Don't Worry, Bibi.

Just order the US Congress to convene for the emergency session and pass the Save Israel's Ass Act by mobilizing the US productive economy. Well, there are many programs which could be cut to finance this--how about cancer research, more funds from Social Security et al. There is nothing what Americans wouldn't do, no sacrifice is too large when defending the US biggest ally (/s). The most important thing is to suck coc ...I mean support Israel. 

Prime Minister Benjamin Netanyahu spoke Monday at the Accountant General's Conference and issued a significant warning: "Israel is entering diplomatic isolation. We will have to deal with a closed economy. The world is dividing into blocs, and we are not part of any bloc. That makes it easier to isolate us. We also have a technological and scientific advantage that creates dependence on us and gives others an interest in maintaining ties with us." "We may find ourselves blocked not only in research and development, but also in production itself. Our defense industries could be blocked, and we will have to be Athens and super-Sparta, adapting to an autarkic economy. We have no choice. At least for the coming years, we will have to cope with these attempts at isolation, and we must first develop the ability to manage on our own."

This is not to say that Israel doesn't have resources. It has some, but in reality it is not the country capable of sustaining itself on the level it used to be in 2023-24. Here is some statistics in terms of Israeli exports:

As you can see yourself--it is a significant trade deficit. You can view Israeli imports here. Here is the 2025 list of Israel's main trading partners. 

As you can see yourself--Turkey evaporated from this list for a variety of reasons main of which, of course, is that even multivector Erdogan cannot anymore do nothing about genocide in Gaza. But in general, Israel's future is at best--murky, at worst--it will simply disappear because it is a terrorist entity of which the world took the note. 

A Logical Conclusion...

 ... of the process of which many, yours truly included, warned for years--that once the energy and economic umbilical cord between Germany and Russia is severed, that means game over for Germany.  Here is Deutsche Welle. 

Война России с Украиной меняет структуру внешней торговли Германии с Восточной Европой. Об этом говорится в сообщении Восточного комитета немецкой экономики (Ost-Ausschuss der Deutschen Wirtschaft, OA), опубликованном в четверг, 9 ноября. Россия продолжает терять позиции торгового партнера ФРГ, в то время как другие рынки ее перегоняют. В сентябре 2023 года товарооборот Германии с Украиной (840 млн евро) впервые оказался больше, чем ее товароборот с Россией (810 млн евро).

Translation: The Russian War in Ukraine means a change in trade structure across the borders of Germany and the Eastern Europe. This is the goal of the Eastern Committee of the German Economics (Eastern Committee of the German Economy, OA), report published on Thursday, 9 November. Russia continues to lose positions of the foreign partner to the Federal Republic of Germany, while other markets are taking over. In February 2023, Germany and Ukraine trade (840 million euros) was awarded the first prize--a larger one than the trade with Russia (810 mln euro). 

Well, I guess 404 is that important for Germany, so be it. I warned a few years back, with Russia simply severing relations with Siemens after the gas turbine scandal, that this was just the start of the process of stripping Germany of her economic potential. And if the Siemens snafu was not that critical for German giant, with Russia constituting only about 2-3% of Siemens' operations, what followed after that was. Germany lost Russia's car market for good and now it has no way of getting Russia's energy, which effectively was the foundation of Germany's industrial development and prosperity for the last 50 years. Most importantly--the good will for Germany in Russia is gone. Russians will not forgive this: 

That matters even more than energy in the long run.

Is Hungary An Example...

...of what pragmatic non-ideological approach to foreign policy should be?  In many respects it is. Victor Orban is a man who cares about his nation's prosperity and stability. Among major prerequisites for that is a foreign policy, which in case of a relatively small nation such as Hungary, serves interests of Hungarian people and business, not some ideological purposes. Apart from Hungary having a contract with Russia's giant Rosatom for new reactors for Hungary's only Paks nuclear power station, Hungary did this now:

Budapest signed a new long-term contract on Monday with Russia’s energy giant Gazprom for gas supplies bypassing Ukraine, Reuters reports. The agreement was sealed by Gazprom CEO Aleksey Miller and Hungarian energy group MVM executives at the Hungarian Foreign Ministry.The deal was signed after Hungarian Foreign Minister Peter Szijjarto announced last month that Budapest had agreed with Moscow on all the conditions for a new supply contract to take effect from October 1. The minister said that under the new deal, Hungary will buy gas “at a much better price than under the expiring contract,” which was signed in 2020.

