The Trump administration on Tuesday removed Moscow-based Kaspersky Lab from two lists of approved vendors used by government agencies to purchase technology equipment, amid concerns the cyber security firm’s products could be used by the Kremlin to gain entry into U.S. networks. Source Reuters
Information Technology
Britain could launch military retaliation such as air strikes against a future cyber attack, the Defence Secretary has suggested. Sir Michael Fallon warned potential attackers that a strike on UK systems “could invite a response from any domain – air, land, sea or cyberspace”. Source The Telegraph
More than 80 companies in Russia and Ukraine were affected by the Petya virus that disabled computers Tuesday and told users to pay $300 in cryptocurrency to unlock them, according to the Moscow-based cybersecurity company Group-IB. Telecommunications operators and retailers were also affected and the virus is spreading in a similar way to the WannaCry attack in May, it said. Source Bloomberg
Cybersecurity firms ESET and Dragos Inc. release detailed analyses of a piece of malware used to attack the Ukrainian electric utility Ukrenergo, what they say represents a dangerous advancement in critical infrastructure hacking. The researchers describe that malware, as only the second-ever known case of malicious code purpose-built to disrupt physical systems. The first, Stuxnet, was used l to destroy centrifuges in an Iranian nuclear facility. Source Wired
Google-owner Alphabet Inc. has agreed to sell robotics firm Boston Dynamics to SoftBank, the Japanese telecommunications and technology company. Source The Verge
China’s controversial new cyber security law requiring strict data surveillance and local storage for internet companies will come into force on 1 June, state run Xinhua News Agency reported. Source MonilWorld
Chinese consumers are voting with their wallets – and they’re no longer voting for a new iPhone. That’s clear to see from Apple’s latest earnings report, released overnight, which shows Tim Cook’s company pulling in shrinking revenue from the greater China area – mainland China, Hong Kong, Macau, Taiwan – in the first three months of the year. Source Tech in Asia
You recognize this fragment, don’t you? Suppose a king is about to go to war against another king. Won’t he first sit down and consider whether he is able with ten thousand men to oppose the one coming against him with twenty thousand? If he is not able, he will send a delegation while the other is still a long way off and will ask for terms of peace. At the outbreak of the hostilities, Ukrainians were very much aware of the proportion of the opposing forces, and so they were willing to negotiate. Such talks even began in Turkey but – lo and behold – Kiev received a command to back out. Now the hostilities are slowly nearing its second year and the number of casualties is rising. More than four hundred thousand (FOUR HUNDRED THOUSAND) Ukrainians are said to have lost their life, but despite these horrible losses and despite the ten thousand being played off against the twenty thousand – to adduce the introductory parable – the war continues and there is no sign of it coming to an end. Why? Do Ukrainians really think they can beat the Russian bear? Do Ukrainians really think they can regain lost territories? Do Ukraine’s Western supporters and guardians really think Ukraine can win and regain its lost territories? Anyone in his right senses cannot believe that, especially high-ranking officials, whether in Ukraine or in the West, because they have all the data and, consequently, they know that ten thousand is fighting a losing battle against twenty thousand. If they know it – assuming we are dealing with people in their rights senses – then why is this war being prolonged?
The war is being prolonged for three reasons, two of which are rather familiar to the reader. One purpose in having this war go on is to weaken Russia as much as possible, to keep it engaged in a conflict, to make Russian president less and less popular among Russians and – maybe? – have the Russian people topple him down. A highly unlikely event, considering the highest approval rates that Vladimir Putin gets as compared to all the other leaders around the globe (Western leaders are credited with less than 50% of approval). The other reason is to deplete American stockpiles of arms so as to have a pretext to replenish them i.e. so that the industrial military complex can have new government lucrative commissions for the production of replacement equipment. There is yet a third important reason why the war – a proxy-war between the United States and Russia – is being prolonged.
Up to February 14, 2022, American troops had carried out military operations or – simply put – outright wars and interventions in very many places of the world, and nowhere did they encounter an enemy to be reckoned with. Whether it was Iraq or Yugoslavia, America’s opponent was significantly weaker, smaller, and usually politically isolated. It is in Ukraine that the American military are encountering an opponent that is a match. It is not only the type and quality of the advanced weaponry that the Russians use, but also the strategy and the tactics that they employ. Americans want to learn about their rival (enemy) as much as possible from the warfare. Ukraine is their laboratory, a military area where a war game is conducted, a war game for real with this precious exception that no American soldier gets killed (save for mercenaries, but that’s a different story). Americans have their advisors there on the ground, they have American mercenaries i.e. American active duty soldiers in disguise, while obliging Ukrainians provide the Pentagon with any and all intel. The war in Ukraine is a huge opportunity to study the Russian army in action. It is a huge opportunity to make Russians reveal the most secret, the most advanced of their weapons. Wars being wars, a hope arises that some of the most advanced types weapons might be intercepted. The reader might recall how the British received the whole V-2 ballistic missile that landed in marshes in occupied Poland and was retrieved, disassembled and documented by the Polish Home Army and then sent in pieces to the United Kingdom by means of a Dakota that flew from southern Italy to Poland and back.
Ukraine cannot win this war, just as ten thousand cannot prevail over twenty thousand. Nor can the collective West win it. Still, the United States can keep one of its global rivals militarily engaged (for more information, see the geopolitical ideas developed by RAND in 61 Gefira Feb 2022), study the Russian strategy and tactics and hope for intercepting as many items of Russian military technology as it is possible. That is why Ukrainians must die.
What if the USSR continued to exist? First, in A.D. 2023 it would not be the same USSR as in A.D. 1989, still less so as in A.D. 1960 or earlier. Everything evolves, so would the USSR and it would have continued to evolve, to change. Consider China, for that matter. The Soviet Union would have been capitalist in all but name with a strong say on the part of the government and the communist(?) party. Since Gorbachev, we would not have had simpletons as leaders like Nikita Khrushchev in the Kremlin. Rather, refined individuals like the said Gorbachev or present-day Putin: i.e. educated men with good manners.
Having said which, let us think about the world A.D. 2023 with the still existing USSR. What would have happened between 1991 (the year of the dissolution of the Soviet Union) and 2023? or – still better, still more relevant – what would not have happened between 1991 and 2023?
