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Satchu's Rich Wrap-Up
Monday 23rd of May 2022

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14-FEB-2022 :: Its the End of the Bull market obviously.
World Of Finance

The Music has been playing for Eternity and its about to stop

Love Fellini. So brave, with that whiff of insanity. @DiAmatoStyle Federico Fellini's 8 1/2 @tcm

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Photographer Thandiwe Muriu highlights the rich cultural history of her Kenyan heritage through stylish, maximalist portraits. @mymodernmet

The images feature models wearing garments resembling the traditional textiles of various African countries and cultures, and they stand in front of backdrops to match. 

Together, it has a camouflage-like effect; but the brilliant beauty of the patterns and colors is nothing to try and hide. 

Rather, Muriu’s images—part of a series aptly titled Camo—command attention and have an almost hypnotic effect on the viewer.

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America, China, Russia and the Avalanche of History @opinion @nfergus
Law & Politics

Does the arc of history bend toward justice? Or is everything falling apart?

Philosophers of history have long sought a cycle of history. 

Ibn Khaldun offered one version in his “Muqaddimah” (1377): Islam in its infancy has “desert toughness” — but power leads to sedentary habits and luxury, while extravagance leads to fiscal crisis.
Oswald Spengler offered an alternative model in “The Decline of the West” (1918), in which the rise and fall of civilizations resembles the seasons. 

In our time, a number of writers have proposed their own cyclical theories, ranging from William Strauss and Neil Howe’s “The Fourth Turning” (1997) to the financier Ray Dalio’s recent “The Changing World Order.”

An alternative approach is the notion that history has some purposeful direction and ultimate destination. 

In a recent essay, Francis Fukuyama reasserted his old claim that history tends towards the triumph of liberal-democratic capitalism and the nation-state. In his words, “there is, indeed, an arc of history, with justice as its terminus.”
This bold assertion is hard to reconcile with the perception of those who follow trends in mass psychology, social media and education that democracy is in the grip of a “stupefaction process” (Jonathan Haidt’s phrase) in the US and elsewhere.

I disbelieve in both cycles of history and ends of history. History is the interaction of many complex systems. 

There are certain long-run processes (notably exponential gains in productivity through the development of technology and the “suprasecular” decline of nominal and real interest rates as a result of capital accumulation) punctuated by, well, one disaster after another. 

These disasters are either randomly distributed or follow a power law (i.e. there are lots of little earthquakes, pandemics or wars, but a few cataclysmic ones).

At unpredictable intervals, the global system is tipped into a major transition by a disturbance that can be quite small, if not quite as small as Edward Lorenz’s famous butterfly in the Amazon setting off a tornado in Texas. 

Russia’s war in Ukraine — destructive certainly, but still a relatively small conflict by 20th-century standards — can be enough to trigger a “conflict avalanche.”
In the same way, a belated tightening of monetary policy by the world’s most important central bank, the Federal Reserve, inflicts a sort of regime change not only on US households and businesses, but on the rest of the world, too

All the consequences of these two shocks — one geopolitical, the other economic — are very hard indeed to predict, but I am confident that we have seen only a small proportion of them so far.
There is quite a bit more trouble ahead before we perceive the restoration of “normality,” which is a term we use loosely to mean something like a period of more than one year during which economic, social and political events do not diverge too radically from the average of the previous 10 years.
The biggest losers in 2022 have of course been cryptocurrencies. 

With the failed “stablecoin” Terra (UST) now en route to zero (at 8 cents to the dollar, compared with 100 cents two weeks ago), there is palpable fear that other stablecoins and even some exchanges could be at risk. 

Bitcoin is down 35% year-to-date. Ethereum, 46%. 

In some ways, however, the major cryptocurrencies in the past two years have simply become substitutes for technology stocks rather than hedging devices. Tesla is down 33%. Amazon is down 36%.

Why are both crypto and tech stocks down? The answer is that the belated tightening of monetary policy has forced investors to rethink their narratives and metrics, especially when it comes to the preference for growth in user numbers over free cash flow.

Valuations that seemed to make sense at a time when the pandemic had driven people indoors and almost permanently online suddenly seemed less plausible as Covid fears receded, the real world of atoms bounced back (oil is up 48% this year and commodities overall up 32%), and the Fed caught up with Larry Summers, the former Treasury secretary who warned of inflation last February.

Owning gold has preserved capital but owning dollars has been a superior strategy. 

Other major currencies have all weakened relative to the US currency, a classic response to Fed tightening and global uncertainty. 

However, that trend could reverse if, after two more 50 basis-point hikes, the Fed blinks and stops hiking or even cuts rates in the fall.

The historical period all this most closely resembles is the 1970s, though the analogy is far from perfect. 

