Tuesday, March 31, 2020

First Italy, Now Good Ol' USA.

You know, Russian perfidious treachery really has no bounds. First Russia invades Italy, now Russians set their sights on the most democratic democracy in space-time continuum.  
A cargo plane loaded with medical supplies and protection equipment may depart for the US by the end of Tuesday, the Kremlin said, after a phone call between US President Donald Trump and Russian President Vladimir Putin. The issue of protective gear was raised during the Monday phone talks, with Putin asking if the US needed help and Trump accepting, Kremlin spokesman Dmitry Peskov told reporters on Tuesday.Moscow suggested the aid in anticipation that the US will be able to return the favor if necessary, once its manufacturers of medical and protective equipment catch up with demand, Peskov said. The current situation “affects everyone without exception and is of a global nature,” he added.
But jokes aside, human lives is what really matters now. So Trump was right--it is a large planeload and this is the only way it should be. This is globalization which IS needed, not the "free flow of capital", a euphemism for robbery. So, we'll see how DNC will react to this Russian interference. But for some Americans this could be, indeed, the difference between surviving and dying. I am sure US media will report on that promptly.... nah, I am screwing with you;)

The Theory Of The Leisure Class-I. Variations On Dunno.

Yes, yes Thorstein Veblen in his cold-hearted definition of a class which knows leisure intimately and has very little understanding of actual work, as in labor (Chapter 4, Conspicuous Consumption):
The quasi-peaceable gentleman of leisure, then, not only consumes of the staff of life beyond the minimum required for subsistence and physical efficiency, but his consumption also undergoes a specialisation as regards the quality of the goods consumed. He consumes freely and of the best, in food, drink, narcotics, shelter, services, ornaments, apparel, weapons and accoutrements, amusements, amulets, and idols or divinities. In the process of gradual amelioration which takes place in the articles of his consumption, the motive principle and proximate aim of innovation is no doubt the higher efficiency of the improved and more elaborate products for personal comfort and well-being. But that does not remain the sole purpose of their consumption. The canon of reputability is at hand and seizes upon such innovations as are, according to its standard, fit to survive. Since the consumption of these more excellent goods is an evidence of wealth, it becomes honorific; and conversely, the failure to consume in due quantity and quality becomes a mark of inferiority and demerit.This growth of punctilious discrimination as to qualitative excellence in eating, drinking, etc. presently affects not only the manner of life, but also the training and intellectual activity of the gentleman of leisure. He is no longer simply the successful, aggressive male,—the man of strength, resource, and intrepidity. In order to avoid stultification he must also cultivate his tastes, for it now becomes incumbent on him to discriminate with some nicety between the noble and the ignoble in consumable goods. He becomes a connoisseur in creditable viands of various degrees of merit, in manly beverages and trinkets, in seemly apparel and architecture, in weapons, games, dancers, and the narcotics. This cultivation of aesthetic faculty requires time and application, and the demands made upon the gentleman in this direction therefore tend to change his life of leisure into a more or less arduous application to the business of learning how to live a life of ostensible leisure in a becoming way. Closely related to the requirement that the gentleman must consume freely and of the right kind of goods, there is the requirement that he must know how to consume them in a seemly manner. His life of leisure must be conducted in due form. Hence arise good manners in the way pointed out in an earlier chapter. High-bred manners and ways of living are items of conformity to the norm of conspicuous leisure and conspicuous consumption. 
You may ask--but what about millionaires who work like hell, day and night, trying to keep their business running? Yes, I know such people personally--some of them excellent people NOT corrupted by conspicuous consumption, who live fairly conventional lives, drive pretty much decent everyday cars or trucks, go fishing, and once in a while indulge themselves in a shot of really nice Scotch and decent cigar. These are the kinds of people I call "salt of the earth" entrepreneurs (businessmen), the ones who actually really built America and other countries too. I know of many such people in Russia. Often those people also have good strong families. But this is not the class of capitalists, and those people are capitalists, I am talking about. I am, same as Veblen, same as Marx, talking about consumption which is:
For the great body of the people in any modern community, the proximate ground of expenditure in excess of what is required for physical comfort is not a conscious effort to excel in the expensiveness of their visible consumption, so much as it is a desire to live up to the conventional standard of decency in the amount and grade of goods consumed. This desire is not guided by a rigidly invariable standard, which must be lived up to, and beyond which there is no incentive to go. The standard is flexible; and especially it is indefinitely extensible, if only time is allowed for habituation to any increase in pecuniary ability and for acquiring facility in the new and larger scale of expenditure that follows such an increase. It is much more difficult to recede from a scale of expenditure once adopted than it is to extend the accustomed scale in response to an accession of wealth. Many items of customary expenditure prove on analysis to be almost purely wasteful, and they are therefore honorific only, but after they have once been incorporated into the scale of decent consumption, and so have become an integral part of one's scheme of life, it is quite as hard to give up these as it is to give up many items that conduce directly to one's physical comfort, or even that may be necessary to life and health. That is to say, the conspicuously wasteful honorific expenditure that confers spiritual well-being may become more indispensable than much of that expenditure which ministers to the "lower" wants of physical well-being or sustenance only. It is notoriously just as difficult to recede from a "high" standard of living as it is to lower a standard which is already relatively low; although in the former case the difficulty is a moral one, while in the latter it may involve a material deduction from the physical comforts of life. 
Here is an example: my friend from Arizona presented to me and my wife a really awesomely made replicas of Rolex watches (one men's, another women's). I don't remember what models those were (they eventually got stolen) but both were in $300 range and looked like originals, that is why they were stolen in the first place, how--it is not important. But the story told by my old friend (a well-off man with business and a Ferrari) while giving us these watches was astounding. He said his friend, a really-really well-off man actually owns men's version of this Rolex which is (was) at that time valued at around $20,000 actually owns same replica and wears only it, while original stays at one of his houses in safe. My jaw dropped to the floor. BTW, this is me in 2006 in my friend's 1984 GTS by Pininfarina--the most gorgeous Ferrari ever, a masterpiece, really. And not as expensive as you may think. But insurance--that's the whole other matter.
So, I kinda get it, plus I am myself not a stranger to some, only some, things of refined nature but they are totally within reasonable price-range. I am by no means well-off and live with my family a very modest, but rewarding life. But this is the issue: I don't need luxuries, unless one considers Jack Daniels and middle-of-the-road Seikos and Movado (and Citizen), yes, I am watches (time) freak, I am former military,  remember, so it comes with territory, luxury items--they are not. Neither is the furniture from IKEA or TVs from COSTCO. This is a normal level of consumption which is characteristic of very many across Northern Hemisphere. Me and my family, we courageously stay in Holiday Ins and Ramadas when traveling (sometimes we even stay in local chains), we courageously fight Chinese tourists at continental breakfast for the last pieces of bacon, and we drive pretty normal, middle-of-the-price range cars. This is not the case with people whose lives and careers revolve around financial capital, in the large cities which "make" money and that goes for NYC, London and even relatively recently Moscow. We are talking about people who not only want (and they want, believe me) but MUST be into conspicuous consumption because their livelihood depends on it. In the end, they simply do not know any other way.  This class, the class of pseudo labor (or work) is what should be discussed and we will discuss it, in depth, including its culture (or rather lack thereof), character, interests and consumer patterns which brought us to the situation we are all in today. Damn, you see, I already started writing my new book... 

