Geostrategic Countries

We’ll Hunt You Down!

Just as the United States is known for its export product – the dollar – so the European Union is known for its domestic product – loads of decrees and decisions and directives. Every year, every month, every week tons of texts are composed and made public in almost 30 languages, with each text being as long as possible. No need to even make a supposition whether those texts are read by anybody save for those unfortunate individuals who are tasked with writing them and translating them into the many tongues. (Maybe those individuals are not all that unfortunate: they are paid well, after all, for the scribbling.)

The European Union badly wants to change not only the Old Continent, but also the whole world, setting moral and political standards, also through the documents that it produces. The reader conversant with history and with Emperor Joseph II of Austria in particular will have recalled that a similar phenomenon took place during his reign of 1780-1790: the said emperor would spend hours every day at his desk with the purpose of mending and repairing his kingdoms, and with the purpose of making his subjects happier and happier. He produced decrees and laws and directives the way the EU has been doing for more than a decade and he genuinely thought he was doing something grandiose.

Among the documents that Brussels bureaucrats have produced is Council Decision 2014/145/CFSP of 17 March 2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (as if, carving up Yugoslavia and tearing Kosovo from Serbia the EU bothered about the integrity of states as a principle, but never mind). We are not going to survey all the measures that the document announces save for one: it provides a list of Russian citizens who are targeted for punishment because they “support the regime” and “threaten the territorial integrity” of Ukraine. This list has been since reviewed and duly expanded by way of Council Decision (CFSP) 2024/1738 of 24 June 2024 amending Decision 2014/145/CFSP concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine. We get a blacklist or a kill list in either document. The targeted individuals are given by first name and surname, followed by such data (if available to the authors of the list) as the date of birth, place of birth, nationality, professional or administrative position, passport number, and even tax identification number – all tabulated. One column states the reason why an individual is recognized as the enemy of humanity, or at least the enemy of the European Union. Who does the blacklist include?

Well, speakers of local parliaments, chairmen of councils, heads of institutions or committees or agencies, ministers and deputy ministers, owners and (majority or controlling) shareholders of companies, and judges of military and other courts. Among them we can also find TV presenters, bloggers, actresses and singers! They are all the enemies of humanity and peace, and especially enemies of Ukraine, supporters of the Russian regime and Russian aggression, and the like.

Talking about singers: the list is graced by no less a person than Polina Sergeevna Gagarina (Полина Сергеевна Гагарина), one of the most popular artists, a participant in the 2015 Eurovision, where she came second in the Grand Final. (Those were the times when Russian artists and sportsmen could still perform in Europe and were even awarded prizes. Hard to believe from today’s perspective, isn’t it?). Her many hits include Я тебя не прощу никогда (I’ll Never Forgive You), Спектакль окончен (The Play Is Over), Драмы больше нет (Drama Is Over), Обезоружена (Disarmed), Смотри (Have a Look), Небо в глазах (Sky in Your Eyes), and many many others. They are not presented to the European public although Europe is constantly bragging about diversity and inclusivity, but – again – never mind this digression. You cannot present a Putin-supporter, or can you?

What are Polina Gagarina’s unforgivable sins? Let us look up the information placed against her name in the kill list. We read that Polina Gagarina “regularly performs in the framework of State propaganda events, for example to celebrate the illegal annexation of four Ukrainian regions or the anniversary of the annexation of Crimea. She thus supports actions which undermine the territorial integrity of Ukraine. Since the beginning of Russia’s war of aggression against Ukraine, Polina Gagarina has been able to generate significant revenue through her frequent participation in state-sponsored propaganda events and programmes. She therefore benefits from the Government of the Russian Federation, which is responsible for the annexation of Crimea and the destabilisation of Ukraine.” Wow! Probably according to the EU commissioners a Russian citizen should oppose the Russian authorities if an external power (like the EU) says so. Probably according to the EU commissioners a Russian citizen ought to think precisely the same as the EU commissioners when it comes to politics and morals or else. Probably according to the EU commissioners Polina Gagarina ought to sing in Ukraine against her own country, to spite her own authorities. Her loyalty should be to the EU rather than to her government.

