On beer, milk, cars and weapons

For smart money, every crisis is an opportunity. Major investors ride the waves of crises; at the lows, they buy new assets; at the peak of the approaching tsunami, they offload shares before the crisis really strikes. They know exactly when it’s coming. Perhaps they are even the ones who trigger the crises – the smart money. The architects of history?

January 1920 – the US government decided to introduce a ban on the production, sale and transport of alcohol. In response to the government’s measures, brewery owners, who already had the infrastructure to chill their products, started producing ice cream (very ‘smart’), and bar owners began selling it on a massive scale to avoid having to close their businesses. People were no longer allowed to meet in pubs, yet they still needed a shared social ritual that would serve as an excuse to get together, so a visit to a pub was replaced by a visit to an ice-cream parlour.

The flow of money, which had previously been directed towards producers of ingredients used in alcohol production, such as hops, was redirected towards dairy farmers. This enabled farmers to base their income on milk production, which was highly profitable at the time. However, the transport of dairy products took place mainly at a local level, as the global transport of chilled foodstuffs still posed a technological challenge.

Help came from the Anheuser-Busch Vehicle Department, which began selling refrigeration units for lorries fitted with the ABC (Automatic Brine Circulation) system to ensure the safe transport of chilled products. This system was innovative as it could transport dairy products over previously inaccessible distances without the need for electricity.

The heyday for the largest US ice cream companies of the pre-war era came with the Second World War. Ice cream scoops were the tool used by the US command to maintain high morale amongst its troops, and ice cream was regarded as a safe substitute for alcohol, as the youngest generation of soldiers had grown up surrounded by ice cream parlours. At one point during the war, the US Navy Command even decided to spend a million dollars (by comparison, a Sherman tank cost around 45,000 dollars) simply to convert a cargo barge into a floating ice cream factory. It was intended solely for the production of ice in the Pacific theatre of war and for delivery to aircraft carriers and soldiers on the islands. It was so huge that it could produce 38 litres of ice every 7 minutes.

The end of the dairy era seemed to come with the end of the war. The oversupply of dairy products led to the bankruptcy of many companies, a situation the US government sought to prevent through intervention and subsidies for the industry. The Agricultural Act of 1949 cost American taxpayers billions for many years after the end of the war. Every successive government in the 1950s, 1960s and 1970s did the same: it bought up dairy products on a massive scale and stored them in huge underground warehouses. It was not until Ronald Reagan, who was known for cutting spending, that this practice was brought to an end. Initially, he wanted to have 254,000 tonnes of cheese dumped into the ocean; in the end, he handed the stocks over to the poorest members of society. To this day, the term ‘government cheese’ is associated in the American consciousness with social welfare cheese that is considered better than that bought in shops. And even today, through its funding of Dairy Management Inc., the US government continues to influence consumer behaviour not only in America – for example, by having this non-profit organisation encourage restaurant chains such as McDonald’s to include as many dairy products as possible in their meals (coffee with milk, cheeseburgers).

What sits at the top of our hierarchy of values determines our behaviour.

Ever since Volkswagen marketed its success thanks to Goebbels, many Germans – and, absurdly enough, Poles and Bulgarians too – still believe that Volkswagen and BMW are the best cars in the world. Well, it turns out that it is Japanese cars that have topped the ADAC’s list for decades. Later came the Koreans, and now Chinese cars such as BYD are well on their way to conquering the European market. Hey, you old mythomaniacs in Poland, in Germany, in the Balkans, in your Porsche – a company that’s going bust: cars with slanted eyes are the best! At some point, you’ve got to face reality.

And look: just as the car manufacturers began to face their first serious difficulties, war broke out in Ukraine. They weren’t as flexible as the beer producers in the US in 1920. They couldn’t switch to producing tanks that quickly. Unless, that is, they’d had a dictator like the one in 1934 who’d ordered them to do so. But those in power in the West were ‘smart’ too: ‘Yes, okay, the industry might be on the decline, but we’ve got Rheinmetall and other arms manufacturers, so we’ll redirect our funding there.’ NATO’s eastern flank has been strengthened, billions are being poured into rearmament, and even the Greens in Germany are in favour of compulsory military service. So the European economy somehow carries on, and even if GDP is rising only slowly, there is no collapse that would threaten the ruling class.