People born in USSR will understand me just by looking at this.
The Dunno On The Moon--the best book on Capitalism ever written, that means you too, Marx. For my Western friends, do not even try to look as modern illustrations or 1990s cartoons of this book--those are abomination. It is all commercial crap. If you want to see the REAL immortal illustrations (and Russian text)--it is here.

To Be Continued....

New Book.

I reached an agreement in principle with Clarity Press to start writing my third book. This one will be about what is known as geopolitics, geoeconomics and culture.  But don't expect it fast:

1. I need to take account of what unfolds in a front of us and this process inevitably will be throwing curved balls at any plans or ideas I wanted to express initially. So, many corrections and adjustments to manuscript thus become inevitable;

2. The process will take a longer research, especially in geoeconomic sense and that involves a lot of reading and processing of information; 

3. This book should be considerably "thicker", that is larger, than my previous two books. I promise very little, if any, math.

So, this means a somewhat reduced posting (nothing drastic, really) at this blog. I'll try to keep everything normal (usual) as much as I can. Some of the points of this upcoming book you are already well acquainted with, others will require additional development and elaboration. So, it looks like I will be getting myself back into the writer's hell (or agony) trying to collect my thoughts and experiences for greater public awareness.

When I Hear (Read) Term "Analyst".

Especially in the context of fraudulent Western "economics", my hand automatically reaches for a gun, so to speak. As I said it many times, financial "analyst" occupation should be one of the first to disappear as a viable occupation. It is down right fascinating when all those "analysts" (such as from Bloomberg, among others) begin to discover reality which was around for a while. 
The title of the article itself, Putin’s Economic Isolation Suddenly Doesn’t Look So Bad, should be changed to "Duh!" It is obvious that all those fraudulent credit ratings are absolutely meaningless because they cannot account for the most important principle which economic activity of any modern large country is based upon: "belief that a nation should be generally self-supporting…" Obviously, for globalist girls and boys "educated" in the pseudo-economic white-board theories detached from real life, the whole notion that real national interests may, and often do, come into contradiction with profit or bottom line is inconceivable. They are simply not taught like this, in fact, most of them have no clue what nation is, how it forms and how it operates. Nor, most of them, understand what REAL economic growth, not some books' cooking, is. How can they--most of them never work a day in a productive sphere and do not understand even basic principles of industrial operations and management which require a combination of meta competencies which are not taught in MBA programs. You remember Mishustin's excellent observation recently, do you?

