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Satchu's Rich Wrap-Up
Wednesday 23rd of March 2022

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Powell’s Volcker pivot @CNBC @KellyCNBC
World Of Finance

Does anyone else feel like we suddenly have a new Fed chair? 

Imagine if President Biden actually had picked a different person, who kicked off their tenure by giving impassioned remarks about Paul Volcker, talked in press conferences about “as I looked around the table at today’s meeting, I saw a committee...determined to use our tools” to return to price stability, and flat-out told reporters that “nothing” would stop the Fed from a half-point rate hike at the next meeting. The press would be having a field day, the markets would be in a tizzy, and we’d all know we were embarking upon a Very Different Era.  

But because it’s “boring old Powell” doing these things, people either aren’t paying attention, or seem to be wryly skeptical that it’s all some sort of performance art that shouldn’t quite be taken seriously. The doves--who think he’s moving too quickly--are going yeah, yeah, watch, they’ll be able to do like two rate hikes before having to reverse. The hawks aren’t that impressed, either; he talks tough, but the Fed admits real rates will still be negative through the end of next year!  

No matter where you come down, though, it’s obvious Powell has changed his stripes. He’s been trying to tell us for months now, even going back to his and Biden’s remarks at his reappointment announcement, which squarely focused on fighting inflation. He gave that vehement response to Senator Shelby on Capitol Hill last month about his admiration for former Chair Volcker: “I think he was...the greatest economic public servant of the era. Shelby: So you’re prepared to do what it takes, without any reservation, to protect price stability? Powell: Yes.”  

But he didn’t stop there! Yesterday, in a speech, Chair Powell said, “In particular, if we conclude that it is appropriate to move more aggressively by raising...more than [a quarter-point] at a meeting or meetings, we will do so.” He twice said the Fed needed to move more “expeditiously.” And asked by reporters what would stop the Fed from a half-point hike next meeting, in early May, he basically said, “nothing.” 

 In response, Goldman now expects two half-point rate hikes--one at the May meeting, and a follow-up one in June--followed by six more quarter-point hikes into late next year. They also expect the Fed to announce in May that they’ll start reducing the size of their nearly $9 trillion balance sheet, which is where the bulk of the Fed’s easing in response to the pandemic took place.  

In short, this is the starkest hawkish Fed pivot in recent memory. And the markets are taking it in stride. If Powell can pull off this landing, after the pandemic and all the unprecedented havoc it wreaked--if he can pull inflation back down to earth without another nasty recession--then he may well go down in history, like Volcker, as one of the greatest economic servants of his era. And you can sense that he senses that right now. Don’t expect him to back off anytime soon. 

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World Of Finance

There is no training – classroom or otherwise.. that can prepare for trading the last third of a move, whether it's the end of a bull market or the end of a bear market. 
There's typically no logic to it; irrationality reigns supreme, and no class can teach what to do during that brief, volatile reign. Paul Tudor-Jones

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The lights must never go out, The music must always play September 1, 1939 by W. H. Auden comes to mind
World Of Finance

Waves of anger and fear
Circulate over the bright
And darkened lands of the earth,
Obsessing our private lives;
The unmentionable odour of death

Into this neutral air
Where blind skyscrapers use
Their full height to proclaim
The strength of Collective Man,
Each language pours its vain
Competitive excuse:
But who can live for long
In an euphoric dream;
Out of the mirror they stare,

Faces along the bar
Cling to their average day:
The lights must never go out,
The music must always play

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Temple of Poseidon at Cape Sounion @JBorgstam

Cold, windy and magnificent day at the Temple of Poseidon at Cape Sounion. Spectacular.

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The Temple of Poseidon is an ancient Greek temple on Cape Sounion, Greece, dedicated to the god Poseidon.

There is evidence of the establishment of sanctuaries on the cape from as early as the 11th century B.C. Sounion’s most prominent temples, the Temple of Athena and the Temple of Poseidon, are however not believed to have been built until about 700 B.C., and their kouroi (freestanding Greek statues of young men) date from about one hundred years later.[1] The material and size of the offerings at the Temple of Poseidon indicate that it was likely frequented by members of the elite and the aristocratic class.[2]

The Greeks considered Poseidon to be the "master of the sea".[3] Given the importance to Athens of trade by sea and the significance of its navy in its creation and survival during the fifth century, Poseidon was of a particular relevance and value to the Athenians.

