Re-Trying Carlos the Jackal, Celebrity Terrorist

♠ Posted by Emmanuel in , at 10/21/2014 01:30:00 AM
bin Laden is dead and gone, but Carlos lives on.
Whereas Osama bin Laden struck me as a po-faced fanatic, Venezuelan Carlos the Jackal always had an ironic streak to him. At the height of his infamy, his pseudo-socialist leanings gave lie to his high living nature as a self-styled "professional revolutionary." The contradictions inherent in Carlos the Jackal are what make him interesting in a manner that eluded bin Laden. The latter was simply a blowhard, whereas the former always had a nudge and a wink ready. As he jetted from one America-hating safe haven to another the world over in between (attempted) acts of terrorism against the West, his actual threat was well-exceeded by his inflated self-image. This was a guy caught, after all, after France effectively bought off the Sudanese. For all that, I hardly think anyone is going to make a five-and-a-half-hour biopic of Osama bin Laden. (And, unlike the movie actor, the real Carlos was always on the chubby side.)

Recently, Carlos the Jackal resurfaced again as his French captors made him stand trial for another terrorist incident in France from long ago. He isn't so young anymore, but he displayed some of the panache that made him the world's most famous terrorist--which he ironically is once more after the killing of bin Laden--wearing a Russian ushanka hat with the flaps tied up while appearing in court late last year. (He didn't get expelled from the Soviet-era Patrice Lumumba Friendship University for nothing.) Now, he's back:
An investigating judge specialising in anti-terror cases had ordered the latest prosecution, French newspaper Le Figaro reported on Tuesday. Ramirez, 64, had admitted carrying out the 15 September 1974 attack on the Drugstore Saint-Germain in an Algerian newspaper five years later, French media said. He has already been given a life sentence for killing 11 people and wounding another 150 in four attacks dating back to the early 1980s:
  • In March 1982, a bomb exploded on a train between Paris and Toulouse, killing five people and wounding 28
  • A month later a car bomb attack was mounted on an anti-Syrian newspaper in Paris, with one passer-by killed and 60 injured
  • On New Year's Eve 1983, a bomb on a TGV fast train between Marseille and Paris killed three people and wounded 13
  • A bomb at a Marseille train station killed two
Ramirez has also been linked to several other attacks outside France.
bin Laden's successors at the Islamic State in Iraq and the Levant (ISIL) are even more pointlessly bloodthirsty than he ever was. Carlos the Jackal was from a different age when targets were more Western ones and socialist fervor was more the cause. That is, the "international workingman" was a broad church where people of different ethnicities could work against bourgeois oppressors. With the fundamentalists, it's simplified into a "you're either with or against us," Muslims against infidels struggle.  

Watch Out, Evita: Imelda Marcos, the Musical

♠ Posted by Emmanuel in ,, at 10/20/2014 01:30:00 AM
Sometimes 2000 shoes just ain't enough.
David Byrne should be familiar to 80s music fans as the Talking Heads frontman of "Burning Down the House" fame. Together with Fatboy Slim, they have turned their 2010 double concept album Here Lies Love loosely based on the life story of Imelda Marcos into a London musical. (I've listened to the album and it's far from an audio biography of the Imeldific one's life story.) Never far away from the headlines, Mrs. Marcos recently returned to the limelight when the Philippine government seized artworks allegedly by Picasso, Gaugin and others. (She recently denied they were purchased using money looted from government coffers.)