Then, as now, errors of monetary and fiscal policy dislodged inflationary expectations in the US. Then, as now, a war made matters worse. 

A geopolitical shock (the Yom Kippur War of 1973) added supply-side disruption in the form of the oil-price hike by the Arab members of the Organization of Petroleum Exporting Countries, in retaliation for US and other countries’ support for Israel.

Then, as now, the dominant feature of the international order was cold war. 

Today, the superpower rivalry is between Washington and Beijing. Then, it was with Moscow — though Russia remains a superpower in terms of the nuclear threat it poses, if in no other respect.

Then, as now, the credibility of the US had been significantly undermined by defeat. 

The shambolic departure of NATO forces from Afghanistan last year, recalling the chaotic abandonment of Saigon in 1975, partly explains the readiness of President Joe Biden’s administration to fund lavishly a proxy war waged by Ukraine.
Then, as now, China had withdrawn into itself, though the Cultural Revolution was a more disruptive event than President Xi Jinping’s “Zero Covid” policy.
Then, as now, generational divisions were part of a broader problem of social polarization that worried people throughout the Western world. 

Then, as now, there was an increase in both criminal and political violence in the US (the latter exemplified by the recent murderous rampages in Buffalo, New York and Laguna Woods, California).
If the experience of the 1970s offers any guidance to investors, it is not to expect a rapid return to stability, whether in macroeconomic or geopolitical terms.  There were avalanches of conflict in the 1970s. 

“Peace” in Vietnam (the treaty of January 1973) was followed not only by the fall of South Vietnam but also by the beginning of the Cambodian genocide under Pol Pot, not to forget the Chinese-Vietnamese border war of 1979.

“Peace” in the Middle East (the Camp David Accords) was followed by the Iranian revolution. 

Detente fell apart as Soviet aggression ramped up from southern Africa to Afghanistan. 

We should prepare ourselves for a similar cascade in the coming years. This will make it very hard to bring inflation back to around 2% at an acceptable political cost.
However, public disaffection with inflation, not to mention violent crime, will likely see a political turn to the right in the US and other countries where left-of-center governments are in power. 

This will not benefit conservative parties currently in power (for example, the British Conservatives). It seems very likely to benefit Republicans in November’s midterm elections.

Because history is not cyclical, this exercise in pattern recognition cannot be prophetic. 

It is unlikely, for example, that the Republican Party will field a candidate as international in his outlook as Ronald Reagan was in 1980. 

It may yet pick former President Donald Trump. Candidates he endorsed are faring somewhat better than I expected in this year’s primaries (though the Trump effect shouldn’t be exaggerated). 

On the other hand, there is something powerfully symbolic about the Supreme Court’s impending opinion on Roe v. Wade (1973), a draft of which was leaked two weeks ago. 

We are literally relitigating one the most bitter controversies of the 1970s.

There is also a nontrivial risk that unexpected internal crises in Russia, or even in Ukraine, could provide some relief for nail-biting investors. 

Mao died in 1976, Soviet leader Leonid Brezhnev (finally, after a protracted decline) in 1982. 

The Grim Reaper will remove Xi and Russian President Vladimir Putin from the scene sooner or later, if political rivals do not preempt him. 

Right on cue, the UK’s Daily Mail ran a story on Monday that Xi is resisting surgery to treat a brain aneurysm, preferring to rely on traditional Chinese remedies.
Like the numerous rumors about Putin’s failing health, this may have political as well as medical significance. 

On Russian state television, we are starting to hear criticism of the war in Ukraine, while the US Defense Department says some Russian officers and soldiers are disobeying orders.
At the same time, a political rift can be discerned at the top of the Chinese Communist Party between Xi’s supporters and critics of his zero-Covid policy, apparently led by Premier Li Keqiang. 

Is Xi really sick, or are people just sick of Xi? Roger Garside’s speculative book, “The China Coup,” looks less fanciful every week.
Meanwhile, in the Philippines, a Marcos is back in power — Ferdinand “Bongbong” Marcos Jr., whose father ruled from 1965 to 1986 — while in Canada it is former Prime Minister Pierre Trudeau’s son, Justin, who rules.
In the US, the 1970s originals are still in office: Biden, who entered the Senate in 1972, and House Speaker Nancy Pelosi, who was elected to the Democratic National Committee four years later.  These days, it’s the 1970s who are calling to ask for their politics back.

What lies ahead? Well, after the inflation there usually comes the recession, with the danger of stagflation if the monetary medicine has been administered at the wrong time or in the wrong dose, driving up what used to be called the “misery index” (the sum of the inflation and unemployment rates).

How likely is that scenario? Very.

In the entire postwar period before 2021, there were six quarterly instances of inflation running above 5% while the unemployment rate was below 5%. 

