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Satchu's Rich Wrap-Up
Friday 08th of July 2022

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Jul 3 One can create inorganic cascade like price moves in the derivatives market and thereby control the physical commodity.
World Of Finance

Jul 3 One can create inorganic cascade like price moves in the derivatives market and thereby control the physical commodity.

One can create inorganic cascade like price moves in the derivatives market and thereby control the physical commodity. 

There are plenty of examples of these inorganic price moves. In essence, the Tail wags the dog. 

The challenge is where the Supply/Demand balance is precarious and a small adjustment [reduce Supply or increase Demand] tips the situation into disequilibrium. 

The Tail will no longer wag the Dog and the Dog will simply run amok.


I think the Trifecta below are a BUY. 

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Let the Wind Speak | Juan Carlos Onetti

Let the Wind Speak | Juan Carlos Onetti 

The best of all were the mornings of that stormy summer, with mud and brown leaves on the ground, that restless air that had just been made for me, that buzzing joy of the old trees in the villas, the houses that had had names and prestige, the indecisive sky, swirling.

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Regime Change in Western Capitals long before Moscow
Law & Politics

Regime Change in Western Capitals long before Moscow

The inability to read the battlefield, the extraordinary propaganda threads on Twitter, the deplatforming of any voice that countered the Propaganda effort have produced a ''Fairy Tale'' reality and a geoeconomic boomerang effect which is shredding the standard of living in the West and whose consequence will be Regime Change in Western Capitals long before Moscow.

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Vanity of Vanities! All is vanity
Law & Politics

Vanity of Vanities! All is vanity

Vanity[a] of vanities, says the Preacher,

vanity of vanities! All is vanity.
A generation goes, and a generation comes,
but the earth remains forever.
The sun rises, and the sun goes down,
and hastens[b] to the place where it rises.
What has been is what will be,
and what has been done is what will be done,
and there is nothing new under the sun.
Is there a thing of which it is said,
“See, this is new”?
It has been already
in the ages before us.
There is no remembrance of former things,[c]
nor will there be any remembrance
of later things[d] yet to be
among those who come after.
Ecclesiastes 1:2-11 2 11 [1]

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Currency Markets at a Glance WSJ
World Currencies

Currency Markets at a Glance WSJ
Euro 1.015835
Dollar Index 106.982
Japan Yen 135.6160
Swiss Franc 0.97369
Pound 1.200500
Aussie 0.682545
India Rupee 79.24050
South Korea Won 1300.370
Brazil Real 5.3398000
Egypt Pound 18.859500 
South Africa Rand 16.748665

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Tycoon Whose Bet Broke the Nickel Market Walks Away a Billionaire @business The Big Take

Tycoon Whose Bet Broke the Nickel Market Walks Away a Billionaire @business The Big Take
By 2:08 p.m. Shanghai time on March 8, it was clear that Xiang Guangda’s giant bet on a fall in nickel prices was going spectacularly wrong.

Futures had just skyrocketed above $100,000 a ton and his trade was more than $10 billion underwater. 

It was threatening not only to bankrupt Xiang’s company, but to trigger a Lehman Brothers-like shock through the entire metals industry and possibly topple the London Metal Exchange itself.

But Xiang was calm. Within hours, more than 50 bankers had arrived at his office wanting to hear how he planned to respond to the crisis. He told them simply: “I’m confident that we will overcome this.”

And he did.
Four months on, the nickel price is falling, as Xiang had predicted. 

The coterie of banks led by JPMorgan Chase & Co. that were baying for his blood has been repaid. 

He has closed out nearly all his short position in nickel, making a loss on the trade of about $1 billion — a manageable sum given the profits being generated elsewhere in his business empire, say people who know him.

Crucially: the man nicknamed ‘Big Shot’ in Chinese commodities circles is poised to walk away from the fiasco with his multibillion-dollar mining and steelmaking company, Tsingshan Holding Group Co., intact and even expanding.

But while Xiang moves on, others are left dealing with the destruction wrought by the crisis. 

His miraculous escape was thanks in no small part to the actions of the LME, which controversially intervened to prevent prices from rising and then suspended trading until Xiang had struck a deal with his banks. 
Those on the other side of the trade, who lost billions, were furious. 

Months later, the LME is dealing with a raft of investigations and lawsuits, and the nickel market is still reeling.
“Nice to see that @jpmorgan and The Big Shot got out of this whole thing with only scratches,” Cliff Asness, founder of AQR Capital Management, said last week in a tweet thick with sarcasm. “It’s just heart warming.”
This account of how Xiang extricated himself from a short squeeze that rocked the global metals markets is based on numerous interviews with people who were involved, all of whom requested anonymity. 

Multiple attempts to seek comment from Tsingshan were unsuccessful.
Massive Short Squeeze
Xiang had built up his massive short position in late 2021 and early 2022 partly as a hedge, partly as a bet that a planned jump in Tsingshan’s production this year would drag down prices. 

But when Russia’s invasion of Ukraine jolted global markets, nickel started climbing — gradually at first, before rocketing 250% in an epic squeeze.

On the evening of March 8, senior bankers crowded into a room at Tsingshan’s headquarters demanding answers. 

Others dialed in for video calls from London or Singapore. Of those present, some didn’t leave until early the next morning.

The crowd that night was so large because Xiang’s position was spread across about 10 banks and brokers — he had been a good client for many of them, including JPMorgan, for years. 

But after nickel started spiking on March 7, Tsingshan struggled to meet its margin calls. Now he owed each of them hundreds of millions of dollars.

The LME had eventually intervened to halt trading a couple of hours after nickel hit $100,000. 

It also canceled billions of dollars of transactions, bringing the price back to $48,078, where it closed the previous day, in what amounted to a lifeline for Xiang and Tsingshan.

To reopen the market, the LME proposed a solution: Xiang should strike a deal with holders of long positions to close out his trade. 

But a price of around $50,000 would be more than twice the level at which he had entered his short position, and would mean accepting billions of dollars in losses.

Xiang, who is in his early 60s, stood firm. From a start making frames for car doors and windows in Wenzhou, eastern China, he’d built Tsingshan into the world’s largest nickel and stainless steel producer, with an empire stretching from mines in remote Indonesian islands to steel mills on China’s east coast. 

Along the way, he’d acquired a reputation for visionary thinking and a taste for betting big.

He had caught the attention of the LME before, when in 2019 Tsingshan was on the other side of a short squeeze, withdrawing large amounts of nickel inventories from exchange warehouses and causing prices to jump. 
This time, his aggressive approach to trading was having much wider ripple effects. 
The spike in prices and the trading freeze caused havoc for companies that use nickel, like stainless steel mills and makers of batteries for electric vehicles. 

Some simply stopped taking new orders. On the LME, dealers were left frantically trying to recoup missed margin calls from clients who couldn’t pay, and at least one had to seek financial support from its parent company.