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Putin Misunderstands History. So, Unfortunately, Does the U.S. @bopinion @nfergus
Law & Politics

“The language people speak in the corridors of power,” former Secretary of Defense Ashton Carter once observed, “is not economics or politics. It is history.”

In a recent academic article, I showed how true this was after both the 9/11 terrorist attacks of 2001 and the “9/15” bankruptcy of Lehman Brothers in 2008. 

Policy makers used all kinds of historical analogies as they reacted. “The Pearl Harbor of the 21st century took place today,” President George W. Bush noted in his diary, late on the night of the attacks, to give just one example, though many other parallels were drawn in the succeeding days, from the Civil War to the Cold War.

Seven years later, Federal Reserve Chair Ben Bernanke and New York Fed President Tim Geithner were the first members of the Federal Open Market Committee to appreciate that, without drastic measures, they risked re-running the Great Depression.

What kind of history is informing today’s decisions in Washington as the war in Ukraine nears the conclusion of its first month? A few clues have emerged.

“American officials are divided on how much the lessons from Cold War proxy wars, like the Soviet Union’s war in Afghanistan, can be applied to the ongoing war in Ukraine,” David Sanger reported for the New York Times on Saturday.

According to Sanger, who cannot have written his piece without high-level sources, the Biden administration “seeks to help Ukraine lock Russia in a quagmire without inciting a broader conflict with a nuclear-armed adversary or cutting off potential paths to de-escalation … CIA officers are helping to ensure that crates of weapons are delivered into the hands of vetted Ukrainian military units, according to American officials. But as of now, Mr. Biden and his staff do not see the utility of an expansive covert effort to use the spy agency to ferry in arms as the United States did in Afghanistan against the Soviet Union during the 1980s.”

Reading this carefully, I conclude that the U.S. intends to keep this war going. The administration will continue to supply the Ukrainians with anti-aircraft Stingers, antitank Javelins and explosive Switchblade drones. It will keep trying to persuade other North Atlantic Treaty Organization governments to supply heavier defensive weaponry. (The latest U.S. proposal is for Turkey to provide Ukraine with the sophisticated S-400 anti-aircraft system, which Ankara purchased from Moscow just a few years ago. I expect it to go the way of the scuttled plan for Polish MiG fighters.) Washington will revert to the Afghanistan-after-1979 playbook of supplying an insurgency only if the Ukrainian government loses the conventional war.

I have evidence from other sources to corroborate this. “The only end game now,” a senior administration official was heard to say at a private event earlier this month, “is the end of Putin regime. Until then, all the time Putin stays, [Russia] will be a pariah state that will never be welcomed back into the community of nations. China has made a huge error in thinking Putin will get away with it. Seeing Russia get cut off will not look like a good vector and they’ll have to re-evaluate the Sino-Russia axis. All this is to say that democracy and the West may well look back on this as a pivotal strengthening moment.”

I gather that senior British figures are talking in similar terms. There is a belief that “the U.K.’s No. 1 option is for the conflict to be extended and thereby bleed Putin.” Again and again, I hear such language. It helps explain, among other things, the lack of any diplomatic effort by the U.S. to secure a cease-fire.  It also explains the readiness of President Joe Biden to call Putin a war criminal.

Now, I may be too pessimistic. I would very much like to share Francis Fukuyama’s optimism that “Russia is heading for an outright defeat in Ukraine.” Here is his bold prediction from March 10 (also here):

The collapse of their position could be sudden and catastrophic, rather than happening slowly through a war of attrition. The army in the field will reach a point where it can neither be supplied nor withdrawn, and morale will vaporize. … Putin will not survive the defeat of his army … A Russian defeat will make possible a “new birth of freedom,” and get us out of our funk about the declining state of global democracy. The spirit of 1989 will live on, thanks to a bunch of brave Ukrainians.

From his laptop to God’s ears.

I can see why so many Western observers attach a high probability to this scenario. There is no question that the Russian invasion force has sustained very high casualties and losses of equipment. Incredibly, Komsomolskaya Pravda, a pro-Kremlin Russian newspaper, just published Russian Ministry of Defense numbers indicating 9,861 Russian soldiers killed in Ukraine and 16,153 wounded. (The story was quickly removed.) By comparison, 15,000 Soviet troops died and 35,000 were wounded in 10 years in Afghanistan.