You see how simple it is? Be nice to Russia and Russia will pay back in kind, a really win-win situation. Obviously Ukraine went bananas immediately and manifested 404's main trait which is envy, which automatically transforms in hatred for Russia. Ukraine immediately ran to...of course, European Commission and promised to halt all gas transit to Hungary through Ukraine. You see, these miserable people cannot reconcile themselves to the fact that not only they managed in 30 years of Project 404 turn their country into the utter shithole and poorest one at that in Europe. No, they still cannot face the reality of Russians agreeing with them that Russians and Ukrainians "are non-brothers". Russians say fine, let's be non-brothers. Since you are not relatives, plus your "leadership" is a collection of Nazi-sympathizers or sanctimonious ass holes who care only about themselves, get in line and face consequences. 

 

Maria Zakharova pointed out in her Telegram-channel that: 

Когда в следующий раз наши западные партнёры будут отмечать «дни жертв тоталитаризма», кивая в сторону постсоветского пространства, пусть вспомнят, что питательной средой для его становления являются доносы на соседей по случаю зависти.  

Translation: The next time our Western partners celebrate the "days of victims of totalitarianism", nodding towards the post-Soviet space, let them remember that denunciations of neighbors on the occasion of envy are a breeding ground for its (totalitarianism) formation.

 

You can almost feel desperation of 404 and her curators in Europe (and the US), but the issue is extremely simple: Gazprom fulfills all its contractual obligations to European customers. Anything above it or when politics is involved, which is always, either pay more or go and freeze to death. Russia is not a charity, and as Putin is on record Russo-phobia has a price. Yes, the price is steep. But when politics takes precedent over normal mutually beneficial relations, well, what can I say--let them live with the consequences. New possible German Chancellor Olaf Scholz (from German Social Democratic Party) already started the same tired tune: Russia needs to keep Ukrainian transit and that Germany really "cares" about "energy security" of Eastern Europe (in Russian). 

 

What most of German politcos fail to understand, of course, is the fact that Russia is not beholden to Germany or Europe. Considering economic and political dynamics of EU, Russia is already hard at work with rerouting her energy supplies to the East, where there are very many customers hungry for Russian energy and, most importantly, those customers do not give a shit about LGBTQRC4ISR rights, about the "freedom of speech" and other propaganda BS the combined West uses for its nefarious purposes, and will gladly pay for what will be (and is being) rerouted from Europe. The objective of Russia's energy policy is to remove EU from the position of primary energy customer and supply it on the bases "as needed" or as "what is available". US "ministry of truth" is already hard at work:

Russia is pumping a lot less natural gas to Europe all of a sudden — and it is not clear why

Then it goes into the same "Russia is bad" tropes until in the very cellar of the article it gets to a sensible conclusion that: 

Another theory, although analysts consider it somewhat less likely, is that because Gazprom believes Nord Stream 2 will soon be fully operational, it may not need to book further capacity elsewhere.

Generally speaking, one cannot communicate with EU and NATO in normal language anymore and the drifting apart will continue. But Hungary is an excellent example of how bilateral relations can work. As you can see the trend in EU-Russian economic relations is very pronounced:

And compared to volume of trade China alone (I underscore it--alone) and despite a dip in exports in 2019 due to pandemic--the trend here is also obvious, the trade grows. 

This trade also begins to increasingly substitute the trade with EU. Once one considers Russia's trade with Japan, Republic of Korea, Vietnam and other countries in Asia (such as steadily increasing trade with Indonesia as one example), one can get a clear idea of a steady diminishing in importance of Europe for Russia, not to mention the fact of a dramatic, tectonic shift in Russian attitudes toward the combined West which is viewed (correctly) as hostile, decadent, perverted and unattractive. As I said many times--I never experienced such level of contempt towards the West in Russia, even during the Cold War 1.0 it was different. Never. These attitudes do have a bearing on economy in the long run. But Hungary is definitely not covered by these attitudes because of both personality of Victor Orban and bilateral steady relations. In the end, even such an uncomfortable partner (due to Erdogan's expansionist aspirations) as Turkey sees her trade relations with Russia on the level ANY EU nation, including totally confused Germany, can only dream about. 

Turkey pledged its commitment to gradually enhancing commercial relations with one of its top trade partners, Russia, as the two nations look to reach their trade volume target, according to Trade Minister Mehmet Muş. “We want to develop trade with Russia in a balanced way on a win-win basis,” Muş said following his visit to Moscow last week, stressing Turkey's determination to bring the volume of commercial exchange to $100 billion (TL 845.4 billion), a goal set by the leaders of the two states. “We have serious cooperation in the field of energy. We want to expand and shift our cooperation there to different areas of energy,” Muş told Anadolu Agency (AA) Sunday.

$100 billion? Absolutely. As I said, Europe is becoming not that important for Russia and it is all for the better. So, Germany should keep in mind that one day she may wake up and find no good will left in Russia and for that she can blame only herself. Eventually, the transit through 404 will be stopped and this shithole of a nation will exist only on the handouts from those who helped to turn it into what it is today. Germany played and continues to play a huge role in creating this cesspool in the middle of European continent and Russians do keep the score.