From the start of such an episode, the median time to the start of a recession was 6.5 quarters, with a mean of 6.7 quarters. 

Since the fourth quarter of last year — and for the first time since 1973 — inflation has been above 5% and the unemployment rate below 5%.

If history is an accurate guide, this would imply a high probability of a recession beginning in 2023. 

While the GDP decline in the first quarter of this year was mostly driven by idiosyncratic factors — exports, inventories, and government spending — surveys suggest that consumers are suddenly more pessimistic than at any point since the 2008-2009 financial crisis.
Across the Atlantic, the longer the war in Ukraine lasts, the more likely Europe is to go into recession. 

The European Union is still debating the details of an oil embargo on Russia, but an accelerated phasing out of Russian energy imports now looks likely. 

This would drive the price of oil higher, as Russia would take time to find new buyers for the 2-2.5 million barrels per day it currently sells to Europe.
Natural gas prices are also rising sharply, due to the risk of Russia preemptively cutting off gas supplies to Europe. 

A complete stop would force many European countries to ration gas for major industry consumers, such as chemicals producers.
The British economic predicament is worse than either the American or the European. 

Unlike the US, the UK is a net energy importer, so higher energy prices subtract from its GDP. 

Unlike the EU, it is witnessing substantial wage pressures, so its monetary policy makers are under more pressure to raise rates.
The recession probabilities only go higher when you look at the plight of China, where the government’s refusal to abandon Zero Covid in the face of the more contagious omicron variant has plunged industrial output and retail sales into a severe contraction. 

Economic activity in Shanghai all but ceased last month. Literally zero automobiles were sold. 
There are signs of further declines in Chinese household spending this year driven by Covid restrictions, rising unemployment (especially among migrant laborers and recent graduates) and an ailing property market. 

Despite efforts this year to prop up housing, home-price growth has flatlined while home sales and real-estate funding are in double-digit negative territory.
Remember that image of an avalanche? That is what we are now seeing around the world as higher food and energy prices combine with monetary tightening and supply-chain disruption. 

As in the 1970s, the most serious damage will be suffered by emerging and developing economies — the “Third World,” as they were then collectively known. Consider just a few examples, beginning in the Middle East.

Turkey’s currency has come under increasing pressure in the last two weeks. 

The government’s response is to try to force the country’s banks to use their dollar reserves to support the lira. 

Last week, Iran’s hardline government raised prices for basic goods including bread, cooking oil and dairy products, by between 100% and 300%. Thousands turned out to protest.

Lebanon is the region’s basket case. Having defaulted on its debt in March 2020, the government barely functions. 

Over 80% of Lebanese live in poverty and everyone faces hyperinflation. 

The situation has worsened this year because Lebanon imports over 60% of its grain from Ukraine and Russia.
A comparable disaster is brewing in El Salvador. Under the populist, authoritarian leadership of President Nayib Bukele, the country has enthusiastically embraced Bitcoin both as a reserve currency and as legal tender nationwide. 

The cryptocurrency selloff has likely pushed El Salvador toward a default next January, when $800 million of sovereign bonds are due.
The crypto-contagion doesn’t stop there. According to a 2021 report by the blockchain-data firm Chainalysis, the top three countries in the Global Crypto Adoption Index are Vietnam, India and Pakistan. 

Keep an eye on Pakistan, where surging food and fuel prices coincided with the toppling of Prime Minister Imran Khan last month.
Finally, Africa has witnessed an above-average level of regime fragility over the past 12 months. 

Governments have been deposed in Mali, Guinea, Sudan and Burkina Faso. 

In Ethiopia, civil war continues between the central government and the Tigray region in the north. 

Atrocities there have been overshadowed by those in Ukraine. With food prices soaring, exports of wheat from Ukraine and Russia severely reduced, and drought conditions in much of the Horn of Africa, famine looms wherever state capacity is weak.
Nigeria, Africa’s largest economy and most populous nation, ought to be doing better, as it is the continent’s largest oil producer. 

But it is stumbling toward a presidential election in February 2023. 

Religious strife bedevils the north, and there are growing demands that a candidate from the Igbo-dominated southeast lead the country. 

You really know it’s a global crisis when you hear the name “Biafra” for the first time since 1970.
So far, 2022 has been an annus horribilis, for consumers and investors alike. Do not expect it to get better in the short term. 

The pain is greatest in those few countries that have been invaded or have collapsed into chaos, or for those investors whose net worth has plunged by a quarter or more. 

But it is a crisis that all of us feel to some extent in the forms of higher prices, higher anxiety, less fun and lower wealth.
The sole consolation I can offer disheartened readers is that, though we tend to remember the Seventies mainly for the terrible clothes — not to mention the big hair, even for balding men — they were not entirely miserable. 