That is why for many in the West facts like this come as "sudden" and, often, shocking:  
One of Russia’s responses to sanctions in 2014 was to place restrictions on imports of certain foodstuffs from the U.S. and Europe. While the measure led to a sharp rise in domestic prices, it also increased farm production, leaving Russia more resilient to distruptions in global trade. “Russia is well prepared for this very new phase of closed borders and closure of international trade and financial processes,” said Sofya Donets, a Moscow-based economist at Renaissance Capital. “It has abundant state buffers and a higher share of local products than it had previously for many consumer goods.”
Yeah, what a concept--to be self-supporting. And then, of course, what is known today (wrongly, I may add) as geopolitics begins to factor in and this geopolitical thingy is altogether beyond the grasp of most Western "analysts" who are taught to think within only one framework, Wall Street framework that is. In this sense, Covid-19 pandemic does all of us a very good service--it exposes a complete incompetence of the globalist financial, managerial, military, academic and other institutions and the so called "elites". No really, would anyone entrust your lawn to be mowed by Christine Lagarde, Angela Merkel or Emmanuel Macron? Being a night-guard at some storage facility? Well, even that requires some skills. Peter Van Buren decries the change which already came:
Van Buren may decry it whatever he wants and he may criticize Orwell for not giving us a detailed account of how 1984's society of IngSoc sprung into existence, but the question he is supposed to be asking is this: why it took a completely rigged and wasteful economic system to last this long? The question is really simple and the one which most in American "elites" dread to answer publicly-- World War Two and the extended lease on life this War gave the system which was able to recover primarily by US government's interference in the systemic decline stock exchange was generating since 1929. Going to war was also a government decision. As for balance of power between "Americans and their government", it should be clearly stated that now "government" is the ONLY institution which holds this country from disintegrating completely, even if "shifting" this balance, which was inevitable and was ongoing in a less dramatic form anyway before Covid-19 struck. Could then, as Van Buren worries, US society degenerate into some version of Orwell's dystopia--well, it already did to a degree by denying, thorough its utterly corrupt media, political class and Wall Street simple truths about reality. Russiagate damaged what's left of the Republic in a much more profound and lasting way than any government check could ever do. Economically, the Unites States is bankrupt and is facing reality no "analyst" could have predicted.
In other words, putting it bluntly, Fed will be buying back its paper junk nobody in the world wants. I like the term "temporarily", but as we know, hope dies last. 

Monday, March 30, 2020

Trump Wants To Talk.

With Putin. Sure, I agree with him--dialog is good. As Ria reports (in Russian) the topics of upcoming phone call will be Covid-19, trade (???) and, you guessed it, oil prices. Yes, about that. My question, immediately, is--so what's on offer from Trump? This is how it works, quid-pro-quo--you want something, you offer something in return. Especially when your hand is extremely weak, and I mean very weak:
Russia can wait. Saudis cannot.
And neither can the United States, because so much rides on "shale oil". But remember, quid-pro-quo. So, what the United States can offer to Russia, granted that US promises as history shows are not worth the paper they are written on, on this matter? It is an interesting issue, because now "giving", that is stopping the sabotage, Nord Stream-2 is not enough--rules have changed dramatically. And if maroons from the American think-tankdom are yet to get the message, Trump, it seems, understands the stakes. Hence the call to Moscow. So what will Putin demand from Trump? But even better question is what realistically the United States can "give" Putin and Russia and this is a point at which this whole quid-pro-quo things runs into trouble, because realistically, there is nothing the United States can offer which will not be either taken or will fall as a ripe apple into Putin's hands. I could, of course, speculate on the prolongation of the START treaty as a viable commodity, but Russia is well positioned to be just fine without this prolongation. 

Putin, of course, also knows real economic situation in the United States. Sure, US will regain a semblance of economic balance once this Covid-19 thingy blows over, but the balance of power was changing globally since 2008 and now the scale of this gigantic shift becomes obvious with the United States in a full departure mode, and this is before we here even begin to feel a real squeeze from high inflation and contraction of US GDP projected by some "analysts" at 30%. And then, of course, there are indications now that Moscow doesn't really care about who is in power in D.C. since no matter who wins US elections, Russian-American relations are broken completely. They will deteriorate even more and here is the main point: Russia's role now is primarily not some quid-pro-quo with the US, but strategic containment of the country which is increasingly irrational and may, out of desperation, unleash a conflict which may grow into a full blown World War. Russia's task is to prevent such a development. Considering the fact that Trump stuffed his admin with war-mongering lunatics, I think Putin will be more interested in discussing issues of strategic stability since, in the end, it will fall to Russia to clean up the mess. As for oil--it can wait. Covid-19 cannot. 

UPDATE: same day. They spoke. It was about oil and no, Russia is not talking about lifting sanctions. Not interested. 
The Trump-Putin call came at the request of the U.S. and was “prolonged,” according to the Kremlin, which didn’t specify how long it lasted. Trump’s view on the the dispute marks a shift from earlier this month, when he likened the plunge in oil prices to a “tax cut” for Americans. The U.S. president spoke to Saudi Crown Prince Mohammed bin Salman on March 9 about the dispute. Trump has long argued that improving relations between Washington and Moscow could help solve international disputes. The president said he wanted to discuss trade with Putin, though he said he expected the Russian president to raise objections to U.S. sanctions. State-run Tass quoted Kremlin spokesman Dmitry Peskov as saying that Putin didn’t ask Trump for sanctions relief on the call.
Pay attention, again, to what is highlighted in yellow. That matters. And, of course, the other question is what is going on between Russia and Saudis BEHIND the scene. I am 100% positive that the activity on Saudi side is feverish right now.

Saturday, March 28, 2020

Didn't Take Long.

Recall smug face expressions of all those financial "analysts" waxing economic when talking about prices and US Dollar, Bit Coin and other worthless papers. Where are they now, all those "analysts"? 