At this juncture one may begin to wonder whether Polina Gagarina and indeed all the men and women from the blacklist are aware that they are the enemies of humanity, and – assuming they know – whether they care.

The EU commissioners in the good tradition of their Bolshevik predecessors administer punishment to the enemies of progress and light. Within the meaning of the paragraphs of the mentioned decisions the member states shall refuse the individuals from the hit list entry into or transfer through their territories and shall freeze their funds and economic resources (obviously if they have any in the EU). Hey, Europeans! Do you know that you are expected not to listen to songs performed by Polina Gagarina? You probably don’t listen to her anyway, but just in case you might be tempted to check the titles given above: you’d better not. If you do, you’ll be supporting the forces of darkness and damaging the cause of Ukraine’s territorial integrity and Ukraine’s sovereignty.

China’s blow to luxury brands from the West

The owners of American and European luxury brands have recently learnt that all means are permitted in war. Due to reciprocal duties on goods, tariffs of 145% are being imposed on goods exported from China to the USA. The Middle Kingdom did not limit itself to the introduction of retaliatory tariffs. The TikTok platform, a Chinese social media app with a global reach of over 1 billion users, has developed a trend that at first glance resembles a grassroots mass initiative by Chinese citizens. Short videos are posted on TikTok that allegedly reveal the modus operandi of luxury brands such as Dior, Prada, Hermès, Chanel, Coach, Ralph Lauren, Apple, Michael Kors, Nike and many others. These companies are said to manufacture their products entirely in China, adding only logos, price tags and, of course, making sky-high profits in the official country of origin, such as America or France. The authors of the videos point out that, for example, a handbag selling for $38,000 only costs $1,300 to make, which should encourage Western customers to buy directly from the manufacturer rather than overpay at an expensive salon in Paris or New York. As you can imagine, these videos are gaining huge popularity and causing controversy. What’s surprising about the above trend?

Firstly, the videos show executives of Chinese factories and other not at all random people who probably could not make a spontaneous decision to record and publish such material on behalf of the company. Secondly, the popularity of this movement has been used by manufacturers of knockoffs to sell them even better. Thirdly, many luxury brands sign agreements with their contractors in China that oblige them to keep this collaboration secret. Fourthly, if a factory actually produces goods for a European luxury brand, how much will its sales fall if that brand ends all its co-operation with it due to the disclosure of company secrets? What will you sell and to whom?

I absolutely do not deny that many western brands use cheap Chinese production to increase their huge profits. Quality does not always go hand in hand with price, and often you only pay for the logo. However, you cannot assume that this is the case in every instance. Sometimes, for example, it is the pre-assembly of a particular product that has to be completed under completely different conditions and using different methods in a completely different country. Let’s also not forget that Chinese contractors do not bear the costs of product development (e.g. designers, electronics), which are often the highest in the entire cycle. Incidentally, experts in the luxury goods market claim that more is bought than the product itself. They talk about emotions, history, a sense of belonging, unique shopping experiences and brand philosophy. It is likely that the target group for these products will find such an argument convincing. Of course, this situation will force manufacturers to be more transparent about the supply chain, which is beneficial for consumers.

Gefira 93: A big picture of purpose

When it comes to the war in Ukraine, Europe – the European Union along with the United Kingdom – is in a fight mode while the United States is not. Europe is still flaunting its so-called human and democratic values, while the United States has just reversed the course of wokeism and genderism. European leaders have shut themselves off from the outside world in their echo chambers and surround themselves with like-minded bellicose individuals, while the United States is trying to find a balance in its foreign policy. Europe is still objectifying Ukraine – the country and the nation are only viewed as a battering ram against Russia, Europe’s topmost foe, while the new American administration seems to be red-pilled to for-ever wars and has become to deal with reality on the ground as it is. European and American ways have ceased to align.