Fortunately, the musical makes itself clear on being about Imelda Marcos by adding a number of biographical details which plot her rise from obscurity to global icon and the downfall which came. To be sure, some details do not quite ring true as you'd expect from two rich white guys envisioning what happens in a poor country, but they're close enough. I've been following the development of this musical for some time, including the casting call in Manila for additional actors. Even musicals, however, are subject to innovation: Melding Mrs. Marcos' love for disco dancing and Filipinos' penchant for Catholic religiosity was bound to have interesting consequences, and the musical seems to deliver on this front. Imagine, then, Philippine history as dancefloor extravaganza:
It takes Imelda and Ferdinand Marcos – for a while, the Asian Kennedys, then more akin to the Ceaucescus in their tyrannic corruption – from Imelda's 1950s rise from the humiliatingly poor side of a family of consequence through to the moment in 1986 when – after 14 years of Martial Law and a short entirely peaceful People Power Revolution – the couple were airlifted out of the country by US marines.  The rescue is realised here in a juddering frenzy of white light: Close Encounters crossed with a berserk parody of Pentecost. Imelda's epic partiality to shoes was only discovered subsequently (1060 is the attested number found) and it's typical of the strange, admirable rigour of the piece that its makers have forborne to make capital of the phenomenon.  
As for the political economy of it all, how does Here Lies Love compare to the benchmark for these things, Andrew Lloyd Webber's Evita? At this point there is no real standout number like "Don't Cry for Me Argentina," but the newer production may benefit from being more attuned to historical circumstance and observation of power dynamics in the rise and fall of Imelda. (Perhaps "Rose of Tacloban" gains resonance after the devastation wrought on Imelda's hometown during Typhoon Haiyan.)
The inescapable comparison is with Evita.  Here Lies Love is, to my mind, politically cannier and sharper about the queasy, telling  overlap between manipulative-diva worship on the musical and on the political stage.

And it moves to its devastating conclusion through the artfully deployed metaphor of disco – one of Imelda's passions in her spendthrift sojourns in the Big Apple.  Overhung by a vast glitterball (she had one in her New York townhouse), the Dorfman [Theatre] has been transformed into a churning, thumping miniature Studio 54.

The packed punters on the ground level are chivvied and manouevred by a live DJ and his helpers around adaptable acting areas: among them, a squatly cruciform central platform, handy for preening photo-ops
I've attended a fair number of musicals. In none of them have they asked you to, well, get up and dance. As a production in a capitalist economy, audiences are in constant need of novelty. Why not be part of a live disco act about Imelda Marcos replete with DJs in full Studio 54-style pomp? It's an intriguing concept that may herald more musicals eliciting more active audience participation.

Interesting stuff. When Mrs Marcos' days on earth come to and end, her tombstone will read, "Here Lies Love."

Manchester United: From AIG to Chevrolet Killer Cars

♠ Posted by Emmanuel in , at 10/18/2014 01:30:00 AM
Chevrolet is "Like a Rock"? Man U makes itself into a global punch line (again).
 When I contemplate the largest follies of sports sponsorship, one name immediately comes to mind, "Manchester United." It takes the cake by some margin even if the competition has become more intense. I have written at some length about the dastardly activities of the Ameriscum Glazer clan which saddled this once-solvent sports team with boatloads of debt after they bought it via leveraged buy out (LBO). They say that misery loves company, and one of the "benefits" the Glazers have brought to Manchester United are American shirt sponsors of the equally dodgy sort.

In a world infested by hellishly daft shirt sponsors, Manchester United took the cake by having fellow American--let me repeat that for emphasis--American Insurance Group (AIG) as shirt sponsor when it imploded spectacularly because of its nefarious activities involving the sale of credit default swaps (CDS) as the US subprime crisis went into full swing. As defaults on subprime real estate-linked assets AIG's London subsidiary sold protection on collapsed, it took down the US mothership. So, the football team was made into a laughingstock as they could not remove AIG from its kit since the deal to sponsor AIG was still in place despite the firm collapsing.

He was smart enough to leave Man U to save the embarrassment of wearing this shirt.
Fast-forward a couple of years later and Manchester United's owners decided to take on another Yanqui laughingstock. In the years between they took AON, a respectable political risk insurer. Not having learned their lesson from the AIG, however, they subsequently took on the General Motors brand Chevrolet. When it comes to corporate social responsibility (CSR), what's worse? AIG underwent the largest government bailout in US government history, wasting colossal amounts of taxpayer money. Meanwhile, the newswires are now plastered with stories about various lawsuits against GM amounting to billions for customer injuries and fatalities. So, Manchester United's penchant for bad press has indeed moved on--from corporate collapse over dodgy dealings to, well, killing the customer:
At least 27 people have died and 25 people have been seriously injured in crashes involving General Motors cars with defective ignition switches. Attorney Kenneth Feinberg, who was hired by GM to compensate victims, updated the totals Monday. Feinberg says he has received 178 death claims since August. Of those, 27 have been deemed eligible for compensation payments. 
Twenty-five of the 1,193 injury claimants have also received compensation offers.
GM knew about faulty ignition switches in Chevrolet Cobalts and other small cars for more than a decade but didn't recall them until February of this year. The switches can slip out of the "on" position, which causes the cars to stall, knocks out power steering and turns off the air bags. Feinberg will accept claims until Dec. 31.
Tragic as it may be, you can't make this stuff up. If you need some ugly Americans, I've got some of the ugliest for you right here as they all flock to a British football team for some strange reason. 