I don't understand, weren't all those "financial instruments" and "financial engineering" the wave of the future recently? Hm, why does gold suddenly look so "attractive". Of course such explanations:
“When people think they can’t get something, they want it even more,” says George Gero, 83, who’s been trading gold for more than 50 years, now at RBC Wealth Management in New York. “Look at toilet paper.”
same as the rest of the WSJ article with statements like these:
Gold is popular with survivalists and conspiracy theorists but it is also a sensible addition to investment portfolios because its price tends to be relatively stable. It is especially in-demand during economic crises as a shield against inflation. When the Federal Reserve floods the economy with cash, like it is doing now, dollars can get less valuable. 
Can only inspire a smile, especially the phrase highlighted in yellow. For al those "financial specialists", who cannot bring themselves to say it, I will say it for them--the "dollars getting less valuable" is called INFLATION. "Dollars" getting less valuable really fast and continuing to do so non-stop is called HYPERINFLATION. And this is precisely the scenario which unfolds in a front of our very own eyes. It is, of course, worth mentioning, you know, a teeny-weeny fact, that for years now the price of gold was deliberately depressed while US inflation was exported globally, but, as you can see, the game is up. In the scenario where the real value of the US Dollar, world's reserve currency (not for long, methinks), is known to be way below of what it is being presented to the "investors", one stable commodity stands out--gold. It has been around for millennia and will continue to be a safe "financial" haven. Here is some spread on the gold reserves as of December 2019. 
Today 1 ton of gold goes for roughly $52.3 million, so do your own calculations. Granted, one deals with actual, physical, gold, not some certificates which give an impression that one has any. You can look up a full list of gold reserves here. While looking at it, note the size of gold reserves of Kingdom of Saudi Arabia. Right: 323 tons. Compare this to Russia's gold reserves of 2,242 tons (7 times more than in KSA) and, against recent news on gold futures rising 9%, one can make a rough estimates of how well can either country weather oil prices collapse when Russia's gold reserves of roughly $120 billion worth of of physical gold provide (again roughly) increase of monetary value (it will grow even more soon) of 120 x 0.09= $10.8 billion of "free" money which, accidentally, is more than 10% of all value of Russia's oil (unrefined) export. Just like that. Saudi Arabia, meanwhile, having its unrefined oil export valued at $110 billion, will have about $10.8/7= 1.5 billion "gain" on its gold reserves, which also is merely 1.4% of "coverage" of its oil exports. See the pattern? I do not say that this is exactly how gold price affects things directly, but ratios presented here DO matter. They show why Saudis already lost heir oil war just on the gold price alone. Russia can afford to both accumulate and sell her gold, Saudi Arabia cannot.

Of course, we also have to keep in mind that Saudi gold, large part of it anyway, is most likely not even physically in the country. It is stored in the US and, as rumor has it, nobody knows actual amount of physical gold in the US. But my point is different here. It is about REAL valuation of gold and the fact that this shiny metal was and is real value, and will outlive US Dollar easily. It will also grow in value over the time since it is a very good cushion against economic upheavals of the scale we all are going through now. On the level of the state, the government, it is certainly true. I don't know how it affects individual "investors" (I am not in financial "advice" business) and it is not my job to know. But always remember:

Friday, March 27, 2020

Music Is Transcendent. Matsuev Playing Gershwin And Blues.

It is Friday. Thanks To Casey I joined in. Watch from the beginning (including Covid-19 speech), but Denis Matsuev and his trio playing blues and variations on Gershwin (starting from 00:47) is something to behold.  Jazz and Blues, and Rhapsody In Blue, are immortal as is Tchaikovsky's music. 
Enjoy this magic.  Hint: add good bourbon and a good cigar and it becomes irresistible. Matsuev is, obviously, a genius.

Russian (And Italian) Troops Disperse Novichok In Italy.

I hope Guardian or NYT will pick up this story. WaPo will do too, together with CNN. Here is 80% "useless" Russian and Italian bio-weapons specialists dealing with Covid-19 in Bergamo today. 
 Here is another one:
I have to admit, as a man who spent my share of time in Chemical Suits (aka in USSR/Russia--Chem-condoms), I approve of these new suits. Really cool. I like how they communicate. 
We still hope that we will be able to make it to Turin and Rome. We planned it this year but everything changed. But it is heartwarming seeing humanity fighting back.

A Mighty LOL!

And what did they expect? 
Here is a simple example: human stomach, house's pantry or even a two car garage have their spacial limits which translate into the calories.  I, theoretically, can eat a good size (12 oz.) rib-eye steak with sides without making me sick. I also, theoretically, can stuff our pantry and garage with finite amount of canned and dry food. Pay attention--finite. Beyond that, consumption, as in eating, stops making sense under the conditions that that food could still easily be bought in a grocery store, while I run out of space. As in "having no more...well, space, length x width x height, as in volume, as in...whatever.  I don't know, in this particular case, what is the level of business "analysts" in Saudi Arabia (the case of oil freight going up 1000% is yet to be presented in the "Saudi's Dumbest Economists" TV Show) but let me stress that this, greatest meme of all: 

was born on Lavrov's pressy together with....Saudi Foreign Minister. So, maroons in Riyadh are yet to learn that the more you saturate market (or sponge), the less it can take in. So simple, almost 2 x 2 =...5 or something like that. Meanwhile, those nasty Rooskies, who without much pomp, finished....remember this? Or you may, using Google Translate, take a look at this: 
Translation: Oil Pipe "Eastern Siberia--Pacific Ocean Reaches Maximum Capacity". 

It is also duly noted in WSJ that Russia managed to reroute its oil to China where demands is growing back. My question, again, is this: do those people even read news or look at the map? 
Did Saudis actually check China's demand even today? Well, 
Oh, I am having fun today. Can I? 