Europe has a history of aggressiveness directed towards the east, which was encapsulated by the notorious German political catchphrase Drang nach Osten or Drive to the East. Indeed, wars between the western and eastern parts of the Old Continent were invariably initiated by its western part. These were the military raids of the Teutonic Knights, these were the invasions launched by Sweden or France, by imperial Germany and the Third Reich. For all that historical record, it is Russia that is credited with aggressive intentions. Why, Europeans, including those with university degrees, are not familiar even cursorily with their own past. Schools are not there for the Europeans to let knowledge sink in; schools are for mind shaping.

Europe obsessed with Russia and Putin appears to be overlooking the worldly political and economic trends. The developing countries are slowly but steadfastly gaining economic and – what follows – political momentum. The United States has broken with globalism and is focusing on its own affairs, recognizing that its role as a global hegemon has come to an end. Not that Washington has given up on exerting leverage here and there in the world: the action to control the Panama Canal or the plans of taking control over Greenland show that the American empire is alive and kicking. Yet, the United States needs to reckon with powerful rivals and concede them some political room on the world stage. It is not only Russia, it is China as well.

Europe has let itself be pushed out of Africa, Europe has developed a guilt complex towards Africans for all the failures of the latter and Europe embarked upon letting itself be colonized. The vacuum created on the Dark Continent has attracted the attention of the Middle Kingdom. China is taking Africa over from degenerating Europe. China’s population is numerically almost a perfect match to that of Africa, while Europe’s dwindling indigenous population is on a slippery road to nothingness. While European influence in Africa is often denounced in European capitals as neo-colonialism, China’s take on its presence on the Dark Continent is framed by Beijing as Going Global. Europe, riddled with guilt and shame, cannot stand up to the Middle Kingdom with the latter’s political ambition. Europe has become irrelevant, while China is a rising star. Also on the Dark Continent.

 

Gefira Financial Bulletin #93 is available now

  • Russia – a stumbling block of nations
  • Greenland
  • Europe out, China in
  • The Mar-a-Lago plan

The difference between tariffs and sanctions is that there is no difference!

The whole world is talking about the many tariffs that President Donald Trump has imposed and is about to impose on various countries around the globe. That is by the way something that he promised he would do on several occasions before he was elected to the highest office in the United States. The leaders of different countries seem not to have believed a word from what President Donald Trump said he would do. They didn’t believe it because they themselves are in the habit of promising things and not delivering on them, not even thinking of delivering on them. This time they have been confronted with a politician who keeps his word, and that comes as a surprise.

President Donald Trump believes in the benefit of tariffs, that is to say he believes that restrictions on international trade, restrictions on the amount and number of goods imported to the United States are beneficial for American economy. Imposing tariffs he must have reckoned with retaliation, which, indeed, is being applied. In other words, President Donald Trump must also believe in the beneficial effects for American economy of the limited exports. To put it otherwise, President Donald Trump is well aware of the fact that his sanctions seal American economy off from the economies of other countries, and yet he also believes that it is good for the United States.

Since tariffs and the retaliatory measures limit or make impossible exports and imports, they are no different from… sanctions. Sanctions are sort of tariffs: a country that is at the receiving end of sanctions cannot export or import as much as it wishes. The result is the same, or is it? Now President Donald Trump may have believed in the beneficial effects of tariffs a long time ago, but it is also possible that he realized the beneficial effects of tariffs (or his long-standing belief was reinforced) as he observed what happened to the Russian Federation since sanctions were imposed on it. Russian economy not only did not collapse, but seems to have developed its potential.

Just as the Western economists have prophesied that the Russian Federation was just about to collapse due to the thousands of sanctions directed against its economy, so are they now prophesying that President Donald Trump has overreached his hand and rather than helping the United States is going to do it enormous harm. Time will show. Still, the similarity of the economic effect that tariffs and sanctions appear to have is striking. Two labels denoting two seemingly different economic policies and apparently the same result.

Then what’s so basically wrong with the tariffs which the American president is so enarmoured of? Does the European Union not separate itself from the rest of the world by means of tariffs? Does the EU not rely on tariffs to defend its economy against that of China? Why then are so many economists critical of America-imposed tariffs while they remain silent when it comes to the EU-imposed tariffs or – for that matter – sanctions?