It was, after all, the decade that actually delivered to the masses the “permissive society” that the Rolling Stones and others had sung about (and pioneered) in the Sixties. 

Alex Comfort published “The Joy of Sex” (1972) and Erica Jong “Fear of Flying” (1973), which launched the quest for “zipless” copulation, unencumbered by any more enduring form of attachment.
A 2018 study by Nicholas Wolfinger, a sociologist at the University of Utah, concluded (on the basis of survey data) that “promiscuity hit its modern peak for men born in the 1950s.” 

For better or for worse, a lot of unhappy marriages ended in the Seventies; the divorce rate surged from below 3 per 1,000 of population in the years 1948 to 1968 to a secular high of 5.3 in 1979. 

As for the consumption of alcohol, tobacco and marijuana, the historian who turns his attention to the 1970s can only marvel at just how much people smoked, boozed and got stoned.

Unfortunately, because history is not cyclical and lacks an arc bending toward justice (or a stairway to heaven, for that matter), I cannot guarantee that our re-rerun of that Seventies show will include a revival of the decade’s shameless hedonism. 

But who knows what a couple of years stagflation may do for our collective mojo?

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States with such rulers can get seized by senility and the chronic disease from which [they] can hardly ever rid [themselves], for which [they] can find no cure
Law & Politics

Ibn Khaldun explained the intrinsic relationship between political leadership and the management of pandemics in the pre-colonial period in his book Muqaddimah
Historically, such pandemics had the capacity to overtake “the dynasties at the time of their senility, when they had reached the limit of their duration” and, in the process, challenged their “power and curtailed their [rulers’] influence...”
Rulers who are only concerned with the well-being of their “inner circle and their parties” are an incurable “disease”.
States with such rulers can get “seized by senility and the chronic disease from which [they] can hardly ever rid [themselves], for which [they] can find no cure”

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There will be no peace agreement. @GonzaloLira1968
Law & Politics

First—the US has told Zelensky not to agree to any peace deal, because they want to weaken Russia as much as possible.
Second—the Russians won't agree to peace until they've captured and control all ethnic-Russian areas of UA, including Odessa.

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Sunday, April 10, 2022 There is clearly zero intention to resolve this matter anywhere other than on the battlefield and through an insurgency which will bleed Russia to death and the Ukrainians as well.
Law & Politics

Secretary Blinken has refused to meet Lavrov, Biden calls for ‘’Regime Change’’ on a daily basis and ‘’defensive’’ weapons are being shoveled into Ukraine at an unprecedented speed. 

There is clearly zero intention to resolve this matter anywhere other than on the battlefield and through an insurgency which will bleed Russia to death and the Ukrainians as well.

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Russia Rewrites the Art of Hybrid War @UnzReview
Law & Politics

The ironclad fictional “narrative” imposed all across NATOstan is that Ukraine is “winning”.

So why would weapons peddler retrofitted as Pentagon head Lloyd “Raytheon” Austin literally beg since late February to have his phone calls answered by Russian Defense Minister Shoigu, only to have his wish finally granted?
It’s now confirmed by one of my top intel sources. The call was a direct consequence of panic. 

The United States Government (USG) by all means wants to scotch the detailed Russian investigation – and accumulation of evidence – on the US bioweapon labs in Ukraine, as I outlined in a previous column.
This phone call happened exactly after an official Russian statement to the UN Security Council on May 13: we will use articles 5 and 6 of the Convention on the Prohibition of Bioweapons to investigate the Pentagon’s biological “experiments” in Ukraine.
That was reiterated by Under Secretary-General of the UN in charge of disarmament, Thomas Markram, even as all ambassadors of NATO member countries predictably denied the collected evidence as “Russian disinformation”.
Shoigu could see the call coming eons away. Reuters, merely quoting the proverbial “Pentagon official”, spun that the allegedly one-hour-long call led to nothing. 

Nonsense. Austin, according to the Americans, demanded a “ceasefire” – which must have originated a Siberian cat smirk on Shoigu’s face.
Shoigu knows exactly which way the wind is blowing on the ground – for Ukrainian Armed Forces and UkroNazis alike. It’s not only the Azovstal debacle – and Kiev’s all-around army breakdown.
After the fall of Popasnaya – the crucial, most fortified Ukrainian stronghold in Donbass – the Russians and Donetsk/Luhansk forces have breached defenses along four different vectors to north, northwest, west and south. 

What’s left of the Ukrainian front is crumbling – fast, with a massive cauldron subdivided in a maze of mini-cauldrons: a military disaster the USG cannot possibly spin.
Now, in parallel, we can also expect full exposure – on overdrive – of the Pentagon bioweapons racket. 