Yet with unprecedented chaos rippling through the industry, Xiang — still facing his bankers in the early hours of March 9 — had a key advantage. They were more terrified than he was.

If he refused to pay, they would have to chase him in courts in Indonesia and China. 

What’s more, he had executed his nickel trade through a variety of corporate entities – such as the Hong Kong branch of battery unit Ruipu Energy Co. – and it wasn’t clear the banks would even have the right to seize Tsingshan’s most valuable assets.

The bankers understood that if things went wrong, their careers would be over, one person who was in the room remembered.

JPMorgan, which had the biggest exposure, took the lead. The group included some international players like Standard Chartered Bank Plc and BNP Paribas SA, but many were Chinese and Singaporean banks that had little experience handling a situation like this. 
Personal Guarantee
Xiang told the assembled bankers he had no intention of closing the position anywhere near $50,000. 

A few hours later he was delivering the same message to Matthew Chamberlain, chief executive of the LME. 

Tsingshan was a strong company, he said, and it had the support of the Chinese government. There would be no backing down.
Instead, he wrote a list of the assets he was willing to put up as collateral: a string of ferronickel plants in Indonesia. 

But for some of the bankers, that wasn’t enough. 

They wouldn’t be able to do any due diligence on the Indonesian assets for weeks or months, and even those who worked closely with Tsingshan hadn’t seen the facilities for years because of the pandemic.
So Xiang made a further concession that was both valuable and, in Chinese business culture, humbling: a personal guarantee. 

If Tsingshan didn’t pay its debts, the bankers could turf him out of his home. That was what he was willing to offer. Take it or leave it.
It wasn’t much of a choice. On March 14, a week after the chaos that engulfed the nickel market, 

Tsingshan announced a deal with its banks under which they agreed not to pursue the company for the billions it owed for a period of time. 

In exchange, Xiang agreed a series of price levels at which he would reduce his nickel position once prices dropped below about $30,000.
When the market reopened two days later, prices moved lower, easing the strain on Xiang and the banks. 

A brief dip below $30,000 allowed Tsingshan to cover about 20% of its short position. 
The pressure on the LME was only intensifying, however. The exchange’s regulators launched reviews of its governance and oversight. 

The Dallas Federal Reserve and International Monetary Fund joined in a chorus of public criticism, and many hedge funds were still furious at the LME’s decision to cancel trades.
“The moment we realized what was really happening, we felt we could no longer entrust the LME with our clients’ money,” said Transtrend, a $6.7 billion Dutch algorithmic fund. 

Open interest across the exchange’s six main metals slid to the lowest in more than a decade as traders headed for the exit.

Each month, Tsingshan and its banks reviewed their standstill agreement. After the initial dip, nickel spent long stretches in limbo with prices hovering around $33,000. 

It was a nervous time. Tsingshan still had a vast short position, meaning it and its banks could still be exposed to large losses if prices started rising again — for example, if sanctions against Russia led to an actual disruption in nickel supplies, which so far they hadn’t. 
Finally, in May, prices tumbled decisively below the key $30,000 level after China’s lockdowns dented metals market sentiment. 

Over the following weeks, Tsingshan reduced its position — which in early March had been over 150,000 tons — to just 60,000 tons.
By this point, prices were below the level at which Tsingshan had stopped being able to pay its margin calls in early March, which meant Xiang no longer owed the banks any money. 

He proposed dropping the personal guarantee from the deal, seeing it as a humiliating concession to his earlier financial troubles. 

Some of the banks were willing to do so, but JPMorgan was not: the number of nickel plants used as collateral was reduced, but the personal guarantee would stay. A JPMorgan spokesman declined to comment.
It was not the only sign that the crisis had soured Xiang’s relationship with his banks. In June, as recessionary fears swept global markets, Xiang’s short position was beginning to look like a smart trade. 

He asked some of his banks for a little flexibility, allowing him to run the position for longer than had been envisaged under their deal. 

Again, JPMorgan said no, and by the end of June Xiang had exited his position entirely with JPMorgan and several other banks, leaving him with a remaining short of less than 20,000 tons.

People familiar with the matter estimate Tsingshan’s losses on the trade at around $1 billion. Xiang isn’t concerned. 

The loss has been roughly offset by the profits of his nickel operations over the same period. 

The standstill agreement, which Xiang extended from the initial three months, is set to expire in mid-July.

Now ‘Big Shot’ is moving on with his life, focusing on plans for the future at Tsingshan, which had revenues of $56 billion last year. 

His ability to trade on the LME may be reduced, for now at least, but he is still able to trade on the Shanghai Futures Exchange. 

He has ambitions to expand, not only in Asia, but also to Africa. And Tsingshan is as powerful as ever in the nickel market: a massive increase in production from his plants in Indonesia is one of the key factors driving prices lower, much as Xiang predicted.
But while Xiang may be moving on, the LME is still dealing with the fallout. 

Regulators have pointed to the chaos in nickel as a sign of the risks lurking in commodity markets, and called for greater oversight of the entire sector. 

Hedge fund Elliot Investment Management and trading firm Jane Street have launched legal action against the LME, seeking nearly $500 million.

And the nickel market is still broken, say people involved in it, with both open interest and trading volumes stuck at sharply lower levels as traders step away from using LME prices in their contracts. 

Jim Lennon, a veteran nickel market-watcher and managing director of Red Door Research Ltd., estimates that less than 25% of global nickel output is now being sold on the basis of LME prices, down from 50% before the crisis in March.
“A lot of the industry now has temporarily disengaged from the LME,” he says. “The market is still functioning, but it’s struggling.”

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#SriLanka has completely collapsed. Angry crowds now chasing and killing wealthy people as food and energy shortages hit. @21stCenturyWire
Emerging Markets

#SriLanka has completely collapsed. Angry crowds now chasing and killing wealthy people as food and energy shortages hit. @21stCenturyWire

Over 200 dead so far, police use live rounds. State of anarchy on one side, police state on the other.

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‘The family took over’: how a feuding ruling dynasty drove Sri Lanka to ruin @guardian
Emerging Markets

‘The family took over’: how a feuding ruling dynasty drove Sri Lanka to ruin @guardian 

Dilith Jayaweera can still recall the moment he realised Sri Lanka was hurtling, unstoppably, towards financial ruin.

It was around October 2021 and Jayaweera, a Sri Lankan media magnate and close friend of the Sri Lankan president, Gotabaya Rajapaksa, had invited Basil Rajapaksa, the president’s younger brother, who was also the finance minister, to join him for dinner.
There was little love lost between Basil Rajapaksa and Jayaweera, who had long mistrusted each other. 