It’s interesting to observe that all that glib talk about free trade, free market, free flow of capital, free flow of goods and services, all that glib talk is just another weapon in the arsenal of the powers that be. If they can turn free trade and free flow of goods and services to their advantage, then they are all in favour of it and they go to great lengths to impress it on others how beneficial it is for all players on the world’s stage. The moment, however, free trade and free flow of goods and services does not serve their purposes, they strike a different note. What yesterday was considered economically good, today is considered economically bad. Sure enough, an explanation or a string of explanations is offered and the consumers of information usually buy into such explanations.

Tariffs and sanctions are two sides of the same coin. President Donald Trump has effectively imposed sanctions in the European Union; conversely, one might say, the European Union has been imposing tariffs on the Russian Federation. The result? Russian economy has emerged victorious, and so will American economy emerge victorious. That’s at least the logic of this economic mechanism of separation or protection of one’s own market, of one’s own entrepreneurs and customers (economic protectionism). Economic protectionism is nothing new in the history of mankind. In point of fact, there were periods during which protectionism was the order of the day, and periods during which it was denounced, as the case may be.

Besides, the application of tariffs by the United States clearly shows that the country’s economy has long ceased to be dominant or else why would Washington use this means in the first place?

Lawfare against Le Pen

Marie Le Pen has been found guilty. Whether Marie Marie Le Pen is guilty of the charges or not is a different matter. ECB’s boss Christine Lagarde or EU’s CEO Ursula von der Leyen have also faced charges and weaseled out of responsibility with ease. The former has been “guilty of negligence but” the court “did not hand down any punishment” while the latter was not even forced to as much as resign from her post over the so called Pfizergate affair. Now Marie Le Pen has been indicted and sentenced. Altogether she must pay a financial fine and serve a suspended term in prison, which is compounded by the duty to wear a humiliating electronic bracelet. This is not all. Now comes the gist of the whole matter: Marie Le Pen has been banned from funning for political office. It is the 2027 presidential election that is on the radar of the French establishment.

With the presidential election cancelled in Romania, with the threats of delegalizing Germany’s AfD, with Brussels’ similar acts of interference in Italy and Austria, one cannot rid oneself of the impression that a certain pattern is in play. It appears, the EU commissioners overlooked the “threat” rising in Bucharest and then were forced to act in a panic mode by resorting to ridiculous pretexts on which the cancellation of the election was based, so now they decided to act preemptively in Paris. Why wait for Marie Le Pen’s victory? It is much more advisable to nip the problem in the bud. Since Marie Le Pen and her National Rally become more and more popular, they need to be stopped in the tracks. The make such a verdict justified to the public, the leftist media across Europe and in the United States reporting on the case and writing about Marie Le Pen and her National Rally are going to great lengths to impress the reader or the viewer with the term “far-right”: Marie Le Pen and her National Rally are far-right.

Everybody and any organization that does not comply with the party line of the Western self-styled elites is automatically called “far-right”, while the consumers of information circulated by the mass media have been trained for years to make a straightforward association between the term far-right and Nazi Germany. Adolf Hitler’s henchmen, though waving red flags and professing their belief in socialism are somehow not referred to as left or – still better – far-left but right, far-right. Which is to say in other words that such “capitalists” and “financiers” as Hitler, Heß, Goebbels, Göring and Borman were far-right, you see?

What does this far-right mean? The association that is imposed on the consumers of information suggests nothing less than concentration camps and witch hunts. In reality, the National Rally wants to make France French again. The National Rally wants to stop immigration, make peace with Russia, put a ban on the propaganda of rainbow sexuality and a few other normal things, things that were regarded as pillars of society and culture twenty-thirty years ago. That’s what far-right stands for in reality. Since most people would like the same goals to be pursued, another association has been created by the powers that be: that of “nazis”. Somehow even this rabid propaganda against Marie Le Pen and the National Rally turned out to become less and less effective, hence the powers that be decided to resort to lawfare. Marie Le Pen had to be stopped from taking part in the 2027 presidential election by hook or by crook or else France might run the risk of having a female counterpart of President Donald Trump, which is unpalatable to the European elites in general and French elites in particular.