The only “offer you can’t refuse” left to the USG would be to present something tangible to the Russians to avoid a full investigation.
That’s not gonna happen. Moscow is fully aware that going public with illegal work on banned biological weapons is an existential threat to the US Deep State. 

Especially when documents seized by the Russians show that Big Pharma – via Pfizer, Moderna, Merck and Gilead – was involved in several “experiments”. Fully exposing the whole maze, from the start, was one of Putin’s stated objectives.
More “military-technical measures”?
Three days after the UN presentation, the board of the Russian Foreign Ministry held a special session to discuss “the radically changed geopolitical realities that have developed as a result of the hybrid war against our country unleashed by the West – under the pretext of the situation in Ukraine – unprecedented in scale and ferocity, including the revival in Europe of a racist worldview in the form of cave Russophobia, an open course for the ‘abolition’ of Russia and everything Russian.”
So it’s no wonder “the aggressive revisionist course of the West requires a radical revision of Russia’s relations with unfriendly states.”
We should expect “a new edition of the Foreign Policy Concept of the Russian Federation” coming out soon.
This new Foreign Policy Concept will elaborate on what Foreign Minister Lavrov once again stressed at a meeting honoring the 30th Assembly of the Council on Foreign and Defense Policy: the US has declared an all-round Hybrid War on Russia. The only thing lacking, as it stands, is a formal declaration of war.
Beyond the disinformation fog veiling the application of Finland and Sweden – call them the Dumb and Dumber Nordics – to join NATO, what really matters is another instance of declaration of war: the prospect of missiles with nuclear warheads stationed really close to Russian borders. 

Moscow already warned the Finns and Swedes, politely, that this would be dealt with it via “military-technical measures”. 

That’s exactly what Washington – and NATO minions – were told would happen before the start of Operation Z.
And of course this goes much deeper, involving Romania and Poland as well. Bucharest already has Aegis Ashore missile launchers capable of sending Tomahawks with nuclear warheads at Russia, while Warsaw is receiving the same systems. 

To cut to the chase, if there’s no de-escalation, they will all eventually end up receiving Mr. Khinzal’s hypersonic business card.
NATO member Turkey, meanwhile, plays a deft game, issuing its own list of demands before even considering the Nordics’ gamble. 

Ankara wants no more sanctions on its purchase of S-400s and on top if be re-included in the F-35 program. 

It will be fascinating to watch what His Master’s Voice will come up with to seduce the Sultan. 

The Nordics engaged in a self-correcting “clear unequivocal stance” against the PKK and the PYD is clearly not enough for the Sultan, who relished muddying the waters even more as he stressed that buying Russian energy is a “strategic” issue for Turkey.
Counteracting financial Shock’n Awe
By now it’s evidently clear that open-ended Operation Z targets unipolar Hegemon power, the infinite expansion of vassalized NATO, and the world’s financial architecture – an intertwined combo that largely transcends the Ukraine battleground.
Serial Western sanctions package hysteria ended up triggering Russia’s so far quite successful counter-financial moves. 

Hybrid War is being fought predominantly in the economic/financial battleground – and the pain dial for the collective West will only go up: inflation, higher commodity prices, breakdown of supply chains, exploding cost of living, impoverishment of the middle classes, and unfortunately for great swathes of the Global South, outright poverty and starvation.
In the near future, as insider evidence surfaces, a convincing case will be made that the Russian leadership even gamed the Western financial gamble/blatant robbery of over $300 billion in Russian reserves.
This implies that already years ago – let’s say, at least from 2016, based on analyses by Sergey Glazyev – the Kremlin knew this would inevitably happen. 

As trust remains a rigid foundation of a monetary system, the Russian leadership may have calculated that the Americans and their vassals, driven by blind Russophobia, would play all their cards at once when push came to shove – utterly demolishing global trust on “their” system.
Because of Russia’s infinite natural resources, the Kremlin may have factored that the nation would eventually survive the financial Shock’n Awe – and even profit from it (ruble appreciation included). 

The reward is just too sweet: opening the way to The Doomed Dollar – without having to ask Mr. Sarmat to present his nuclear business card.
Russia could even entertain the hypothesis of getting a mighty return on those stolen funds.

 A great deal of Western assets – totaling as much as $500 billion – may be nationalized if the Kremlin so chooses.
So Russia is winning not only militarily but also to a large extent geopolitically – 88% of the planet does not align with NATOstan hysteria – and of course in the economic/financial sphere.
This in fact is the key Hybrid War battleground where the collective West is being checkmated. 

One of the next key steps will be an expanded BRICS coordinating their dollar-bypassing strategy.
None of the above should overshadow the still to be measured interconnected repercussions of the mass surrender of Azov neo-Nazis at UkroNazistan Central in Azovstal.
The mythical Western “narrative” about freedom-fighting heroes imposed since February by NATOstan media collapsed with a single blow.