But nonetheless, as the pair ate in his sleek Colombo office, the media mogul had some urgent questions for the man responsible for Sri Lanka’s economy. Was the country heading for a terrible crash?
“Basil couldn’t answer even my basic questions,” recounted Jayaweera. “He was giving very lousy answers – that we’ll find money from here, from there, saying it would all be fine to pay our debts. I saw then he really didn’t understand the economy at all; that it was done, dusted, finished for us.”

What came less than six months later was the worst economic crisis that Sri Lanka has experienced since independence in 1948. 

The suffering it has caused, as the treasury ran dry and the country became unable to import fuel, food and medicine, has left barely anyone on the island of 22 million people unscathed. 

According to the UN, Sri Lanka is facing a “dire humanitarian crisis”; many struggle for one meal a day, surgeries and cancer treatments are being halted, schools have shut and petrol sales have stopped as fuel has run out. 

“Our economy has completely collapsed,” the prime minister, Ranil Wickremesinghe, recently told parliament.

It has prompted an unprecedented political reckoning in Sri Lanka, focused largely on the Rajapaksa family dynasty, which has held power over Sri Lankan politics for two decades. 

Since March, mass protests have called for the resignation of the president. Mahinda Rajapaksa, his brother and a former prime minister and president, has already resigned because of the pressure, as have Basil Rajapaksa and several other family members who were in the cabinet or held political posts.
According to those who witnessed it from the inside, the story of Sri Lanka’s crisis is rooted in this family, who concentrated power to the point that the country came to resemble an autocratic family business, accountable to no one until it pushed the nation to bankruptcy. 

As Sri Lanka began to unravel, the family became riddled with infighting and the once cordial relationship between the two brothers Gotabaya and Mahinda descended into bitterness as they both clung to power. 

On 9 May, the family divisions spilled out on to the streets as the country’s worst violence in more than three decades took place.
Cabinet ministers, opposition politicians, Rajapaksa aides and confidantes – many of whom still have vested interests and strong ties to various Rajapaksa family members – pointed overwhelmingly to Basil, the younger of the brothers and so-called strategist of the family, as the one who oversaw the downfall. 

Operating first as a shadowy power broker behind the scenes before becoming finance minister, he was described by several ministers as having unparalleled influence over the president and cabinet, yet proved incompetent at running the economy and ignored multiple warnings that a financial meltdown was coming.
“Basil was the true power,” said Udaya Gammanpila, who was a cabinet minister between 2020 and 2022 before Basil had him removed in March for being publicly critical. 

“Gotabaya didn’t know how bad things were and Mahinda was getting old and not in the best health, he was just the figurehead. Everything was controlled by Basil.” 

Basil declined to be interviewed for this article and his close aides refused to speak on the record.
Sri Lanka’s economic problems began long before Gotabaya took power in late 2019. 

From 1977 onwards, successive governments built the country on a precarious foundation of debt. 

Imports overwhelmingly exceeded exports and a progressive but costly welfare state widened the deficit further, which was covered by more high-interest borrowing.
''This was a timebomb that had been accumulating for several decades now,” said Gammanpila. “Everything was built with borrowed, not earned, money.”
From 2005, when Mahinda was elected as president and the family began to dominate the political landscape, they, too, began rampantly borrowing, first to pay for Sri Lanka’s three-decade civil war against Tamil minority separatists, which was brought to a brutal end in 2009, then for a “super-growth” development spree of roads, airports, stadiums and power grids. 

GDP grew from $20bn (£16.6bn) to $80bn but more than $14bn was borrowed in the process, and all the Rajapaksas became mired in accusations of vast-scale corruption, from bribes to money laundering.
Mahinda lost the 2014 presidential election but the dynasty had no intention of relinquishing its hold on power. 

Basil, who was out on bail on corruption charges that were later dismissed, set about forming a new political party, the Sri Lanka Podujana Peramuna (SLPP). 

After an amendment to the constitution meant Mahinda was not allowed to run for a third term, it was decided – after considerable resistance by some in the family ranks – that Gotabaya would be their candidate in the November 2019 presidential elections. 

But, speaking in 2018, Basil made his intentions known. “The truth is that if Gotabaya comes forward it will be I who will run the country since he is new to politics,” he told local media.
Gotabaya, an austere, devout and straight-talking military man, was the opposite to his older brother, the charismatic and politically savvy Mahinda. 

He had attracted the backing of an influential group of intellectuals, business leaders and academics, who believed he would forge his own path from the previous Rajapaksa regime. 

However, Gotabaya’s experience in politics was limited; he had only held the unelected post of defence secretary in Mahinda’s administration, where he was celebrated for ending the civil war, despite accusations of war crimes.
As soon as Gotabaya took office, “the family took over; he was dancing only to their tune”, said Nalaka Godahewa, a former CEO turned SLPP MP who had backed Gotabaya. 

Basil loyalists were given the key cabinet portfolios and the family parachuted in PB Jayasundara, a bureaucrat who had a decades-long relationship with Mahinda and Basil, to become secretary and economic adviser to the president. Jayasundara had once been barred from holding public office, but that was later overturned.
“Gotabaya had no political experience and knew nothing about economics; he depended entirely on PB Jayasundara to run the economy,” said Charitha Herath, an SLPP MP who sat on several parliamentary finance committees. 

“The problem was, he was giving very bad advice.”

It was on his advice that Gotabaya implemented sweeping tax cuts in 2019, despite international warnings against it, causing government revenue to fall by more than a trillion rupees in two years. 

As Sri Lanka was hit by Covid, and money from tourism and foreign remittances dried up, Jayasundara pushed back against import bans and going to the IMF to restructure the country’s loans, even as debt repayments were mounting and warnings were given by the central bank monetary board from November 2020. 

He is also accused of feeding the president misleading information, including a cashflow statement – which Jayaweera said he saw himself during a meeting with Gotabaya in early 2021 – that presented a rosy picture of Sri Lanka’s outgoings.

The Rajapaksas’ grasp over the government tightened further after the SLPP swept the 2020 parliamentary elections. 

Mahinda became prime minister, while his son and heir apparent, Namal Rajapaksa, was brought into cabinet, as was the eldest Rajapaksa brother, Chamal.
“The Rajapaksas controlled the entire country,” said Asanga Abeyagoonasekera, a Sri Lankan political analyst and author. “The government became autocratic, ultranationalist and heavily militarised.”
They pushed through an amendment to the constitution that concentrated more power into the president’s hands and allowed for dual citizens to become MPs. 

Not long after, in July 2021, Basil – who is also a US citizen – was made finance minister, though several in the cabinet believed he had already been running the economy with Jayasundara behind closed doors.
According to several ministers, Basil swiftly became the de facto head of the cabinet. He would decide which cabinet papers were approved and had the last word on all big decisions, while Gotabaya and Mahinda – who was now in his mid-70s and had stepped back from decision-making – would nod along. 