Moreover, there is ample evidence that their logistics is a mess, exemplified by the many supply trucks that have simply been abandoned because their tires or engines gave out. By these measures, Ukraine does seem to be winning the war, as Phillips O’Brien and Eliot A. Cohen have argued. History also provides numerous cases of authoritarian regimes that fell apart quite rapidly in the face of military reverses — think of the fates of Saddam Hussein and Moammar Al Qaddafi, or the Argentine junta that invaded the Falklands almost exactly 40 years ago.

It would indeed be wonderful if the combination of attrition in Ukraine and a sanctions-induced financial crisis at home led to Putin’s downfall. Take that, China! Just you try the same trick with Taiwan — which, by the way, we care about a lot more than Ukraine because of all those amazing semiconductors they make at Taiwan Semiconductor Manufacturing Co.

The fascinating thing about this strategy is the way it combines cynicism and optimism. It is, when you come to think of it, archetypal Realpolitik to allow the carnage in Ukraine to continue; to sit back and watch the heroic Ukrainians “bleed Russia dry”; to think of the conflict as a mere sub-plot in Cold War II, a struggle in which China is our real opponent.

The Biden administration not only thinks it’s doing enough to sustain the Ukrainian war effort, but not so much as to provoke Putin to escalation. It also thinks it’s doing enough to satisfy public opinion, which has rallied strongly behind Ukraine, but not so much as to cost American lives, aside from a few unlucky volunteers and journalists.

The optimism, however, is the assumption that allowing the war to keep going will necessarily undermine Putin’s position; and that his humiliation in turn will serve as a deterrent to China. I fear these assumptions may be badly wrong and reflect a misunderstanding of the relevant history.

Prolonging the war runs the risk not just of leaving tens of thousands of Ukrainians dead and millions homeless, but also of handing Putin something that he can plausibly present at home as victory. Betting on a Russian revolution is betting on an exceedingly rare event, even if the war continues to go badly for Putin; if the war turns in his favor, there will be no palace coup.

As for China, I believe the Biden administration is deeply misguided in thinking that its threats of secondary sanctions against Chinese companies will deter President Xi Jinping from providing economic assistance to Russia.

Begin with the military situation, which Western analysts consistently present in too favorable a light for the Ukrainians. As I write, it is true that the Russians seem to have put on hold their planned encirclement of Kyiv, though fighting continues on the outskirts of the city. But the theaters of war to watch are in the east and the south.

In the east, according to military experts whom I trust, there is a significant risk that the Ukrainian positions near the Donbas will come under serious threat in the coming weeks. In the south, a battalion-sized Chechen force is closing in on the besieged and 80%-destroyed city of Mariupol. The Ukrainian defenders lack resupply outlets and room for tactical breakout. In short, the fall of Mariupol may be just days away. That in turn will free up Russian forces to complete the envelopment of the Donbas front.

The next major targets in the south lie further west: Mykolayiv, which is inland, northwest of Kherson, and then the real prize, the historic port city of Odesa. It doesn’t help the defenders that a large storm in the northern Black Sea on Friday did considerable damage to Ukrainian sea defenses by dislodging mines.

Also on Friday, the Russians claim, they used a hypersonic weapon in combat for the first time: a Kinzhal air-launched missile which was used to take out an underground munitions depot at Deliatyn in western Ukraine. They could have achieved the same result with a conventional cruise missile. The point was presumably to remind Ukraine’s backers of the vastly superior firepower Russia has at its disposal. Thus far, around 1,100 missiles have struck Ukraine. There are plenty more where they came from.

And, of course, Putin has the power — unlike Saddam or Qaddafi — to threaten to use nuclear weapons, though I don’t believe he needs to do more than make threats, given that the conventional war is likely to turn in his favor. The next blow will be when Belarusian forces invade western Ukraine from the north, which the Ukrainian general staff expects to happen in the coming days, and which could pose a threat to the supply of arms from Poland.

In any case, Putin has other less inflammatory options if he chooses to escalate. Cyberwarfare thus far has been Sherlock Holmes’s dog that didn’t bark. On Monday the Biden administration officially warned the private sector: “Beware of the dog.” Direct physical attacks on infrastructure (e.g., the undersea cables that carry the bulk of global digital traffic) are also conceivable.

I fail to see in current Western strategizing any real recognition of how badly this war could go for Ukraine in the coming weeks. The incentive for Putin is obviously to create for himself a stronger bargaining position than he currently has before entering into serious negotiations. The Ukrainians have shown their cards. They are ready to drop the idea of NATO membership; to accept neutrality; to seek security guarantees from third parties; to accept limits on their own military capability.