Yes, the West is facing problems in supporting Ukraine in the conflict, but look: there are clever people here too, just like those at Anheuser-Busch back in the day with their cooling systems for transporting ice: the Ukrainians are building the world’s most effective combat drones themselves, and at a bargain price at that – you fools at Rheinmetall!

But every war ends eventually, and we’ll be left with the old cheese and hundreds of thousands of unnecessary soldiers, whilst our children and grandchildren will have to pay off the debts from this war farce for many decades to come with their taxes and meagre pensions.

Property – a huge problem in the US

The US has been battling the property crisis for years, and it is coming to a head.

According to the report by the US President’s Council of Economic Advisers, there is currently a shortfall of 10 million homes in the US. One of the main causes is the growing disparity between income and expenditure on rent or housing costs. Almost half of the country’s tenants spend more than 30 per cent of their income on housing. More than a quarter of American households who rent spend more than half their income on housing, and recent surveys show that most Americans consider housing costs to be too high.

The difficult situation in the housing market is also reflected in the eviction figures. The number of evictions is rising steadily, leading to an increase in homelessness. A distinctive feature in the US is that the reasons for eviction vary according to tenants’ ethnic background. Whilst only 7% of white tenants fail to pay rent, the corresponding figures for Black and Latin American tenants are 19.5% and 14.5% respectively.

The housing crisis not only poses a growing threat of homelessness but also contributes to the impoverishment of society. When property prices rise (relative to income), people have less money left over for other goods and services. As a result, some citizens will never be able to buy their own home. For this reason, some young people are forced to return to their parents’ home or never leave it at all, preventing them from starting an independent life and raising a family.

The shortage of affordable housing is causing a decline in economic productivity. Employees find it difficult to live in metropolitan areas where demand for skilled workers is rising or where well-paid jobs are being created. High property prices are also having a negative impact on fertility – many couples are postponing the decision to have children.

The report also points out that the climate policy decisions taken by former US President Joe Biden have contributed to higher costs for house building. These relate to energy-efficient building regulations that imposed an obligation to install more efficient air-conditioning systems and water heaters in buildings. The document cites a 2021 analysis by the National Association of Home Builders, which concludes that the installation of environmentally friendly appliances can increase the price of a house by 31 thousand dollars. It can take up to 90 years to recoup the costs associated with purchasing these solutions.

Added to this are the American bureaucracy, which is in a state of disarray, and restrictions on land-use planning that prevent the construction of denser housing. The consequences? The most difficult situation is in California (where 187,000 people are living without a roof over their heads) and in the State of New York (with 158,000 homeless people).

Welcome to America, the land of opportunity.

Sit down at the negotiating table, you paranoid wimp!

On 4 June 2026 the President of Ukraine published an Open Letter to the President of the Russian Federation. In this letter, Volodymyr Zelenskyy proposes talks on putting an end to the ongoing war. The letter (which we recommend reading it in full) has been written in a tone that is fraught with threats and personal insults while depicting Ukraine’s leader as the one who holds moral high ground. The text also presents Ukraine as holding the winning hand in the conflict. The last mentioned is a quirky idea. If Ukraine’s about to win, why should Ukraine’s president suggest peace talks? It is by definition the losing party that sues for peace, is it not? But never mind that.

Consider first Volodymyr Zelenskyy’s claim that this war is your personal choice — a war without a real cause. For those who strive to remain unbiased, the cause is plain to see: NATO expansion and the resultant encirclement of the Russian Federation. The idea that Ukraine might become a NATO member-state would compel even such a dissident as Navalny – if he were alive and held the reins of power – to respond to it militarily. That’s game theory! You cannot allow your competitor to gradually encircle, bleed and eventually entrap your state. Think about the 1962 Cuban Missile Crisis and the reaction of the United States to the Soviets deploying their missiles so close to America. It would have triggered the World War Three had the Soviets not backed out. (Remember that the decision of the deployment of Russian rockets in Cuba had been provoked by the deployment of American missiles in Turkey!). The decision on the part of the United States and the collective West to suggest NATO membership for Ukraine set the alarm bells ringing in the Kremlin.