So, Saudis can saturate oil market whatever they want, or are capable of, which is not for very long, but Moscow is unimpressed, neither is Beijing, methinks, who doesn't mind some cheap sweet oil. Me and Arctic Fox already exchanged about Bretton Woods 2.0 and it seems there are more people who think along those lines in a face of a new Great Depression (no, this is not a typo). 
No shit (again), pardon my French. No, not "could", it was and is happening as I type this, de facto, and de jure will not be far away once shit REALLY hits the fan in the United States. And gigantic masses of excrement are on the final approach to the increasingly fast rotating blades of the economic collapse the likes of which we didn't see yet. Historic, really. They even say it (at least they are trying) as it is:
One concern is that monetary policy in the U.S. – actions by the Fed to maximize domestic employment and keep prices stable – reverberates through countries all over the globe, often saddling them with higher inflation whenever their currencies weaken versus the dollar; while exporters of raw materials or manufactured goods might become more competitive, consumers feel the pinch from higher prices for imported goods. Another factor is that so many commodities such as oil, copper and gold are priced in dollars, leaving producers including Russia, Brazil and South Africa at the mercy of foreign-exchange markets.   
OK, let me be even more direct: the MAIN American export in the last decades (apart from export of the most democratic democracy, like ever) was...inflation, which was generously spread around the world. This time is over. But I want to stress it again: this was OVER even before Covid-19 hit the fan, it was over much much earlier. So, what is in store for all of us HERE, in the US, or North America generally. I don't really know in economic terms other than it is getting tough and will make 2008 look like a picnic, albeit even then food-banks ran out of food pretty fast. My main concern here is the one I never made a secret of--we must avoid a war. By all means, after that it is the matter of time and patience, and, hopefully good District Attorneys and Attorney General for leveling charges against those who defrauded and raped not only America, but globe too. But we'll get there when we get there, hopefully.  In conclusion, however, I again will post a quote from brilliant Corelli Barnett. Just read it attentively, take it in--this is what America is paying now and will be paying even more for: 
"… swift decline in British vigor at home and the failure to exploit the empire were not owing to some inevitable senescent process of history....That cause was a political doctrine....The doctrine was liberalism, which criticized and finally demolished the traditional conception of the nation-state as a collective organism, a community, and asserted instead the primacy of individual. According to liberal thinking a nation was no more than so many human atoms who happened to live under the same set of laws....It was Adam Smith who formulated the doctrine of Free Trade, the keystone of liberalism, which was to exercise a long-live and baneful effect on British power....Adam Smith attacked the traditional "mercantilist” belief that a nation should be generally self-supporting…" 

Thursday, March 26, 2020

Are You (Fvcking) Kidding Me?

Russians have proverb: impudence is a second happiness (naglost'--vtoroe schast'ye). And when you think that you saw it all, bang! And it is Ukraine. Rada's (Ukraine's parliament) MP with a typical Ukrainian name Vadim Rabinovich, speaking to Ukrainian outlet NewsOne proposed to ask for help... from Russia. Here is video (in Ukrainian/Russian):

I am still in shock and am trying to lift my jaw from the floor. But before I proceed, Rabinovich proposes to Ukraine, after, by his own admission, listening to Putin's "Covid-19" Address to Russia, simply to copy this program and... apply it to Ukraine. He says that if ever-sanctioned Russia can do this, then Ukraine, and I quote, "supported by half-the-world" certainly can do this too." You know what follows: 
One comment from the Rabinovich's video summarizes it really well: 
Translation: let AmeriGa and Europe help you...freeloaders and traitors. 

This is precisely the attitude of overwhelming majority of Russians both in Russia and around the world towards...no, not to the shithole of a country which Ukraine is...but towards Ukrainians. I was going to do a separate write-up on Ukraine, but this whole thing is so surreal, that I had to comment on it. Rabinovich is, obviously, delusional, which is a normal state of not only Ukrainian "elites" but majority of "Ukrainians", who, in addition overwhelmingly consider Russia to be a hostile state (in Russian), while large parts of their society still think that Ukro Army fights Russian Army in Donbass. I will omit here the description of Ukrainian media as an asylum run by patients, but I have to state a thing which I repeat ad nauseam: Ukraine is anti-Russia. It cannot exist in ANY other form for a number of major historic, geopolitical, economic, cultural and other reasons. I do, however, give Ukrainian "nation" the right for metaphysical existence, because this nation did coagulate around central idea as a political nation. This central idea is primarily a combination of kindergarten-level fantasies, down right delirium and and of radical Russophobia. 

And here is Ukrainian problem: nation built on those ideas cannot create a viable state in principle, unless such a "state" is a failed state and Ukraine is more than a failed state, Ukrainian nation is a failed nation. Because it needs to constantly prove to themselves that they are not Russians and this has to be done against the measure of Russia as a country. Truth is, Russia is economic and military superpower, Ukraine is a decrepit, backward, dirty place, populated with increasingly irrational population, which still dreams about "integration" into EU and NATO, not understanding that it is needed there only as a ram against Russia to be eventually used and thrown out as used condom after intercourse. This time has arrived. First, EU as a whole is a joke and it is on its way out, the US is facing existential crisis which makes 2008 crisis look like a Nerf gun against 152-mm howitzer. Most importantly, Russians DO NOT want to help Ukraine. In fact, majority of Russians do not want to hear anything about the country which hates Russian guts due to this nation being a loser on a historical scale, getting in 30 years since its independence, from one of the most economically developed former Soviet Republics to a main provider of toilet cleaners and strawberry pickers to Poland and a variety of prostitutes both to Russia and EU. 