“The president accepted whatever proposal Basil put before him,” said Vasudeva Nanayakkara, a leftwing MP who was a cabinet minister in Gotabaya’s ruling coalition until April this year.
Basil did not tolerate dissent in cabinet and under his watch, those in the cabinet and on financial oversight committees claim they were presented with misleading information about the country’s finances.

“I submitted 11 cabinet papers warning about the impending crisis,” said Gammanpila. 

“But whenever we raised an economic issue, Basil felt we were interfering with his work and he got offended. He repeatedly said that everything was fine. But in my assessment, he doesn’t have even a basic understanding about economics.”

Meanwhile, dysfunction reigned at Sri Lanka’s central bank. A glaring rift had developed between Basil and the bank governor, Ajith Nivard Cabraal. 

They refused to speak for months and blamed each other for the mounting financial problems. 

Cabraal began excessively printing money to try to fill the gaps in the treasury, triggering mass inflation.

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‘The family took over’: how a feuding ruling dynasty drove Sri Lanka to ruin @guardian [continued]
Emerging Markets

‘The family took over’: how a feuding ruling dynasty drove Sri Lanka to ruin @guardian [continued]

Government bureaucracy was also in a state of disarray after Gotabaya had appointed military generals, some implicated in war crimes, to run 15 civilian government ministries, which proved autocratic and inefficient. 

Defence spending, higher under Gotabaya than during the civil war, further drained the treasury while his presidential order suddenly banning all chemical fertilisers resulted in agricultural devastation.
By the beginning of 2022, it was clear that Sri Lanka’s economy, in particular its reserves of foreign currency, was facing an unprecedented catastrophe. 

The country owed $51bn in foreign loans, of which it was expected to pay back almost $7 billion that year, but it was running out of dollars and had been locked out of all international markets to borrow any more.
As Sri Lanka struggled to pay for food, petrol and medicine imports and inflation kept soaring, people began to protest in droves. 

Internally, the Rajapaksa family were shocked that the anger on the streets was viscerally directed towards them. 

As the demonstrations grew, the president was advised that even if he would not go, others in his family needed to.
In early April, to the fury of Basil, Gotabaya asked for the resignation of all Rajapaksas who held government positions, except Mahinda. 

However, this did little to ease public anger and Gotabaya quickly became convinced the only way to secure stability was for Mahinda also to also step down as prime minister.
Those on the inside say Mahinda agreed to resign on three or four occasions, but would then return to his inner circle – including his wife and two sons who were in politics – to be persuaded he did not need to go. 

“This kept on happening for about two weeks,” said Godahewa. Frustration and anger grew between the two brothers.
“The relationship between Gotabaya and Mahinda had always been very cordial, very loving and paternal,” said Nanayakkara. 

“But towards the end, as Gotabaya told Mahinda in so many words to step down, it was very, very bitter.”
It was on 9 May, during a rally at the prime minister’s Colombo residence – a few days after Mahinda had finally agreed to go – that the rupture between the two brothers came to a head. 

Some described the meeting as a farewell to Mahinda, others as a show of strength to demonstrate to Gotabaya that it was Mahinda who was still the true political magnet of the family.
Arranged by Basil, Mahinda’s son Namal and their close cabinet allies, hundreds of Mahinda’s loyal grassroots supporters were bussed into the prime minister’s residence. 

But as witnesses and video footage testify, the meeting quickly got out of hand. 

Riled by chants of “Whose power? Mahinda’s power” and the government’s chief whip, Johnston Fernando, calling out “let’s start a fight … he [the president] should hand power over to us”, some of the supporters charged out of the gates, led by several SLPP MPs.

They marched towards Galle Face, the anti-government protest camp where thousands had been gathering to demonstrate for weeks, and began violently beating hundreds of protesters and setting alight their tents.

As reports of the attacks reached Gotabaya Rajapaksa, who was at home in Colombo, he exploded in anger. 

The night before, having already had concerns about the gathering, he had given instructions to the chief of police to be ready with officers, teargas and water cannon.
“The president was screaming over the phone to the senior DIG, asking why the hell haven’t you prevented these people entering Galle Face,” said Godahewa, who was holed up at Gotabaya Rajapaksa’s home for two days as it all took place. 

“He was shouting: ‘I’m the president, you do what I say, somehow stop these people.’”
But, according to police and ministerial sources, the police chief held back from taking action against the mobs attacking Galle Face, having been told by his seniors that this was a family matter between Mahinda and Gotabaya and it was safer for police to not be seen to take sides.
By the time the police responded, the spark of violence had been lit, engulfing Sri Lanka in some of the worst attacks in decades. 

A mob tried to storm the prime minister’s residence, leaving him barricaded in his bedroom with his sons and allies until he was evacuated by special forces at 4am. 

The houses of more than 70 SLPP MPs and Rajapaksa allies were set alight and an MP was beaten to death by a mob. 

Many believe militant political elements who wanted to bring down the government seized the opportunity to launch a coordinated attack.
Gotabaya also appeared to have lost control of the military, who failed to intervene, many said out of fear by top brass that they would be held accountable if anyone was killed. 

“I saw how much the president pleaded with the army chief to take action, saying: ‘Send troops, do something,’” said Godahewa, whose own house was burned down. 

“The president was so frustrated because everybody’s house was burning and the army was not stopping them.”
In the aftermath, the Rajapaksas were a family divided: Gotabaya and Chamal, the eldest of the brothers, on one side, and Basil, Mahinda and his sons Namal and Yoshita on the other. 

Gotabaya blamed those around Mahinda for stirring up violence with “that stupid meeting” and publicly Chamal condemned Mahinda for not resigning earlier. Privately those close to Basil pushed the narrative that Gotabaya was not up to the job any longer.
Those around Gotabaya – who was frequently described as “out of touch” with the mood of the people – believe he still has no intention of stepping down as president, even though he cuts an isolated figure; this week he was driven out of the parliament chamber by chants of “Gota Go Home” by MPs.
Some said he was staying put out of a militaristic obligation to duty and preserving the Rajapaksa name, while Godahewa said that “in his mind, he’s still naively determined to have a positive legacy”.
The future of the Rajapaksa dynasty now looks increasingly uncertain. A new amendment to the constitution has been submitted to cabinet for approval, which will reduce presidential powers and once again ban dual citizens holding office. 

Basil initially put up a fierce resistance to it but last month pre-emptively stepped down as an MP, though other SLPP MPs continue to try to halt it and it has been criticised for not going far enough.
Yet some remain unconvinced Sri Lanka has permanently thrown off the shackles of dynastic politics. 

“The Rajapaksas are known to play the long game, so I couldn’t say for sure if this will be the end of them – look at the Philippines, there’s a Marcos back in power after 30 years,” said Herath. “But right now, there’s no place left for them here.”