The Trojan Horse of Sudzha

Almost 16 kilometers in darkness, four long days, with little oxygen, with little food or water, almost suffocating from the remnants of methane. Four long days of marching, half-bent, inside a disused gas pipeline with a diameter of merely 170 cm. Man after man after another man, five hundred of them, tenaciously pressing forward. High spirits, excitement of adventure, and the awareness of being part of something grand. Four long days, kilometer after kilometer, gasping for breath, sharing the little food that they have and the little water that they are supplied with. They reach the proverbial end of the tunnel but it is not the the end of their trail. What follows are Jonas-like two days of wait, two days of lying low in the whale’s maw. Their emergence from the maw must be coordinated with the efforts of the comrades in arms operating in the open. They can hear the pounding of the guns, they can hear the movement of the tanks and that of the armoured vehicles. A thought that their presence might be detected prematurely by the enemy sparks anxiety in their minds. These two days of inaction are perhaps the most difficult.

As is known, warfare is not merely a clash of arms. Nor is it merely a contest of strategical thinking. Warfare involves also subterfuge. The most famous is represented by the iconic Trojan Horse. The Achaeans did not conquer the city of Troy by arms, by the ten-year siege, betrayal of some of the Trojans. The Achaeans won the war by means of an ingenious stratagem, by means of cunning and deception, by means of surprise. Similar feats would be employed in the centuries to come by various contesting parties. Such military feats are also pulled off today.

It was in August 2024 that the Ukrainian military forces decided to break through the front line in the direction of Kursk. As the Russians were taken by surprise, Ukrainians managed to conquer over 400 square kilometers and pursued their goal of capturing the nuclear power station in Kurchatov. What was the intention of the Ukrainian general staff and the Ukrainian civilian leaders?

First, the Ukrainian authorities wanted to raise the morale of the society. Months of retreat, months of Russian advance had played havoc with the will to fight or to resist the enemy.

Second, the Ukrainians had hoped to distract the Russian forces from the other segments of the front line and thus make it easier for Ukrainian soldiers to withstand Russian assaults there.

Third, the Kursk region, if captured and permanently held by Ukrainians, might become a bargaining chip in future negotiations between Kiev and Moscow. Kursk could be exchanged for one or a few or all the provinces claimed by Russia.

So far, so good. It was to the Ukrainians’ disadvantage that Russians had numerical superiority in manpower and equipment, so they could quickly mobilize troops that had been held in reserve and launch a counteroffensive. Strictly speaking it was not a counteroffensive in the true meaning of the word. Rather, Kutuzov-like harrowing. The Russian troops limited themselves to pounding the enemy by means of their artillery and drones, and severing the enemy’s supply lines. It took a lot of time but it proved to be successful. That’s what General Kutuzov opted for when Napoleon invaded Russia. Rather than fighting a series of spectacular battles, he enticed the enemy deep inside the country and let the European troops overreach themselves, to exhaust themselves. Didn’t Ukrainians know about it?

One of the focal points during the fight over the Kursk region was the town of Sudzha. It is here where the Trojan Horse comes into play. It happens so that a disused gas pipeline runs by Sudzha and this pipeline was to be employed by some five hundred selected Russian soldiers. At first the engineers presented the blueprints of the pipeline. They were available because the pipeline was constructed during the times of the Soviet Union. Then some of the remnants of the gas was pumped out as much as it was feasible. Despite these efforts, a lot remained inside. Next, the selected fighters entered the dark chasm. It took four days for the 500 soldiers to move almost 16 kilometers along the pipeline whose diameter is 1.7 meter. They had difficulties breathing and they were running low on their food and water supplies. When they reached the outlet of the pipe, they they stayed put two more days, waiting for the opportune moment to emerge and attack the enemy. When they eventually carried out an assault, the Ukrainian troops were taken by surprise and went into panic. You can only imagine the feeling of suddenly discovering that the enemy is shooting not only from the front but also from the rear.

