantial gas and oil fields
are a lure to state-owned Russian companies (particularly as the EU
looks for non-Russian new energy sources).

Telecommunications is another major area of cooperation. Russia’s
space agency developed Angola’s first national satellite and has said
it will build a second. Moscow’s motivations are questionable. A
sophisticated, Kremlin-linked hacking group has allegedly hijacked
commercial satellite communications in Africa and the Middle East to
obscure the whereabouts of aggressive cyberespionage attacks on
American and European government agencies.Lavrov included Angola on a
recent trip around eastern and southern Africa, with stops in former
Soviet-aligned Ethiopia, Mozambique, Namibia and Zimbabwe. This
comeback tour focused on boosting weapons trade, gaining access to
diamond reserves and developing energy projects. Stephen Blank, a
senior fellow at the American Foreign Policy Council, says the trip
“was part of Russia’s overall global policy to challenge the West,”
with Lavrov pushing the line that “the West was responsible for trying
to force its solutions on African countries.”In Ethiopia, Lavrov
visited the headquarters of the African Union—a key NATO partner—where
he and the institution’s chairman, Moussa Faki Mahamat, pledged to
strengthen cooperation against criminals and terrorists. In a
throwback to Soviet-era university exchanges, the pair discussed
setting up partnerships between African and Russian academies. When
asked how NATO regards Russia’s growing presence in Africa, a
spokesperson for the alliance—which stations a senior officer at the
African Union—refused to comment.Not all Russia’s attempts at making
inroads in Africa are successful. The U.S. has its largest permanent
military base in Africa in Djibouti, a small country on the Red Sea
that serves as a  launch pad for American counterterrorist operations
in Yemen and Somalia. Last August, the Chinese opened a base near
America’s to the ire of U.S. commanders. But Djibouti, not wishing to
“become the terrain for a proxy war,” has barred Russia from building
a base in its borders, according to the country’s foreign minister.

Russia may have better luck in Sudan, a staunch Kremlin ally and
longtime buyer of Russian military hardware. Last November, Sudanese
President Omar al-Bashir—wanted by the International Criminal Court
for genocide and war crimes—visited Moscow. There, he expressed an
interest in purchasing Russian-made jets and an air-defense system,
inviting his hosts to build a base on his country’s Red Sea coast and
insisting that Sudan needed “protection from the aggressive actions of
the United States.”Russian boots may already be on the ground in
Sudan. Last December, Alexander Kots, a journalist for a pro-Kremlin
newspaper, posted a video that purportedly shows Russian instructors
training local soldiers in the Sudanese desert. Breaking years of
silence on the Kremlin’s shadow wars, one Russian veteran group
recently said Moscow is sending private military contractors into
foreign war zones, including CAR, Libya and Sudan. Separately, another
contractor described malaria-stricken mercenaries returning from
deployment in Sudan.Many countries—including the U.S., France and the
U.K.—rely on military firms for operations in the Sahel’s volatile
badlands, assisting with medical evacuation, transport logistics and
more combat-oriented activity. But Russian hired guns have gained a
particular notoriety due to their covert yet widespread use in Ukraine
and Syria. Many of these heavily armed proxies have been contracted to
the Wagner Group, a private military company with close ties to the
Kremlin.

Similar troop movements are reported in CAR. The Russian Foreign
Ministry says out of the 175 instructors dispatched to Bangui, only
five are members of the Russian army. The remaining 170 are “civilian
instructors,” which some analysts read as shorthand for private
military contractors.Cellphone footage has emerged of Russian soldiers
contacting rebels in northeast CAR. Teeming with diamonds and gold,
this area is controlled by an armed group called the Popular Front for
the Renaissance of the Central African Republic—known by its French
acronym the FPRC and accused by human rights groups of war crimes. A
France 24 report describes how, in May, the FPRC’s military leader,
Abdoulaye Hissène, stopped and searched a Russian 18-truck convoy
carrying “55 Russia-linked paramilitaries” and medical equipment. The
commander also uncovered military gear, which he duly confiscated,
claiming such cargo was “not part of our agreement.” One Russian
soldier points to the camera: “Stop filming please.” Hissène—whom the
U.N. has implicated in attacks against peacekeepers—dismisses the
request: “Non, c’est bon.”After the search, the trucks are reported to
have continued their cross-country journey to Bria, a tense rebel
stronghold in the east. Ibrahim Alawad, a senior FPRC official, was
there to greet them. “I met the Russians here,” he tells Newsweek.
“They say, ‘We want to help the people. We want to build a hospital’.…
We don’t know what they want to do. We don’t know who we’re dealing
with.”One senior Western diplomat accuses the Russians of terrifying
incompetence. “I almost wish they were being evil geniuses because it
would give me more confidence,” says the diplomat, speaking on
condition of anonymity. “Their engagement with the armed groups has
created a situation where potentially no one trusts anyone.” By
pursuing both state and commercial interests, they are “creating an
atmosphere that really could be combustible.”