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Sri Lanka c. bank raises rates to 21-year high to contain inflation @Reuters.
Emerging Markets

The Central Bank of Sri Lanka (CBSL) raised its key rates by a full percentage point on Thursday to tackle record high domestic inflation and to contain any build-up of underlying demand, it said.

The Standing Lending Facility (LKSLFR=ECI) rate was raised to 15.50% while the Standing Deposit Facility Rate (LKSDFR=ECI) rose to 14.50%, the highest in 21 years.
Inflation touched a record 54.6% year-on-year in June while food inflation accelerated to 80.1%.

The policy adjustment would help guide inflation expectations to be anchored around the targeted 4-6% level over the medium term and curtail any build-up of underlying demand pressures in the economy, it said.

The CBSL had raised rates by a massive 700 basis points in April but held them steady at its previous policy meeting in May.

"Bond yields shot up on Wednesday on the expectations of about a 500 basis point increase but what is interesting is the central bank is anchoring it's decision on Sri Lanka seeing dis-inflation in the second quarter of 2023," said Udeeshan Jonas, chief strategist at equity research firm CAL.

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You’re a mutant virus, I’m the immune system and it’s my job to expel you from the organism. OCTOBER 30, 2014 BY @Dominic2306 The Hollow Men II
Law & Politics

You’re a mutant virus, I’m the immune system and it’s my job to expel you from the organism. OCTOBER 30, 2014 BY @Dominic2306 The Hollow Men II

One of the best descriptions of the current zeitgeist was written in a blog [dated] OCTOBER 30, 2014 BY DOMINIC CUMMINGS The Hollow Men II [2]
Complexity makes prediction hard. Our world is based on extremely complex, nonlinear, interdependent networks (physical, mental, social). Properties emerge from feedback between vast numbers of interactions: for example, the war of ant colonies, the immune system’s defences, market prices, and abstract thoughts all emerge from the interaction of millions of individual agents. Interdependence, feedback, and nonlinearity mean that systems are fragile and vulnerable to nonlinear shocks: ‘big things come from small beginnings’ and problems cascade, ‘they come not single spies / But in battalions’. Prediction is extremely hard even for small timescales. Effective action and (even loose) control are very hard and most endeavours fail.
In the same article Cummings continues
Blofeld: Kronsteen, you are sure this plan is foolproof?
Kronsteen: Yes it is, because I have anticipated every possible variation of counter-move.
Politics therefore suffers from a surfeit of narcissists.
The occupants of No10, like Tolstoy’s characters in War and Peace, are blown around by forces they do not comprehend as they gossip, intrigue, and babble to the media.
The MPs and spin doctors steer their priorities according to the rapidly shifting sands of the pundits who they are all spinning, while the pundits shift (to some extent unconsciously) according to the polls.
The outcome? Everybody rushes around in tailspins assembling circular firing squads while the real dynamics of opinion play out largely untouched by their conscious actions.
In terms of a method to ‘manage’ government, it is not far from tribal elders howling incantations around the camp fire after inspecting the entrails of slaughtered animals. 

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Niger: the west’s bulwark against jihadis and Russian influence in Africa @FinancialTimes

Niger: the west’s bulwark against jihadis and Russian influence in Africa @FinancialTimes 

Standing in a landscape of sand and scrub that rolls to the horizon, General Mahamadou Abou Tarka dabs sweat from his forehead and points north to Niger’s frontier with Mali and west to Burkina Faso.

“There’s a vacuum on the other side,” he says, referring to the lawless regions in the countries abutting Niger’s restive Tillabéri region. 

Across the invisible border, the Malian and Burkinabe states barely function, the general says. Swaths of territory have been overrun by terrorists affiliated with al-Qaeda and Islamic State.
“Mali is a failed state. Burkina is failing,” says Abou Tarka who, as head of Niger’s High Authority for the Consolidation of Peace, advises his civilian government on the fight against a hydra-headed terrorist threat, much of it spilling over hundreds of miles of unpoliced frontier.
“As for Nigeria,” he gestures in the direction of the huge country to the south. “We say we have a border with Boko-Haramia,” he says, in a biting reference to the Boko Haram fundamentalists who, until recently at least, frequently swept across the frontier to attack villages in Niger.
The world’s poorest country, according to the UN’s human development index, Niger is rarely considered a geopolitical linchpin. 

But that is exactly what it has become as successive dominoes fall, terrorism spreads and Russian influence grows in the Sahel, a sub-continental-sized belt of semi-desert stretching thousands of miles across Africa.
In May, Olaf Scholz visited German troops stationed at a base close to Niger’s border with Mali, extending Berlin’s mission to train Niger’s soldiers in counter-terrorism. 

The German chancellor met his counterpart Mohamed Bazoum, who was elected president last year in Niger’s first democratic transfer of power.
Western officials have praised Bazoum, a former schoolteacher and right-hand man of the previous president, as someone who is willing to fight terrorists and tackle the root causes of radicalism. 

His administration has promised to increase the range and efficacy of the state, including by improving its inadequate school system. It has started tentative peace talks with some terrorist groups.
Scholz was the latest of a string of senior European, US and other officials to pledge support for Niger. 

In 2019, the US opened a drone base near the northern city of Agadez to carry out surveillance. 

France, whose troops were this year ejected from Mali, has started ramping up its presence in Niger, a pivot towards what has been dubbed Paris’s “partner of last resort” in the Sahel.
If the jihadist threat intensifies in Niger — and particularly if Bazoum’s government were to fall to one of the coups that have toppled successive civilian regimes in the region — analysts say Islamists could end up controlling a contiguous belt across the Sahel from Mali to northern Nigeria

That would threaten more prosperous coastal west African states such as Ivory Coast, Ghana, Togo or Benin that have largely escaped terrorist attacks. It could also provoke waves of immigration to Europe, they say.
“Western powers are saying that Niger is a bulwark against all those extremist groups,” says Abou Tarka. “They are saying that Niger is a democracy, that we have to help Niger survive in a neighbourhood that is crumbling.”
Power vacuum
With the exceptions of Algeria and Benin, every one of Niger’s neighbours is in crisis. 

A military junta has seized power in Mali, where a homegrown Tuareg rebellion continues and both Jama’at Nusrat al-Islam wal-Muslimin, a consortium of al-Qaeda-linked groups, and Islamic State in the Greater Sahara control territory and carry out attacks.
In Burkina Faso, a junta shot its way to power in January, citing the civilian government’s inability to tackle a jihadist insurgency that has killed thousands and displaced millions more. These days, if anything, Burkina is considered more dangerous than Mali.
Vladimir Putin’s Russia has also been gaining traction in the region. 

Mali’s generals have replaced French troops with mercenaries supplied by Russia’s shadowy Wagner group, some of whom have been implicated in atrocities. 