Any Human Language?

Last time I checked, Russia's official language, Russian, is a human language. That means you can  translate it, learn it, use it and comprehend it on this planet of ours. That is what usually assumed by Russians, especially at the top political level, which is a level of Russia's President or Minister of Foreign Affairs. Top shelf interpreters work there and they bear personal responsibility for precision with which words from and to Russian officials are translated. Well, EU "diplomacy" (I have no idea what is this) and "elites" evidently have issues with understanding a rather important human language, such as Russian, since they still do not get the message. When Russia's President tells them directly that: "... love is impossible if it is declared only by one side. It must be mutual", he expects EU to understand that he, being highly cultured and well-behaved statesman, is telling EU to go fuck itself until their attitude changes. OK, that's Putin. Sergei Viktorovich Lavrov, however, is a man who can turn the heat up a notch and that is why his famous meme is... well, famous. 

EU's high commissioner for whatever passes there for diplomacy, Josep Borrell, is in Moscow now, expressing his worries about:

The EU's foreign affairs chief has said relations with Russia are at their lowest level because of Alexei Navalny's poisoning and subsequent imprisonment. Josep Borrell was speaking during a three-day visit to Moscow ahead of talks with the Russian Foreign Minister Sergei Lavrov, who said he was ready to discuss "any topic".

Well, he got his audience with Lavrov who, basically, repeated what Putin said but in a more direct form. Speaking about EU as non-agreement capable, Lavrov stated:

"Поэтому мы свою жизнь выстраиваем, исходя из того, что Евросоюз является ненадежным партнером, по крайней мере на данном этапе."

Translation: because of that, we build our life out of consideration that EU is not reliable partner, at least at this stage. 

After that Russia declared persons non-Grata and kicked out three diplomats from Poland, Sweden and Germany, who were especially active in fomenting trouble inside Russia around Navalny. I don't know in what language should Russia talk to EU for EU to understand that, as Lavrov stated, Russia doesn't really care about EU's internal decisions and nobody in Moscow, in reality, gives a shit how Borrell "assesses" EU-Russia's relations. Who knows, maybe Lavrov has to go to 11 and openly state to these cretins that they should go and fuck themselves, literally. Evidently they still don't get the message. EU does not have a subjectivity in international relations, it is an object which is there to dance to Washington's tune. Russians are fully aware of that and that is why Russia is turning away from EU. Including being somewhat reluctant, for now, to let go of Nord Stream 2 for purely geopolitical, not economic reasons as Ischenko thinks, a view which I share. I also completely agree with his assessment, that abandoning NS 2 for Russia is merely an inconvenience, for Germany--it is a catastrophe.  In what language, then, do you communicate with a bunch of cretins? Obviously, they do not understand human language. 

To underscore the absence of intelligent life in EU, I will leave this link (in Russian) and you can easily translate TASS reporting using Google translate tool. They don't even understand that most of Russia laughs at them. As you can see from this EU graph, the trend in economic relations was pronounced already by 2019. Russia simply started importing less from EU. 

Even when adjusted for Covid-19, it is clear that imports from EU to Russia will continue to decline in mid to long-term. As some people in Russia suggest: what about trading Navalny for Assange? That could be a really good deal, especially since politically Navalny is dead, especially after his disgraceful behavior in court today, while his "org" was effectively dismantled and there are many sad people in MI-6 and CIA today because of that. As strategic truism states, don't try to make strong plays with a weak hand. But then again, do they even understand a human language, any human language. 

 

ADDENDUM: What is wrong with these people? 

President Joe Biden has dusted off an old story about how he came under fire while visiting Iraq, more than a decade after he admitted the claim was somewhat exaggerated. ‘Where’s the MSM outrage?’ social media users have asked.While addressing US State Department staff on Thursday, Biden hailed the diplomats for showing “great personal courage,” which the new US president has purportedly seen first-hand. "I’ve been with some of you when we’ve been shot at," he told the audience. It’s unclear what Biden meant by the passing remark, and the White House has not elaborated on the statement.

What's the deal here with stolen valor pandemic of which I wrote before. It is becoming nauseating with US politicians telling fairy tales of their "courage under fire". 

 

Why?