Though the place from which the Russian troops were emerging was soon localized by Ukrainian drones and consequently shelled by the artillery, the overwhelming majority of the Russian fighters (if not all of them) had already left the belly of the Trojan Horse – the chasm of the pipeline – and were engaging the enemy. The days or rather hours of the Kursk salient were counted. Before the month of March expired, Ukrainians lost the Kursk salient to Russians.

The Kursk salient! It resonates with Russian historical memory! It was in this Kursk region that the greatest battle of tanks was fought during World War Two between the Wehrmacht and the Red Army. It was fought in 1943. Who would have thought that eighty-three years later Russians would fight in the same place… this time against Ukrainians? Who would have thought back then that those Russians and Ukrainians who were united within the ranks of the Red Army would in eighty-three years’ time be at each other’s throats? Who would have thought back then that in eighty-three years one Slavic tribe going by the name of Ukrainians would be equipped with German – German! – tanks and combat the other Slavic tribe known as Russians? The Führer must have made a terrible blunder back then. He sacrificed precious German blood in a war against Russians and Ukrainians making up the Red Army rather than pitting the latter against the former, rather than providing the latter with his Tiger and Panther tanks and idly watching the two ethnicities bleeding themselves dry! Who knows, maybe at present this blunder is being put right…?

Russian soldier mopping up conquered terrain in and around Sudzha. Notice the religious emblems on his outfit.

Trump wants to cause a recession

The American president changed his approach to the stock market in his second term. To the extent that he paid homage to Wall Street during his first term, he recently said in an interview for Fox News that he needs to build a strong country without looking at the stock market. The average American cares because retirement funds are operating on risky assets and many small investors are putting their savings into the stock market instead of keeping their money in low-interest accounts like Germans or most Europeans.

Trump believes that we are now facing a transition that will eventually lead to the return of wealth to America. Incoming Secretary of the Treasury Scott Bessent later added fuel to the fire when he said during his interview that if anyone thinks Trump will change his policies to stop the stock market decline, they will be disappointed. Bessent is of the opinion that we are currently in a “detox period” – a transition from reliance on public spending to private spending – and any negative market behavior is the legacy of Joe Biden and his policies to stimulate the economy with debt and deficits.

The new managers on the Potomac point out that the indicators are falling and Wall Street appears to be heading for a deeper correction.

What is also falling are the indicators of economic activity: the ISM Manufacturing (PMI) (activity in the US manufacturing sector), while ISM Manufacturing Price (change in the prices manufacturers pay for raw materials and other materials for production) is rising significantly. In the case of the former, it was above 50 points, i.e. above the threshold above which the economy is assumed to be developing, but well below the previous value and also below forecasts. In the case of the latter, it may be a return of higher inflation. In addition, orders in the US manufacturing sector are falling. Unemployment is also rising – Trump’s (or Musk’s) redundancies in the public sector are important here.

As a result, Americans are less willing to spend their money, which means that domestic demand, one of the main drivers of the US economy, is falling. After all, consumer spending accounts for 68% of US GDP!

Can such a situation suit the Trump administration? Paradoxically: Yes!

It is well known that the Fed is maintaining high interest rates (4.5%) in response to persistent inflation of around 3% (target is 2%). High interest rates lead to higher bond yields. Considering that the US needs to refinance a large portion of its debt this year (a good 25% of the total), it would be best for it to do so at the lowest price – i.e. the lowest interest rate on bonds. It is well known that it will not be easy to get the Fed to lower interest rates in the face of increased inflation, so a recession is the best solution. With limited economic growth and demand (see above), inflation may ease considerably and the associated layoffs could prompt the Fed to cut rates to stimulate economic growth.

Hence the tariffs, hence the trade wars – the aim is to bring production back to America, to increase the attractiveness of US products for domestic consumers and… to initiate a new, better period for the American economy after the recession.