Race Over: Why Venezuela Should Default

♠ Posted by Emmanuel in ,,, at 10/17/2014 01:30:00 AM
Supposedly paying Lotus $40m/year for a non-competitive drive is only the start of Venezuela's folly.
Amidst the wider economic turbulence worldwide, among the very first to get hit are energy exporters with very high production costs for obvious reasons. Dependence on energy revenues amidst an oil rout ensures that state coffers are being depleted--especially when your breakeven price is high. The poster child for national mismanagement--dwindling production, inefficient technology, and politicization of oil funds is, of course, Venezuela's state-owned oil companny PDVSA which features all these things and worse. For a supposedly socialist nation, the ultimate bourgeois folly is sponsoring F1 driver Pastor Maldonaldo at the enfeebled Lotus which currently lies 8th of 11 in the constructors standings. In the pit paddock, ol' Pastor has a reputation for being a nutter, and the leader who bankrolls him is no different.

Economists Carmen Reinhart and Ken Rogoff wading into the fray has sparked another round of debate on Venezuela's fate. Their colleague, Venezuela-born Harvard economist Ricardo Hausmann--he of "deficits don't matter since dark matter makes US deficit disappear" infamy--actually seems to offer a less fantastical analysis of his home country. Apparently, deficits seem to matter in Venezuela, or he was at least chastened by the global financial crisis that came after his "dark matter" flight of fancy. Don't ask me to explain; it's a Venezuelan thang. Anyway, here are Hausmann's colleagues coming to his defense:
It is unclear whether Maduro, who called for Venezuela’s authorities to take unspecified “action” against Hausmann and Santos (both Venezuelan citizens), was more offended by the suggestion that his government should default on external debt, or by the authors’ list of all the other ways it has already defaulted. These include the government’s $3.5 billion unpaid bill for pharmaceutical imports, payment arrears of more than $2 billion for food, and nearly $4 billion owed to airline companies. Oil production has more than halved since 1997, in no small part because the state-owned oil company has repeatedly defaulted on suppliers and joint-venture partners.
Predicting a Venezuelan default in the near future and actually encouraging this course of action has not endeared Hausmann to the bus driver taking Venezuela down the highway to hell, Nicolas Maduro:
The suggestion that the country stop servicing its bonds comes a month after Harvard colleagues Ricardo Hausmann and Miguel Angel Santos wrote that Venezuela should consider defaulting given that it was piling up arrears to importers. Venezuela owes about $21 billion to domestic companies and airlines, according to Caracas-based consultancy Ecoanalitica...

“People are beginning to see that a sensible strategy for the government is to default,” Joaquin Almeyra, a Miami-based bond trader at Bulltick Capital Markets, said in an e-mailed response to questions. “And oil below $90 complicates things.”  
If you like financial adventure, buy some Venezuelan sovereign debt:
Venezuelan debt is the riskiest in the world, yielding 16.07 percentage points more than Treasuries, according to data compiled by JPMorgan Chase & Co. The cost to insure the country’s bonds against default with credit-default swaps is also the highest for any government globally. “Given that the government is defaulting in numerous ways on its domestic residents already, the historical cross-country probability of an external default is close to” 100 percent, Reinhart and Rogoff wrote in their article. 
What is Maduro's retort to Hausmann? His predictably feeble-minded response is to dub the Harvard economist a financial "hit man" after a really bad conspiracy theory book. But alas, the day of reckoning is nigh since crammed into the end of 2015 is a logjam of payment dates that should deliver Venezuela to the gates of insolvency:
President Nicolas Maduro dubbed Hausmann a “financial hit man” and “outlaw” and instructed the attorney general and public prosecutor to take “actions” against the Venezuelan-born professor for seeking to destabilize the country...
 
There is little risk of an immediate default in Venezuela, Sebastian Briozzo, director of sovereign ratings at Standard and Poor’s, said today in an interview at Bloomberg headquarters in New York. Last month, the ratings company lowered Venezuela’s credit rating to CCC+, which implies at least a 50 percent chance of default over the next two years.