What is less clear is where they stand on the future status of Crimea and the supposedly independent republics of Donetsk and Luhansk. It seems obvious that Putin needs more than just these to be able to claim credibly to have won his war. It seems equally obvious that, if they believe they are winning, the Ukrainians will not yield a square mile of territory. Control of the Black Sea coast would give Putin the basis from which to demand further concessions, notably a “land bridge” from Crimea to Russia.

Meanwhile, the mainly financial sanctions imposed on Russia are doing their intended work, in causing something like a nationwide bank run and consumer goods shortages. Estimates vary as to the scale of the economic contraction — perhaps as much as a third, recalling the depression conditions that followed the Soviet collapse in 1991.

Yet, so long as European Union countries refuse to impose an energy embargo on Russia, Putin’s regime continues to receive around $1.1 billion a day from the EU in oil and gas receipts. I remain skeptical that the sanctions as presently constituted can either halt the Russian war machine or topple Putin. Why has the ruble not fallen further and even rallied against the euro last week?

Remember, both sides get to apply history. The Ukrainian President Volodymyr Zelenskiy is a master of the art, carefully tailoring his speeches to each national parliament he addresses, effectively telling one country after another: “Our history is your history. We are you.” He gave the Brits Churchill, the Germans the Berlin Wall, the Yanks Martin Luther King Jr., and the Israelis the Holocaust.

Putin applies history in a diametrically opposite way. “The president has completely lost interest in the present,” the Russian journalist Mikhail Zygar argued in a recent New York Times piece. “The economy, social issues, the coronavirus pandemic, these all annoy him. Instead, he and [his adviser Yuri] Kovalchuk obsess over the past.”

I can see that. Putin’s recent pseudo-scholarly writing — on the origins of World War II and “On the Historical Unity of the Russians and Ukrainians” — confirm the historical turn in his thought.

I disagree with the former Russian foreign minister, Andrey Kozyrev, who told the Financial Times that, for Putin and his cronies, “the cold war never stopped.” That is not the history that interests Putin. As the Bulgarian political scientist Ivan Krastev told Der Spiegel, Putin “expressed outrage that the annexation of the Crimea had been compared with Hitler’s annexation of the Sudetenland in 1938. Putin lives in historic analogies and metaphors. Those who are enemies of eternal Russia must be Nazis.” Moreover:

The hypocrisy of the West has become an obsession of his, and it is reflected in everything the Russian government does. Did you know that in parts of his declaration on the annexation of Crimea, he took passages almost verbatim from the Kosovo declaration of independence, which was supported by the West? Or that the attack on Kyiv began with the destruction of the television tower just as NATO attacked the television tower in Belgrade in 1999?

Yet such recent history is less significant to Putin than the much older history of Russia’s imperial past. I have made this argument here before. Fresh evidence that Putin’s project is not the resurrection of the Soviet Union, but looks back to tsarist imperialism and Orthodoxy, was provided by his speech at the fascistic rally held on Friday at Moscow’s main football stadium. Its concluding allusion to the tsarist admiral Fyodor Ushakov, who made his reputation by winning victories in the Black Sea, struck me as ominous for Odesa.

The Chinese also know how to apply history to contemporary problems, but they do it in a different way again. While Putin wants to transport post-Soviet Russia back into a mythologized tsarist past, Xi remains the heir to Mao Zedong, and one who aspires to a place alongside him in the Chinese Communist Party’s pantheon. In their two-hour call on Friday, according to the Chinese Foreign Ministry read-out, Biden told Xi:

50 years ago, the US and China made the important choice of issuing the Shanghai Communique. Fifty years on, the US-China relationship has once again come to a critical time. How this relationship develops will shape the world in the 21st century. Biden reiterated that the US does not seek a new Cold War with China; it does not aim to change China’s system; the revitalization of its alliances is not targeted at China; the US does not support “Taiwan independence”; and it has no intention to seek a conflict with China. 

To judge by Xi’s response, he believes not one word of Biden’s assurances. As he replied:

The China-US relationship, instead of getting out of the predicament created by the previous US administration, has encountered a growing number of challenges. …

In particular … some people in the US have sent a wrong signal to “Taiwan independence” forces. This is very dangerous. Mishandling of the Taiwan question will have a disruptive impact on the bilateral ties … The direct cause for the current situation in the China-US relationship is that some people on the US side have not followed through on the important common understanding reached by the two Presidents … 

Xi concluded with a Chinese saying: “He who tied the bell to the tiger must take it off.” Make of that what you will, but it didn’t strike me as very encouraging to those in Team Biden who have been pushing a hawkish line toward China.

