Money & Markets Report: March 3, 2022

Theme: Meet the New War – Risk ON

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257 Comments

  1. What sanction can EU impose? I live in EU. Went to a hypermarket and checked the labels to see how many products are Made in EU or Made in USA. Even American and European brands are made in Asia. Could not find anything from USA or Canada. Of course Japan, S.Korea, Thailand.. will block exports. Russia will be forced to buy Chinese equivalent. For now, China needs Russia, otherwise they are alone.
    Before 2014, Russia imported food from EU. Now they are bigger exporter of wheat. They still import cars, wine, french cheese .. nothing essential. They can drive Lada and eat homemade cheese. Everything that USA produces they can download from torrents.

    What if Russia ask payment for gas in yuan or rubles? Or gold. Doubt they will accept bitcoin.

    Off Topic:
    I worked for a German corporation. Few years ago they announced that 20 new locations will open worldwide. one in Romania, 19 in China. Downsizing in Germany.

    1. a massive expat exodus has happened in china since covid border restrictions. french school has closed one campus in shanghai, and at the german school 2/3 of pupils are dual passport chinese kids who do not speak german. for foreign companies, new staff has difficulty getting themselves and their families into the country, and old staff is eager to get out because they haven’t seen their families in 2 years. quarantine is rumored to be up to 21 days, plus 7 more days home observation. that is a month in isolation, with a risk for longer quarantine in case of a positive covid test.

      difficult to see the expat population returning to what it was in 2019. the question i imagine the foreign corps are asking themselves is, can we keep investing and running these operations with no oversight except local management?

    1. Also Germany and France being separated.

      > There are future weapons contracts for US and UK military contractors at stake here, as well as France’s desires to become a major player in European arms sales … The European Union is looking for ways to assert its independence from Washington D.C.

      Germany will now be buying more US equipment, https://www.reuters.com/business/aerospace-defense/germany-hike-defense-spending-scholz-says-further-policy-shift-2022-02-27/

      > Germany has long resisted pressure from the United States and others to raise its defence spending to 2% of economic output in the light of its 20th century history and resulting strong pacifism among its population … Scholz said the government had decided to supply 100 billion euros for military investments from its 2022 budget. Germany’s entire defence budget by comparison was 47 billion euros in 2021 … Germany could purchase U.S. F-35 fighter jets built by Lockheed Martin (LMT.N) to replace its ageing Tornado in the role of nuclear sharing, Scholz said.

    1. The WHO website has video of the initial meeting. Subsequent meetings have seen lack of consensus: https://subscriber-input.solari.com/forums/topic/november-29-2021-the-day-of-the-world-coup-detat-by-who/

      “The EB report from the Working Group on Strengthening WHO Preparedness and Response to Health Emergencies (WGSWP) was nine pages at the start of the group’s meeting last week – but the latest version is down to six pages. The entire clause that suggested that the WHO should have speedy access to disease outbreak sites has been removed – at the insistence of China, diplomatic sources told Health Policy Watch.”

  6. So if china decides to invade Taiwan, what’s the odds of the US getting involved? Wouldn’t the US step in to defend the dollar?

    Can the dollar survive as the worlds reserve currency if china takes Taiwan?

    1. READ “UKRAINE IS THE FINANCIAL WATERLOO OF THE WEST”
      THERE IS A LOT GOING ON!!
      ALSO ANYONE SUGGEST A RELIABLE PLACE TO DONATE FOR THE UKRAINE CAUSE&EVACUATION EFFORTS?
      PRAYERS GOING OUT TO THOSE SUFFERING ALL OVER INCLUDING OURS HERE

      1. My best friend is Ukranian, in CA, and is sending $$ to her niece who is distributing it to about 20 families there for food and warm clothes. Let me know if you want to connect with her.

    2. Look at the recent failure of the Nvidia-Arm merger, where (a) Arm China “went rogue” and (b) US-based Nvidia had months of access to Arm for pre-merger due diligence. Arm-based chips are in every phone. Is the end result that some UK Arm IP has also been shared/forked with US and China?

      TSMC (Taiwan) is building plants in Arizona and the EU. Recent graduates of TSMC are now in Taiwan for 18-months paid cultural and technical training, before they return to US mainland to operate the TSMC fab. TSMC expertise is being shared/forked with US and EU. Presumably China already has close ties.

      What’s the long-term result? Key technology and financial pillars are being duplicated across blocs of a future multipolar world. Subsequently, they can compete and diverge from this common starting point. Are these expensive exercises in duplication an indicator of future poli-tech-fin-bio borders?

      1. of course they are. since industrial capacity benefits from economies of scale, a financial question would be, if this tech industrial capacity is duplicated or triplicated in, say USA / asia / europe, what will the financial effects be? assume raw materials will go up as multiple producers compete for the same materials, while the end products would be in over supply and hence sold at no profit or even below cost. the supply demand for these products would be outside of laws of typical supply / demand.

        and then you get to the question, which population can subsidize the losing industries the longest.

        its almost a 1984 type result where the living standard of the population declines in support of a never ending war effort.

        and the winners are those whose corporate champions turn out to be the best at producing products of digital slavery.

        1. If smart cities ever became real, the demand for semiconductors could far exceed anything that exists today, at least for the initial build-out. For smart cities in competing “empires”, it may be beneficial to have different silicon foundations. E.g. Starlink poached Broadcom engineers to build their own custom silicon for Starlink satellites, instead of buying existing chips from Broadcom.

          So yes, a multi-polar world would have reduced economy of scale for end products, and increased competition for raw material inputs. Perhaps such things matter less in a centrally planned economy with unlimited digital fiat for control and incentives. There is also a slow but steady push for “right to repair” legislation in both the US and EU, which could nudge the consumer electronics industry away from planned obsolescence and frequent hardware upgrades.

          I don’t quite understand the simultaneous push towards “centralized world government” and multipolar empires. Is multi-polarity just a phase before a new and larger unipolar world, controlled by the winner of the multi-polar conflict?

  7. There are many good points in this text and 9-min video, but it’s potentially a “whataboutism” mind-control vehicle to convince Western populations that they are guilty of destroying their own democracies, since they historically accepted the fruits of poisoned labor from non-democratic states.

    This allows the Ukraine crisis to continue the Covid destruction of nation-state citizens’ trust in elected representatives and journalistic sense-making, which wasn’t high pre-Covid. Loss of trust in human representatives lays the groundwork for world government by AI, smart contracts and crypto-finance, with a rise of smart city human mayors as the public face.

    https://www.gbnews.uk/gb-views/neil-oliver-we-watch-ukraine-and-russia-but-at-the-same-time-we-should-watch-what-our-leaders-are-up-to-here-in-the-west/235533

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