“Once we get closer to the end of next year, the situation could become more difficult,” Briozzo said. The government is prioritizing debt payments because it needs foreign investment to expand oil production, he said. 
I do not quite understand the logic of the leftist nutter Maduro. Why is he out to attract foreign investment from foreigners in hopes of boosting production? Can't the great socialist people of Venezuela be inspired by the great Simon Bolivar to sort the matter out for themselves instead of relying on the capitalist imperialists? Moreover, if he really wanted to stick it to these dumb foreigners who think they know better, he should screw them over ASAP by paying them nothing, nada, zip, zilch, Argentina style.

Viva la revolucion! Viva Nicolas Maduro! Viva Pastor Maldonaldo too while we're at it! If nothing else, a guy who recklessly drives into other cars week in and week out is nothing if not an excellent representative for Venezuela's crash wreck of an economy.

Russia Sues EU Over Sanctions on Gazprom Funding

♠ Posted by Emmanuel in , at 10/17/2014 01:00:00 AM
Hot on the heels of Russia intervening in the currency markets to no real effect, we receive word that it is using legal maneuvers to resume being able to obtain financing from Western capital markets which have been closed to the country ever since a new round of sanctions were implemented by the European Council (the "upper house" of European Parliament composed of EU heads of state) in the wake of the downing of the Malaysian Airlines jetliner. The troubles in Ukraine continue to roil, especially if the Russian state-owned enterprises are unable to roll over their debts coming due at the end of next year:
The EU bans, with similar measures adopted by the US, have all but frozen Russian companies and banks out of western capital markets, at a time when they have to refinance more than $130bn of foreign debt due for redemption by the end of 2015. Rosneft filed a case against the EU’s European Council in the general court under the European Court of Justice on October 9, requesting an annulment of the council’s July 31 decision that largely barred it and other Russian energy companies and state banks from raising funds on European capital markets.
Russia is counting on the precedent of ECJ rulings that have rolled back sanctions against the likes of Iran and Syria. That said, those countries hardly have become welcome participants in European capital markets--not by a long shot. In this vein I'd say it's more like a speculative ploy to obtain some breathing room as Russian finances get shot:
The challenges follow verdicts that have gone against the council in relation to similar measures imposed on Iran and Syria. In particular, the court has ruled that in implementing sanctions, European states have been too reliant on confidential sources, which impair the targets’ ability to mount an effective defence.
Rosneft seeks to "liberate" a grab bag of crony capitalists, mostly state-owned banks that provide it with working capital:
Rosneft’s request was filed on behalf of the company itself and other unidentified parties.
The capital markets sanctions that the company wants overturned also affect Russia’s biggest state lenders Sberbank, VTB, VEB, Gazprombank and Rosselkhozbank, as well as Gazpromneft, the oil arm of the state gas monopoly, and Transneft, the state-owned pipeline monopoly. Rosneft, Rosselkhozbank and Sberbank declined to comment. VTB said it had not made a final decision with regard to legal action over the sanctions. “We are carefully studying this issue and taking legal advice,” the bank said.
As the song goes, Russia has now sent the lawyers in after dabbling with guns (military adventurism in Ukraine) and money (feebly trying to staunch ruble devaluation). I guess these self-styled tough guys who can "stick it to the West" are not as badass as they portray themselves to be, having withdrawn massed forces on Ukraine's border and now resorting to legal chicanery in the interest of economic survival.

As I said earlier, it turns out that the West has Russia by the balls and not the other way around as energy prices drop precipitously. $400+ billion in reserves can go quite quickly when your burn rate is as phenomenal as Russia's at the moment. 

Meet America's #2 Real-Estate Buyer, Norway

♠ Posted by Emmanuel in , at 10/16/2014 01:30:00 AM
Where Monopoly money comes from.
As far as Europeans go, Norway has a maverick, independent streak. It is not a member of the European Union, let alone a user of the euro. Unlike most of its neighbors, it has a petroleum-based economy. The latter has given rise to a fairly sizable sovereign wealth fund (SWF) officially known as the "Government Pension Fund Global" as oil proceeds have been saved over the years. Depending on the source quoted, its holdings range from $820 billion to a cool $890 billion--supposedly worth $178,000 for each Norwegian. [Can I retire as a Norwegian?] As you would expect from these smart, non-subprime-loving folks, it is a well-run SWF to boot.