1 The Warsaw Pact would have continued to exist, which by itself and in itself means that NATO would not have expanded to central and eastern Europe; which in turn means that no conflict would have been in the making as we can observe it today.
2 Yugoslavia would have continued to exist, and even if it had somehow disintegrated, then peacefully. Certainly, there would have been no bombing of Yugoslavia by West, no civil war, no show trials in the Hague, no murdering of Slobodan Milošević in prison.
3 There would have been no wars in Chechnya: thousands of lives would have been saved.
4 No worldwide covid-occasioned freezing of the world activities would have been feasible. Most probably, the powers that be – those who prepared the covid dress rehearsal (before who knows what?) – would not have even considered imposing that ill-famed worldwide curfew with all others attendant restrictions.
5 All central European countries would still have been part of the “European Union of the East” i.e. the Comecon. The Western European union would not have expanded to the east.
6 Most remarkable: Ukraine would have remained the second most important republic of the Soviet Union. As such:
[a] in 2023, it would have approximately 50 million inhabitants as opposed to the estimated 25 or so million at present;
[b] it would have been highly industrialized; no need for people to flood Europe in search of employment;
[c] 400 thousand Ukrainian men would not have been killed, tens of thousands would not have been maimed or become amputees;
[d] Ukrainian cites, towns and villages would have remained unscathed;
[e] the Ukrainian Soviet Socialist Republic would still possess the Donbass and Crimea.
7 The Baltic States would not have been depopulated as they are now.
8 The managers of the world in the West would not have dropped their masks and would not have:
[a] accelerated the ethnic replacement; and
[b] enforced homosexuality on people at large.
Why? Because during the existence of the Soviet Union both sides tried to convince their own societies and the societies in the opposite political bloc that their system was better, more attractive, more humane. Surely, the open propaganda of homosexuality with all attendant phenomena like encouraging teenagers to take hormone blockers or change their biological sex would have been moderated or even deactivated; surely, the Western managers of the world would not have wanted to show to the central Europeans and the citizens of the Soviet Union how much they despise their own Western nations and how much they want to replace them with aliens.
9 Muammar Qaddafi would not have been toppled; no influx to Europe of people from Africa would have occurred.
10 Most probably Germany would not have been re-united. The existence of East Germany would have influenced the policy-making of Western Germany; since by 2023 travel restrictions would certainly have been loosened, Western Germans might have been able to move to East Germany in an attempt to flee the homosexual propaganda and the ethnic replacement if these had been executed as they are today. Notice that Alternative for Germany is especially popular in the former German Democratic Republic. How much more would it have been popular if that republic had persisted?
11 The Comecon (the eastern version of the EEC or the European Economic Community, the predecessor to the European Union) would have evolved into a rivalry counterpart of the EEC (a miniature of today’s BRICS?), which would have been a healthy phenomenon: rather than having a monopolist as regards the economic, political and societal model, we would now have two European models of civilizational development, vying with each other and not letting each other degenerate into something that we can now see in the European Union.
What do you say to all of the above? True or false? Notice how many lives would have been saved in Yugoslavia and Ukraine. Notice how many able-bodied men would have served their respective countries with their hands and brains rather than with their corpses. Notice the continued immutability of state borders that we would have had up to now and the resultant peace. Correct me if I’m wrong.
It is amazing how similar the outcomes of World War I and the Cold War are. Indeed, how similar the military and political realities are.
Let’s simplify the picture: In World War I, it was Germany and Austria-Hungary against the West (with Russia falling out of the picture toward the end of the war). It was the German world (Germany was almost 100% ethnically German, while in the Habsburg monarchy the German element was in the minority but still dominated the whole country) against France and the Anglophere, i.e. the United Kingdom, the United States and Canada.
During the Cold War it was the Soviet Union and its satellites against the West, again mainly the Anglosphere. The Soviet Union corresponded in this comparison to Germany in that it was basically a Russian state (including Russian-speaking Ukrainians and Belorussians), while the countries of the Warsaw Pact corresponded to the Austria-Hungary or Dual Monarchy.
The two political and military camps – the German dominated Europe as opposed to the West, and the Russian dominated Europe as opposed to the West – vied for dominance. The hostilities during World War One brought about the weakening of the German-dominated alliance juts as the peaceful rivalry during the times of the Cold War brought about the weakening of the Soviet or Russian dominated part of the world. Talks were brokered, the warring parties sat at the negotiating table and slowly but surely a peace deal was worked out: Germany trusted its military and political adversaries would settle the post-war relations in a chivalrous way; so did the Soviet Union with regard for the victorious Western world. What happened next?
In the case of Germany the West – especially France – inebriated with victory began to step up demands and multiply acts aimed at humiliating yesterday’s enemy; precisely the same happened in the aftermath of the Cold War: the West – especially the United States – inebriated with its victory over the Soviet Union began stepping up demands and humiliating Russia, the core of the former Soviet Union. After 1918, Germany was forced to pay enormous contribution to the victors, cede chunks of territory and generally subjugate itself to the diktat of yesterday’s enemies. After 1991, Russia as heir to the Soviet Union lost huge chunks of territory (Ukraine, Belarus, the Baltic States, the Caucasus and the central Asian republics) and experienced a financial and economic plunder comparable to what Germany had gone through after World War One. What was the result in both countries?
An economic crisis that played havoc with the cohesion of society and a lingering sense of being humiliated and cheated. Yes, cheated, because the winning nations went back on their promise of jointly creating a better, peaceful world and only sought dominance and exploitation. The ten or so years of the Weimar Republic and the ten or so years of the presidency of Boris Yeltsin have much in common: both states found themselves at the mercy of the winning powers, both states were immersed in economic and political crisis, and both nations felt disillusioned with democracy made by the West. The result?
The result was in either case roughly the same: in the early 1930s in Germany and in the early 2000s in Russia, a strong leader emerged and gained popular support: in either case the strong leaders succeeded in first alleviating and then eliminating the economic, social, and political crises, and in either case both strong leaders managed to slowly restore the international high standing of their respective countries. In either case, the West’s relentless drive to expand its dominance eventually entailed war.
For all the approximations, the similarities are striking, are they not?