Wagner has also manoeuvred its way into the Central African Republic, where it protects the president and runs lucrative businesses, including in gold mining.
Chad, previously a stalwart French ally, is unstable after Idriss Déby, president and commander of the most effective fighting machine in the Sahel, died in battle last year at the hands of insurgents allegedly trained by Wagner. 

Emmanuel Macron, the French president, attended Déby’s funeral in N’Djamena.
Much of the rot set in after western powers, including France and the UK, engineered the downfall of Libya’s longtime dictator, Muammer Gaddafi, in 2011. 

The resulting power vacuum precipitated a flood of arms into the Sahel, weaponising ancient antagonisms and providing Islamists and criminal gangs with the wherewithal to wage terror. Wagner is now fighting in Libya too, alongside the rebel general Khalifa Haftar.
Ibrahim Yahaya, senior Sahel analyst at Crisis Group, endorses the idea that Russia has opened “a second front” in the Sahel with the aim of destabilising European interests. 

Using Wagner, he says, is a cheap way of making trouble that provides deniability and costs Moscow nothing. 

“It’s a different way of doing diplomacy. You use private companies that are there to make money, but then you use them to promote your strategic goals.”

The more immediate concern, says Yahaya, is the plethora of Islamist groups who now control large swaths of Mali, Burkina Faso and parts of northern Nigeria — and who have made some inroads in Niger.

Ornella Moderan, head of the Sahel Programme at the Institute for Security Studies, points out that Niger is not standing entirely alone. 

Mauritania, she notes, has avoided a coup and Niger is itself battling terrorism on several fronts, including in the Tillabéri region and the area around Diffa on the south-east border with Nigeria, where Boko Haram had been active in the past. 

“Banditry and acts of violence” have also been seen in the south-central border area with Nigeria, Moderan says, which “could spiral into a third front”.
The Mali debacle
At France’s military base in Niamey, General Hervé Pierre, a veteran of French deployments in the Sahel, has no doubt about Niger’s strategic importance. 

“Niger is one of the countries that has a strong and very professionalised army that is able to face the terrorists,” he says, over the roar of two Mirage fighters taking off from the base. 

“President Bazoum took the responsibility for this struggle at a regional level and the Nigerien army really fights the enemy.”
France, says Pierre, has learned lessons from Mali where French troops were initially welcomed as liberating heroes in 2013 only to be drummed out of the country a decade later when relations nosedived. 

France was accused of propping up a civilian government that many saw as lacking in legitimacy. 

That stoked anti-French sentiment in the country, which spread on social media, allegedly fanned by Russian troll farms operating in the region.
In January, Mali’s second military junta in as many years expelled France’s ambassador. 

In May it terminated a defence agreement with Paris, forcing France to close its military bases. 

Some people on the streets of Bamako, the capital, celebrated with a display of Russian flags.
The French are trying to avoid a repeat of the Mali debacle by taking a softly-softly approach in Niger. 

No French flags fly at its sprawling base near Niamey’s international airport. Nigerien captains command platoons of mainly French troops and vice versa.
French troops are supporting operations to establish permanent garrisons on the border with Mali, both to stop incursions and to persuade displaced villagers to return to their homes. 

“The objective is to reinforce the presence of the state in the eyes of the people,” says Mahaman Moha, a government policy adviser.
Despite its lower-key approach, the French do take direct action. In June, French air strikes, including from Reaper drones, killed nearly 40 members of what Paris called “an armed terrorist group” moving by motorbike from Burkina Faso into Niger. 

If there are more such attacks, civilian casualties are inevitable, members of Niger’s armed forces concede. 

“There’s no clean war,” says one. Groups belonging to the al-Qaeda-affiliated JNIM are adept at infiltrating villages, making them hard to pick out.
Lisa Tschörner, an expert on Niger at the German Institute for International and Security Affairs, says some Islamist groups have won support from local communities by offering what she called “alternative modes of governance and justice” to people who felt marginalised. 

Islamist ideology, she says, has deeper roots in Niger than its authorities admit.
Terrorists have often exploited local rivalries, Tschörner adds, especially those between herders who roam in search of pasture and sedentary farmers. 

“The homegrown conflicts that have been labelled bandit-ism for a very long time have been co-opted by jihadist groups,” she says. 

“Then you have the dynamics of climate change and population growth which has increased pressure on land, intensifying the conflict.”
Some Nigeriens welcome France’s military support, but others point to the ineffectiveness of French tactics in Mali, where terrorism flourished despite — or even because of — French intervention.

 “We know for a fact that France is behind this insecurity,” says Mikka Adam Maiga, a resident of Niamey.
France concedes there is no purely military solution. Agence Française de Développement, a government-owned financial institution, is increasing its investment in Niger from about €100mn to a projected €150mn in both loans and grants. 

Some of that will be spent on social and economic projects in the Tilabérri region, a so-called “red zone” where strict security protocols for French officials apply.
On a recent trip to an AFD-financed cattle market, Emilie Garret, acting director for AFD in Niger, spoke of the difficulties of establishing projects amid such insecurity. 

“It’s a very challenging environment,” she said. In Paris, Rémy Rioux, AFD chief executive, says France is financing projects including a dam to bring power and irrigation to farmers and a job-creation scheme for young men who joined, but then renounced, terrorist groups.
Siren calls
The biggest concern continues to be the weakness of Niger’s state. If terrorists exploit poverty and marginalisation, in Niger there is plenty to go round. 

The country has a nominal per capita income of $600, according to the World Bank, reflecting the fact that more than 80 per cent of its 25mn people live outside cities and mostly beyond the money economy. The literacy rate is just 35 per cent.
Clashes over land, pasture and water may intensify as the population grows. With an average seven children per woman, the highest in the world, Niger’s population is expanding at nearly 4 per cent a year and is forecast to almost triple to 70mn by 2050.
While some Nigeriens see that as a strength, Bazoum describes it as a weakness. 

In his inaugural presidential address, he highlighted the fact that more than one-quarter of Nigerien girls marry before the age of 15 and three-quarters before 18, something he said he wanted to stop by keeping girls in school longer.
Such liberal leanings have won the Niger president praise in the west, but may do him fewer favours at home where conservative social norms prevail. 

By contrast, he has been accused of cracking down on civil society, a sign, say some, that his position at home is not as secure as allies might wish. 

Two days before he was sworn in last April, soldiers opened fire on the presidential palace in what appears to have been a coup attempt. Rumours of a second plot followed.
Still, in contrast with Mali, where tensions between the north and south persist, Niger has more successfully incorporated different elements of society into government. 

The sting was removed from a Tuareg rebellion in the 1990s after a peace settlement that has seen a Tuareg serve as prime minister. 

Officials say the fact that Bazoum, who comes from the tiny Arab minority, has become president at all is evidence that Niger has progressed in tamping ethnic rivalries.
Bazoum has spoken of the need to shore up the capabilities of the state as a counterweight to siren calls from terrorist groups offering cash, religion or a form of justice. 