Critics, however, point to its preference for investing mostly in the developed world where returns are rather lower. You can see this from the nifty interactive map on the SWF's site. However, this criticism has not dissuaded it from buying more blue-chip properties all over the world in accomplishing their version of "diversification." Take, for example, the United States:
Norway has vaulted to the top ranks of foreign U.S. commercial real estate buyers as its $870 billion sovereign-wealth fund, the world’s largest, acquires buildings from New York to San Francisco. The country has spent more than $3.2 billion on U.S. real estate this year, including the assumption of debt, according to research firm Real Capital Analytics Inc. and statements from the wealth fund. That makes it the biggest international buyer after Canada. The total is more than double the amount spent in all of 2013, when Norway ranked No. 6 for property purchases.

Norway, which has a smaller population than New York City, is spending billions of dollars on properties globally as its wealth fund seeks to meet a target to invest as much as 5 percent of its assets in real estate. In the U.S., prices for top-quality buildings in major markets are being driven up by foreign funds that often are willing to accept lower yields than domestic buyers in return for a safe place to put their money, according to research firm Green Street Advisors Inc.

“There’s an element of perceived safety in a hard asset in the United States, in New York City, that is harder to replicate in other alternatives,” said Michael Knott, a managing director at Newport Beach, California-based Green Street. Investors such as the Norwegian fund “have the ability to hold indefinitely and probably not be troubled at all by a low going-in yield.”
In a sign of the times, Norway is even buying prime London properties from Singapore's SWF:
Norway’s sovereign wealth fund, the world’s largest, agreed to buy the Bank of America (BAC:US) Merrill Lynch Financial Centre in London for 582.5 million pounds ($944 million) as it expands its bet on the U.K. capital.
The fund acquired the 585,000 square-foot (54,000 square-meter) office complex at King Edward St. from GIC Pte, Singapore’s wealth fund, Oslo-based Norges Bank Investment Management said today in a statement. GIC bought the property from Merrill Lynch & Co. Inc. in 2007 for 480 million pounds.
Norway’s $860 billion wealth fund formed a new real estate group in July to speed up its property investments and is seeking to invest almost $10 billion annually over the next three years. The fund owns properties on Times Square in New York and the Avenue des Champs-Elysees in Paris, as well as in Boston, San Francisco and Zurich. 
Gemany, too, has seen Norwegian investment as of late:
Norway's $840-billion sovereign wealth fund purchased a 94.9 percent stake in several firms that own two office buildings in Munich's Lenbach Gärten quarter, the fund said on Tuesday. The fund purchased the stakes from AM Alpha GmbH for a total consideration of 176.1 million euro, including 75 million euro of third-party debt, it said in a statement.The buildings have 29,000 square meters of total leasable area and are primarily leased to McKinsey & Company Inc. and Condé Nast Verlag GmbH.  

I've been to Norway twice and had a Norwegian boss to boot.  They are easygoing but highly focused folks, so I'm sure their real-estate investments have been thought through. In this day and age, investors for the long haul are to be welcomed like the Norwegians.