The war in Ukraine has been going on for almost a year now. There is no doubt that it is a war between Russia and the West, between Russia and NATO, between Russia and the United States. There is also no doubt that Kiev, left to its own devices, would have long since been beaten and conquered and subjugated by Moscow. The constant supply of arms, financial loans and political support coming from the West means that Ukraine continues to fight, albeit not only with its own army, but also resorting to thousands of mercenaries from a variety of nationalities. Polish and British soldiers and officers are said to be operating in Ukrainian uniforms. The West has deployed all its authority, all its diplomatic and economic muscle, to sustain Ukraine’s resistance against Russia. Is it because anyone in Washington, London, Paris and Berlin or Kiev believes that Ukraine can win this war? Is it because anyone in Washington, London, Paris and Berlin or Kiev believes that Ukrainian troops will drive out Russian troops, that Ukraine will regain not only the four provinces that have been annexed to Russia, but also the Crimea? Is it because Moscow, having been repulsed and vanquished, will start paying compensation to Ukraine and the Russian leaders will stand before the international tribunal in The Hague like the former leaders of Yugoslavia and Serbia?
Of course not! So why are they fighting this war? Why are Washington and London, Paris and Berlin encouraging Kiev to resist further? Why are Western governments subjecting millions of Ukrainians to death, starvation, cold and emigration? The answer is self-explanatory. Because if the war goes on as long as possible, then:
① Russia, a rival that the West dislikes (to put it mildly), will be weakened and bled to the maximum;
② Ukraine will incur as much debt and as many obligations to the West as possible, only to repay them for decades, i.e. to relinquish control over its own natural resources, production facilities and population (for how else can Kiev repay these gigantic obligations?); Continue reading
The mechanism is simple. The Hegemon has power. The Hegemon has power not only because it is economically powerful and because it has a powerful military force. The Hegemon has power also and perhaps above all because it has a mint where it mints the world’s coin. The Hegemon can therefore, for example, put too much money into circulation, i.e. create inflation, and since the whole world uses the Hegemon’s money in trade between countries, this inflation hits all the economies of the world! Inflation in the Hegemon translates into inflation in all the other political players. This is a political masterstroke!
We wanted to draw attention to yet another mechanism, equally efficient, equally cleverly devised. Here it is. The Hegemon looks around to select nations or states, anywhere on the globe, but especially those where there are various natural resources or developed industries. Having found a region of the world that the Hegemon would like to exploit, the Hegemon looks around for such two nations, two states or social groups that do not like each other very much. Never and nowhere in the world is this task difficult. All neighbourhoods are fraught with a long history of conflict: France-Germany, France-England, Germany-Poland, Hungary-Romania, Croatia-Serbia, Greece-Turkey, Poland-Russia, Poland-Ukraine, Ukraine-Russia… and these are just a handful of conflicts and just European ones! They all can be revived, they all can be fuelled and they all can be exploited. Religious and ideological divisions can also be skilfully manipualted: Catholic-Protestant, Catholic-Orthodox, Sunni-Shiite, believer-infidel, right-left, liberal-conservative, you name it.
States are governed by different people, not necessarily the wisest, not necessarily the most sensible, not necessarily the prudent. Since they are not the wisest or most prudent people, since they are people who have weaknesses and (often) burning ambitions, they can be skilfully controlled. This is precisely what the Hegemon does. The Hegemon seeks out individuals who have exuberant political ambitions and helps such individuals to take power in a country. The Hegemon selects people with a psychological profile that ensures they will be remotely controllable. The Hegemon can create compromising situations for such an individual or it can nurture such an individual: the Forum of Young Global(!) Leaders of the International Economic Forum or universities founded or financed by various NGOs are breeding grounds for such leaders.
Political dissidents from the countries of Central Europe before 1989, people who often emigrated to the West, acted in the West, received support from the West, these people were excellent material for the Western secret services. These services were able to pick and choose human tools, human puppets for their intelligence games and political manoeuvres, and these puppets usually did not even realise that they were someone else’s… tools. The awarding of scholarships to such people for study or research, or the granting of prizes in various fields, tied the beneficiaries to the centres that exercised power over them in an extremely strong and thus permanent manner. Who can resist an award, international recognition, acclaim, or interviews for CNN or the BBC? Continue reading
It’s not just a question of how much military power a given side to the conflict has at its disposal; it’s not even a question of whose economy is stronger. It’s more a question of which side prevails culturally, spiritually, or psychologically (psyche is Greek for soul or spirit).
Consider. The names of the months in Germanic and Romance languages, i.e. languages spoken in the West, have Latin origin. The names of the same months in Russian… also have Latin origin. Russians could have named the months giving them names in their native language, as the Poles or Czechs did; or they could have created the names of the months by drawing from Greek. The latter would have been more natural and understandable than taking those names from Latin: after all, the Russian principalities modeled themselves on Byzantium (a state that, although derived from the Roman Empire, used not Latin but Greek). Medieval Russians referred to Byzantium (and rightly so! and correctly so!) as to the Greek state; medieval Russians took Christianity from Byzantium; from the Greeks – Rus’ took (and slightly modified) the alphabet and modeled its own political system on Constantinople, which it called Tsargrad (Царьград) or Carigrad – the city of the emperor or the city of emperors. And yet, Russians adopted the names of the months from Western languages. And not only the names of the months. Those who know the language know how many German and French and now English words have found their way into Russian. These foreign inclusions are foreign to the point that they are not even declined by grammatical cases, although all native words are. Why are we talking about this? Is it because we are interested in proper names or etymology or languages in general?
We talk about it because language reflects the soul of a nation. It’s not the Germans, French or Americans who have Russian words in their own languages, but, conversely, the Russians have plenty of French, German and English words in their language. This, in turn, attests to who has an overwhelming cultural, philosophical, mental, spiritual and psychological influence on whom. It shows who really rules over whom. This is a better litmus test for demonstrating who is subject to whom than finances, the economy or military conquests. Why? Because financial or economic advantage can be coerced, because military advantage is demonstrated through the use of brute force. In the case of language, it is quite different. No one outside Russia told Russians to adopt foreign words! They did it on their own, willingly, and they did it because they recognized the superiority of Western civilization. Patriotic Russians may deny it, but it is the language that is hard evidence that Russians have always considered themselves inferior.
To get an Oscar (or a similar award given in the West) is the dream of every Russian film director; to get a Nobel Prize for literature (or a similar award given in the West) is the dream of every Russian writer. Does any Western film director or Western writer dream of getting an award in Moscow or St. Petersburg?