As news have it (in Russian) Trump wants to see Russia, India, Australia and South Korea at what used to be G-7 meeting some time in the future (in Russian). As you may have noticed already, one entity which is conspicuously absent from this is the largest, by far, economy in the world, which is China. This is not to mentio0n that the fact that Trump's desires mean absolutely nothing for Russia, who has a committed relations with China. Trump also has to understand that Russia was in decoupling mode with Europe for a few years no. Sure, selling Russian energy to Europe is important, so is important to sell finished and agricultural products, but here is a short view of what Russian-European trade relations look like today:

Russia is the EU's fifth largest trading partner and the EU is Russia's largest trading partner, with a two-way trade in goods value of €232 billion in 2019. In 2019 Russia was the origin of ca. 40% of EU imports of gas and 27% of EU imports of oil. Due to the large value these imports, EU’s trade deficit with Russia (€ 57 billion in 2019) is only second to EU’s trade deficit with China.

The issue here, of course, is the fact that this trade is represented for a whole Europe, 4 of the major nations of her, constitute a bulk of G-7. By far the most important dynamics here is this: 

EU-Russia bilateral trade in goods peaked in 2012, dropping by 43% between 2012 and 2016 from two-way €322 billion in 2012 to €183 billion in 2016. Since 2016, bilateral trade has partially recovered. However, Overall EU exports to Russia were in 2019 25% lower than in 2012, agri-food exports were 38% lower.

These are the effects of a non-stop trade war (sanctions) on Russia supported by all those Europeans and, quoting, Karen Shakhnazarov, "sanctions are good for Russia", because sanctions allow increasing decoupling from EU, including by means of import substitution, and the only way Europe can still retain interest for Russians is EU being a market, which will increasingly, due to a sheer stupidity of EU bureaucracy, will be destabilized due to confluence of macroeconomic and cultural factors. Russia is just fine dealing with Europeans on a bilateral level. But here is another dynamics to consider:

Look at this dynamics, which brought Russia-Chinese trade to $107 billion in 2019 and continues to grow, eventually projected to hit volume of $200 billion by 2024. Comparable to the volume of trade of Russia with Europe, which hates Russian guts and will behave as the US lap dog in the future. So, Russia's choice is quite obvious here. Especially when one considers a puny trade relations between the US and Russia and Russia having a full grasp of US enmity towards herself. Aw, just look at these numbers:

Russia ranked No. 28 in total trade value through March with a total of $6.61 billion. Exports totaled $1.18 billion and Imports totaled $5.43 billion, a deficit of $4.25 billion.

Pretty much sums it up, doesn't it? So, Trump wants to exclude China from "international community" by holding this gathering which decides nothing and is worthless in terms of any practical solutions to an unfolding catastrophe which is global economic crisis. So, anyone can explain what Russia is to gain, other than some photo-ops for Trump, from this meeting? Why should Vladimir Putin even be there? Moscow and New Delhi have a direct line and can solve their issues by talking directly, Europe, frankly, is economically suicidal, Australia is a non-entity for Russia, so why? I don't know, but Trump, evidently thinks that this is a good idea. I think it is a waste of time, because the settling of global issues must happen first between G-3: China, US and Russia. Until something is decided within this triangle no other meetings will produce any sensible world order which will reasonably satisfy everyone. The United States is not ready to deal with this issue yet, but US has only two options here: war and getting back to the reality. What will be this choice we don't know yet, hopefully the latter one.  

Oh, Boy, Oh, Boy!

Just when you think that you repeated that USD and US stock market papers are just virtual "values" which are "worth"... well, let's leave at that for now, enough times to drive point home, news come in which in these strange times take it to eleven. From yesterday (in Russian):

Правительство России разрешило инвестировать средства Фонда национального благосостояния (ФНБ) в национальную валюту и гособлигации Китая.

Translation:  Government of Russia allowed to invest resources of the Fund of National Wealth (FNB) into national currency and state obligations of China.

This is exactly what many of us here discussed very recently, and that means acceleration of the removal of the USD as one of many (yes, Pound Sterling, Euros, Swiss Franks are also there) cash (I stress it--cash, not some BS paper) from Russia's main piggy bank. That also shines a light on the long-term policy of growth of trade between China and Russia and that means, among many other things, dedollarization of the oil trade. Reputable "establishment" Gazeta Ru then proceeds to make this astonishing statement:

Доля европейской валюты в отечественном экспорте в КНР за год выросла с 12% до 45,6%. При этом импорт китайских товаров и услуг в Россию почти на 25% оплачивается в «других валютах». Вероятнее всего, это и есть юани. 

Translation: The share of European currency in domestic (Russia's) export to China grew in one year from 12% to 45.6%. Meanwhile, almost 25% of import of Chinese goods and services in being paid for almost 25%  in "other currencies", which, most likely are Yuans. 