Brent Spar 2: Greenpeace, Lego & Shell's Betrayal

♠ Posted by Emmanuel in ,, at 10/15/2014 01:30:00 AM
This WSJ feature is sponsored by, er, Shell.
Environmentalist activists are not infallible despite being ostensibly well-intentioned. Common failings include impractical courses of action as well as those which actually make the situation worse. With regard to the latter, Greenpeace has some history with energy titan Shell. In 1995, Greenpeace singled out Shell for the planned sinking of an exhausted oil platform, Brent Spar. Greenpeace argued that it was better to bring the platform on land and dispose it from there at considerable additional expense. After making a huge racket, Shell eventually bowed to the environmentalists. However, this action was foolish and misguided. In a study published in the prestigious journal Nature, it was explained how sinking the platform into the sea as originally planned was actually the ecologically-friendly alternative:
However, the true scandal may have never made it to the public: In June 1995, a study was published in the scientific journal “Nature”. This study stated that the impact on the environment by sinking the Brent Spar would have been minimal and the authors even said it would have been a gift to the eco-system. In September 1995, Greenpeace had to publish publicly that the 5,500 tons of leftovers of oil they assumed to be in the Brent Spar, was too much. In October 1995, the assessment of the Brent Spar by a Norwegian independent institution found that it was only 75 to 100 tons of oil. This is 1.36% – 1.82% of the amount assumed by Greenpeace. In retrospective, it seems to be true that sinking the Brent Spar would have been the best option, also ecologically.
Good job, Greenpeace. Nowadays, we have "Brent Spar Round 2" as Greenpeace has singled out Shell again for its role in Arctic drilling and targeted Lego for creating toy sets which feature Shell gas stations and the like via a viral YouTube video. Always loving irony, the WSJ feature on this incident was preceded by--you guessed it--a Shell video playing up its alternative energy portfolio (see picture above). Anyway, on to the matter...
A 1-minute, 45-second video has ended a long-term relationship between Lego and Royal Dutch Shell. The Danish toymaker said today that it will not renew a co-promotion deal with Shell, after a Greenpeace video linking Lego with the oil company’s Arctic drilling program went viral.

The video, which shows an Arctic landscape built of Lego blocks being swallowed up in a pool of black oil, “may have created misunderstandings among our stakeholders about the way we operate,” Lego Chief Executive Jørgen Vig Knudstorp said in a statement. Greenpeace has been pressing Lego to end a partnership signed in 2011, in which co-branded Lego toy cars are sold at Shell stations in some countries.

Greenpeace, in a statement on its website, called the decision “fantastic news.” In a statement issued by its London press service, Shell said it did not comment on contractual matters. “Our latest co-promotion with Lego has been a great success and will continue to be as we roll it out in more countries across the world,” the statement said.
I myself have some distaste for Arctic drilling, but I certainly don't think that targeting Lego is ideal. After all, remember that Lego pieces are made of acrylonitrile butadiene styrene (ABS). ABS is a petroleum-based product, i.e. a "petrochemical" derived from fossil fuels.

Lego disowning petroleum-based products is like McDonalds disowning meat production. Ironic, and worst of all, dumb. First off, Greenpeace should not have targeted Lego, a marketer of petroleum-based products. Second, Lego was doubly stupid to give in since it undermines the whole business model of selling petrochemical-based toy elements. Makes you sad, doesn't it?

FX Interventionski: Russian Ruble Amid Oil Rout

♠ Posted by Emmanuel in , at 10/14/2014 01:30:00 AM
Poor Russia; it always pick the worst time to have a crisis. 
The trouble with being a commodity-dependent country is that putting all your eggs in one basket is bound to have deleterious effects when downturns in the prices these commodities command occur. Unfortunately for Russia, its worst downturns coincide with steep falls in commodity prices. In 1998 when it famously went to the IMF poorhouse, oil prices were around $18 a barrel. $20/bbl oil! It almost makes you wish China didn't grow so much, but being a charitable sort, I am thankful for all those Chinese lifted out of poverty over this time. The Russians were also rather grateful as Vladimir Putin became Russian president shortly thereafter, erasing the memory of the traumatic Boris Yeltsin years.

Fast-forward sixteen years and it is Putin's turn in the hot seat. As if ill-advised military adventurism and sanctions weren't enough to deal with, recent evidence of the global economy slowing down is causing oil prices to decline anew. Sure $88/bbl oil doesn't sound so bad compared to $18/bbl oil for producers, but the trouble is that Russian production costs have risen since way back when since it doesn't exactly have Western levels of efficiency. What's more, expectations for turning a profit selling oil overseas was predicated on a rather higher market price. As of last year, it was...
Russia will probably require an average Brent oil price of $117.8 a barrel this year to balance its budget, the fifth straight year it’s needed crude above $100 and compared with break-even prices of $90.3 for Saudi Arabia and $65 for Kazakhstan, Deutsche Bank AG said in a May 10 report.  
This sets the stage for what's happening to Russia at the moment. In advance of the damage sanctions will cause as well as lower oil prices, the ruble has plummeted. Simultaneously, the central bank has been intervening in a big way to stem the currency's downward spiral. How "big"? Try $6 billion for starters:
The ruble extended its longest losing streak in more than a year as $6 billion of Russian currency interventions failed to stem the depreciation amid tumbling oil prices. The ruble weakened 0.6 percent versus the dollar-euro basket to 45.3303 by 6 p.m. in Moscow, taking its seven-day decline to 2.3 percent, the longest stretch of losses since the nine days ended Aug. 1, 2013. Oil, which along with natural gas contributes almost half of Russia’s revenue, fell 2.2 percent to $88.21 per barrel in London, the lowest since December 2010.