There are hopes the economy could receive an important fillip thanks to a Chinese-built pipeline to the coast of Benin, which should lead to a quintupling of oil exports to 100,000 barrels a day and a boost to government revenues.
On a recent trip to Diffa, more than 1,200km east of the capital on the border with Nigeria and Chad, Bazoum told soldiers defending the area: “Terrorists need a vacuum where they can do what they want.” 

He brought with him all the trappings of state, including a huge military presence, helicopters and even a sweeper to continually brush the desert sand from the red carpet laid out before him.
He has encouraged displaced villagers in Diffa to return to their villages. The hope is that 40,000 will do so in the next few months in time for the planting season. 

In return, the president says, the army will provide security, partly by recruiting from local communities. It must also provide basic services, including clinics and access to water, he says.
“Things have calmed down,” says Smaine Youndousse, an adviser to Bazoum, of the situation in Diffa. 

“Three to four years ago you couldn’t sleep at night for the sound of gunshots.” Most insecurity is now concentrated on the border with Burkina Faso, he adds.
Even so, the situation remains precarious. Shortly after the president’s heavily guarded entourage rolled out of a makeshift base, snipers hidden in the scrub took aim at the soldiers left behind.
“What you have to understand is that this is a fight for our nation, a fight for the right of our state to exist,” says Abou Tarka. “We’re in a neighbourhood of failed states, but Niger is still on its feet — for now.”

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28 OCT 19 :: From Russia with Love

28 OCT 19 ::  From Russia with Love

But, he said, Russia was going to be a different kind of superpower, one that does not engage in “pressure, in- timidation and blackmail” to “exploit” sovereign African governments.

“Our African agenda is positive and future-oriented. We do not ally with someone against someone else, and we strongly oppose any geopolitical games involving Africa.”
“Russia regards Africa as an important and active participant in the emerging polycentric archi- tecture of the world order and an ally in protecting international law against attempts to undermine it,” said Russian deputy foreign minister Mikhail Bogdanov back in November 2018.

Recently we have seen Russian interventions in the Central African Republic 
In July this year, a three-minute animated video appeared on YouTube. Called Lionbear, the cartoon was aimed at children and told the story of a brave but beleaguered Central African lion, who was fighting a losing battle against a pack of hungry hyenas. 

Luckily the lion had a friend who came to the rescue — the strong Russian bear. 

The bear fights off the hyenas brings peace to the land and everyone lives happily ever after.

The video was produced by Lobaye Invest, a Russian mining company with links to the Wagner Group. 

Lobaye runs a radio station in the CAR, and organised a Miss CAR pageant. 

But, as a CNN investigation reported this year, Lobaye also funds the 250 Russian mercenaries who are stationed in the country.
“The dividend for Lobaye Invest: generous concessions to explore for diamonds and gold in a country rich in mineral wealth,” it reported. 

The Russian mercenaries are officially there to train the CAR’s national army.
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 tech- nologists” have reportedly devised bespoke solutions for confronting in- cipient and ongoing color revolutions, just like its private military contrac- tors (PMCs) have supposedly done the same when it comes to ending insurgencies.

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24 OCT 11 :: Gaddafi's Body in a Freezer - What's the Message?

 24 OCT 11 :: Gaddafi's Body in a Freezer - What's the Message?

The image of a bloodied Gaddafi, then of a dead Gaddafi in a meat locker have flashed around the world via the mobile, YouTube and Twitter.

Marshall McLuhan’s prediction in The Gutenberg Galaxy (1962) that ‘The new electronic interdependence recreates the world in the image of a global village’ has come to pass. 

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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.

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Africa Needs $424 Billion to Recover From Pandemic Devastation @markets

Africa Needs $424 Billion to Recover From Pandemic Devastation @markets 

African nations need $424 billion this year to help them cope with the devastation caused by the coronavirus pandemic, according to the head of the continent’s top multilateral lender.
After decades of progress in the continent’s fight against poverty, Covid-19 plunged 30 million Africans into “extreme poverty” in 2020. 

Meanwhile, Russia’s war on Ukraine has fueled inflation and left millions hungry. 

Surging prices along with slowing economic growth are also increasing indebtedness in the region. 
“We should not minimize the impact of Covid-19 on African economies,” Akinwumi Adesina, president of the African Development Bank, said in an interview on Bloomberg Radio. 

“We have to expand the fiscal space for African countries. Secondly, we must tackle the whole issue of debt, you cannot run up a hill while carrying a backpack of sand on your back.”
From Ghana to Zambia, multiple African nations have tapped the International Monetary Fund to help revamp their debt and finance government budgets. 

The war on Ukraine worsened the situation just as countries in the continent were rebounding from the pandemic.
Global food prices surged to a record after Russia’s Feb. 24 invasion disrupted exports of grain and vegetable oil. 

That’s exacerbated a hunger crisis affecting countries including Ethiopia, Kenya and Somalia. Africa depends on Russia and Ukraine for about 41% of it’s wheat and maize, Adesina said. 
The AfDB’s $1.5 billion plan to boost production will help farmers on the continent produce 30 million tons of food, he said, adding that obstacles in importing fertilizer may hit productivity by as much as 50%.
“The special drawing rights from IMF have helped a lot, but Africa still needs to have $150 billion channeled to it.”
“We are talking to the countries who hold the SDR’s in their reserves, so far we have received positive signals from the UK and France but I cannot give you a specific timeline on when it will all be done.”
On Africa’s debt burden:
“A lot of the debt in Africa is infrastructure-related debt but if we are able to get a sustainable way to do this that would be much better. That sustainable way is that the private sector has to have a role, it shouldn’t just fall on the government.”

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Best performing stocks in Africa in H1 2022 (in USD terms) @TellimerHQ @MwangoCapital

best performing stocks in Africa in H1 2022 (in USD terms) @TellimerHQ @MwangoCapital

1⃣Thungela Resources: + 189%
2⃣Sasol: +41%
3⃣Exxaro Resources: +34%

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Nigeria’s Currency Falls to Record Low as Traders Track Central Bank’s Latest Dollar Sale @markets

Nigeria’s Currency Falls to Record Low as Traders Track Central Bank’s Latest Dollar Sale @markets 

Central bank offering 450-465 naira per dollar, StanChart says

Naira trading at 615 a dollar in black market, a new low

Nigeria’s currency fell to the lowest on record after traders adjusted prices to reflect the rate Central Bank of Nigeria sold the currency amid a lack of dollar supply in the authorized foreign-exchange market.
The naira retreated 1.6% to 426.26 a dollar as of 3.30 p.m. local time on the investors and exporters window, also known as Nafex, in Lagos. 

The Nafex is regarded as the official market for foreign currency transactions in Africa’s biggest economy.

