Category Archives: Trade

“Social Peace Is In Great Danger”: Germany Is Quietly Shutting Down As Energy Crunch Paralyzes Economy, by Tyler Durden

Posted on July 9, 2022 | Leave a comment

And its all self-inflicted. From Tyler Durden at zerohedge.com:

Earlier today we wrote that Germany’s largest landlord, Vonovia, had taken the unprecedented step of restrictring heating at night, a terrifying preview of what lies in stock for the “most advanced” European nation this winter. Alas, it’s going to get worse, much worse.

According to the FT, Germany is now rationing hot water, dimming its street lights and shutting down swimming pools as the impact of its energy crunch begins to spread like the proverbial Ice-Nine wave, from industry to offices, leisure centers and residential homes.

The reason behind Germany’s slow motion paralysis is well-known: the huge increase in gas prices triggered by Russia’s move last month to sharply reduce supplies to Germany has plunged Europe’s biggest economy into its worst energy crisis since the oil price shock of 1973 (see “What’s Unfolding In Europe In Recent Days Is A Fresh Big Negative Supply Shock“)

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NATO’s Banana Blockade, by Declan Hayes

Posted on July 8, 2022 | 2 comments

If we can just keep Russian kids from getting bananas, Ukraine will win the war. From Declan Hayes at strategic-culture.org:

The world is at a critical inflection point as it pits the children of Ecuador, Paraguay, Russia, China, Vietnam, Gaza, the Philippines and Syria against Del Monte, Hunter Biden and Liz Truss in a fight to the death with only one winner.

As fierce fighting continues in Ukraine and British Foreign Secretary Liz Truss determines to arm Taiwan to fight China, Ecuadorian bananas have found themselves smack in the center of NATO’s campaign to crush Russia. The key to getting Russia to hoist the white flag and surrender her bountiful resources to the Anglo American alliance is, it seems, not only to deprive Russia of Ecuador’s bananas but to ensure the Russians cannot source their banana supply elsewhere.

If truth has been the first casualty of NATO’s Ukrainian war Ecuador, it seems, must be the second. In 2021, Ecuador received $706 million for exporting bananas to Russia, $142 million for shrimp, $99 million for flowers, $28 million for fish, and $17 million for coffee. Russia accounted for 20% (about 85 million boxes) of the total volume of Ecuador’s exported bananas. Now, as there is nowhere to sell and store them, those 85 million boxes, like so much of Latin America’s other embargoed produce, must be destroyed on Uncle Sam’s ignorant orders.

Ecuador is not NATO’s only innocent victim. Paraguay, one of Latin America poorest countries, was a major exporter of cattle meat to Russia; in 2021, it exported 79,213 tons of cattle meat to Russia, for which Paraguay received $314 million, chicken feed to NATO but critical foreign currency to Paraguay.

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California Trucking Prepares For “Radically New World” Under Independent Contractor Law AB5, by John Kingston

Posted on July 2, 2022 | Leave a comment

Now California is trying to turn independent contractors into employees and raise business costs, particularly those of the trucking companies. Many will join he exodus of companies leaving the state. From John Kingston at Freight Waves via zerohedge.com:

It is going to be a radically new world in California’s trucking sector with the imposition of AB5, and it isn’t clear what parts of the industry — if any — are ready for it.

“Most immediately, motor carriers must evaluate and adopt alternative operating models to mitigate risk if they intend to continue to do business in California” was the admonition from the Benesch law firm in the wake of the Supreme Court decision in the case of California Trucking Association vs. (state Attorney General) Bonta. The decision opens the door for the imposition of AB5, the law on independent contractors that leans heavily toward classifying workers as employees rather than ICs.

“Motor carriers should immediately evaluate their California operations to determine what steps, if any, should be taken to respond to the changed backdrop for trucking” was the call to action from the trucking-focused Scopelitis law firm.

On the other side of the divide, there was celebration, including a victory lap by Lorena Gonzalez, the former and future labor leader who successfully pushed for AB5’s passage in the California legislature in 2019.

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Farm equipment is scarce and pricey. The John Deere strike has farmers worried. By Phil McCausland

Posted on June 29, 2022 | Leave a comment

This is a representative instance of what’s going on out there in the real economy. From Phil McCausland at nbcnews.com, h/t Hardscrabble Farmer at The Burning Platform:

Farmers say they sympathize with the desire for better wages, but they face equipment and parts shortages. A long strike could affect the food supply chain and their bottom lines.

Joel Everett said he was astounded when a lightly used 2009 John Deere tractor sold at his last auction in Strawberry Point, Iowa, for tens of thousands of dollars more than it had cost fresh off the production line more than a decade ago.