 Cue to the thunderous silence all over the Western infowar front, where no mutts even attempted to sing that crappy, “winning” Eurovision song.
What happened, in essence, is that the creme de la creme of NATO-trained neo-Nazis, “advised” by top Western experts, weaponized to death, entrenched in deep concrete anti-nuclear bunkers in the bowels of Azovstal, was either pulverized or forced to surrender like cornered rats.
Novorossiya as a game-changer
The Russian General Staff will be adjusting their tactics for the major follow-up in Donbass – as the best Russian analysts and war correspondents incessantly debate. 

They will have to face an inescapable problem: as much as the Russian methodically grind down the – disaggregated – Ukrainian Army in Donbass, a new NATO army is being trained and weaponized in western Ukraine.
So there is a real danger that depending on the ultimate long-term aims of Operation Z – which are only shared by the Russian military leadership – 

Moscow runs the risk of encountering, in a few months, a mobile and better weaponized incarnation of the demoralized army it is now destroying. And this is exactly what the Americans mean by “weakening” Russia.
As it stands, there are several reasons why a new Novorossiya reality may turn out to be a positive game-changer for Russia. Among them:
The economic/logistics complex from Kharkov to Odessa – along Donetsk, Luhansk, Dnepropetrovsk, Zaporozhye, Kherson, Nikolaev – is intimately linked with Russian industry.
By controlling the Sea of Azov – already a de facto “Russian lake” – and subsequently the Black Sea, Russia will have total control of export routes for the region’s world-class grain production. Extra bonus: total exclusion of NATO.
All of the above suggests a concerted drive for the development of an integrated agro-heavy industry complex – with the extra bonus of serious tourism potential.
Under this scenario, a remaining Kiev-Lviv rump Ukraine, not incorporated to Russia, and of course not rebuilt, would be at best subjected to a no-fly zone plus selected artillery/missile/drone strikes in case NATO continues to entertain funny ideas.
This would be a logical conclusion for a Special Military Operation focused on precision strikes and a deliberate emphasis on sparing civilian lives and infrastructure while methodically disabling the Ukrainian military/logistics spectrum. 

All of that takes time. Yet Russia may have all the time in the world, as we all keep listening to the sound of the collective West spiraling down.

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April 10, 2022 ‘You can print money, but not oil to heat or wheat to eat’ wrote @CreditSuisse’s Zoltan Pozsar.
Law & Politics

“You know, we can play chess, too,” Singh said. “It was important for us to show that the fortress could come crumbling down.”

The Sanction warfare program is a reiteration of the @BarackObama 2014 version but then Oil was dropped to $20.00 and today its trading at $97.56 a barrel. This is the first flaw in the sanction warfare effort.
‘’You can print money, but not oil to heat or wheat to eat’’ wrote @CreditSuisse’s Zoltan Pozsar.
Russia essentially gave the $ and the Euro the very same exorbitant privilege that King Abdul Aziz Ibn Saud of Saudi Arabia gave President Franklin D Roosevelt aboard the USS Quincy in Great Bitter Lake in February 14, 1945 when the petro dollar economy was symbolically born.

By insisting payments are made in Russian Rubles for Russian commodities Vladimir Putin has withdrawn that exorbitant privilege.
The Russian Ruble rally is real and has much further to go.

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Hybrid War
Law & Politics

Andrew Korybko writes Moscow invaluably fills the much-needed niche of providing its partners there with “Democratic Security”, or in other words, the cost-effective and low-commitment capabilities needed to thwart colour revolutions and resolve unconventional Wars (collectively referred to as Hybrid War).

To simplify, Russia’s “political technologists” have reportedly devised bespoke solutions for confronting incipient and ongoing color revolutions, just like its private military contractors (PMCs) have supposedly done the same when it comes to ending insurgencies.

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So new Govermentt is gender balanced ideologically balanced between left & right, ethnically diverse and includes all factions of Macrons centrist electoral alliance. A tour de force in its way. We will soon discover whether its also a good Government
Law & Politics

So new Govt is gender balanced (8 men & women), ideologically balanced (or split) between left & right, ethnically diverse & includes all factions & fractions of Macron’s centrist electoral alliance. A tour de force in its way. We will soon discover whether it’s also a good Govt.