The China hawks in the administration — notably Kurt Campbell and Rush Doshi at the National Security Council — do not like the term “Cold War II.” But Doshi’s recent book “The Long Game” (which I reviewed here) is essentially a manual for the containment of China — the nearest thing we are likely to get to George Kennan’s foundational Long Telegram and “X” article in Foreign Affairs.

And National Security Advisor Jake Sullivan did not make himself popular at last Monday’s marathon meeting with his Chinese counterpart, Yang Jiechi, by threatening secondary sanctions against a list of Chinese companies the U.S. will be watching for signs that they are trading with Russia. If Benn Steill and Benjamin Della Rocca of the Council on Foreign Relations are right, the Chinese have already helped Russia hide some of its foreign exchange reserves from financial sanctions.

Judging by his weekend interview in the Wall Street Journal, a member of President Donald Trump’s NSC, Matthew Pottinger, is now more than content to call a cold war by its real name. I agree: The invasion of Ukraine in many ways resembles the invasion of South Korea by North Korea in 1950.

I would put it like this: Cold War II is like a strange mirror-image of Cold War I. In the First Cold War, the senior partner was Russia, the junior partner was China — now the roles are reversed. In Cold War I, the first hot war was in Asia (Korea) — now it’s in Europe (Ukraine). In Cold War I, Korea was just the first of many confrontations with aggressive Soviet-backed proxies — today the crisis in Ukraine will likely be followed by crises in the Middle East (Iran) and Far East (Taiwan).

But there’s one very striking contrast. In Cold War I, President Harry Truman’s administration was able to lead an international coalition with a United Nations mandate to defend South Korea; now Ukraine has to make do with just arms supplies. And the reason for that, as we have seen, is the Biden administration’s intense fear that Putin may escalate to nuclear war if U.S. support for Ukraine goes too far.

That wasn’t a concern in 1950. Although the Soviets conducted their first atomic test on August 29, 1949, less than a year before the outbreak of the Korean War, they were in no way ready to retaliate if (as General Douglas MacArthur recommended) the U.S. had used atomic bombs to win the Korean War.

History talks in the corridors of power. But it speaks in different voices, according to where the corridors are located. In my view — and I really would love to be wrong about this — the Biden administration is making a colossal mistake in thinking that it can protract the war in Ukraine, bleed Russia dry, topple Putin and signal to China to keep its hands off Taiwan.

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A freshly minted Tripolar World. US might still be reliving its glory days of the 1990s and essentially inviting its own triangulation
Law & Politics

A freshly minted Tripolar World. It is clear the Russian abrasiveness is in part informed by a fundamentally better understanding of realpolitik and its chagrin that The US might still be reliving its glory days of the 1990s and essentially inviting its own triangulation

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29-NOV-2021 :: Regime Change
Law & Politics

Regime Change came to Saddam’s Iraq and for a while regime change was de rigeur
Muammar Gaddafi was decapitated and the domino effect only stopped when Vladimir Putin decided he was going to put a stop to it and intervened on behalf of Bashar Al-Assad in Syria.
Today, the US has exited Afghanistan and the days of a Unipolar World are self evidently behind us. We exist in a Tripolar World [US China and Russia] with rapidly emerging Middle Powers. 
I am not discounting Fortress Europe but one senses the Fortress is keener on a more defensive posture unlike the US [notwithstanding its withdrawal from Afghanistan], China and Russia. Taiwan and Ukraine are the immediate geopolitical flashpoints.

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US army war college quarterly 1997. The US officer charged with defining the future of warfare, wrote One of the defining bifurcations of the future will be the conflict between information masters and information victims.
Law & Politics

This information warfare will not be couched in the rationale of geopolitics, the author suggests, but will be “spawned” - like any Hollywood drama - out of raw emotions.

 “Hatred, jealousy, and greed - emotions, rather than strategy - will set the terms of [information warfare] struggles”.