Most insulting for Ukrainian mentality, moreover, is the fact that Russians live better than them, much-much better. Russia's per capita GDP is 3 times that of Ukraine, in reality even higher. Much higher.  I would offer you all to do a little bit of comparison of two respective capitals of Russia (Moscow) and Ukraine (Kiev), their transport and street infrastructure,  done in Autumn of 2019. No knowledge of Russian language is necessary, except for knowing the fact that many Russians (justly so) were incensed with this comparison of Kiev to Moscow, stating that comparison should be with smaller Russian cities in provinces, granted that even those would make Kiev still look as the capital of the third world shithole. So, enjoy (who wants) the video and pay attention to the faces of people in respective cities. 
So, now they want Russia, after they are still hard at work in D.C. lobbying for more sanctions on Russia and trying to sell the only product they have which has value in the West--Russophobia--to help them? Nope. Let them deal with all that completely on their own--not a single Ruble should ever be spent on this country and its people. They wanted independence and European "integration"--let them have it. Russia needs to get busy building cordon sanitaire around this shithole, and close borders for most of those lunatics. They have their own "government", Rada, President and EU with the United States. Let them ask Lieutenant-Colonel Vindman to lobby Ukraine's interests in D.C. (this American "hero" knows how to do it) and ask DNC to provide help.  After all, there is always Canada with its massive Ukrainian diaspora. As Rabinovich stated--half-the-world supports Ukraine, so let it, leave Russia out of it. Build A WALL, Russia.

Finally! I Was Beginning To Worry.

I almost thought for a couple of days that I live in a different world and started to worry since my matrix began to disintegrate. And now I can exhale, everything is back to normal. Whew. First they understood it:
That, of course, was followed by La Stampa's piece that 80% what Russians sent to Italy was useless. Of course. Maria Zaharova was forced to comment on this "article" in La Stampa with only one question (in Russian): "Why does La Stampa use anonymous sources?" While the President of Lombardy Attilio Fontana was even more direct--he quoted Dante (in Russian): "They all are not worth the words--look at them, nothing to see." You can find proper translation if you get to Divine Comedy when you have the time. But, generally, everything is back to normal" "evil Rooskies", "evil plans by evil Rooskies" and "evil Rooskies' evil aid with evil plans in mind", and so on. Damage control, of course. Obviously La Stampa needs to recall this:  
This is the monument to Russian Navy's sailors who rushed to help Messina and its inhabitants in 1908, after devastating earthquake.
The scale of the destruction caused by the Earthquake was so large that the contacts of the mainland with the city of Messina were lost for a few days and the Italian government was slow in sending a relief force. For at least a couple of days, the survivors of the earthquake were helped only by an international force, mainly composed of the sailors of four Russian military ships that happened to be cruising nearby. British and German ships also provided help and, subsequently, the Italian navy took over with a large relief effort. Still, it seems that the Russians did a lot and with great good will. We have little detail of the events of those confused first days, but some surviving documents of the time tell us much about the gratitude of the survivors. One note sent to the Russian consulate by the Pira family says, "Jesus is with Russia, thank you!" The Russian intervention was so much appreciated by the inhabitants of Messina that, shortly after the earthquake, the city enacted a decree that dedicated a square of the town to the Russian sailor and planned to build a monument to them. It took more than a hundred years to build the promised monument. It is hard to say exactly why it took so long but, eventually, it was done in 2012. Today, it stands, little known outside Messina, but a reminder of a story of human solidarity and friendship.
You may not know this, but Russians have this knack for being in the wrong place at a very right time. San Francisco can testify to this, not without a scandal, of course. 
VALLEJO, Calif. —A gesture by the Russian government to honor six of its sailors who were buried in a San Francisco Bay area cemetery nearly 150 years ago is not sitting well with preservationists. The visiting Russian sailors died in 1863 while helping to fight a massive fire near San Francisco’s waterfront. They were buried at the Navy cemetery on Mare Island, where weathered, broken stone slabs marked their graves for decades. To honor their heroism, the Russian Consulate decided last year to buy new cross-shaped, granite headstones for the burial sites of A. Trapeznikov, K. Kort, Y. Bootorin and three unidentified sailors. But Vallejo officials and preservationists told the San Francisco Chronicle that the Consulate did not follow proper procedures for the oldest Navy cemetery in the West, which became a national landmark after it closed in 1921.
But by now we all must get used to acrimony in Russian-American relations. But here is the part which is most important. Relations are not only the governments anymore, they are also today between people. And, in fact, primarily between people. In case of Russian aid to Italy it is an absolutely overwhelming wave of love and support from Russians to Italians, who pay back in kind. You can see it everywhere--on every public forum. The atmosphere of mutual warm feelings between two peoples. Here is one example, from 2017:
Here is this incredible monument.
Now ask yourself a question--do Russians remember this gesture? Hint: this was covered by ALL major Russian media (minor too). Or do Russians remember who designed St. Petersburg for Peter the Great and Russia. Name of Rastrelli in Russia is next to the name of Peter the Great. So, let's put it in simpler terms--Russia and Italy are a bit closer than mere governmental, however important, relations. Do you think Russia's desire to help is purely for propaganda? Of course not. Western media, however, are nothing more than propaganda outlets with many creatures infesting them qualifying easily for the title of simple human ass-holes and whores. Not even in "journalist" terms, but namely--human. Take a look at NYT or WaPo, as an example. So, it is always pleasant to recognize that I wasn't mistaken in Western "free" media. Luckily, modern technology allows people to see each-other without media's distortions, due both to malice and sheer stupidity, and that gives some hope. After all, what can I say--since 1978 I am a passionate fan of Squadra Azzurra, from the times of legendary Enzo Bearzot, Dino Zoff, Paolo Rossi, to the times of Alessandro Del Piero and GiGi Buffon. There are many people like me in Russia and former USSR. So, how can one Juventus fan not help another Juventus (OK, Milan and Roma too) fan in time of need;))

Basic Economics.