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One of the welcome surprises in the new team is the appointment of the Fr ambassador to the UK, @AmbColonna as Minister for Europe and Foreign affairs. @Mij_Europe
Law & Politics

One of the welcome surprises in the new team is the appointment of the Fr ambassador to the UK, @AmbColonna  as Minister for Europe and Foreign affairs. This is only the second time that a woman has held one of the oldest jobs in the French Govt, going back to the 16th C

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The most audacious - and very welcome choice in new Govt was historian Pap Ndiaye as minister for education. Ndiaye, born in Fr of Senegalese Fr parents, will be highest ever profile black Fr minister @Mij_Europe
Law & Politics

The most audacious - & v welcome choice in new Govt was historian Pap Ndiaye as minister for education. Fr has lagged behind UK/US in appointing senior ministers from ethnic minorities. Ndiaye, born in Fr of Senegalese Fr parents, will be highest ever profile black Fr minister 7/

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Rahul Gandhis @RahulGandhi comment at #Cambridge @IndiaToday
Law & Politics

.@RahulGandhi was mocked for saying this. काश तब सुन लिया होता @SriniSivabalan @srinivasiyc

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.0600
Dollar Index 102.55
Japan Yen 127.73
Swiss Franc 0.97194
Pound 1.2561
Aussie 0.711335
India Rupee 77.6211
South Korea Won 1264.395 
Brazil Real 4.8798
Egypt Pound 18.2767
South Africa Rand 15.78290 

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Markets are starting to be selective in every asset class, including commodities. @MacroAlf

Global-demand driven commodities (e.g. copper)🔽
Supply-bottlenecks driven commodities (e.g. agri)🔼

The ''growth scare'' trade is becoming more real.

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What cherry tomatoes tell you about the cost of living crisis we're all going through. tomato prices are up 21% over the past yr - the fastest rate in over a decade. @EdConwaySky
Food, Climate & Agriculture

What cherry tomatoes tell you about the cost of living crisis we're all going through.
Amid the wider consternation about inflation, perhaps you missed the fact that tomato prices are up 21% over the past yr - the fastest rate in over a decade.

Let's explore why...

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Row after row of tomatoes as far as the eye can see, all growing in hydroponic substrate in these enormous greenhouses. @EdConwaySky
Food, Climate & Agriculture

There are bees buzzing everywhere (they pollinate the tomatoes) and even on a cloudy day it's warm and toasty.

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Of course, CO2 isn't the only thing that aids growth. Just as if not more important is nitrogen-based fertiliser. @EdConwaySky
Food, Climate & Agriculture

Here are enormous bags of it piled high.
It gets dissolved into the hydroponic system here in precise quantities.
These are big greenhouses so they need lots.

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Luck is luck. Luck isn’t structural... Luck is running out Zoltan Pozsar

Luck is luck. Luck isn’t structural... Luck is running out; central banks were lucky to have price stability as a tailwind when they had to fight crises of FX pegs, par, repo, and the cash-futures basis. Those were the easy crises. The ones you can print your way out of with QE.
But not this time around...

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S&P revises outlook on South Africa BB- rating to positive @Markbohlund

S&P revises outlook on South Africa BB- rating to positive on expectation that favorable terms of trade, a path toward contained fiscal expenditure, and implementation of structural reforms could lead to a continued easing of fiscal and external pressures.

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MALAWI Dollarlessness bites @thecontinent_

Government and private sector forex reserves in Malawi are running low and, as a result, shops are running out of commodities like cooking oil. 

Kenya Airways and Ethiopian Airways have suspended ticketing in Malawi saying they are having trouble moving dollars out of the country. 

The Malawi Confederation of Chambers of Commerce and Industry has warned that the forex shortage is going to decimate other businesses too. 

In an attempt at addressing the situation, the government is applying for funding from the International Monetary Fund.

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Driest Conditions in 40 Years Seen Continuing in Horn of Africa @economics @Habesh_

A weather phenomenon over the Indian Ocean is exacerbating the driest conditions in more than four decades in the Horn of Africa that may continue for the rest of the year.

The extreme climate conditions are damaging crops and leading to the death of livestock in countries including Somalia, Ethiopia and Kenya, compounding the steep increase in food prices that have resulted from Russia’s war with Ukraine. 

Rains that usually fall from March to May have failed this year and the resulting drought has exhausted the coping mechanisms of people who now have to rely on humanitarian aid to survive, the World Food Programme said in April.  

Every year, an oscillation in sea-surface temperatures in the western and eastern parts of the Indian Ocean, causes either long droughts or heavy rain in eastern Africa. 

The so-called Indian Ocean Dipole was also responsible for the desert locust plague that ravaged swaths of farmlands from 2019. 

This year, the IOD “will be one of the strongest, if not the strongest,” according to the United Nations’ Food and Agriculture Organization. 
“The stronger the IOD on one side, you will have really strong contrast between the two sides,” Abubakr Salih Babiker of the World Meteorological Organization’s regional office for Africa said by phone from Addis Ababa, Ethiopia’s capital. 

“The prospect is not looking good. There is risk that these dry conditions might continue until the end of the year.”