In the letter, Ukraine’s President Volodymyr Zelenskyy uses language that is challenging and defying, aimed at ridiculing the Russian leader. Ukraine’s president says, among others, Do not be afraid to take the path out of this war. Rather than looking for words and phrases that might subtly make the Russian president consider peace talks, Ukraine’s president chooses to look down on him – much like an elder brother looks down on a younger one – implying timidity to force him into action.

This defiance is followed by unveiled threats when Ukraine’s President Volodymyr Zelenskyy brings up Hungarian Prime Minister Viktor Orban’s electoral loss. Why did Viktor Orban lose? Because he dared to support Russia and all those who support Russia are fighting a losing battle, or – to use Ukraine’s President Volodymyr Zelenskyy’s own words: Orban shows how those who choose to help Russia in its war against us end in disgrace.

The again Volodymyr Zelenskyy resorts to ridicule and scoff, saying to Vladimir Putin, you would not have been able to cope with it without North Korea’s help. You are the first ruler of Russia to turn to Pyongyang for assistance. And today you are fully dependent on China — also for the first time in Russia’s history. Aha, North Korea is a pariah state, and it is precisely this pariah state on whose aid the Russian president relies! How humiliating, how demeaning, how degrading!

As if denying reality and anticipating Putin’s arguments, Ukraine’s President Volodymyr Zelenskyy goes on to say that the world has not grown tired of Ukraine, as you long hoped it would. Really? Wishful thinking pure.

To top it all, Volodymyr Zelenskyy claims that Russian losses are a few times larger than those of Ukraine. If that were the case, why on earth should Ukraine’s President propose peace talks? Why should Russian troops be still operating on Ukraine’s terrain rather than the other way around?

Finally, the Ukrainian President points to Vladimir Putin’s age – age is beginning to take its toll (does Putin seem senile to you the way Trump does or, especially, Biden did?) – and doubles down on the Russian leader with a final and personal threat: you (…) will have to fight much harder for your own existence — not Russia’s, but your own. You might think that Volodymyr Zelenskyy is magnanimously extending his helping hand to rescue his Russian counterpart from the latter’s personal catastrophe!

There is nothing, virtually nothing in the letter that sounds like Volodymyr Zelenskyy genuinely wants peace. The tone is aggressive and scornful, and much of its content is simply mendacious. You do not invite your opponent to a negotiating table, telling him that he is a senile, carven coward relying on a pariah state, aging and fighting for mere survival.

If the open letter is not a genuine invitation to talks, then what is it?

The Treasure of the Appalachians

The US Geological Survey (USGS) has published a report that could have a significant impact on the geopolitical dynamics between the US and China. It turns out that the Appalachian Mountains contain 2.3 million tonnes of lithium oxide. To better understand the significance of this information, suffice it to say that such a quantity would meet the US’s demand for this rare metal for around 328 years. To date, the country has operated only one small mine, and more than 50% of its lithium is imported from Chile, Argentina and Australia, whilst the raw material itself is still sent to China for processing. Indeed, China processes 60% of all lithium, which serves as a means of exerting pressure on other countries, including the US. In recent years, Beijing has repeatedly introduced export controls on, among other things, lithium processing technology, the manufacture of LFP cathodes (which contain directly recycled lithium) and high-energy lithium-ion batteries. As a result, Beijing has a real influence on the cost, availability and delivery times of battery components worldwide.

