Tip of the Iceberg: Russian Use of Power in Syria

 

EXECUTIVE SUMMARY: The Russians are determined to reacquire some of the status once enjoyed by the Soviet Union of yore. They believe Western carelessness is to blame for the rise of Islamic State, and are using the Syrian theater to demonstrate their strategic capability.

russia-air-force-in-syriaBECA

Russia’s status in the Middle East has changed remarkably in recent years. Some go so far as to argue, with some justification, that it has become the most powerful superpower in the region, or at least within the context of the Syrian conflict. The main reason for this has been Russian President Vladimir Putin’s ability to invest significant resources in the region, coupled with his willingness to take significant risk.

Continue reading

Financial ‘bread & circuses’ and the approaching Global fiscal storm

As the Financial Circus continues today, pushing down the precious metals prices, millions of Americans are going to get wiped out when the collapse of U.S. net worth begins in earnest. Anyone with a bit of common sense must realises that the financial markets today are totally disconnected from reality.

With new stories of 40 million Russians to take part in “Nuclear Disaster” drill, the Philippine President telling President Obama “To Go To Hell”, and suggesting that he is buying weapons from Russia, U.S. Suspends Diplomatic Relations With Russia based on the mess that is Syria, U.S. Ends Fiscal 2014 With $1.4 Trillion Debt Increase the third largest in history, Deutsche Bank troubles raise fear of global shock, so it’s completely ‘mysterious’ that the gold and silver prices are falling. Surely this is totally contrary to normal financial orthodoxy?

With 90% of the U.S. media now in control by six large mega-corporations, Americans have no idea just how bad the U.S. financial system has become. News stories today that would have caused a stock market crash and a spike in the precious metals years ago… no longer are a realistic barometer of the market today. Instead, the broader Stock, Bond and Real Estate Markets where 99% of Americans are invested, continue to be propped up.

How propped up? Well, let’s say by a staggering $31 trillion in the past six years. According to the wonderful folks at the Federal Reserve, U.S. net worth increased from $57.9 trillion Q2 2010, to a stunning $89 trillion Q2 2016:

fred-us-net-worth

Continue reading

The Flight 93 Election

 

2016 is the Flight 93 election: charge the cockpit or you die. You may die anyway. You—or the leader of your party—may make it into the cockpit and not know how to fly or land the plane. There are no guarantees.

hero_image_main_2AP

Except one: if you don’t try, death is certain. To compound the metaphor: a Hillary Clinton presidency is Russian Roulette with a semi-auto. With Trump, at least you can spin the cylinder and take your chances.

09clinton-charlotte-videosmallReuters

Continue reading

The EU Rot sets in: The Full Details Behind Italy’s Monte Paschi’s €5 Billion Bail Out

35A6EC3700000578-3659769-image-a-30_1466865800530Reuters

After the close on Friday, the European Banking Authority did what it does every other year: it released the results of what it calls a “stress test” which is simply an annual exercise in boosting confidence. Case in point, the 2016 edition did not even “test” for Europe’s two biggest threats, namely negative interest rates or “Brexit.” It also did not test any banks from Greece or Portugal, knowing well what the results would have been. However, in order to retain some credibility, the same test which in previous years passed such failed institution as Dexia, Bankia and Novo Banco, had to fail one bank, and this year the honors fell to Italy’s Monte Paschi a bank that goes back to before Columbus sailed to the Americas.

However, as we reported earlier on Friday, the EBA only failed Monte Paschi after the bank announced it had obtained a private bailout from a consortium of banks. The Monte Paschi bailout, a €5 billion capital increase, was unique in several ways, not least representing 5.6x BMPS’s market cap.

In a nutshell, the plan can be summarized in the following three steps:

Continue reading

No Exit for China

 

Li_Keqiang_africa_AP_240x180Reuters

In the 18th century after a passing breeze caused him to lose his place in a book, a Chinese scholar named Xu Jun wrote this short poem: “The clear breeze is illiterate, so why does it insist on rummaging through the pages of a book?” Though this couplet was seemingly harmless, the Manchu-ruled Qing Dynasty (1645-1911) executed Xu in 1730 for seditious thought. The Qing, invaders from the Manchurian steppe whose dynastic name meant “clear” or “pure,” were acutely sensitive to the insinuation that they were illiterate barbarians despite adopting the trappings of Chinese civilization. Countless other poets shared Xu’s fate during the dynasty’s infamous literary inquisitions. While this paranoia appears excessive, it was a reflection of a very real problem for the Manchus.

The Qing, like all other Chinese central governments, struggled to contain dissent across a continent-sized empire. This proved doubly difficult because a small number of ethnic Manchus ruled over a far larger population of resentful Han Chinese. Han rebellion, which often coalesced around the purported superiority of Han culture, was a constant threat, shaking the foundations of the empire from the mid-19th century. Eventually, Han-led revolution swept away the Qing — and the entire imperial Chinese system — in 1911, leading to the formation of the Republic of China. This, in turn, quickly split along factional lines into warlord cliques. Truly effective central rule did not return until the Communists seized power in 1949.

Continue reading