This is what drives many people in the US (like yesterday's Paul Brandus) totally desperate and butt-hurt, because removal of USD in mutual payments between geopolitical players who matter IS the end of the petrodollar. It is a very practical end, without much fanfare--just normal everyday economic activity which is ongoing without employing USD and creating a financial fortress and common Eurasian market whose actual size dwarfs US economy even when this economy is valued by Wall Street  fraudst.... pardon me, exceptionalists. Ah, yes, about exceptionalism. Daniel Larison published today a good piece related to Andrew Bacevich's latest article:  

It Took COVID To Expose the Fraud of ‘American Exceptionalism.’ Our leaders were so preoccupied with remaking the world they failed to see that our country was falling apart around them.

Well, I have a minor quibble with this title, because this fraud was exposed way before any COVID was present. In fact, I launched this blog in 2014 to do precisely this, prior to that I formed opinion on this fraud years before. As I state ad nauseam, American exceptionalism is a self-replicating delusion which is organic to the US body-politic as a main prerequisite of achieving anything on the way to power and money. It is also a main driver behind degeneration of American political and intellectual elites. As Larison observes: 

The more that U.S. policies have proved “American exceptionalism” to be a pernicious myth at odds with reality, the more we have heard the phrase used to defend those policies. Republican hawks began the decade by accusing Obama of not believing in this “exceptionalism,” and some Democratic hawks closed it out by “reclaiming” the idea on behalf of their own discredited foreign policy vision. There may be differences in emphasis between the two camps, but there is a consensus that the U.S. has special rights and privileges that other nations cannot have. That has translated into waging unnecessary wars, assuming excessive overseas burdens, and trampling on the rights of other states, and all the while congratulating ourselves on how virtuous we are for doing all of it.

As the recent events of the 2020 have demonstrated so dramatically--to have some "special rights and privileges" one has to perform across the board, from economy, to military to culture, to society. And, I mean, of course, in real terms not by cooking books, declaring defeats victories and praising social illnesses as achievements. The world is not impressed anymore, not to mention this ever present fact that, as I wrote in my latest book:

Today, the same titanic battle for life on Earth is being waged globally for a new, better, freer, more just and more peaceful global order to emerge. This struggle is not for glory and the sword for forestalling evil has been forged. 

But it will be ultimately up to Americans and America's internal struggles to determine if, she can be, as Larison observes:

American exceptionalism has been the story that our leaders told us to excuse their neglect of America. It is a flattering story, but ultimately it is a vain one that distracts us from protecting our own country and people. We would do well if we put away this boastful fantasy and learned how to live like a normal nation.

One can only hope.      

It Was Expected And Predicted.

After President Putin and China's Leader Xi Jingping concluded their first meeting in Moscow today with press-conference, one of the statements by Vladimir Putin certainly stood out (deliberately in Russian): 

"Россия и Китай намерены развивать практику расчетов в национальных валютах", — сообщил президент. По его словам, заключено межправсоглашение, нацеленное на дальнейшее расширение использования рублей и юаней в двусторонней торговле, а также на обеспечение бесперебойности банковского обслуживание сделок в условиях нестабильности на глобальных рынках. 

In other (English) words:

"Russia and China intend to develop the practice of settlements in national currencies,” Putin told journalists at the news conference following the talks. He added that the states have signed intergovernmental agreements on expanding the use of the yuan and the ruble in bilateral financial operations. 

It is, by now, almost anti-climactic--the way genuine multi-polarity unfolds--with China and Russia claiming, step-by-step, independence from Western (primarily American) institutions in every single field--from economy to "security". It is especially contrasting with what Daniel Larison described as Trump's Venezuela Hallucination:

Trump was eager to boast about Moscow’s withdrawal of its troops from Venezuela, but it turned out that he or someone else in the administration just made it up....Trump’s Venezuela policy is a shambles, and Russia previously brushed off his ultimatum to remove their forces from the country. It isn’t surprising that he would try to spin any development in his favor, but in this case it seems that he just invented something out of thin air so that his Venezuela policy wouldn’t look quite so feckless. He has no genuine successes that he can talk about, so he has to have pretend victories instead. The original tweet is still up:

It is, indeed, embarrassing, but in the same time--how is that different from Obama's "Russian economy left in tatters"--a hallucination and imbecility applauded by a bunch of Democratic ignoramuses with the aid of foreign policy "experts" of GOP such as late terrorism supporter McCain or his buddy in delusion Lindsey Graham. No difference whatsoever--it is still same ol' myopia (myopia? how about being retarded, literally) of which I write for years now. 

But at least give Associated Press a credit for allowing this to be made public:

Putin and Xi were meeting in Moscow as world leaders gathered on the south coast of England to mark the 75th anniversary of the D-Day landings. Putin, who attended 70th anniversary commemorations in France five years ago, has not been invited. Russia was not involved in D-Day but the Soviet effort was crucial in defeating the Nazis on the Eastern Front.