Bought new for $109,000, the tractor sold for $143,000 at auction, he said. It’s not an isolated incident, said Everett, who has run Joel’s Tractor and Auction since 1992. A lot of farm equipment, particularly used tractors, is selling for 30 percent to 50 percent more than it was two years ago at his auction house.

“It’s been unreal,” Everett said. “Our last sale was the biggest dollar sale we ever had, and we’re fixing to have another in three to four weeks that’s going to blow that one away.”

Quality farm equipment is getting hard to find amid the supply chain shortage, many farmers and experts said, and its scarcity is driving up prices and raising questions about whether farmers’ harvests and next year’s planting season could be affected.

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BRICS Summit Reaffirms That Russia Not As Isolated As NATO Suggests, by Tyler Durden

Posted on June 28, 2022 | Leave a comment

You’ve got something when you’ve got over half the world’s population and well over half the world’s natural resources either tacitly or explicitly on your team. From Tyler Durden at zerohedge.com:

The recent BRICS summit managed to run its course this past week with very little fanfare, despite the fact that Russia is in the midst of a conflict with Ukraine that has led to a worldwide economic war. China is edging towards a potential invasion of Taiwan, and much of the planet is in the middle of a stagflationary crisis in the meantime.

The one major takeaway from the summit was the reaffirmed stance of the BRICS that they would continue to work closely with Russia in economic terms.

Since the beginning of the invasion of Ukraine, there has been a running narrative in the western media that sanctions and the removal of Russian access to the SWIFT network would crush the country within a few months, leaving them penniless and unable to project military power.  This has not happened.

A picture was painted by journalists and politicians of a completely isolated Russia, destroyed by a global cancel culture campaign that would de-nation them.  In reality, Russian trade, specifically their oil trade, has actually expanded.  Both China and India have increased their purchases of Russian oil while enjoying discounted prices.  Simultaneously, Europe and the US are suffering from oil and gas inflation and the EU is cutting vital oil and gas supplies from Russia.

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Zugzwang*, by Alasdair Crooke

Posted on June 23, 2022 | Leave a comment

The failure to recognize their own economic vulnerabilities more than anything marks a complete failure to think by the West’s supposedly leading lights. From Alasdair Crooke at strategic-culture.org:

Europe’s future looks bleak. It is now pressed by its own imposition of sanctions, and the resultant spike in commodity prices. The EU is lumbering around in a daze.

Western self-destruction – a puzzle defying any unique causal explanation – continues. The examples where policy is pursued in apparent indifference to anything resembling rigorous reflection, has become so extreme as to provoke a former British military chief (and former head of NATO forces in Afghanistan), Lord Richards, to huff that the relationship between strategy and any synchronisation of ends has become hopelessly broken in the West.

The West pursues a “let’s see how it goes” ‘strategy’, or in other words, no real strategy at all, Richards contends. Many would say that a cult of unrelenting, untethered, positive spin, has asphyxiated mainstream critical faculties. How is it that the West, awash with ‘think-tanks’, invariably gets it so wrong? Why is it that facile memes and illusions, posing as geo-politics, get little or no challenge? Compliance to official and mainstream narratives is all. It is baffling to observe this becoming routine, without apparent cognizance of the risks which this entails.

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Russia Overtakes Saudi Arabia As China’s Top Oil Supplier, by Tsvetana Paraskova

Posted on June 22, 2022 | Leave a comment

Those sanctions are just killing the Russians. From Tsvetana Paraskova at oilprice.com:

  • Chinese imports of Russian crude surged by 55 percent in May as the world’s biggest importer of oil took advantage of major discounts.
  • Russia has now overtaken Saudi Arabia as China’s top oil supplier.
  • While Russia is sending lots more crude to Asia, it is unlikely that the Asian market can absorb all 4 million barrels that were going to Europe.

China imported a record volume of Russian crude in May, with arrivals surging by 55 percent to nearly 2 million barrels per day (bpd). This has made Russia the top oil supplier to the world’s leading crude importer—putting it ahead of Saudi Arabia for the first time in a year and a half.   A record volume of cheap Russian oil, which sells at steep discounts to crude from other countries, made its way to Chinese refiners last month, according to figures from China’s General Administration of Customs cited by Reuters.

China imported 1.98 million bpd of Russian crude oil in May, up by 55 percent from May last year and up from 1.59 million bpd of Russian oil imported in April 2022, the data showed.

The high purchases of Russian oil outstripped supply from Saudi Arabia, Russia’s partner in the OPEC+ deal. Chinese imports of Saudi crude averaged 1.84 million bpd in May, up by 9 percent compared to May 2021, but down from 2.17 million bpd imported in April, according to the data cited by Reuters.