It is the above-described sense of the inferiority complex on the part of Russians that makes rich Russians buy properties in the West and keep their money in Western banks. In other words, rich Russians are at the mercy and disfavor of the West, which can take these estates and accounts from them at any time it sees fit. Such Russians with estates and bank accounts abroad constitute a fifth column within the Russian Federation. Russians who have accounts in Western banks, who have properties in the West – what’s more – whose children study at Western universities do not think in Russian, whether they want to admit it or not. These Russians are a powerful force, scattered about the country, that works to the advantage of the West and to the detriment of their own homeland whether they want to admit it or not. Continue reading
If you ask the average Westerner which places in the world he would like to see, he will answer that he would like to see Paris, Rome, Venice, Barcelona, Los Angeles, Florida, the Riviera, the Alps. If you ask the same question to a man from other parts of the world, he will answer that he would like to see… Paris, Rome, Venice, Barcelona, Los Angeles, Florida, the Riviera, the Alps. Similarly, if you ask a man from the West which university he would like to study at, he will answer that Oxford, Cambridge, Sorbonne, Harvard… If you ask the same question to a man from other parts of the world, you will get the same answer. If you ask a man from the West in which banks he would like to keep his money, he will mention one of the Western banks. If you ask a non-Western man, you will get the same answer. Let’s go further. If you ask a Westerner what his favorite movies or books or music are, you will hear titles, authors and performers that belong to the Anglo-Saxon world. If you ask the same question to a non-Western man, you will get the same answer. Questions with similar content can be multiplied. The result will always be the same. And it has always been the same. Representatives of previous generations would have answered the same way, people living in the nineteenth and eighteenth centuries would have answered the same way. One could say that the world is arranged in such a way that Westerners love the West and non-Westerners also love the West. Statistically speaking, no one in France, Great Britain, Germany or the United States dreams of their child studying in Poland, Hungary, Romania or even Russia. Conversely, parents from Poland, Hungary, Romania and Russia would give a lot for their children to study in France, Great Britain, Germany or the United States.
Western political scientists and politicians should be aware of this. They should know that they wield enormous soft power. They should realize that they have enormous power over non-Westerners. They can control them almost at will. All they have to do is wave a carrot or a sausage, and a non-Westerner is ready to do almost anything, including actions that will be detrimental to his own country, to his own people. The only thing the West should not do is to use a stick, to show exaggerated contempt for non-Westerners or to be too insulting to their feelings. If Westerners can’t help but show superiority or contempt, they should show this superiority or contempt in a measured way, intensifying these demonstrations gradually so that non-Westerners don’t notice it too much. If, on top of this, the West accepts at least some of the elites of non-Western nations into its club, the West’s power over the rest of the world is guaranteed.
Unfortunately, stupidity, hubris, greed, overconfidence – you name it – cause Western elites, Western leaders, Western think tanks to continually make the same mistake: they begin to ostentatiously escalate their display of contempt, they begin to ostentatiously and excessively pillage non-Western nations, they begin to hurt these nations’ sense of dignity too quickly and too violently (such as by imposing marches of sexual deviants in morally traditional societies), all of which leads to conflict. The West has made this mistake over and over again and continues to do so, and is unable to learn from the past.
Consider Russia. The elites of this country capitulated before the West at the end of the 1980s, declared the bankruptcy of their own system, behaved with allegiance to the West, began to take over and imitate everything as far as culture is concerned, and their only dream was if not to settle or at least live for a long time in the West – because, as is known, there is paradise for humanity – then at least to recreate this West at home. The elites not only of Russia, but also of Ukraine, Poland, Czechia, Hungary, Romania and so on, as well as the elites of India and China would do anything to shed their own culture and to embrace the West. How many Indians and Chinese go to Great Britain or the United States to be able to study there or at least to see with their own eyes those countries they have dreamed of since the cradle! If smart people ruled in the West, they would use this soft power to rule over the rest of the world until… the end of the world. But no. Continue reading
So we have a war, a war that lasts more than six months, a civil war, a war between one Ruthenian nation and another Ruthenian nation (don’t be fooled by the propagandists that these are two different nations!), a war in which external forces support one side to keep fighting. This is reminiscent of the wars in Yugoslavia, where the Croats and Bosniaks were constantly supported by the West, were constantly turned by the West against the Serbs, were constantly encouraged not to stop resisting the Serbs, to constantly irritate the Serbs, to reject peace solutions and to renege on peace agreements, if any had already been made. Both Croats and Bosnians and Serbs speak one and the same language. Never mind that. Somewhere it was decided that Yugoslavia was to cease to exist, that Yugoslavia must disintegrate. A strange resolve, strange especially in a world where globalisation is professed, where nationalisms are condemned, where huge political blocs are formed. Why did Yugoslavia have to break up in such a world? That is a good question! Especially since, the very next day, the states, or rather pseudo-states, that emerged on the ruins of Yugoslavia, nations that never wanted to live together with the Serbs, nations that wanted sovereignty at all costs, these same states or these same nations were more than happy to apply to become members of the European Union and…. to lose that longed-for, fought-for sovereignty! Do you understand any of this?
Yugoslavia was a dress rehearsal. The break-up of Yugoslavia happened between the peaceful break-up of the Soviet Union and the… planned – and, as it appears, non-peaceful – break-up of the Russian Federation. And yet it could have been quite different! Instead of war, we could have enjoyed peace and cooperation! Is this not what we dreamt of during the Cold War? Was it not then that we did not even dare to dream that the division between political East and political West could disappear in our lifetime?
Those of us who lived during the Soviet Union’s existence did not even imagine, did not even dare to suppose that the Soviet Union would cease to exist in their lifetime. The end of this enormous state, which had at its disposal a huge arsenal of nuclear weapons, seemed inconceivable. Unless…. unless there was to be another world war, which nobody wanted.
And lo and behold, the seemingly impossible happened: a giant empire hoisted the white flag. The giant empire dissolved like a failed business, the giant empire went out of business like a dissolved sports club. The individual republics – members of this empire – filed for a no-fault divorce and received this divorce overnight. Everything went smoothly and was accompanied by great enthusiasm. Do we remember the song ‘Winds of Change’ sung by the Scorpions? This is what it was like at the time. It seemed that humanity was entering a new era, an era of peace and cooperation.
