Risk

[noirua]

You can stay here for 50c a night:

 

[timer]

Warning ….Please Read
Remember all the scamming related to Share Express..well they have gone but have been reinvented under different names but with the same financial backer..Olive Financial Markets....please read the following which I have taken from another article...

1. Surfers Paradise: The Gold Coast is a hotspot for financial scams in Australia.
2. Ricarmo Pty Ltd is an "Authorised Representative", or if you like, it is legally registered to provide financial advice, though it's Financial Services Guide provided by a company called Olive Financial Markets Pty Ltd of 87-97 Liverpool Street, Sydney www.ricarmo.com.au/wp-content/themes/ricarmo/pdf/OliveFinancialMarketsFSGOctober2017.pdf
3. Olive Financial Markets Pty Ltd www.olivefinancialmarkets.com.au/contact-us/ has other Authorised Representatives who are Gold Coast based managed superannuation advisors, including:
4. Camori Pty Ltd https://camoriinvestments.com.au (see home page footer for it's Authorised Representative number). Although Camori operates out of the Gold Coast, it gives it's address as identical to that of Olive Financial Markets Pty Ltd in Sydney.
5. Paradise Financial Group also operates out of the Gold Coast but gives the same street number address http://www.paradisefinancial.com.au/#5 as Olive Financial Markets Pty Ltd in Sydney.
6. Sharescope http://www.sharescope.com.au owned and run by Markets Pty Ltd is another business which uses Olive Financial Markets Pty Ltd's Financial Services License (if you check the Australian Financial Services License number that they give against the ASIC register). Interestingly, they are at No. 89 Liverpool Street but in an identical Suite Number. Oh! No. 87 and No. 89 are the same building, so it's actually the exact same office as the others despite the different street number! Tricky!
7. Ricarmo Pty Ltd gives its address as
   The Gateway, Ground Floor,
   50 Appel Street,
   Surfers Paradise, QLD, 4217
8. It so happens that ASIC raided three businesses at this address (see next item for how we know this) a month ago, as part of an investigation into investment fraud: (www.afr.com/brand/rear-window/asic-sends-police-to-almost-raid-channel-seven-20170920-gylewt – Paywall, but you should get one look for free; or www.goldcoastbulletin.com.au/business/detectives-raid-surfers-paradise-businesses/news-story/6bd9fa317c8a2ca34b0b6e20bfbdd5e3)
9. Only two of the three businesses are named in the stories viz. Camori Investments and Paradise Financial Group. The third business is unknown, but if you check the White Pages for Channel 7 (bear with me!), you'll see that Channel 7 is in the same building as Ricarmo. Now, if you've been reading carefully, you'll remember that the AFR story in the previous item says that the Camori/Paradice Financial raid was on Channel 7's Gold Coast building. So, it does look likely that Ricarmo is that mysterious third company that was raided in that office. To sum up, Ricarmo is an Authorised Representative of Olive Financial, which in turn, shares an office and a building with the two raided companies back in Sydney, as, it appears, does Ricarmo share with them their raided operational office on the Gold Coast. So many coincidences!

You'll also find negative reviews for a number of the companies above on the web if you Google them. All in all, with so many risk factors, maybe it's worth waiting until ASIC puts out an all clear before giving them your hard earned cash!

 

[basilio]

What does risk look like world wide ? This graph was produced at the start of 2021

Visualized: A Global Risk Assessment of 2021 And Beyond

Which risks are top of mind in 2021? We visualize the World Economic Forum's risk assessment for top global risks by impact and livelihood.

www.visualcapitalist.com

 

[Dona Ferentes]

What does risk look like world wide ? This graph was produced at the start of 2021

and now it's 2022 and I bet the relativities have changed.


1. Last Wednesday, a few hours before Russian tanks began rolling into Ukraine, alarms went off inside Microsoft’s Threat Intelligence Centre, warning of a never-before-seen piece of “wiper” malware that appeared aimed at the country’s government ministries and financial institutions.

Within three hours, Microsoft threw itself into the middle of a ground war in Europe — from 5,500 miles away. The threat centre, north of Seattle, had been on high alert, and it quickly picked apart the malware, named it “FoxBlade” and notified Ukraine’s top cyberdefence authority. Within three hours, Microsoft’s virus detection systems had been updated to block the code, which erases — “wipes” — data on computers in a network.

2. Koda Capital is in full mea culpa mode after a private note urged clients to fill their boots with “disproportionately oversold” Russian stocks, which the firm argued are “well-placed to cope with current and likely future sanctions”. Cue outrage.