Commercially, the Russians may be hoping for a gold rush. Last
November, a French investigation linked a security firm set in Bangui
to the Russian director of a mining company that specializes in “the
extraction of precious stones.” Despite an export ban, the rebels are
keen to trade. “If somebody wants to do business and they can help me,
can I refuse?” says Alawad.Similar Russian companies profit from
Moscow’s intervention in Syria. One of these is Moscow-based Evro
Polis, suspected of being a front for Wagner in the country, granting
mercenaries a cut from oil and gas fields seized from Islamic State
militants (ISIS). One member of Putin’s inner circle—St. Petersburg
entrepreneur Yevgeny Prigozhin—has a stake in the company and is
subject to U.S. banking and travel sanctions. Russian links between
Syria and CAR may go deeper. An air base leased by the Assad regime to
Moscow appears to be allowing Russian transport aircraft to deliver
cargo and personnel from Syria to Sudan, then on to CAR.A presidential
spokesman in CAR has denied that the Russians have formalized any
mining initiatives, but the Russian Foreign Ministry has already
highlighted “the considerable potential for partnership in
mineral-resources exploration.”Gluck admits that “when the Russians
first started coming in, the concern was the lack of transparency.”
But even as the Russian elite insist Moscow’s aims are not
underhanded, rebels feel the threat. “Putin wants to put his foot
anywhere in Africa,” Alawad says. “There are a lot of resources here.
He cannot be trusted. We don’t want to be another Syria.”

The key point flowing from this is that the Marange diamond operations
consolidated the transformation of the military into a Corporation. In
other words, as it had done in the DRC the military went way beyond
its core Constitutional mandate of being a body responsible for the
defence of Zimbabwe to a Corporation involved in business, which
appears to almost exclusively benefitted its directors, being the
military hierarchy. There is no evidence that the vast profits
generated by the military’s diamond mining in both the DRC and Marange
ever trickled down to benefit rank and file soldiers.

At the time that information was not in the public domain and so I was
surprised as most people were when General Chiwenga held a press
conference on Tuesday the 14th November flanked by nearly all his
senior officers in both the army and air force. The only arm of the
disciplined forces which didn’t fall in line was the ZRP. The
divisions which we had seen within ZANU PF and which I assumed would
appear also appear in the military, along ethnic or political lines,
did not appear. The interests of the military hierarchy clearly
transcended the factions within ZANU PF. In other words, the military
corporation’s interests were being threatened and it responded to
protect its interests, not so much ZANU PF’s.

After the coup, it was critical for the facade of civilian rule to be
restored as quickly as possible. The junta went to a military judge in
the High Court, Judge Chiweshe, to get him to rule that the coup was
lawful. ZANU PF held its Congress and Emmerson Mnangagwa was elected
to replace Mugabe. Mnangagwa appointed his new Cabinet which further
revealed where the true power lay – Sibusiso Moyo, the face of the
coup, was brought in as Foreign Minister; Perance Shiri was brought
into the critical Minister of Lands post.

But it was in the appointment of Chiwenga in December 2017 that we saw
where the real power lay. Chiwenga was appointed 2nd Secretary of ZANU
PF at its Congress on the 15th December and I assumed that his
appointment as Vice President of Zimbabwe would follow quickly. But
there was a delay until 23 December when he and Kembo Mohadi were
appointed Vice Presidents. Then on 28 December, when sworn in as Vice
President, it was announced that Chiwenga would also be in charge of
Defence. This demonstrated where the real power lay.

Since then there is little to suggest that Mnangagwa is any less a
political fig leaf than Robert Mugabe was. The power matrix created by
the November coup has not changed. But for the military coup,
Mnangagwa would still be in exile and he is entirely dependent on the
support of the military hierarchy to remain in power. The Cabinet is
dominated by the same military figures involved in the DRC, the 2008
political violence and the Marange diamond fields – namely
Chiwenga,Shiri and SibusisoMoyo. I have deliberately not mentioned
Gukurahundi, but it must be stated in this context than Chiwengaand
Shiri were also the two principal army commanders most responsible for
those atrocities. Chiwenga, then called Dominic Chinenge, was the
Commander of 1 Brigade which provided all the logistical support
needed by the notorious North Korean trained 5 Brigade commanded by
Shiri. Mnangagwa was the Minister in charge of the CIO (Zimbabwe’s
secret police) which provided intelligence to the 5 Brigade which
resulted in the decimation of Joshua Nkomo’s ZAPU party structures.
The events they were responsible in Matabeleland between January 1983
and June 1984 were crimes against humanity. In other words, the same
two principal military commanders who have engineered violence in
Zimbabwe for the last 38 years are still there. Without their support
Mnangagwa is powerless.