The discovery by the US authorities now appears to mark a breakthrough, but the devil is in the detail. The first problem is the nature of the deposits found. These are so-called pegmatites, i.e. hard rocks, from which the extraction and processing of lithium is much more expensive and difficult than from brine. What matters, however, is that mining would be economically viable. The greatest hopes lie in the Kings Mountain region, where companies such as Albemarle and Piedmont Lithium are already developing their projects. The biggest problem, however, remains time. The construction of mines and the commissioning of lithium extraction and recycling plants is a process that will take at least 10 to 15 years. Consequently, the significance of this discovery remains moderate in the short term.

So where exactly do the real benefits for the US lie? First and foremost, we need to adopt a longer-term approach here in the context of competition with China. This competition will not end in two or three years. A new world order will emerge over the coming decades, and from that timeframe, the discovery of such vast lithium deposits is already significant. This is a milestone that completely transforms the US’s vision of raw material security in relation to lithium and offers real hope of weakening Chinese influence, even in the area of control over battery production. It is also a positive signal for American companies in this sector.

Every gift discarded, every device rejected

Such is the final symbolic act of the American state visit to Beijing (13-15 May 2026). Nothing gifted by the Chinese diplomatic counterparts was allowed on board Air Force One. The measure of mistrust just cannot be higher. The ostentatiousness of the act boggles the mind. The symbolic failure of the gesture cannot be overestimated.

Gifts may be poisonous. No doubt about that. Think about the cell phones that Palestinian leaders purchased, the cell phones that were tampered with by the Israeli secret services, the cell phones that were detonated, killing or maiming the users of those cell phones.

Think about the notorious infected blankets that the European conquerors of North America presented to the Indians. The purpose was to do away with the indigenous peoples in a surreptitious and efficient way. Or, for that matter, think about the alcohol generously sold to the same Indians for the purpose of weakening their health and paralysing their will.

Why, think about China itself, about the opium that was forcibly sold to the Chinese in the 19th century. Two protracted wars were waged over the right of the Europeans to bless the indigenous people with this good!

Think about the Trojan Horse. Legend or no legend, the principle was known and well established in antiquity. Gifts may be dangerous, and oftentimes they are.

Hence an interesting development of the meaning of the German word Gift, whose initial sense overlapped with that of the English word gift, but with time came to denote… poison!

Think about drug dealers who gift or give freely the first few doses of a drug to hook the person on the substance, to make him addictive.

Also the English language has an expression showcasing the troublesomeness of receiving gifts. The expression is to receive a white elephant, i.e. to get a gift that costs a lot to maintain but provides no usefulness (white elephants were considered sacred, hence one could not use them for any kind of work, but one, obviously, needed to feed them).

So, who knows, the Chinese may have concealed spying malware or whatever malicious things in their gifts, down to biological material. The American delegation acted verbatim on the old maxim: Timeo Danaos et dona ferentes, which in our context would be: Timeo Sinae et dona ferentes, meaning: I fear the Chinese, even those bearing gifts (The Aeneid, Book II).

How should that act on the part of the American delegation be construed? A message of mistrust of the Chinese? Real, palpable fear of being threatened by Chinese technology? How was that gesture perceived by the managers of the Middle Kingdom?

Almost a century back the Chinese were American allies in Washington’s fight against Japan. After the war came a split: Americans backed Chiang Kai-shek, the leader of China’s nationalists, against Mao Zedong, the leader of China’s communists. Chiang Kai-shek lost to the communists and found refuge on the island of Taiwan. Americans recognized Taiwan as ‘China’ and tried to ignore mainland China in the hope of reversing the historical process. Nothing came out of it. Communist China, poor and backward as it was, showed no signs of disintegration, so much so as it was backed by the Soviet Union. But then the fate smiled at Americans: Nikita Khrushchev, the USSR’s leader, fell out with Mao Zedong, which later even culminated in border skirmishes. That was something that Americans had been waiting for. Washington reversed its political course and did its best to win Beijing over to its side against Moscow. Americans withdrew recognition for Taiwan and recognized mainland China as… China proper. Much later came the years of economic cooperation in that American businesses were for a large part outsourced to China. The fall of the Soviet Union – history’s another gift for the United States – seemed to seal the fate of the globe: the United States emerged as the only dominant power, Russia – the Soviet Union’s political heir – was assigned the role of the provider of resources, while the Middle Kingdom was supposed to happily accept the role of the world’s manufacturer.