Obviously, Eastern Front in general and Operation Bagration in particular were the key for success of Allied Breakout from Normandy, but even brief reminder is good enough for now. It takes nothing from heroism, dedication and sacrifice of Allies: Americans, Britons, Canadians, Poles and others who stormed Normandy beaches on June 6, 1944. Their sacrifice will never be forgotten. But on the 75th Anniversary of D-Day it comes with a sense of dark irony how non-stop Cold War by the combined West against USSR/Russia and now China already resulted in a dramatic decline of the combined West and inevitably leads to a serious clash of (Western)European and American interests. Why? Because there is only so much is available to go around and, as I stated huge number of times, no currency worth anything unless it rests on the real military (and by implication, economic) capability. I reiterate it--REAL. This very Daniel Larison, on Trump's example, conveys how American political class played a key role in America's worst nightmare coming to reality, with China and Russia not willing to play by American rules and how it, in the words of Pink Floyd, missed the starting gun. 

This episode isn’t that important by itself, but it shows how easily Trump can be convinced of the reality of things that haven’t happened and how readily he will accept any story, no matter how unfounded it may be, if it flatters him and bolsters his agenda. That makes him unusually easy to manipulate and provoke, and it makes him an exceptionally easy mark for misinformation. That puts the president’s decision-making completely at the mercy of the advisers that control what he sees and hears.  

Substitute "Trump" with "American elites" and it will describe really well the overall state of the affairs in the shining city upon a hill.  

UPDATE from 06/06/19: As I stated not for once, United States will exit START (strategic arms limitations) treaty and Russia was preparing for that. Here is Putin today:

САНКТ-ПЕТЕРБУРГ, 6 июня. /ТАСС/. Новейшее гиперзвуковое оружие России будет способно защитить страну даже в случае прекращения действия Договора о сокращении стратегических наступательных вооружений (СНВ-3)  

Translation: Russia's newest hyper-sonic weapons will be able to protect Russia even in case of START-III ceasing to exist. 

Putin added (in Russian), very ominously, that if nobody wants START's extension, well, Russia is not going to insist. What will be demonstrated next? I can only speculate but REAL, fully integrated echeloned anti-missile system covering all of Russia is being constructed as I type this. We are yet to learn about actual capabilities of S-500 which surpass by far those of S-400 (imagine that). Plus, in another little news-piece, as Natsionalnaya Oborona reports (in Russian), Poliment-Redut, which is an anti-air and missile system on Russia's latest frigates of pr. 22350 (and reportedly will be installed on two remaining nuclear cruisers), will receive long-range (400 kilometers) missile based on 40H6 for S-400. So, make your own conclusions.      

Some Interesting News.

As I state time after time, while China's economic successes are very impressive, economy which boomed initially primarily thanks to Western (a lot of it American) wealth and technology transfers in 1980s-2000s, can not exist without, however stupid the arrangement is, American market. In this sense China and US are a pair, no matter how one looks at it. And here is the freshest news:

The world’s two largest economies, the United States and China have reportedly started laying out a deal to put an end to their seven-month trade dispute.Sources told Reuters the broad outline of what could make up a deal is beginning to emerge from high level talks held on Thursday and Friday in Washington.Beijing and Washington are pushing for an agreement by March 1 which could mark the end of a 90-day truce that US President Donald Trump and Chinese President Xi Jinping agreed to when they met in Argentina late last year.... The process has become a real trade negotiation, one of them said. The other source cautioned that the talks could still end in failure, adding, however, the work on the MOUs was a significant step in getting China to sign up both to broad principles and to specific commitments on key issues.

In layman's lingo--China surrendered and Trump pressed China (by not always diplomatic means) into negotiations with agenda defined by the US, not China. I think Moscow takes note, in fact--I know so. So, for people who try to see in Russian-Chinese geopolitical arrangements more than there is in reality, they should understand why in this arrangement the United States still separates Russia and China as two centers of power--Washington thinks that it can coerce China and such thinking is not far fetched, in Russian case the United States deals with the nation whose history is one of unparalleled and, I may add, successful fight for survival and keeping the realm. China is the largest economy in the world, but in terms of main component of geopolitical power--military--China is a novice. This is the main factor which defines a set of attitudes of Washington to Eurasian arrangement, because China can not defend most of Eurasia, Russia can and does, both kinetically and in her potential. And, while at it, for people who idealize Russian-Chinese relations, they have to remember that even shrewd Deng was a massive Russophobe and China had no problems with supplying Afghan mujaheddin with weapons and materiel. Nothing personal, folks, just business. So, let's put it this way--it is complicated.      

There Is Always A Price To Be Paid.

We have been over this in this blog several times. It is good to repeat it yet again.