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An obscure climate Phenomenon called the the Indian Ocean Dipole (IOD) [an oscillation of sea surface temperatures in the Indian Ocean]

For those who are Weather enthusiasts, the current drought conditions in East Africa is being caused by an ''obscure'' climate Phenomenon called the the Indian Ocean Dipole (IOD) [an oscillation of sea surface temperatures in the Indian Ocean]  

It wasn’t until the 1990s that Japanese scientists discovered the Indian Ocean Dipole, a warm pool of water that migrates between western and eastern “poles” and affects atmospheric temperatures and rainfall. 

The phenomenon occurs in cycles of positive (warmer) and negative (cooler) sea temperatures, but it has become more extreme in recent years due to climate change.
A negative Indian Ocean Dipole results in less rainfall over East Africa, and that’s contributing to the current drought that aid agencies warn could trigger mass famine. 

The Scientists found that before 1924, the IOD occurred approximately every 10 years, but since 1960, IOD events have been occurring approximately 18 months to three years apart.

The researchers suggested that global warming effects on the western Indian Ocean have driven the observed shift in IOD variability and note that the IOD has replaced the El Nino-Southern Oscillation as the major driver of climate patterns over the Indian Ocean region. 

It is this negative Indian ocean Dipole which has parched the Country and the region.

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About this time of year, I would park myself on the Verandah at the Mombasa Club and search for the sea breeze.

Later I would learn that I was in fact sniffing the sea breeze for Petrichor [Petrichor (/ˈpɛtr�k ɔәr/) is the earthy scent produced when rain falls on dry soil].

 The word is constructed from Greek πέτρα petra, meaning "stone", and ἰχώρ īchōr, the fluid that flows in the veins of the gods in Greek mythology Wikipedia]. 

According to Wikipedia, Some scientists believe that humans appreciate the rain scent because ancestors may have relied on rainy weather for survival. 

I like the idea that my sojourns to that verandah at the Club, tied me somehow to my ancestors. 

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In chaos theory, the butterfly effect is the sensitive dependence on initial conditions in which a small change in one state of a deterministic nonlinear system can result in large differences in a later state.

Lorenz wrote:
"At one point I decided to repeat some of the computations in order to examine what was happening in greater detail. I stopped the computer, typed in a line of numbers that it had printed out a while earlier, and set it running again. I went down the hall for a cup of coffee and returned after about an hour, during which time the computer had simulated about two months of weather. The numbers being printed were nothing like the old ones. I immediately suspected a weak vacuum tube or some other computer trouble, which was not uncommon, but before calling for service I decided to see just where the mistake had occurred, knowing that this could speed up the servicing process. Instead of a sudden break, I found that the new values at first repeated the old ones, but soon afterward differed by one and then several units in the last decimal place, and then began to differ in the next to the last place and then in the place before that. In fact, the differences more or less steadily doubled in size every four days or so, until all resemblance with the original output disappeared somewhere in the second month. This was enough to tell me what had happened: the numbers that I had typed in were not the exact original numbers, but were the rounded-off values that had appeared in the original printout. The initial round-off errors were the culprits; they were steadily amplifying until they dominated the solution." (E. N. Lorenz, The Essence of Chaos, U. Washington Press, Seattle (1993), page 134)[7]
Elsewhere he stated:
One meteorologist remarked that if the theory were correct, one flap of a sea gull's wings would be enough to alter the course of the weather forever. The controversy has not yet been settled, but the most recent evidence seems to favor the sea gulls.

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Cargo volumes at Dar es Salaam port have grown by 21% while they have dropped by 6% at Mombasa port. — The East African @moneyacademyKE

Decline at Mombasa blamed on move by Uganda and Rwanda to divert more cargo to Dar es Salaam.

— The East African

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Said @Nikhil_Hira on #TheSituationRoom about growth from reducing taxes. In the 1990s, tax rates were at 65%+ then, after they were reduced to 30% & capital gains removed in 1995, tax collections grew at a 45% curve @bankelele
Kenyan Economy

Said @Nikhil_Hira on #TheSituationRoom about growth from reducing taxes. In the 1990s, tax rates were at 65%+ then, after they were reduced to 30% & capital gains removed in 1995, tax collections grew at a 45% curve as it became cheaper & easier to pay than to evade.

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.@SafaricomPLC share data
N.S.E Equities - Commercial & Services

Price: 27.80
Market Cap: $9.519b 
EPS:             1.74
PE:                 15.977

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M-Pesa might soon be taking on banks directly: @MwangoCapital
N.S.E Equities - Commercial & Services

"What may happen is maybe if we took M-Pesa out of Safaricom and it was regulated by the CBK, we could then apply to the CBK to offer more services that are not necessarily telecommunication-related" - Chairman @michaelj2

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

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