Why did the Soviet Union collapse? There are many more or less convincing explanations – the economic bankruptcy of the socialist system, the effective penetration of Western intelligence, reforms that escaped the control of the reformers – we will not cite them all here. We will only point to an extremely important factor, a psychological factor: the peoples of central and eastern Europe, and therefore also the Russians (as well as the Ukrainians, Poles, Czechs, Slovaks, Romanians, Hungarians, etc.), have lived, are living and will continue to live nurturing a huge inferiority complex against the West. This inferiority complex did not arise when communism took hold in the countries of central and eastern Europe. No. It existed there from the cradle of these nations, from the dawn of their history. They all adopted civilisation from the West, their elites were educated in the West, they travelled to the West, they imitated Western styles in art and literature, they modelled their legal systems on Western legal systems and they learnt Western languages. In the languages of the above-mentioned nations, there is a huge proportion of words – and everyday words! at that – taken from French, Italian, German and English. These words came along with new technology or cultural currents, and were adopted and assimilated even though more often than not they had equivalents in their native languages. Foreign words in the mouths of central and eastern Europeans gave them social status. Continue reading
Putin’s speech
On September 30, 2022, President Vladimir Putin delivered a momentous speech occasioned by the act of joining to the Russian Federation the territories of Luhansk, Donetsk, Zaporozhye and Kherson. All the diplomatic masks have fallen: the Russian leader laid down all the resentment that the Russian nation has been nurturing towards the West. It is praiseworthy to read the whole speech rather than let oneself be fooled by the media. Below we give an excerpt from it and we encourage the reader to give a simple yes-or-no answer to each question and observation made by the Russian president.
① “The last leaders of the Soviet Union, contrary to the direct expression of the will of the majority of people in the referendum of 1991, destroyed our great country, and simply made the people in the former republics face this as an accomplished fact.”
– Did the last leaders of the Soviet Union act against the 1991 referendum or did they not?
② “When the Soviet Union collapsed, the West decided that the world and all of us would permanently accede to its dictates.”
– True or false? Continue reading
Competing large states, the superpowers, aim to eliminate their opponent from the game. This can be done in a variety of ways. One of these, of course, is war: one rival destroys the other, subjugates it or wipes it off the world map. This is how, in three wars, ancient Rome wrestled with Carthage and brought about its annihilation; Rome did not annihilate Greece, but subjugated it, and since the Greeks did not resist in the time in which they were subject to Rome, and that’s where it ended. Another way of settling a rivalry is to weaken the state that one sees as a rival to rule over a region of the world or over the whole world. The victorious state takes away industrially or strategically important parts of territory from the defeated state. Still another way is to make the competitor economically or financially dependent. This is how perennial colonial states continue to rule former colonial territories, although they have officially withdrawn from them: they rule them through money and economic connections. The last way to subjugate an adversary, to weaken or eradicate it, is through territorial partition: the breaking up of a state territory into several smaller ones, which is generally done by exploiting frictions, resentments and hostilities that exist on national religious or anthropological grounds. This is how Yugoslavia was dealt with. This state of the southern Slavs, whose territory had an area comparable to that of Romania, was divided into several smaller political entities.
The West conceived a similar collective fate for the Russian Federation. The driving force is the United States and the United Kingdom, while the tool is the European Union and especially the countries of Central Europe, as well as so-called dissidents – citizens of the Russian Federation who act to the detriment of their own state. The idea of dividing Russia into a dozen or more parts was given the name of decolonization. The creators of this notion assume that Russia is in fact a conglomeration of the Russian centre with many colonies, and that the difference between the colonies ruled by Moscow and those once ruled by Paris, London or Berlin is only that the Russian colonies are not overseas. What is being proposed, therefore, is decolonization – as it is now fashionably said and written – 2.0 (that is, the second, as the first was either the decolonization carried out between 1950 and 1970 in Africa and Asia, or the decolonization of the USSR, a preliminary to the now proposed division of the vast territory that was under the Kremlin’s rule until 1991).
The idea of splitting the Russian Federation into multiple political entities is justified on the grounds that Russia, its elites and even the mentality of its people, grew out of dictatorial and slave traditions and as such are unreformable. It is said that Russia as it exists will be a constant threat to world peace and that a single centre of power is incapable of efficiently managing such a large territory, let alone such a large and ethnically and religiously diverse population. (One might ask, as an aside, how it is that the same judgement is not applied either to the United States, which is, after all, a territorially huge and population-diverse state, or to the European Union, which is absorbing more and more new members and seeking to administer the whole uniformly from a single centre in Brussels, but never mind). Since Russia is a nuclear-armed state, it is not proposed to provoke a war for this purpose; rather, it is recommended that the various nationalities and religions living on the territory of the Federation should peacefully assert their independence. The weapons are to be strikes, demonstrations, pickets, civil disobedience and all that makes up the technique of instigating and carrying out colour revolutions. Continue reading
Nordstream pipes have been blown up. Sure, no one knows who did it, and yet…. everyone knows. At a time when referendums in the four provinces of eastern Ukraine (historically: Novorossiya) are sealing the fate of those regions by handing them over to Russia, at a time when European countries fear the coming winter and hesitate to cut all trade ties with Moscow, at a time when right-wing parties are gaining popularity across Europe, the United States, seeing its policies falling apart, is erupting in hysteria.
Former Polish Foreign Minister Radek Sikorski, married to US neocon Anne Applebaum, wrote a message of thanks to the US. Was it a slip of the tongue, or did he act on American orders to indirectly show the Russians who was behind the sabotage? Either way, Russian journalists using open source airborne radar were able to trace the mysterious plane’s flight across the Baltic to Poland, and then across the Baltic again, including over the site of the sabotage: the area around Bornholm Island. That the Polish government and Polish elites are rabidly anti-Russian is well known.
Ukraine is slowly but nevertheless shrinking territorially. This is always the case when a country relies too much on Western aid. President Zelenski was ready to sit down at the negotiating table soon after the outbreak of hostilities. He was quickly barred from doing so. Now the country he leads has lost four pieces of its territory – permanently. No one in their right mind believes that Russia will ever give them back to Ukraine after what has been going on these past few months, after so much bloodshed, after all the sanctions, and now after the disruption of two gas pipelines.
1% owns 50% of the world’s wealth and there are countries that want to change it. About geopolitical redistribution.