Russia’s central bank intervened in the past 10 days to stabilize the currency, central bank Governor Elvira Nabiullina told lawmakers in Moscow today. The action, which comes as President Vladimir Putin orders a withdrawal of Russian forces from Ukraine’s border, has failed to halt the ruble’s drop amid a domestic foreign-currency shortage stemming from sanctions. The cost to swap rubles into dollars widened to a record, while wagers for interest-rate increases climbed to a six-year high.

The main driver for the ruble right now is the oil price,” Dmitry Polevoy, the chief economist for Russia at ING Groep NV, said in an e-mailed note. Crude’s decline “totally eclipses” the “reassuring news” that Russia announced it was pulling back forces from Ukraine’s borders, he said. The ruble slid 0.9 percent to a record 51.3120 versus the euro and lost 0.3 percent to 40.4350 against the dollar.
Russia's $400 billion-something reserves sound impressive until you hear about the rate they're burning cash. I am not entirely surprised that they've pulled back troops from the border with Ukraine with few histrionics. Apparently not even mighty Russia can buck Western hegemony circa 2014. As its currency drops and drops without end in sight, the interim verdict is inevitable -

The West has got Putin by the balls.

US Hates Competition: Killing PRC's World Bank Rival

♠ Posted by Emmanuel in , at 10/13/2014 01:30:00 AM
US seeks to strangle Xi Jinping's baby in its cradle.
The "market" for development lending is dominated by institutions with no small amount of American influence. Remember, the United States always has a say in choosing who gets to be the head of the World Bank, the global development lender. It too is a force to reckon with among regional development lenders--the European Bank for Reconstruction and Development (EBRD), the African Development Bank (AfDB), the Inter-American Development Bank (IADB) and the Asian Development Bank (ADB). Recently I discussed China's plans to create a rival to American hegemony in development lending that focuses on infrastructure projects--something China ought to know a thing or two about--the much-touted Asian Infrastructure Investment Bank (AIIB). If it becomes reality, it would represent a rival to the Asian Development Bank whose joint largest shareholder alongside Japan is the United States.

Or so it would. One of the interesting things happening behind the scenes right now is the United States pulling out all the stops to ensure that the AIIB is stillborn. From the New York Times:
[I]n quiet conversations with China's potential partners, American officials have lobbied against the development bank with unexpected determination and engaged in a vigorous campaign to persuade important allies to shun the project, according to senior United States officials and representatives of other governments involved. Call it the "League of Nations" strategy: strip it of legitimacy by not having participation from respected members of the international community and it will die off soon:
 
The dispute, the latest manifestation of Chinese-American competition in Asia, could escalate in coming weeks, as Beijing pushes to confirm South Korea and Australia as founding partners of the bank in time for Mr. Xi to formally announce it at a summit meeting of Asian leaders in November [APEC 2014 in Beijing]. President Obama is scheduled to attend the meeting, and Washington is pressing the two countries to reject the Chinese plan.
What the US is attempting to do is strong-arm erstwhile allies into not contributing capital to AIIB. Note that among those not solicited are arch-American toady Japan as well as India which it has something of a regional rivalry with:
Beijing has asked dozens of nations to contribute funds to the bank, which it calls the Asian Infrastructure Investment Bank, and hopes it will become a global institution that rivals the World Bank. To give it broader scope, the Chinese have invited and won the support of some wealthy Middle East nations, including Qatar and Saudi Arabia. But if Washington persuades South Korea and Australia to abstain, it would all but ensure membership in the bank would be limited to smaller countries, depriving it of the prestige and respectability the Chinese seek.
 