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.1031
Dollar Index 98.457
Japan Yen 121.14
Swiss Franc 0.93465 
Pound 1.328355 
Aussie 0.746190
India Rupee 76.1475 
South Korea Won 1214.800
Brazil Real 4.9111000 
Egypt Pound 18.497576 
South Africa Rand 14.80720

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The #Ukraine war will have major consequences for energy, food, inflation and poverty. @EBRD chief economist @bjavorcik explains the impact of the conflict on the global economy @AFP @rolandfj

Historical experience tells us that, if the conflict continues, the number of refugees may reach six million.
The scale of it is huge and it is unprecedented.
Q: What about spiking commodity markets?
A: Even if the war stopped today, the consequences of this conflict would be felt for months to come, and that would work through commodity prices.
The poor are going to be hit much harder by higher energy prices and by higher food prices.
That has implications for poverty and for political stability.
Russia and Ukraine are responsible for 30 percent of wheat exports globally. Ukrainian farmers have not sold last year's crop yet. Shipping in the Black Sea is hindered — and Ukrainian farmers are not sowing new crops.
Russia and Belarus are very important exporters of ammonia and potash — inputs into fertilizers.
There is an impact on renewable energy because nickel, copper, platinum, and palladium are inputs into the industry.
If you think about gas being at record levels in Europe and oil being high globally ... All of these things lead to inflation.
So, this conflict will have an adverse effect on the global economy — no question about that.

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The Nickel Market Will Be Broken Even After the LME Is Fixed @bopinion @davidfickling

Here’s one remarkable aspect of the short squeeze that briefly drove nickel prices to nearly quadruple in 48 hours earlier this month:

The player who was squeezed to the point of making billions of paper losses each day is the world’s biggest producer of nickel, Tsingshan Holding Group Co.

Such an outcome is a bit like Exxon Mobil Co. getting caught on the wrong side of the oil market. 

A short squeeze only works on a trader who’s unable to cover their position, forcing them to buy back contracts at ever-escalating prices in a market where supply is vanishing. 

Tsingshan should be immune from that problem. The company aims to produce 850,000 metric tons of nickel this year. 

Short interest across the entire London Metal Exchange on the eve of the squeeze amounted to not much more than half that amount. 

If Tsingshan’s billionaire owner Xiang Guangda wanted to avoid those disastrous costs, he simply needed to deliver nickel from his plants in Indonesia into the LME’s warehouses in Singapore and Malaysia.

That’s the theory, at least. The problem is that not all nickel is created equal. 

Tsingshan made its name producing not the highly purified plates and briquettes which are traded on the LME as Class 1 nickel, but nickel pig iron or NPI — lumps of low-grade metal that can be fed into electric furnaces as a low-cost way of producing stainless steel, the destination of about three-quarters of the world’s nickel. That helps explain why Tsingshan was unable to cover its trading position. While it produces plenty of nickel, hardly any of it is the high-grade sort that’s accepted by the LME.

That’s a problem that reaches well beyond this month’s trading turmoil. 

A few decades ago, Class 1 metal was overwhelmingly the most useful way of getting nickel into steel, alloys, electroplating, and the array of other minor applications in which it’s used. 

But refining a metal from ore up to 99.8% purity before alloying it down to lower concentrations can be a wasteful and cumbersome way of going about things. 

After nickel last spiked to $51,600 a ton in 2007, Chinese metallurgists turned to NPI, which has similar concentrations of elements to finished stainless steel, as a cheap but emissions-intensive way of churning out finished metal. 

That revolutionized the nickel market during the 2010s, leading to an explosion in production from Indonesia and the Philippines, whose low-grade ores aren’t well-suited for refining into Class 1 metal.

The same process is now underway with battery materials. Nickel 28 Capital Corp. forecasts that demand from electric cars, barely worth counting a few years ago, will rise to about 1.3 million tons in 2030, equivalent to about half of last year’s output. 

Miners and battery companies are again looking to bypass Class 1 metal: BHP Group is producing nickel sulfate crystals from its mines in Australia, while Tsingshan and other Chinese companies have developed mixed hydroxide precipitate or MHP, a product rich in the battery elements nickel and cobalt.

What’s the role for Class 1 nickel in a world where its two largest end-used markets are supplied by alternative products? It’s not zero: Because of its high purity, Class 1 can operate as a sort of swing product, with the versatility to make up for shortages in the stainless steel and battery materials market when NPI and MHP aren’t available in sufficient quantities. Its uniformity makes trading alternative products easier, too. NPI and MHP are typically priced at a discount to the refined metal, adjusted based on their chemical composition, ease of processing and transport costs.

That’s not an unusual situation. Most of the world’s crude oil is not the light, sweet type on which the Brent and West Texas Intermediate contracts are based. 