In 1974, the middle class had the highest share of world wealth. Today, it is at its lowest level in 100 years. Within the last 50 years, there has been a gigantic transfer of wealth from the working class to the class of society that owns assets. The latter, elitist stratum owns a disproportionate share of the wealth generated throughout the world and constantly increases it thanks to the central bankers who skillfully cause sometimes recession, sometimes revival of the economy through their interest rate policies and increase or decrease the money supply. These are the waves on which the great ones of the financial world surf and later eat caviar and drink champagne. You know it well that this elitist class is not sitting in Beijing, Jakarta, Rio or Moscow. It’s enough to name two cities and you already know who it’s really about: London and New York.
Erdoğan and the president of Brazil, leaders of ASEAN countries and comrade Xi – they all want to make their middle class bigger and stronger because they know it that the first industrial revolution, which lasted 150 (!) years, was possible only thanks to the creative and hard-working middle class. Therefore, they want to introduce their own monetary system, independent of Anglo-Saxon influences, which
(i) operates fairly,
(ii) is not dependent on a fiat currency like the dollar,
(iii) enables the middle class to accumulate wealth, and
(iv) does not serve to remove politically undesirables from the face of the earth through currency wars or military intervention. Suffice it to mention here how weak the Turkish lira is during Erdoğan’s tenure, or how Saddam Hussein fared because of the oil trade in euros, or Gaddafi because of the attempt to introduce the Pan-African currency, which was supposed to be based on gold.
The latter initiatives of countries seeking to free themselves from dollar domination – be it agreements between Russia and China, the BRICS initiative, agreements among ASEAN countries, and many others – all aim at creating some kind of common currency for these, as they are called in the West, “rapidly developing emerging economies.” This currency, however, should not be a fiat currency, such as the euro, but a currency based on tangible assets, thereby ensuring its purchasing power. It may be digital or classic – one thing is certain: its introduction will mean a huge war against the U.S. dollar. It will mean a war against the COMEX (USA) and LME (London) exchanges, where precious metal prices are now decided. And as we emphasized several times before in analyses in our bulletins: these prices have been suppressed and manipulated for decades by the so-called US bullion banks. So, the elitist class that owns the highest share of the world’s wealth may be in for a treat this September, when the BRICS group’s decisions are to be made. One possible scenario: the BRICS countries may, for example, buy countless futures contracts on precious metals and demand delivery of the physical commodity on the expiration date. Since it is common knowledge that COMEX and LME can physically back up perhaps only 20% of their transactions with physical reserves (the paper gold problem), there would be a collapse similar to the Nixon days.
So will the yuan or a whole new emerging market currency soon become a new world reserve currency? If you look at the chart below, you can see that nothing lasts forever and that the dollar’s days may be numbered.
Major reserve currencies since 1250
After the 2015 introduction of the common currency in Lithuania, much has changed. On the one hand, the euro positively influenced economic growth, as loans became cheaper, resulting in increasing exports and investments, on the other hand, the gap between rich and poor and between the level of living in the cities and in the countryside deepened. Until the beginning of the post-pandemic inflation, prices and salaries increased continuously in the Baltic country, but the latter mainly in the cities. Already between 2015-2019, prices increased by 10%, among others food by 6% and services by 22%. In the post-pandemic period, all Baltic countries are now among those with the highest inflation, with salaries, including those of the richer urbanites, unable to catch up with galloping food prices for a good two years. The ECB’s policy is not helping anyone. If one speaks to a Lithuanian or Latvian on this topic, one hears the following: I used to be able to often invite my girlfriend to the restaurant, now I can hardly afford it (a Latvian truck driver aged around 30). Prices have become European, salaries have not.
However, the argument with growth seems to be a bit misguided. Polish economy with its own currency is growing faster than that of Slovakia and Slovenia, which quickly adopted the euro. Since the introduction of the common currency in the PIGS countries, they systematically lose their growth rate compared to Germany. Contrary to the widespread complaints in the German media about Polish fiscal policy (and the hope that it would be “disciplined” after the introduction of the euro), public debt in Poland is keeping within limits – and this despite the policy of social transfers never seen before. In the euro zone, on the other hand, debt is exploding, despite various formal restrictions. This is true even for the countries that joined the euro without having a public debt problem. The debt has been created over time – precisely in this oh-so-fantastic union. This fact is illustrated in the following graph.
Source: Ameco
The culprit is the crazy idea that one monetary and fiscal policy should fit all countries like a universal recipe (one size fits all). One policy for 24 countries – that can’t work, like a 5 year plan for all Soviets, or one for the so very different regions of China. The same interest rate for the entire Eurozone cannot be effective. It leads to destabilizing and costly imbalances in individual member states, which subsequently spill over to the entire euro area, which cannot develop fast enough vis-à-vis the U.S. and China.
But what’s all the talk about? After all, it’s summer vacation and you want to relax. That’s when we recommend a vacation in Croatia – the latest to enjoy the benefits of the single currency. After the introduction of the euro this year, prices in the once cheap country rose to the level of Austria. The Austrian “Kronenzeitung” even compared the price level with Swiss health resorts. The Croatian newspaper “Slobodnaja Dalmacija” calculates that a kilo of cherries and figs now costs 8 euros – 10 percent more than a year ago. Wholesalers have to pay 5 euros for a kilo of pears, 3 euros for cucumbers and 5 euros for peaches. No wonder tourists are canceling their reservations in the country that depends on them the most in the whole EU (11% of GDP comes from them). Another local newspaper “Jutarnji list” points out the surprisingly high cost of daily rent of a deck chair. On the island of Hvar it costs €40, in Split €35 and in Dubrovnik €33. On Croatian social media, a video of an American tourist is very popular, where she aptly notes that the price of the service remained the same after the currency conversion from kuna to euro. The greed of (small) entrepreneurs is one downside of it all, the other is that the euro is actually always Teuro. So we wish you a nice vacation in Poland.
I can’t understand that. I would rather say: There should be a movement here and there under the prevailing circumstances, a kind of yellow vest against the bankers. But lo and behold, the anti-globalists protest against the “rulers” during the G7 summits, as if they don’t know who pulls the strings in G7. The bankers were, are and will be spared. Look at the history of the “Occupy Wall Street” movement, how it was mercilessly swept away by the rulers. You could say: like an oppositional movement in Russia, but in the middle of freedom-loving America. What does the dictatorship of the bankers look like at the moment? And what threats does it pose to us?