The United States Treasury Department has criticized the bank as a deliberate effort to undercut the World Bank and the Asian Development Bank, international financial institutions established after World War II that are dominated by the United States and Japan, senior South Korean and Australian officials said. Washington also sees the bank as a political tool for China to pull countries in Southeast Asia closer to its orbit, a soft-power play that promises economic benefits while polishing its image among neighbors anxious about its territorial claims.
The truth of the matter is simpler: despite the doubt and fearmongering Washington wishes to propagate, there are massive infrastructure requirements in the region going forward that will hardly be met by the World Bank and ADB:
But Washington's arguments run up against undisputed needs on the ground in Asia — needs that existing institutions have been unable to meet, some development experts said. The Asian Development Bank estimated in 2009 that the region would need as much as $8 trillion in investments in physical infrastructure by 2020 — an amount that exceeds what it or the World Bank can muster, experts at the two banks said.
Personally, my objections to this American meddling is simpler. Neoliberal policy dialogue spouted by the World Bank and ADB champions the beneficial effects of competition in raising the quality of product or service offerings as well as forestalling monopoly. OK, fine. If this principle holds in development, I do not see why it should not apply to development lending:
A literature review shows that competition policy reforms allow markets to work more efficiently for the benefit of consumers and drive sustainable economic growth. Three main insights emerge: Greater market competition matters for achieving greater innovation, productivity, and economic growth. Policies that help open markets and remove anticompetitive regulations can promote competition, resulting in lower prices and better deals for consumers and firms. And effective enforcement of competition rules across sectors—rather than the pure existence of competition laws—makes a difference in the impact of competition policies.
Bottom line: the US is using anti-competitive practices like strong-arming would-be AIIB contributors [1, 2] to the detriment of alternate sources of much-needed infrastructure funding in our region. As objectionable as the Chinese can be, it is up for would-be borrowers to decide for themselves whether they want to borrow from them instead of the United States.

America, can't you for once mind your own business and allow the "competition" you champion to flourish? Let the best development lender win.

Zimbabwe & 'Global Depopulation Policy' Conspiracy Theory

♠ Posted by Emmanuel in , at 10/12/2014 01:30:00 AM
While I am partial to Latin conspiracy theories which surpass the limits of credulity, I must tell you there are even more outlandish crackpot conspiracy theories out there to captivate the feeble-minded. Among the most fantastical flights of fancy is the so-called "Global Depopulation Policy" supposedly foisted by the United Nations to reduce population growth in poor countries. Aside from developing country groupings at the United Nations like the G-77 never mentioning let alone protesting this nonsense, people with too much free time have spun it a number of ways. Among other alleged means the CIA / NSA / military industrial complex / Trilateral Commission / Club of Rome / Rand Corporation / Goldman Sachs / Carlyle Group / [insert your favorite Master Organization for Global Domination here] use to depopulate poor countries are:
  • civil war
  • famine
  • introducing AIDS to the African continent
  • introducing the Ebola virus to the African continents
Apparently, this nonsense has quite a following, otherwise it would not persist after all these years. Witness this open letter by some guy who claims the British government is out to kill him for Zimbabwe to stop bowing to the wishes on the UN and other agents of global domination:
Zimbabwe was forced into the Global Depopulation Policy in 1978, when the World Health Organization deliberately infected a large number of people with the HIV virus (a bioweapon developed by a cooperative effort between American and Soviet scientists working for the military-industrial complex) under the cover of a smallpox immunization program. As a result, the total fertility rate decreased from 7.3 children per woman in 1980 to 3.4 today, the mortality rate increased from 9 to 15 deaths per 1000 people, and life expectancy for men went down to 44 years and for women to 43 years (from 60 in 1990), the lowest in the world. The HIV/AIDS infection rate in 2001 reached an astounding 34% of the population aged 15 to 49 years and it currently stands at 16%. Given that the population of Zimbabwe is not projected to grow at all over the next 30 years, even though the crude birth rate is twice as high as the crude death rate, one can only surmise that your government is allowing the UN to subvert your people’s reproductive rights and abilities through chemical sterilization programs that are administered under the pretext of improving child and maternal health
Actually, the truth is not out there but right in your face: GET A LIFE. The Man is not keeping you down, but your own delusions. 

[Non-]DISCLOSURE: Despite expressing "attitudes of elegant despair on subprime globalization," be wary since I may actually be a double agent for the running dogs of capitalism who pull the levers of the world economy. Additionally, these posts may be mind-altering distortions conceived by the Syndicate as I help prepare the Earth for eventual alien takeover. I may also be a wanted man since at least eighty (at last count) governments have marked me for immediate liquidation.