As in REAL economy, not this Wall Street financial BS. I already had a short exchange with Dillon yesterday on this matter, but before we get to particulars, let's recall, if one can, 1998 and default in Russia. One of the effects of major inflation which was unleashed by this default was devaluation of Ruble to US Dollar. While I omit here all this bankster mambo-jumbo, one of the effects of the weakened Ruble was the fact which at that time Judy Woodruff of CNN, being Moscow correspondent (remember when CNN was an actual news corporation?) reported with amusement: the fact that while Russian financial "markets" (financial "market" is akin to hairy baldness) were being slaughtered, Russia's industry, especially food processing, became very competitive with the flow of Western products young "Russian" so called "reformers", in reality robber barons and criminals, directed towards Russian market thus making Russian producers fight for own survival. Default corrected that and since then Russian producers never looked back. Even when hard times of 2008 or massive sanctions of 2014 happened. 

It is an economic truism that in the international economic relations a weaker domestic currency makes goods produced domestically more competitive on the international arena. That is, THAT IS, if you have the ability to produce those goods. Jamaica may weaken its Dollar whatever it wants, it changes absolutely nothing for its goods because Jamaica basically produces nothing, well, not exactly nothing (wink, wink) and weakening of its currency, in fact, makes life harder because Jamaica would have to buy more hard currency to buy goods which it really needs. It is simple as that--let's say Jamaica (or any other minor player) wants to buy a regional commercial aircraft (something like Embraer or Bombardier) for 20 million USD. For the sake of discussion let's assume Jamaican Dollar being 5 to 1 USD. In this case, for Jamaica, to buy such a plane it must have 20 million x 5 = 100 million Jamaican Dollars. But what if Jamaican Dollar weakens two fold, now it is 10 to 1 USD (exchange rate), and that means that for the same plane Jamaica will have to have 20 million x 10= 200 million Jamaican Dollars. You see how it works? Of course, Jamaica may go and mortgage a shitload of its assets for this tremendously disadvantageous rate, but no matter what Jamaica does, it needs 200 million Jamaican Dollars. 

Now comes this teeny-weeny country of Russia, which produces pretty much everything on its own, ranging from shoes and toilet paper to space ships, commercial aircraft, cars, what have you. So, say I want to buy in Russia Lada X-Ray Cross in January of 2019 for (let's round) 660, 000 ₽--I go to dealership and pay 660,000 OR $10,000 per existing exchange rate between Ruble and US Dollar then. Now, let's fast forward to March 2020. Say, I decide to buy this model now. Today exchange rate between Ruble and USD is 81 to 1. So, what would I pay for Lada today? Well, same 660,000 ₽, or....drum roll... 660,000/81= $8,148. Compare: $10,000 in December of 2019 to $8,148 in March 2020. So, Lada X-ray (and other Ladas) which, actually do sell quite well in Europe and elsewhere may drop their price in USD thus making these well-made cars even more competitive. What is going on, one may ask. Very simple explanation--unless you buy something abroad for hard currency, such as Russia buying some pharmaceutical products and pays higher price in USD (or EURO) for them due to weakening Ruble and the prices on those grow in Rubles too for domestic market, everything else what is produced home pretty much remains more-or-less unchanged. 