Setting aside the moral implications of a wealth manager pointing its nearest and dearest into an underweight war thematic, there’s the minor issue of its general advisability.

Major asset managers all over the world are yanking their capital from Russian investments and index providers are axing them from emerging market benchmarks.

“The Russian market is effectively closed,” Dimitris Melas, chairman of MSCI’s index policy committee, told the Financial Times on Tuesday. “It is now uninvestable.”

Koda Capital’s crazy Russia bet

Introducing Koda’s Russian fund manager of choice, Prosperity Capital.

www.afr.com

.................. I hope their Risk Disclosure bit at the back of their documents is thorough. "Hello, Shine Lawyers?"

 

[Garpal Gumnut]

and now it's 2022 and I bet the relativities have changed.


1. Last Wednesday, a few hours before Russian tanks began rolling into Ukraine, alarms went off inside Microsoft’s Threat Intelligence Centre, warning of a never-before-seen piece of “wiper” malware that appeared aimed at the country’s government ministries and financial institutions.

Within three hours, Microsoft threw itself into the middle of a ground war in Europe — from 5,500 miles away. The threat centre, north of Seattle, had been on high alert, and it quickly picked apart the malware, named it “FoxBlade” and notified Ukraine’s top cyberdefence authority. Within three hours, Microsoft’s virus detection systems had been updated to block the code, which erases — “wipes” — data on computers in a network.

2. Koda Capital is in full mea culpa mode after a private note urged clients to fill their boots with “disproportionately oversold” Russian stocks, which the firm argued are “well-placed to cope with current and likely future sanctions”. Cue outrage.

Setting aside the moral implications of a wealth manager pointing its nearest and dearest into an underweight war thematic, there’s the minor issue of its general advisability.

Major asset managers all over the world are yanking their capital from Russian investments and index providers are axing them from emerging market benchmarks.

Koda Capital’s crazy Russia bet

Introducing Koda’s Russian fund manager of choice, Prosperity Capital.

www.afr.com

.................. I hope their Risk Disclosure bit at the back of their documents is thorough. "Hello, Shine Lawyers?"

Thanks @Dona Ferentes .

I was thinking similarly when reading the AFR this morning.

Having been involved in many risk/benefit analyses in life it was always easier to make a benefit analysis.

Le cygne noir always lurked for risk.

Ask the little old lady sitting on the bench outside Coles is as good a risk analysis as you will get atm and much cheaper.

gg

 

[Garpal Gumnut]

I see nothing but Risk atm. starting with Europe.

Europe :
War
Refugees
Oil
Food
Industrial Production
Supply chain
Climate/Weather
Covid resurgence

USA :
Political instability
Stagflation
Supply chain
Taiwan/South Korea Protection/War
Social conflict as in Rich/Poor Black/Other Religious Right/Modernity
Further China disagreements, not war (yet).
Covid resurgence

Asia. :
China hegemony
China market for our exports
N Korea
China/India mini-wars
Refugee crisis ( Rohyngia, India internal, India Kashmir, )

South America : Don't know much about them. Political foment. Rich/Poor.

Africa : Don't know much about them. Political foment. Rich/Poor.

Australia/NZ/Pacific : China hegemony,
Iron/Coal exports,
Poor political leadership.
Corruption of Politicians.
Global risk to products of our quarry,
Climate change.

I liquidated my Trading Portfolio in to Cash last week.

I'll have a look at the ASX stocks in my SMSF at 11.30 am tomorrow when all the madmen have done their bit with downsies and upsies and make some decisions.

I certainly won't be buying.

gg

 

[frugal.rock]

I certainly won't be buying.

I did a bit of buying on Friday... fwiw.

Most of what you mentioned is priced in... said with trader tongue in cheek, unless things take a turn for even worse in Europe.
Hopefully not, for everyone's sake.

 

[Garpal Gumnut]

I did a bit of buying on Friday... fwiw.

Most of what you mentioned is priced in... said with trader tongue in cheek, unless things take a turn for even worse in Europe.
Hopefully not, for everyone's sake.

A reasonable point.

Although the inputs in to decision making are changing much more rapidly.

I've got a bad feeling atm.

It's just the Vibe. The Constitution. Mabo.

I just thought I'd throw in my 2c worth and get a discussion going on Global Market Risk.

gg

 

[moXJO]

I was interested in a few Chinese stocks the other day that have all run up now. Just a bit worried the US will sanction China if they supply the Russians.