Things may have stayed that way till this day but for America’s greed and arrogance. Gradual military encirclement of Russia in terms of expanding NATO and engineering unrest in the post-Soviet area (Ukraine, Belarus, Armenia, Georgia, Kazakhstan) along with a simultaneous political assault against China as America’s most dangerous political and economic rival pushed Moscow and Beijing in their mutual embraces. Khrushchev’s political mistake has been corrected: Moscow and Beijing have begun to cooperate against the West, against the United States, though openly no such declaration has been issued.

The political sine wave for the United States could be traced something like this: from friendly China (Chiang Kai-shek) to unfriendly China (Mao Zedong), to friendly China again (Prime Minister Zhou Enlai), and again to a rather unfriendly China (Xi Jinping). The discarded gifts and the rejected devices merely illustrate the current state of affairs.

The demographic crisis in China

The birth rate in China has reached a record low. The economy is already feeling the demographic pressure. Experts point out that this could lead to a significant slowdown and even a decline.

For decades, the Middle Kingdom was regarded as the world’s factory. The vast pool of cheap labour, low production costs and ease of transporting goods led to a situation where Western companies massively relocated their production lines to the country. Beijing benefited from this situation as GDP grew rapidly. A symbol of the developing nation was the massive investment in infrastructure, which aroused both admiration and envy in the West. It seemed as though nothing could stop the Chinese dragon.

Meanwhile, although the economy continues to grow at a pace that is unattainable for most Western countries, it faces a serious problem that could significantly weaken it. Birth rates are at an all-time low and, unless the situation changes radically, the demographic crisis will lead to rising labour costs and prices for manufactured goods.

In 2023, China lost its title as the world’s most populous country to India. In 2025, Beijing recorded its fastest annual population decline since the great famine of 1960, which took place during Mao Zedong’s rule. Falling birth rates and rising mortality rates have reduced the country’s population by 3.39 million. In 2023, the birth rate fell to 0.99, well below the replacement rate of 2.1. This means that there must be 2.1 children per woman for the country’s population to remain stable. In practice, this means that one in three women must give birth to at least three children.

According to statistics, the number of people of working age in China (aged 16–59) has been declining over the years. In 2025, people in this group accounted for around 60.6 per cent of the total population, whereas ten years ago this percentage stood at 70 per cent. The demographic situation in China is exacerbated by migration, as more and more citizens are leaving the country. This unfavourable trend, as the analysis shows, could significantly weaken economic growth in the long term and dash Beijing’s hopes of overtaking the US.

One-Child Policy

Many experts point out that the current demographic crisis is, to a certain extent, the result of the ‘one-child policy’ that has been in place for decades. Since 1949, the Chinese population has grown rapidly. This led to food shortages and a housing crisis. For this reason, the government introduced the policy, which remained in force from 1979 to 2016. Children born as the second or subsequent child in the family were denied a hukou, i.e. an official registration that grants access to social services and other benefits. Families with an “excessive” number of children were also persecuted by the state apparatus and fined. As a result of the one-child policy, sons were favoured in most Chinese families. For this reason, women were forced to terminate their pregnancies when it became clear they were carrying a girl. This led to a gender imbalance. Although the ratio has stabilised in recent years at around 104 boys for every 100 girls (by way of comparison: in 2000, there were 118 male births for every 100 female births), there is still a shortage of women of childbearing age in China.

Beijing is now attempting to reverse this unfavourable trend. In 2025, China’s first national childcare subsidy scheme came into force. Every family receives 3,600 yuan, or approximately 503 US dollars, per year from the state for each child aged up to three. A decision was also made to raise the retirement age. However, it remains to be seen what the results of these changes will be. Another decision designed to encourage the Chinese to start a family was a change in the law allowing them to marry anywhere in the country rather than being restricted to their place of residence. The initial results appear promising: in the third quarter of 2025, the number of marriages rose by 22.5 per cent. From 1 January 2026, Beijing has also removed contraceptive pills from the list of tax-exempt goods and services. The government is also calling for a reduction in the number of ‘medically unnecessary’ abortions. It should be noted, however, that after many years of practising forced abortions, Chinese society is currently the most tolerant in the world when it comes to this procedure.