Most metal is traded not as refined cathodes and briquettes but as powdery concentrates and mattes that are almost as diverse as the rocks from which they’re processed.

Still, benchmarks that don’t reflect their market quickly lose their usefulness. Within the span of a few decades, Class 1 nickel has fallen from roughly two-thirds of the world’s mined nickel by value to a third or so

That number will fall further as battery compounds take up an ever-larger share of demand. Producers and consumers of metal won’t want their cashflows to be hostage to the gyrations of an illiquid commodity they barely even trade.

Fixing that problem won’t be easy. Class 1 nickel may be illiquid, but the less refined products that might challenge its role as a benchmark aren’t traded in volumes significant enough to supplant it, especially when you consider the disadvantages of their less standardized nature. Nickel is unlikely to see turmoil as dramatic as its recent run to $100,000 a ton any time soon — but if producers and consumers can’t agree a more reliable yardstick for pricing, this won’t be the last upset to hit the market.

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On 24 December, USD/TRY was around 10.50. Anyone who went into the FX-protected account for 3 months will see maturity in two days. @canokar
Emerging Markets

Instead of just offering reasonable interest, the state is going to be making up a 4 lira difference.
Turkey’s KKM is astoundingly stupid.

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In 1998, Prime Minister Margaret Thatcher told the House of @HouseofCommons There is no way in which one can buck the market. from Monday, August 13, 2018
Emerging Markets

He 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]

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The World’s Deadliest War Isn’t in Ukraine, But in Ethiopia @bopinion @ghoshworld

Coming from a Nobel Peace Prize winner, Abiy Ahmed’s call for restraint and diplomacy to end the war in Ukraine might have attracted more attention if the Ethiopian prime minister hadn’t stained his laurels with the blood of his own people. 

Reports of hideous war crimes committed by his forces and those of his Eritrean allies against civilians in the rebel northern province of Tigray make a mockery of his appeals for nonviolence in other parts of the world.
Russia’s invasion of Ukraine has diverted international attention from conflicts elsewhere, including those in Yemen, Mozambique and Africa’s Sahel, the region just south of the Sahara. 

In Ethiopia, Africa’s second-most populous nation, a bloody civil war is now in its 16th month. 

The fighting between Abiy’s forces and the rebel Tigray People’s Liberation Front seems at a standstill, but human-rights groups and multilateral organizations have condemned atrocities on both sides.

Caught in the middle are civilians in the northern province, who now face a calamity that is being likened to horrors of Africa’s — and Ethiopia’s — past: mass starvation and ethnocide

World Health Organization Director-General Tedros Adhanom Ghebreyesus, himself an Ethiopian, says there is “nowhere on earth where the health of millions of people is more under threat” than the Tigray region.

Abiy’s government, which had celebrated Tedros’s elevation to the leadership of the WHO as a matter of national pride, now is trying to tar him because his family has origins in Tigray. 

But as well as anecdotal evidence, there is a growing body of data to support Tedros’s claim that the province is on the edge of a major humanitarian disaster.
Though the war’s true toll is impossible to know, researchers from Belgium’s Ghent University estimate as many as half a million people have died so far: 

between 50,000 and 100,000 from the fighting, 150,000 to 200,000 from starvation and more than 100,000 from the lack of medical attention

U.S. Secretary of State Antony Blinken has expressed concern about possible ethnic cleansing in Tigray, but the government in Addis Ababa has dismissed this as “spurious.”
The Tigrayan rebels have been accused of crimes, including murder and rape, against other ethnic groups. But Abiy’s soldiers are blamed for most of the civilian casualties, especially those from starvation and neglect. 

Government forces are preventing food aid and medicine from reaching Tigray, humanitarian groups say.
And they are no slouches at other kinds of atrocity, including the recent immolation of a Tigrayan man, which even the government-affiliated human rights commission has blamed on Abiy’s forces.
Such outrages are likely to multiply and escalate as the war remains stalemated. 

Late last year, government troops were able to beat back a rebel advance toward the capital and retake towns on the border with Tigray. 

The use of military drones, apparently supplied by Turkey, helped turn the tide. (Turkish drones have also helped Ukrainian forces slow the Russian advance.)
While his ground forces seem to have stopped short of an assault on Tigray, where the mountainous terrain has previously proved to be a distinct rebel advantage, 

Abiy has no qualms about ordering airstrikes that have inflicted heavy civilian casualties. 