DUBAI (Reuters) - IranAir is looking to buy planes from any company not requiring U.S. sales permits and may consider Russia's Sukhoi Superjet 100, the flag carrier's head was quoted as saying, as Iran tries to renew its aging fleet despite facing U.S. sanctions... IranAir had ordered 200 passenger aircraft - 100 from Airbus, 80 from Boeing and 20 from Franco-Italian turboprop maker ATR. All the deals were dependent on U.S. licenses because of the heavy use of American parts in commercial planes.

I don't know if Iranians learned their lesson, after all Russian proverb the orient is a very delicate business applies fully here, but it is about time they started making some proper decisions. Especially with this in mind:

Most modern commercial planes have more than 10 percent in U.S. parts, the threshold for needing U.S. Treasury approval. But Russian officials have been reported as saying Sukhoi is working on reducing the number of U.S. parts in the hopes of winning an Iranian order for up to 100 aircraft. 

Big power politics does not work on mere trade contracts, however important they are.

The European Union, China and Russia backed a mechanism to allow “legitimate” business to continue with Iran, a plan aimed at sidestepping American sanctions and allowing international trade to continue unimpeded as President Donald Trump pursues his "America First" agenda. The push for such a channel, announced by EU foreign affairs chief Federica Mogherini in New York late on Monday, reflects growing calls in countries such as France and Germany for the EU to adopt tools that will allow it to pursue its foreign-policy goals with less recourse to an unpredictable U.S. ally. A chief catalyst was Trump’s decision to withdraw from the Iran nuclear deal even as world powers urged the U.S. to stick to its mandate.

Bloomberg gives a decent representation of Iran's main export's (oil) distribution:

As you can see, if push comes to shove--new "instruments" or not, the United States can "kill off" Iran's deliveries to Europe and Asia easily. I do not have any faith with EU, which, I think, can be forced to do US bidding, especially when one talks about "defense" issue, which are important to Europeans (after all, aggressive Russkies are planning to harm Europe for...no apparent reason). This could be a disaster for Iran but... enter Russia. 

First, the reason Iran is still not bombed, as many in Tel Aviv (and D.C.) sleep and (wet) dream about, is because of, no, not China, but Russia. After all, even Iranian assets in Syria are breathing much easier as member of Knesset's Committee on Foreign Policy and Defense Xenia Svetlova (obviously of Russian Jewish descent) admitted today (in Russian). 

Since Russia supplied S-300s to Syria, Israel didn't fly a single mission into this country and this delivery changed the balance of power in region. 

Isn't it what I preach for years now? How many more empirical evidences are needed before people start to take in basic facts of great power behavior. Especially if this great power (or superpower) is Russia who loves peace and quiet. Iran, sure as hell, now better start thinking very clearly regarding her trade relations with Russia, because it is her who is selling this most important and desperately desirable product in the world--political stability. Hence the question: can Iran be slightly more patient for Russians finishing SSJ-100s to fully Russian specs, same goes to MC-21, which goes into series production next year, and so on? There is, after all, another dimension to this whole regional dynamics once one considers that almost 40% of Iranian population are ethnic Azerbaijanis and that brings into focus the issue of Caucasus and Turkey, which herself is somewhat in limbo right now, albeit I expect her to fall back into the NATO fold eventually. In the end, Iranian oil deliveries also rest on arrangements which Russia, who doesn't really gives a damn about sanctions, will make. 

So, no matter how important for Iran her regional ambitions are, she will have, at least for a little while, to dance a little bit to Russian tune, whose music sheet ranges from trade to military assistance to the alternative to SWIFT which eventually will be killed by the US, to...well, guarantees of Iran's safety which is a direct function of Russia's military might and geopolitical weight. It is what it is and for the time of this great turbulence, Iran will have to do a slight accommodation with Russia who is sincerely interested in keeping Iran stable, prosperous and peaceful. In the end, it was Iran who, once sanctions have been lifted, immediately signed contracts for 200 commercial aircraft NOT with Russia, who at that time hoped that Iran will consider Russia's support. But, as they say in Russia the orient is a very delicate business. It looks like Russians finally learned their lessons and that is what matters most at this point of time.

Moving Stuff.

Stumbled upon this interesting piece and discovered for myself that the situation with US merchant fleet is even grimmer than I expected.

“It’s been an 80 percent reduction in the overall global (U.S. military) footprint since circa 1990,” said Eric P. Ebeling, chief executive of American Roll-on Roll-off Carrier Group out of Woodcliff Lake, New Jersey, the third-largest U.S. flag carrier in international trade. “When cargo goes down, that’s less cargo on U.S. flag ships.”