 

[moXJO]

Another thing coming up is the Russian debt obligation. I think they paid in the region of 180million just recently and have a $630million coming up. I think they said they were paying in rules but the interest has to be US $.

So it potentially has a default smell to it

 

[Garpal Gumnut]

Another thing coming up is the Russian debt obligation. I think they paid in the region of 180million just recently and have a $630million coming up. I think they said they were paying in rules but the interest has to be US $.

So it potentially has a default smell to it

Inflation is what the big guys tell us will cause a panic rather than a billion or so in defaults.

I'm watching but still inclined to stay in the market.

gg

 

[Country Lad]

So it potentially has a default smell to it

Russia of course has plenty of gold bullion.


BUT, - not much good to them if they can't use it

And like oil, Russia holds some of the world's largest reserves of gold — some 2,300 tons of it, worth nearly $140 billion.
The huge reserves of the precious metal were built up over the past decade and a half, and were intended to be a sort of economic insurance policy for the country.
But as with oil, sanctions are making it incredibly difficult for Russia to actually realize the value of its holdings.
"This is why they bought their gold, it was for a situation just like this," Cork University Business School lecturer Fergal O'Connor told Bloomberg. "But if no one will trade it with you, it doesn't matter."
Last week, London's gold marketplace — the most important center in the world for bullion — banned all bars from Russian refineries, effectively shutting it out of the global trade.
The US Senate followed that move with a new bill that would prohibit US citizens from making any transaction that involves Russian gold.
"Russia's massive gold supply is one of the few remaining assets that Putin can use to keep his country's economy from falling even further," Maine Sen. Angus King said in a statement. "By sanctioning these reserves, we will further isolate Russia from the world's economy and increase the difficulty of Putin's increasingly-costly military campaign."

 

[Garpal Gumnut]

Russia of course has plenty of gold bullion.

View attachment 139296
BUT, - not much good to them if they can't use it

And like oil, Russia holds some of the world's largest reserves of gold — some 2,300 tons of it, worth nearly $140 billion.
The huge reserves of the precious metal were built up over the past decade and a half, and were intended to be a sort of economic insurance policy for the country.
But as with oil, sanctions are making it incredibly difficult for Russia to actually realize the value of its holdings.
"This is why they bought their gold, it was for a situation just like this," Cork University Business School lecturer Fergal O'Connor told Bloomberg. "But if no one will trade it with you, it doesn't matter."
Last week, London's gold marketplace — the most important center in the world for bullion — banned all bars from Russian refineries, effectively shutting it out of the global trade.
The US Senate followed that move with a new bill that would prohibit US citizens from making any transaction that involves Russian gold.
"Russia's massive gold supply is one of the few remaining assets that Putin can use to keep his country's economy from falling even further," Maine Sen. Angus King said in a statement. "By sanctioning these reserves, we will further isolate Russia from the world's economy and increase the difficulty of Putin's increasingly-costly military campaign."

Russia may be forced to swap or use Gold contracts to maintain their armaments and economy, both of which Putin has shredded.

Mr. Market seems to have priced this in. And is still doing so.

Gold may fall back to support at $USD1750 to $USD1800.



gg

 

[Dona Ferentes]

I see nothing but Risk atm. starting with Europe.

Europe :
War
Refugees
Oil
Food
Industrial Production
Supply chain
Climate/Weather
Covid resurgence

USA :
Political instability
Stagflation
Supply chain
Taiwan/South Korea Protection/War
Social conflict as in Rich/Poor Black/Other Religious Right/Modernity
Further China disagreements, not war (yet).
Covid resurgence

Asia. :
China hegemony
China market for our exports
N Korea
China/India mini-wars
Refugee crisis ( Rohyngia, India internal, India Kashmir, )

South America : Don't know much about them. Political foment. Rich/Poor.

Africa : Don't know much about them. Political foment. Rich/Poor.

Australia/NZ/Pacific : China hegemony,
Iron/Coal exports,
Poor political leadership.
Corruption of Politicians.
Global risk to products of our quarry,
Climate change.

I liquidated my Trading Portfolio in to Cash last week.

I'll have a look at the ASX stocks in my SMSF at 11.30 am tomorrow when all the madmen have done their bit with downsies and upsies and make some decisions.

I certainly won't be buying.

gg

I think the big risk at present is the bifurcation of global systems into what is conveniently if perhaps misleadingly called:
1. The 'Rule of Law' nations, usually liberal democracies
2. The autocracies that can verge on kleptocracies.

The first tend to be more effective and efficient, forming alliances and with a basis of trust oiling the cogs.