Thanks to the increased shipments of cheap crude to China, Russia became the top supplier to the world’s biggest oil importer for the first time in 19 months, per Reuters estimates.

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A Permanent Shortage of Everything, by Daniel Greenfield

Posted on June 21, 2022 | Leave a comment

The only things that are not in short supply are governments, NGOs, and bureaucrats. From Daniel Greenfield at gatestoneinstitute.org:

Globalists were wrong. The world isn’t flat.

  • The world isn’t flat, it’s all too round…. That’s why Islam is once again at war with Europe, Russia is invading Ukraine, China is relaunching its empire, and the ‘flatland’ is experiencing a dimensional shift.
  • Globalization advocates had just recreated Marxist central planning with a somewhat more flexible global model in which massive corporations bridged global barriers to create the most efficient possible means of moving goods and services around the planet. Borders would come down and cultural exchanges would make us all one ushering in the great union of humanity.
  • Market consolidation due to government regulations has left a handful of companies sitting atop the market. When one of them, like Abbott for baby formula, has a hiccup, the results are catastrophic; others like Procter & Gamble, which controls about half the menstrual products market, don’t have to worry about losing market share to competition. Similar consolidation in food, paper products and supermarkets have replaced a dynamic economy with cartels.
  • Behind all the brands on the product shelves is a creaky Soviet system in which a handful of massive enterprises interconnected with the state lazily crank out low-quality products from vast supply chains that they no longer control and feel little competitive pressure to perform better. The only thing that is still American about the supermarket experience is the advertising.

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Posted in Business, Civil Liberties, Collapse, Economics, Economy, Governments, Media, Politics, Propaganda, Trade, War

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Meet the New Boss; Putin Reroutes Critical Hydrocarbons Eastward Leaving Europe High-and-Dry, by Mike Whitney

Posted on June 16, 2022 | Leave a comment

Putin is indeed giving Europe the energy middle finger. From Mike Whitney at unz.com:

“Rejection of Russian energy resources means that Europe will become the region with the highest energy costs in the world. This will seriously undermine the competitiveness of European industry which is already losing the competition to companies in other parts of the world…. Our Western colleagues seem to have forgotten the elementary laws of economics, or simply prefer to ignore them.” Vladimir Putin, President of the Russian Federation

On Tuesday, Russia announced a 40% reduction in the flow of natural gas to Germany through the Nord Stream pipeline. The announcement, that was made by Gazprom officials, sent tremors through the European gas market where prices quickly soared to new highs. In Germany—where prices have tripled in the last three months—the news was met with gasps of horror. With inflation already running at a 40-year high, this latest reduction in supply is certain to tip the German economy into recession or worse. All of Europe is now feeling the impact of Washington’s misguided sanctions on Russia. Here’s more from Oil Price website:

“Russia’s Gazprom said on Tuesday that it would limit natural gas supply via the Nord Stream pipeline to Germany by 40 percent compared to planned flows because of a delay in equipment repairs… The lower supply of gas via Nord Stream to the biggest European economy, Germany, sent Europe’s gas prices surging by double digits...

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Posted in Economics, Economy, Energy, Eurasian Axis, Foreign Policy, Geopolitics, Governments, History, Politics, Propaganda, Trade, War

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The ‘New G8’ Meets China’s ‘Three Rings’, by Pepe Escobar

Posted on June 16, 2022 | Leave a comment

Much of the world is not just turning its back on the U.S., it is constructing an alternative order. From Pepe Escobar at thesaker.is:

The coming of the new G8 points to the inevitable advent of BRICS +, one of the key themes to be discussed in the upcoming BRICS summit in China.

The speaker of the Duma, Vyacheslav Volodin, may have created the defining acronym for the emerging multipolar world: “the new G8”.

As Volodin noted, “the United States has created conditions with its own hands so that countries wishing to build an equal dialogue and mutually beneficial relations will actually form a ‘new G8’ together with Russia.”

This non Russia-sanctioning G8, he added, is 24.4% ahead of the old one, which is in fact the G7, in terms of GDP in purchasing power parity (PPP), as G7 economies are on the verge of collapsing and the U.S. registers record inflation.

The power of the acronym was confirmed by one of the researchers on Europe at the Russian Academy of Sciences, Sergei Fedorov: three BRICS members (Brazil, China and India) alongside Russia, plus Indonesia, Iran, Turkey and Mexico, all non adherents to the all-out Western economic war against Russia, will soon dominate global markets.

Fedorov stressed the power of the new G8 in population as well as economically: “If the West, which restricted all international organizations, follows its own policies, and pressures everyone, then why are these organizations necessary? Russia does not follow these rules.”

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