Michelle Bachelet, head of the U.N. Human Rights Commission, says her staff have recorded hundreds of deaths from aerial attacks “apparently carried out by the Ethiopian Air Force.” 

The government has denied this. 
Abiy and the TPLF leadership have both said they are willing to negotiate an end to the civil war, but neither side has demonstrated much flexibility on their demands. 

The prime minister want the rebels to disarm and accept rule from Addis Ababa, while the TPLF wants greater autonomy for Tigray and an accounting for atrocities committed by Ethiopian and Eritrean forces. 
There is little prospect of progress toward reconciliation and peace without more outside pressure. 

But with the world’s attention focused on Ukraine and Russia, there is every chance that both sides in the Ethiopian civil war will use the stalemate to rearm for still more fighting.

Who can prevent this from happening? The African Union’s attempts at mediation have proved singularly ineffective. 

The European Union has done little since suspending some budgetary support for Ethiopia early last year. 

The U.S. has already exerted considerable effort — President Joe Biden has spoken directly with Abiy, his Horn of Africa envoy has traveled to Addis Ababa and his administration has terminated favorable access for Ethiopian goods to the U.S.

The only strategy that hasn’t yet been tried is the imposition of sanctions against the TPLF leadership and top government figures, including Abiy himself. 

With Tigray on the precipice of a humanitarian catastrophe, it’s time for Biden to signal that option is, at the very least, on the table.

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Turning and turning in the widening gyre

Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere The ceremony of innocence is drowned;
The best lack all conviction, while the worst Are full of passionate intensity.

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Equity Group Holdings Ltd reports FY 2021 EPS +98% Earnings here
N.S.E Equities - Finance & Investment

Par Value:                  0.50/-
Closing Price:           52.00
Total Shares Issued:          3773674802.00
Market Capitalization:        196,231,089,704
EPS:              10.38 
PE:                 5.009

Equity Group reports FY 2021 Earnings versus FY 2020 

FY Total Assets 1.304913824 Trillion versus 1.015093315 Trillion

FY Investment Securities 394.101448b versus 217.407885b

FY Kenya Government Securities 215.880077b versus 162.309318b

FY Other Securities 164.514258b versus 39.256150b

FY Loans and Advances [Net] to Customers 587.775071b versus 477.847189b

FY Customer Deposits 958.977b versus 740.800779b

FY Total Interest Income 94.345030b versus 73.764833b

FY Total Interest Expenses 25.534056b versus 18.616042b 
FY Net Interest Income 68.810974b versus 55.148791b

FY Total Non-Interest Income 44.575415b versus 38.508081b

FY Total Operating Income 113.386389b versus 93.656872b

FY Loan Loss Provision 5.844707b versus 26.631273b

FY Staff Costs 19.108213b versus 15.418429b

FY Other Operating expenses 28.682087b versus 23.512357b 

FY Total Operating Expenses 61.505369b versus 72.664472b

FY Profit before Tax after exceptional items 51.881020b versus 22.169790b

FY Profit after Tax exceptional items and minority interest 39.174429b versus 19.789398b

FY EPS 10.38 versus 5.24 +98% 

FY Dividend 3.00 a share 

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Equity Group Full Year 2021 Results [KES YoY]: @MwangoCapital
N.S.E Equities - Finance & Investment

- Loan book +23% to 587.7B.
- Total Assets +28.5% to 1.3T.
- Customer Deposits +29.4% to 958.9B.
- Total Interest Income +27.8% to 94.3B.
- Loan provisions -78.0% to 5.8B.
- PAT +99% to 40.1B
- EPS +98% to 10.4

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Equity groups 86% of all transactions is in digital channels 6% in 3rd party infrastructure 3% performed by brick and mortar banking. @kasiva_mutisya
N.S.E Equities - Finance & Investment


The numbers are flattered by lapping FY 2020 where Earnings were suppressed.

However, make no mistake this is a alpha stock and the DRC is a Jewel in the crown

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8 JAN 18 :: The Crypto Avocado Millenial Economy.
Kenyan Economy

The ‘’Zeitgeist’’ of a time is its defining spirit or its mood. Capturing the ‘’zeitgeist’’ of the Now is not an easy thing because we are living in a dizzyingly fluid moment.

American per-capita consumption was 6.9 pounds in 2015, versus 3.5 pounds in 2006. My point is millenials discovered the virtues of avocado, the behaviour spread like a ‘virus’ and boom, prices sky-rocketed. 

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by Aly Khan Satchu (www.rich.co.ke)
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March 2022

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