Gnawing away as risks in 1) are the actions of some, often the self appointed 'entitled ones' resorting to lawfare and other coercive actions.

 

[divs4ever]

Russia of course has plenty of gold bullion.

View attachment 139296
BUT, - not much good to them if they can't use it

And like oil, Russia holds some of the world's largest reserves of gold — some 2,300 tons of it, worth nearly $140 billion.
The huge reserves of the precious metal were built up over the past decade and a half, and were intended to be a sort of economic insurance policy for the country.
But as with oil, sanctions are making it incredibly difficult for Russia to actually realize the value of its holdings.
"This is why they bought their gold, it was for a situation just like this," Cork University Business School lecturer Fergal O'Connor told Bloomberg. "But if no one will trade it with you, it doesn't matter."
Last week, London's gold marketplace — the most important center in the world for bullion — banned all bars from Russian refineries, effectively shutting it out of the global trade.
The US Senate followed that move with a new bill that would prohibit US citizens from making any transaction that involves Russian gold.
"Russia's massive gold supply is one of the few remaining assets that Putin can use to keep his country's economy from falling even further," Maine Sen. Angus King said in a statement. "By sanctioning these reserves, we will further isolate Russia from the world's economy and increase the difficulty of Putin's increasingly-costly military campaign."

Chinese and Indians LOVE gold they will even risk long prison sentences to smuggle it in , and those two nations alone are about one-third of the global population

gold will be fine

those bits of paper ( promises of things that might be ) might have the problems

 

[noirua]

 

[noirua]

 

[Dona Ferentes]

There's no real geopolitics thread... I don't want to land this in one of the Trump threads as it would be lost. Searched hegemony, and here are. It is American.

​

A Geopolitical Tale: How We Got Where We Are​

by George Friedman​

This is the story of how we got to a moment in history defined by global and national crises. It is the story about how a radical geopolitical transition is taking place as old socio-economic and institutional cycles in the US end and new ones begin. But there is also a massive global geopolitical crisis taking place. The story is long and complex. I wish it were shorter, but the complexities are such that there is no way to tell it simply. It began 80 years ago and brings us to our current crises. We are in the storm before the calm, and it’s as intense as storms can be.
During the Cold War, the geopolitical system had an anchor: the confrontation between the United States and Soviet Union. All other nations had three options. They could align with the US, align with the Soviet Union, or be neutral. This did not define all international activity, of course, but the Cold War set the rules around which international activity took place. The Cold War was based on the assumption that a Russian invasion of Western Europe was a genuine threat to the US, and that NATO and US forces were therefore indispensable. If anything, they might have been insufficient to stop a determined Russian assault, or so the thinking went.

The Cold War did not end with the fall of communism; it ended with Russia’s invasion of Ukraine in 2022. Some say Russia intended only to seize the parts of Ukraine it now holds. But this belies the nature of the invasion. Russia invaded Ukraine on four axes: an attack from the east, a second thrust from the north down the country’s center, a third from the north meant to occupy the capital, and a fourth one from the south. It was an all-out attack whose only purpose was to occupy the whole of Ukraine. Had Russia’s intentions been more measured, Moscow might have massed its forces against Eastern Ukraine. But that isn’t what it did.

This is important to the new geopolitical reality because the Russian invasion, in no uncertain terms, failed. It failed so badly that Vladimir Putin sent in mercenaries from the Wagner Group to bolster Russia’s conventional military. The mercenaries feuded with, but were not completely under the command of, Russian military leaders. So bad was the animosity between them that the Wagner Group staged an insurrection against Putin. This, too, failed, leading to the group leader’s death in a plane crash some weeks later.
Russia’s failure to rapidly subdue Ukraine, a much smaller and seemingly weaker country, was the point at which the Cold War really ended. After three years of war, it was clear that Russia was not the threat many had believed. Ukraine may have been receiving weapons and supplies from the West, but there were no Western troops on the ground. It became clear that the foundation of the Cold War—the Russian capacity to invade and occupy Western Europe—was not possible without radical reconstruction that would take many years to achieve. And perhaps not even then. The war in Ukraine showed that Russia could not invade and occupy Europe.

From the 1940s to the 1990s, the US justified its defense of Europe on moral grounds. It was framed as liberal democracy against tyrannical communism. This was true but not the whole truth, which lay in the geopolitical imperatives of the US—imperatives deeply embedded in US strategic reality. That reality rested on US geography.
The US is the dominant power in North America by massive degrees. It is one of the few countries in the world—and the only major power—that cannot be invaded by land. To the north is Canada, to the south Mexico, and neither is a conceivable military threat. Any threat to the US mainland would have come from the Atlantic and Pacific oceans, which are more reliable as buffers to attack than a source of it.