Mario Draghi. Remember his assurance that he would do everything to preserve the euro and its stability? Whatever the cost? This is what he said and did in fact, but at the expense of taxpayers. A more recent example: Jerome Powell, the head of the FED assured on June 21 of this year, in relation to the problems of cryptocurrencies in the U.S. market, made by rigorous actions of the FED and SEC against the platforms and banks dealing in this digital money, that he would do everything to preserve the dollar as the main reserve currency in the world. How much will this cost the American taxpayers? Hello, Mr. Powell! Have you lost touch with reality? The Saudis are renouncing U.S. guarantees and reconciling with Iran; China is trading with the yuan with its partners; The BRICS countries are banding together, looking to add new members, including perhaps France – who knows? And you, Mister Powell, together with your colleagues, want to introduce the digital dollar, called “FED-NOW”, sometime in July 2023 at any cost to show every country in the world who rules here? Pride always comes before a fall.
As always, the next crisis is carefully prepared. One day an article appears, for example in “Financial Times”, the other “qualitative” media follow the topic. Then comes the “crisis,” always like a bolt from the blue. What is the “Financial Times” writing now? That the Bundesbank is broke. And that’s true. But then they publish a counter-statement. After all, the “crisis” has to be baptized in the media at the right time. They have to wait until the bankers themselves (the owners of the leading media) will give a sign to the editors; Yes, you may write that now because all the rats have long since fled the sinking ship and the captain never existed.
Why would the Bundesbank need a bailout right now? Because it is, of course, too big to simply let it fall? Yes, of course. But the reason is too boring for the average citizen, so he ignores the facts, but as always only until the headlines sound the alarm or until the next “unexpected” tax increase comes along. It is about bonds, the world of the bankers, which hardly everyone understands and therefore fails as a small investor mostly because he invests against the current, by the way.
Super Mario, otherwise called “Cost what it may”, bought for years from the member banks of the ECB their government bonds so that they (especially his Italian home central bank) could service their debts. Thus, the over-indebted PISA countries did not become insolvent. But, wait, wasn’t that forbidden by the Maastricht Treaty? Yes, of course, but only if the bank in Frankfurt am Main had bought the debt directly from the states. The states, however, wisely sold their debts to the biggest bigwigs in the financial world, including the infamous funds like Black Rock. Thus, the ECB financed and continues to finance the private US money industry, which has done nothing to any EU citizen. These piles of the securities were hoarded in the bunker in Frankfurt and the great Italian banker had hoped that they would not lose value. But then inflation came, and his successor (remember: he himself did not) had to raise interest rates significantly. Since while prime rates were rising, fixed-income securities were losing value, it turned out that the bunker was full of toilet paper. Independent journalists (not those from the leading media) have calculated that the total loss of the EU monetary guardians could be as high as 500 billion euros. If the Bundesbank takes a stake in the ECB of about 10%, that’s already a small problem. But as a well-known German politician once said: Not all Germans believe in God, but they all believe in the Bundesbank. The euro will last forever. Maybe for 1000 years.
We have recently seen a significant increase in the price of gold, which today is approaching the mark of $ 2,000 per ounce. The appreciation we predicted in the recommendations of our bulletin was largely fueled by the liquidity crisis, which was only exacerbated by the expansion of the Federal Reserve’s balance sheet and a small rate hike (25 pts) by Jerome Powell and his colleagues. It is worth noting that the market was expecting a 50 basis point hike even before the Silicon Valley Bank problems.
The Fed’s head insists that the $297 billion increase in total assets is the result of a completely unique situation related to banks’ liquidity needs. What is crucial, however, is not the reason, but the fact that further substantial funds were created out of thin air – and this is directly related to another dose of fuel for inflation, which continues to show no signs of abating. So the risk of stagflation caused by an economic slump remains.
The last notable example of an exit from stagflation in the U.S. occurred in the 1970s. In response, Paul Volcker, then chairman of the Federal Reserve, raised interest rates above 19% to restore confidence in the economy. The positive real interest rates achieved at that time (with inflation at 13.5%) are out of reach for central bankers today.
An economic crisis will happen sooner or later for one reason or another. History simply shows that. The important question, however, is what methods will be available to central bankers when that crisis occurs (if we don’t already have it). In past decades, these were based primarily on lowering interest rates and expanding the money supply. However, the above measures are now being drastically curtailed because of their impact on the rise in inflation. A further rise in inflation would probably only prompt investors to withdraw their money from financial institutions in order to protect their capital elsewhere from the increasing loss of purchasing power. Such decisions would only lead to further liquidity problems. It also cannot be ruled out that the Fed will decide to raise interest rates further. These in turn would devalue the bonds held by banks, which would also deal a severe blow to the financial system. The impact is likely to be similar in both cases: either a liquidity crisis or inflation that is likely to spiral out of control sooner or later, or a combination of both. Janet Yellen and Jerome Powell thus seem to be caught between the hammer and the anvil, and their actions resemble those of an elephant in a china store.
Also worth mentioning is the recent news about the growing risk of a Deutsche Bank default. The banking crisis seems to be coming to a head, also in Europe. Even more important than the crisis itself, however, as already mentioned, seems to be the considerably limited room for maneuver of central bankers to counter it.
It is not inflation, nor the Fed, nor the NFP, and certainly not the hostilities in Ukraine that is attracting investors’ attention, but the major problem that the U.S. banking sector is beset with, rendering especially Silicon Valley Bank barely capable of making payments to its customers. All this reminds us of 2008, although there are no clear signs yet that we are on the verge of collapse.
SVB is a very specific bank in the US market. It is a bank that deals mainly with technology companies. Though it provides financial services to them, primarily it takes deposits from them. The bank participates in venture capital projects (venture capital), but it has also invested the surpluses in the US bond market or in MBS. The sharp rise in interest rates and the resulting significant revaluation of bonds resulted in a large financial loss in the bank’s portfolio, which is nothing unusual. In fact, this was something normal across the financial sector. However, this is where the peculiarities of SVB itself come into play. It is a bank that manages hundreds or even thousands of technology companies or start-ups. This sector, in turn, has been struggling for some time to catch its breath after the strong last 2 years. Companies have begun to slow their growth, look for savings and reach for capital from deposits. In order to get liquidity, SVB was forced to sell all liquid assets worth over $20 billion, incurring a loss of almost $2 billion! That’s a sizable hole in the bank’s balance sheet. At the same time, the bank announced an additional equity offering to close the gap, prompting investors to divest themselves of the bank’s shares. Yesterday (March 9, 2023), the shares plunged by as much as about 70%! These problems are still deepening today before the weekend, which is why some have already drawn parallels with 2008.