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To this day, the natural reservoir of Marburg is unknown. Marburg lives somewhere in the shadow of Mt. Elgon. Crisis in the Hot Zone Lessons from an outbreak of Ebola. Richard Preston

To this day, the natural reservoir of Marburg is unknown. Marburg lives somewhere in the shadow of Mt. Elgon. Crisis in the Hot Zone Lessons from an outbreak of Ebola. Richard Preston

The first known emergence of a filovirus happened in August, 1967, in Marburg, Germany. 

A shipment of green monkeys from Uganda had arrived in Frankfurt. 
Green-monkey kidney cells are useful for the production of vaccines, and these monkeys were going to be killed for their kidneys. 
Marburg began with a splitting headache, focussed behind the eyes and temples. 
That was followed by a fever. The characteristic diagnostic sign was a red speckled rash over the body which blistered into a sea of tiny white bubbles. 

“Most of the patients showed a sullen, slightly aggressive, or negativistic behavior,” Martini wrote. “Two patients [had] a feeling as if they were lying on crumbs.” 
One became deranged and psychotic. These mental signs were caused by the virus’s having damaged the brain. 
The patient Hans O.-V. showed no signs of mental change, but he suffered a sudden, acute fall of blood pressure and died. 
At autopsy, his brain was found to be laced with hemorrhages, and there was a massive, fatal hemorrhage at the center. 
In Frankfurt, an animal attendant known as B. developed a high fever and eventually began bleeding from his mouth, nose, and gastrointestinal tract. 
He was given whole-blood transfusions, but then he developed uncontrollable hemorrhages at the sites of the I.V. punctures. 
He died with blood running from his mouth and his nipples. All the survivors lost their hair. During convalescence, the skin peeled off their faces, hands, feet, and genitals. 
It was a small, frightening emergence.
Marburg virus looks like rope, or it rolls up into the rings that resemble Cheerios. 
Virologists had never seen a ring-shaped virus, and couldn’t figure out how to classify it. They thought that it might be a type of rabies. 

The rabies particle is shaped like a bullet, and if you stretch a bullet it becomes a rod, and the rod can be bent into a doughnut: Marburg. They started calling Marburg “stretched rabies.”
But it is not related to rabies. 

The question was: What is the virus’s natural history? In what animal or insect does Marburg hide? Marburg evidently does not circulate in monkeys. 
Monkeys die quickly of the disease, and if they were the reservoir, Marburg wouldn’t wipe them out. 
The monkey’s immune system would have learned to attack the virus, and the virus itself would have become better adapted to living in monkeys without killing them, since it is in the virus’s best interest to let the host survive. 
The Marburg monkeys had been collected in Uganda by native trappers—apparently in forested habitat to the west of Mt. Elgon, an extinct volcano that straddles the border between Uganda and Kenya.
Teams of epidemiologists combed Uganda, and especially the western slopes of Mt. Elgon, looking for some animal or insect that harbored Marburg virus; they found nothing.
In 1980, a French engineer who was employed by the Nzoia Sugar Company at a factory in Kenya within sight of Mt. Elgon developed Marburg and died. 
He was an amateur naturalist who spent time camping and hiking around Mt. Elgon, and he had recently visited a cavern on the Kenyan side of the mountain which was known as Kitum Cave. 
It wasn’t clear where the Frenchman had picked up the virus, whether at the sugar factory or outdoors. 
Then, in the late summer of 1987, a Danish boy whose name will be given here as Peter Cardinal visited the Kenyan side of Mt. Elgon with his parents—the Cardinals were tourists—and the boy broke with Marburg and died. 
Epidemiologists at usamriid became interested in the cases, and they traced the movements of the French engineer and the Danish boy in the days before their illnesses and deaths. 
The result was weird. The paths of the French engineer and the Danish boy had crossed only once—in Kitum Cave.  Peter Cardinal had gone inside Kitum Cave. 
As for the Ugandan trappers who had collected the original Marburg monkeys, they might have poached them from the Kenyan side of Mt. Elgon. 
Those monkeys might have lived near Kitum Cave, and might even have occasionally visited the cave. 
Mt. Elgon is a huge, eroded volcanic massif, fifty miles across—one of the largest volcanoes in East Africa. 
Kitum Cave is one of a number of caverns that penetrate Mt. Elgon at an altitude of around eight thousand feet and open their mouths in a deep forest of podo trees, African junipers, African olives, and camphors. 
Kitum Cave descends into tight passages and underground pools that extend an unknown distance back into Mt. Elgon. The volcanic rock within Kitum Cave is permeated with mineral salts. 
Elephants go inside the cave to root out chunks of salty rock with their tusks and chew on them. 
Water buffalo also visit the cave to lick the rocks, and they may be followed into the cave by leopards. Fruit bats and insect-eating bats roost in the cave, filling the air with a sour smell. 
The animals drop their dung in the cave—an enclosed airspace—and they attract biting flies and carry ticks and mites. 
The volcanic rock contains petrified logs, the remains of trees that were enveloped in lava, and the logs are filled with sharp crystals. 

Peter Cardinal may have handled crystals inside the cave and scratched his hands. 
Possibly the crystals were tainted with animal urine or the remains of an insect. 

The Army keeps some of Peter Cardinal’s tissues frozen in cryovials, and the Cardinal strain is viciously hot. It kills guinea pigs like flies. 
in February, 1988, a few months after Peter Cardinal died, the Army sent a team of epidemiologists to Kitum Cave. 
The team wore Racal suits inside the cave. A Racal is a lightweight pressurized suit with a filtered air supply, used for hot operations in the field. 
There is no vaccine for Marburg, and the Army people had come to believe that the virus could be spread through the air. 
Near and inside the cave they set out, in cages, guinea pigs and primates—baboons, green monkeys, and Sykes’ monkeys—and they surrounded the cages with electrified wire to discourage predators. 
The guinea pigs and monkeys were sentinel animals, like canaries in a coal mine: they were placed there in the theory or the hope that some of them would develop Marburg. 
With the help of Kenyan naturalists, the Army team trapped as many different kinds of wild mammals as they could find, including rodents, rock hyraxes, and bats, and drew blood from them. 
They collected insects. Some local people, the il-Kony, had lived in some of the caves. 
A Kenyan doctor from the Kenya Medical Research Institute, in Nairobi, drew blood from these people and took their medical histories. 
At the far end of Kitum Cave, where it disappears in pools of water, the Army team found a population of sand flies. They mashed some flies and tested them for Marburg. The expedition was a dry hole. 
The sentinel animals remained healthy, and the blood and tissue samples from the mammals, insects, arthropods, and local people showed no obvious signs of Marburg. 
To this day, the natural reservoir of Marburg is unknown. Marburg lives somewhere in the shadow of Mt. Elgon


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