So, yesterday some "brainiaks" from Oilprice.com discover basic math and economic for themselves:
While the ruble is now at its lowest level against the dollar in four years, the cheaper ruble has a silver lining for Russia’s oil producers in the oil price war for market share with Saudi Arabia. The collapse of the OPEC+ deal and oil prices has hit Russia’s financial markets and currency, leading to a sharp drop in the ruble versus the U.S. dollar. The lower the ruble slides against the U.S. dollar, the lower the production costs of Russian oil companies in U.S. dollars are. To be sure, a crumbling ruble is not the preferred outcome of the oil price collapse for Russia’s monetary system and foreign currency reserves. Still, it could help Russian oil firms to have lower costs in U.S. dollars for their operations. According to calculations by Reuters, the lifting cost per barrel of oil equivalent of Russia’s largest oil producer, state-controlled Rosneft, is now lower than the costs of Saudi Arabia’s oil giant Aramco. And this is due to the falling ruble against the dollar. On the other hand, Saudi Arabia’s currency, the riyal, is pegged to the dollar at a fixed exchange rate, so the dollar costs for Saudi Aramco are the same before and after the oil price collapse and the collapse of the OPEC+ coalition. Last year, the average lifting cost in dollars per barrel of oil equivalent of Rosneft was $3.10. This compared to a $2.80 cost per barrel for Saudi Aramco, as per company financials cited by Reuters. The crumbling ruble has now cut Rosneft’s cost to $2.50 per barrel, while Aramco’s cost is the same because of the fixed exchange rate with the riyal peg to the dollar, Reuters calculations show.
Okey-dokey, boys and girls from Oilprice--back to school to study basic facts and please change the stupidest title of the article: Russia’s Unexpected Advantage In The Oil Price War. There is nothing, zilch, nada "unexpected" in this "advantage". It was planned all along and that is why "crumbling Ruble" didn't create any panic in Russia. Yes, overall global situation and the most acute crisis of liberalism will, of course, impact Russia--I already presented one example with medical supplies--but for the country which was re-industrializing like there is no tomorrow since 2007-08, this impact will be limited because not only Russia doesn't have to spent huge volumes of Rubles to buy hard currency but it makes Russia's exports extremely competitive be that selling S-400, SU-35C, Ladas or food, or, of course, hydrocarbons, especially oil. Anyone wants to fight Russia's oil? Good luck with that--costs do matter. So, they begin to suspect something in D.C.
(Bloomberg) -- The Trump administration is pressing Saudi Arabia to dial back its plan to flood the oil market after a price war with Russia sent crude prices crashing to their lowest levels in almost two decades. The U.S. wants Saudi Arabia to hold back on a plan to supply a record 12.3 million barrels a day next month, people familiar with the situation said. It’s asking for the Saudis’ help in bringing oil prices back to where they were before the market cratered in early March, one of the people said. Oil prices have plummeted since Russia and Saudi Arabia failed to reach a deal to cut back production in response to an unprecedented decline in crude demand brought on by the coronavirus pandemic. The market collapse has imperiled hundreds of thousands of jobs, wiped out tens of billions of dollars in capital spending and is threatening to force as many as 70% of U.S. shale drillers into bankruptcy.
My question in this case is this: didn't you, guys, see that coming? Have anyone in D.C. tried to mitigate the problem by engaging Russia, not Saudis, who is in real control of situation? Any diplomacy, any quid-pro-quo? No? Well, then I guess you have only yourself to blame for not having a faintest clue about Russia. Continue chest beating, while Russia will put Saudis on their knees and then will give the United States, yet another, chance to save face and come to the negotiating table. Mnuchin, as we all know, already got the message. But this activity could have been enough 4-5 years ago. Now, it doesn't go too far. Russians do not care about this Saudi shithole, but the United States for Russia are different--Russians know that for the American elites Russia is the most important and deadliest enemy which must be annihilated. So, the framework for any negotiations, thus, changes dramatically. As this Covid-19 spectacle demonstrated so well--only economically self-sufficient countries, with massive REAL sector--yes, manufacturing nearly everything they need for own existence--are the real players on the global arena who have options of escalation, both economically and militarily. Simple as that, because it is basic economics (however grossly simplified here for the sake of example). In related news:
This is just the beginning. It is also yet another demonstration of utter incompetence and ignorance of US "elites" who long ago lost any touch with geopolitical, economic, military and any other realities. But I warned about that for years, yet, this is not the occasion on which I would have satisfaction of being right, because it is not easy to see the old world departing, knowing that for me, and others, there still were some joys and dreams. 

Wednesday, March 25, 2020

Russian Army Invades Italy.

And makes a dash to Bergamo. No, really, Russian contingent of Radiation, Chemical and Biological Defense Forces (RHBZ) deploys to one of the hardest hit regions of Italy, around the city of Bergamo.   
Russian Vesti (Russia 1) reporters are also at hand to document this act of aggression. 

Russia also registered today first two deaths from Covid-19: 73 and 81 year old patients, both with a host of chronic illnesses, which, of course, is a very small consolation for their relatives. But it is what it is, we all are at risk one way or another. 

Today, also, in the act of unheard of militancy, Russian insidiousness and lack of democracy, Russians conducted another anti-American provocation and operation of influence and, through Russia's Ambassador to the United States  Anatoly Antonov offered (if needed) aid to the United States in containing Covid-19 pandemic (in Russian). I think US Intelligence Community headed by the US Congress Select Committee On Intelligence  must immediately commence a thorough investigation of this atrocious Russian interference with American democracy. Declarations such as this:
«Простые американцы должны знать – Россия при необходимости будет готова помочь и США, как не раз предлагала содействие в тушении пожаров в Калифорнии»
Translation: "Simple Americans must know--if necessary, Russia will be ready to help the United States, the same as Russia, not for once, offered help in extinguishing fires in California". 

Or this barely veiled threat to American national security when stating that Russian Covid-19 test kits are top notch and already have proven themselves in China, Iran and, now, Italy, are absolutely inadmissible. This is atrocious, where are Malcolm Nance or Adam Schiff, or specialist in Russian genetics and bodily fluids Mr. Clapper, when you need them? Where is everybody?  Who can stop this Russian aggression? But never mind, it doesn't really matter because there are always sanctions the United States can impose on Russia for conducting herself in such an aggressive, democracy-threatening manner. So, as you can see, Russian invasion is in progress and NATO does nothing. What's next, Russians sending toys and food for women and children? Ah, wait--Syria, forgot completely. While combined West tries to support peaceful humanitarian jihadists and other democratic head-choppers, Russians assault Syrian civilian population with doctors, food, clothing, clean water and other typically Russian tools of aggression and subversion.  Look at that, Russian agents are already deep in Italy. So, ladies and gentlemen, the Russians Are Coming! Run for your life!