In fact, these are all simply layers of lipstick on a pig. And the pig
isn’t Mnangagwa, – he is just another layer of lipstick – the pig is,
in fact, the junta. A junta is defined as “a military or political
group that rules a country after taking power by force”.

South African Rand $ZAR just completes one of the best looking longer
term cup & handle formations I have seen in a long time...cue up
currency crisis in South Africa soon.

Have a look at this move just now in the South African Rand... USD-ZAR
just popped 10% ... granted of course there's very thin liquidity in
this during Asia

Nigeria's stock market entered a bear market today (down 20% from its
peak in January) as political tensions and the emerging-market selloff
cause foreign investors to flee.

Ghana Stock Exchange Composite Index Bloomberg +11.16% 2018
http://www.bloomberg.com/quote/GGSECI:IND

Today from Massawa, Eritrea [admittedly on the Red Sea] to Djibouti,
from Berbera to Mogadishu, from Lamu to Mombasa to Tanga to Bagamoyo
to Dar Es Salaam, through Beira and Maputo all the way to Durban and
all points in between we are witnessing a Port race of sorts as
everyone seeks to get a piece of the Indian Ocean Port action.

China [The BRI initiative], the Gulf Countries [who now appear to see
the Horn of Africa as their hinterland], Japan and India [to a lesser
degree] are all jostling for optimal ‘’geo-economic’’ positioning.

Improving diaspora remittances, which increased by 71.9% y/y to USD
266.2 mn from USD 154.9 mn in June 2017, and 4.9% m/m, from USD 253.7
mn in May 2018 @CytonnInvest http://bit.ly/2McjxhP

The Dollar is King. All Hail the King Dollar.
President Trump an avowed linguistic warfare Specialist has embraced
coercive sanction and financial warfare.
Look at Venezuela where the Bolivar has cratered -2,000,000%, Iran
-30% and China where his Tariff warfare has Xi Jinping reeling.
The Dollar is currently seriously weaponised.  In fact, if Trump
wanted to press his advantage he should buy the Dollar not sell it.
The Turkish Lira opened -20% Lower Monday morning and above 7.00.
''Even if they got dollars, we got 'our people, our God''' [In the
markets that is called a ''Hail Mary'' Pass] President Erdogan.
This Move spread contagion across the Emerging Markets Universe.
The Indian Rupee fell -0.95% to 69.4750 PER USD an all time low.
The Rand flash-crashed more than 10% falling below 15.00 and losing
all its Ramaphosa-related Ramaphoria gains.
The Kenyan Shilling has gained by 2.7% year to date and is the 3rd
best performing currency in the World in 2018.
The Nairobi All Share ignored the rest of the World [for now] and
firmed +0.67 points to close at 173.51
The Nairobi NSE20 firmed +2.43 points to close at 3317.35

Safaricom [which turned down the opportunity to go Head-To-Head with
Airtel in a voice price war and that was probably informed by the fact
that Voice's centrality to the Proposition has diminished] firmed
+0.88% to close at 28.50 and traded 2.021m shares.

KCB Group eased -0.98% to close at 50.50 and was the most actively
traded share at the Exchange with 3.981m shares worth 201.174m. KCB is
+25.146% in 2018 on a Total Return Basis.
Diamond Trust Bank closed unchanged at 197.00 and transacted 384,500
shares worth 75.746m at that level. DTB is +3.95% on a Total Return
Basis in 2018 and trades on a Trailing PE Ratio of 8.302.
Equity Group firmed +0.97% to close at 52.00 and traded shares as high
as 53.50 during the session. Equity is +35.84% in 2018 on a Total
Return Basis in 2018 and trades on a Trailing PE Ratio of 10.4.
Standard Chartered Bank pushed +0.98% higher to close at 207.00 and
traded 182,100 shares worth 37.985m. StanChart trades on a Trailing PE
of 10.539 and is +7.211% in 2018 on a Total Return Basis. It is
inexpensive.

EABL traded 323,400 shares and closed -0.92% at 215.00. EABL recently
reported FY Earnings where FY FY Profit After Tax declined -15.00% to
clock 7.3b. EABL is -9.66% in 2018 ahead of a FY Dividend Pay out of 5
shillings and 50 cents.

KenGen eased -0.76% to close at 6.50 on low volume action of 61,900 shares.

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