Read more here: http://www.miamiherald.com/news/nation-world/national/article210623279.html#storylink=cpy

Read more here: http://www.miamiherald.com/news/nation-world/national/article210623279.html#storylink=cpy

Obviously, the United States is a SLOC-dependent nation but, of course, naval, that is military, considerations are also at a prime and reflect a rather moribund concept of US Armed Forces fighting some conflict which would require a steady supply train of merchant marine vessels to Europe. It is a moribund doctrine since, while implying that US will be fighting in Europe (a suicidal scenario), presumably Russia, and will require an intense operations on Atlantic SLOCs, forgets how things changed since the good ol' Cold War 1.0. It doesn't mean that Russia will not try to interdict those Atlantic SLOCs, but as even some US experts admit:

Some experts said that in a world of hypersonic missiles, laser satellites and smart bombs, discussion of ships and long land wars may seem obsolete.

“People today don’t have the same sense that they did in the 1950s or before then of the possibility of a large-scale conflict. They say, ‘Uh-uh, no way,’” said Seth Cropsey, a former deputy undersecretary of the Navy now affiliated with the Hudson Institute, a conservative think tank in Washington. For his part, Buzby said future conflicts will carry additional risk if the Pentagon must send cargo on foreign flagged vessels – especially if enemy vessels try to stop the supplies.

“What other country is going to want to stand up and say, ‘Yeah, I’ll carry American stuff’ and get potentially shot at?” Buzby asked.

It has to be stated very clearly that the United States simply has no real resources to fight any REAL war against Russia in Europe, because:

1. Russians are absolutely not interested, nor intent, in attacking, or invading, or what have you, anything in Europe unless, see below...

2. NATO commits suicide and does attack Russia, as some people in D.C. and Brussels are convinced they can. Well, in this case no amount of supplies will help them. US simply has no military hardware for sustaining a large conventional combined arms war against such peer as Russia. Why so--is a separate issue here.

3. Russia is certainly not going to interdict Atlantic SLOCs in a peace time.

Reality, however, is rather simple and reduces all this strategic maritime (mambo-jumbo) talk to a few simple facts:

1. Mediterranean is already largely (Eastern and Central parts) "closed" for any combat activity and in case of real war (God forbids) will be closed up to Majorca or even Gibraltar by merely deploying a squadron of MiG-31K (yes, that is official now--MiG-31K)  with Kinzhal to Khmeimim Base in Syria. 

2. Northern "approaches" are also "controllable" both on water and on land by a variety of means ranging from already proverbial Kinzhal to a variety of stand-off land and ship attack weapons carried both by Russian Navy and VKS. 

So, one may ask, what's left then for US Merchant Marine? The answer is simple--get competitive and try, by whatever means necessary, to restore American civil shipbuilding industry. In the end, the United States has some very legitimate commercial interests which are tied to SLOCs and nobody, at least not in the Atlantic, is going to mess with them. The faster this delusion that US can fight the war in Europe will be dispelled the better it will be for the shipbuilding industry. For now, however, this is a situation:

One move is afoot to stimulate shipyards by again requiring some energy exports to sail on U.S. flag vessels. Garamendi said he will introduce a bill in the House later this month that would require a growing percentage of LNG and other energy exports to move on U.S.-built ships, starting at only 1 percent and slowly rising to 30 percent.

“We would simultaneously rebuild the American fleet and the ability of our shipyards to produce blue water ships,” Garamendi said.

Shippers said the 2015 end to the ban on U.S. energy exports hit them hard.

“It caused a huge reduction in the demand for American-flagged tankers. But nobody ever talks about that stuff in Congress,” said Crowley, who called the move “highly disruptive.”

“Some companies scrapped ships,” he added.

His own company laid up two tankers for up to a year for lack of work.

“Everybody suffered because the revenue per ship dropped dramatically because there was more capacity,” Crowley said.

Read more here: http://www.miamiherald.com/news/nation-world/national/article210623279.html#storylink=cpy

Read more here: http://www.miamiherald.com/news/nation-world/national/article210623279.html#storylink=cpy

So, it is yet to be seen if the US, once mighty, merchant shipbuilding industry and Merchant Marine will recover, but there is very little doubt that this, unlike many insanely dubious and useless military programs, is a worthy goal to pursue. I, somehow, prefer economic competition to military one. As Garamendi's Bill state:

“We’re the most powerful nation in the world, but 99% of our trade travels on foreign-flagged ships,” continued Garamendi. “To develop the kinds of jobs that will keep the American economic engine moving, we need to right this ship and grow America’s maritime sector.”

I have some news for Garamendi, however, "most powerful nations in the world" do not have 99% of their trade traveling on foreign ships. The faster this will be understood and BS mantras of American exceptionalism be dropped--the faster this nation will find much needed real economic recovery.