One of the most significant factors driving this demographic decline, which is affecting the economy, is the loss of productivity. According to recent forecasts, the proportion of the Chinese population aged between 16 and 64 is set to fall from 69.33 per cent in 2024 to 59.14 per cent in 2050. Unless this can be offset by technological innovation, stagnation in the Chinese economy appears inevitable.

Another negative factor is the weakening of domestic demand. Young people and middle-aged people are the two groups with the highest levels of consumption. The smaller their numbers, the lower domestic demand. The decline in the birth rate leads to a situation described as ‘still poor and already old’. In this scenario, China could fall into a ‘middle-income trap’, which refers to a situation where a country that has reached a middle income (measured by GDP per capita) is unable to effectively transform and modernise its economy (for example, due to a lack of innovation, stagnant productivity or institutional rigidity), leading to long-term economic stagnation and making it impossible to advance unhindered into the ranks of high-income countries. According to the World Bank, China’s gross per capita income in 2023 stood at US$13,390, placing China among the group of middle-income countries. If the demographic crisis persists, it will be difficult for China to rise to the ranks of the wealthiest nations.

The Italian historical sample

Where is Italy and where is Russia?

Worlds apart.

If you glance at the map of present-day Europe, you’ll see a number of countries separating Italy from Russia. They include (travelling from Italy to Russia) Austria, Slovakia, and Ukraine or (taking a more northerly route) Austria, Czechia, Poland, and Belarus, or (taking a more southerly route) Slovenia, Hungary, and Ukraine. Quite a journey. What bone to pick can Italy and Russia have? What cause of conflict could there ever have been between Rome and Moscow?

And yet, within less than a century and a half, Italian troops fought against Russian troops, and there were many Italian casualties, many corpses covering Russian soil, and many cripples coming back to Italy.

Italy has sent its troops against Russia three times. First, during the time of Napoleonic wars. Some readers may tend to think that when Napoleon Bonaparte invaded Russia (1812), he led the French troops alone. No. He led almost the whole of Europe against the tsar, and those troops included lots of Italians. The men accustomed to Italy’s warm climate suffered frostbite and death somewhere between Moscow and Smolensk.

Then came the Crimean War of 1853-1856. It was the second time that Italy (to be precise, the Kingdom of Sardinia-Piedmont) sent its troops against Russia. That was how the Italians most likely wanted to liberate their country from… well, from what?

Then came the war of the Third Reich against the Soviet Union of 1941-1945. It was the third time that Italy sent its troops against Russia to support Germany. Again, Italian troopers experienced frostbite and death, far away on the Volga.

Three consecutive times Italians (or rather their governments) let Italian blood flow copiously far, far away from their home country for God knows what purpose.

Since Napoleon and Hitler lost the war to Russians, neither could Italians gain anything from their participation in them. While the Crimean War was successful for the Anglo-French coalition, Italians as their allies, could gain something from it. Italy’s international stance somewhat increased. Also, Italy’s alliance with France led to a later Franco-Italian war against Austria (1859), the country that stood in the way of Italian unification. Ok, that was a gain, but still the question rankles the mind: why fight against Russia when Austria happens to be your opponent?

Strange are the intricacies of history, are they not?

Italy’s historical experience shows that twice the blood sacrifice was made in vain, once it brought some dividend: the unification of Italy brought about by the victorious war of the Franco-Italian coalition against Austria, the main hindrance to the said unification. France’s help was earned by Italy’s participation in the Crimean War, where France had its vested interests.

What hopes of gain do the European countries cherish while getting involved (again and again across the recent centuries) in the conflict against Russia? What “Austria” do they have in their crosshairs? Whose alliance and consequently whose political and military aid do they want to earn?