Of course, it’s important to remember that SVB and the tech industry are a specific sector and may have less overall impact on the overall stock market than the collapse of Lehman Brothers or the problems that occurred at Bear Stearns. The key question is whether this is just an isolated incident or a major problem across the industry.
It surely is a religion: the worship of the planet earth. No doubt about that. At the same time it is risible: a peninsula attached to a huge Asiatic continent wishes to make the global climate better and – as if the movement of waters and winds could be stopped at state borders – to make its own climate better. How? By banning the fossil fuels (which means: by banning the combustion engine), relying on renewable sources of energy and developing the CO2 market (you know, the market where you buy and sell CO2 quotas). You see, in the Middle Ages people would trade in relics: in the 21st century people trade in CO2! Isn’t that one thing alone a grand exploit that the European Union has pulled off?
No combustion-engine cars to be manufactured after 2030 plus net CO2 emissions by 2050! Why? For what purpose? Well, to save the planet, stupid! We all know that Mother Earth is suffocating and getting overheated (or overcooled, depending on the currently valid scientific version concerning the global climate); we all know that it is man-made. If you are not convinced, then look at the children: they know it! They know it for certain! That’s why they are protesting and begging you (if that is not enough: demanding of you) that you reconsider your life choices.
You know, it is not only the climate. We are all running out of water and food. What do you think will happen once water and food are in short supply? Famine? Y-e-e-e-s. Try hard to follow the thought where it leads. Imagine a global famine and water shortages. What do you think it will lead humanity to? Yes, bingo! To war! So, to prevent war over food and war over water from breaking out, the men and women (or the representatives of the other sixty or so recognized genders) who happen to be at the helm of the European Union do their best to spare us the bleak future. Yes, we will all pay for it: prices will shoot up, but then health, life and peace are invaluable. We will all willingly sacrifice our comfort and resign from the luxuries and pleasures of the flesh to… save the flesh.
Ursula von der Leyen (President of the European Commission or in plain English: the EU’s prime minister) and Frans Timmermans (Executive Vice-President of the European Commission or again in plain English: the EU’s deputy prime minister) along with all the Directorates-General (in plain English: ministries) indefatigably keep foisting upon us the magic phrases of European green deal, climate neutral Europe, reduction in emissions, clean transport, electric vehicles, sustainable (their beloved word!) houses, clean energy, renewable energy, protecting nature, a healthier future, support for vulnerable citizens (always the same!), and they assure us that all this is doable. Ursula von der Leyen says that she wants Europe to become the first climate-neutral continent in the world by 2050. She says verbatim: “I want Europe to become…”. You see? Occasionally, they let a word out here and there for all to hear: they want to enforce those changes, Ursula von der Leyen, Frans Timmermans, and company. Whenever they are on their guard, they say that it is the Europeans who want it, but when they are off their guard, they say as it is. Continue reading
In retaliation for freezing Russian assets by the West, President Putin has signed a decree that enables Russian exporters of gas to demand rubles rather than dollars or euros. This is an interesting development in the war that is being waged between the West and Russia. The European Union depends to a very large extent on Russian gas. The efforts to create the green economy (they like to call it sustainable economy) are far from being completed. (To think of it: they have sought to put us on the green economy to spite Russia! Climate change was the bait for the gullible to join in.) Europe will need Russian gas (and oil). In order to buy it, it will need to have the Russian national currency. To acquire the Russian national currency, the West will be forced to trade dollars or euros for rubles at the Moscow stock exchange, thus raising international demand for the Russian currency and turning it into a means of international exchange. Sanctions work both ways.
On March 18, the Luzhniki Stadium gathered thousands of Russians in a patriotic rally, attended by various artists and the Russian president himself. Vladimir Putin delivered a speech in which – quoting the Gospel – he praised the efforts of the soldiers of the Russian Russian Federation fighting in Ukraine. A sea of waving Russia’s national white-blue-red flags dominated the scenery. The event was an eruption of patriotic feelings, something unknown in the West. If you think that the “regime” in Moscow is about to collapse or to be toppled, then think again.
The answer is not easy. Bill Gross, the founder of Pimco and “king of government bonds”, predicts that the yield on US 10-year bonds will rise to 2% next year. This would mean the 3% loss for investors at the current inflation rate. The dynamics of demand and supply also point to the further fall in the prices of US government bonds (rise in yield). Today, the FED is buying 60% of all US bonds as part of its quantitative easing, but will soon have no choice but to reduce the scale of US bond purchases in the face of inflation. At the same time, China, Russia are massively dumping these debt securities. So should one invest in equities? Now, when their prices are shooting through the roof? After all, shares can turn out to be rubbish if companies’ profits don’t want to rise as they have in recent years. With today’s inflation, it’s not worth holding cash either. The situation is becoming dramatic.
If you want to learn more, if you are looking for tips for your investments, please read recommendations and warnings for investors in our bulletins.
President Vladimir Putin told Gazprom PJSC to turn to refilling European gas-storage facilities next month, signaling that long-awaited additional Russian supplies could be on the way. The move will “create a more favorable situation on the European energy market,” Putin said at a meeting broadcast on state television Wednesday. Source Al Jazeera
The chaos in gas and electricity markets is set to hit one group of people the hardest this winter: the four million households that use prepayment meters (PPMs).
While most people pay their bills monthly for energy they have already used, PPMs require people to pay for energy before they use it. PPMs take whatever money is in the meter and supply energy to the household. Source Open Democracy
Russia’s Gazprom has damped hopes for additional gas exports to Europe next month as the continent struggles with record prices, despite recent hints from President Vladimir Putin that more could be forthcoming.
UK and European gas prices surged as much as 18 per cent on Monday after a keenly awaited pipeline capacity auction showed no increase from Russia either through the Ukrainian pipeline system or lines passing via Poland to north-west Europe. Source FT