In 1890, Adm. Alfred Thayer Mahan wrote a book called “The Influence of Sea Power upon History,” which is the intellectual foundation of US grand strategy to this day. US national security, he argued, depends on command of the sea. So long as there is no threat in the Atlantic or Pacific, US security is assured. And by logical extension, the US does not have an interest in the Eastern Hemisphere.
Thus the US did not get involved in World War I until U-Boats started attacking Atlantic shipping lanes and sank the Lusitania, at the cost of many American lives. The US joined the war to block the German navy from accessing the Atlantic. Years later, Washington passed the Lend-Lease Act, an agreement with Britain aimed at making sure Germany didn’t invade, defeat, or take control of the Royal Navy and, in doing so, challenge the US. In fact, there was a proviso in the agreement that said that in the event of British capitulation to Germany, the Royal Navy would move to North America. Only after all this, when Japan devastated the American Pacific fleet at Pearl Harbor, did Washington conduct a strategy to drive Japan out of the Pacific.

The US approached the Soviet Union from an ideological position, but the fundamental geopolitical reality was that if Moscow took Western Europe, it would be able to hold Atlantic ports, construct a significant navy, and threaten the US via the Atlantic. In the third world, now called the Global South, the US and Russians competed for the most part through proxies for dominance. Neither really wanted dominance, but neither did they want the other to dominate. All of this dissolved with the outcome of the war in Ukraine. Now that it is unanchored by the Cold War, the US faces a new geopolitical reality that is redefining the global system and America’s place in it.

The end of the Cold War means the Russian threat to the Atlantic is gone. From the US perspective, China is a threat in the Pacific, but it is a future threat because it lacks the naval capabilities to control the seas. China cannot, for example, reliably navigate warships through waters in ready range of US drones. Even if its navy could break into the Pacific at some point, the ability of its vessels to return to base for supplies—or for supplies to reach the vessels—in amphibious operations would be a high risk.

The US has, then, returned to a familiar geopolitical reality: It controls the Atlantic, and there is only a limited threat in the Pacific. It has rebuilt its national security on its former foundations. The US has command of the seas, and its geopolitical imperative in Europe and the Third World has been achieved. The US national strategy must change accordingly, and the change is radical. Since the end of World War II, the US has been heavily involved in the Eastern Hemisphere. In Europe, it stood guard against Russia. In the Pacific, it built alliances with nations and islands to limit China’s access to the Pacific in the event of war.

Source: Geopolitical Futures​

The US no longer needs a major forward deployment on the ground in Europe and needs only minimal exposure in the Pacific. Nor does the US feel the need to block Russian influence in the Global South. In other words, the need the US once felt to deploy major forces on a global basis is gone because the geopolitics of the Cold War are gone. The current US geopolitical imperative is to minimize the risk and cost of extensive engagement in the security of the Eastern Hemisphere. What was unthinkable for 80 years is now rational.

​

Russia’s greatest weakness was its economy. America’s greatest strength was its economy. The Russians might be able to guarantee the security of a nation, but not its economic growth or well-being. US strategy, therefore, had two dimensions: the martial and the economic. This was first made clear in the Marshall Plan, which was pivotal in resurrecting European economies. It also gave NATO members, for example, an opportunity to recreate their militaries and array them against the Russian threat. In creating this program, and then in creating an economic system that allowed them access to the powerful American market, the US used economic strategies to improve the internal security of militarily allied countries. This strategy was pursued geopolitically in the competition of the US and Russia in the Global South. Access to the Russian market was limited by both Russian policy and necessity. A relationship with Russia did not bring economic rewards. The US used foreign aid and access to American markets as an incentive to governments and the public to remain in the American sphere of influence. The method, beyond foreign aid, was in allowing the United States to maintain negative balances of trade with many countries.

Given the geopolitical situation, it was a cost-effective strategy, much cheaper than waging war, which in many cases was waged anyway. First, the US resurrected former enemies such as Japan to have favorable access to the American economy. “Made in Japan” was a common substitute for cheap and poorly made products. But it helped rebuild Japan as it did Europe and turned it into a military asset of bases and cooperation. Again, the US policy of ready access to US markets and initial aid was a powerful geopolitical tool Russia didn’t have. It was instrumental in winning the Cold War. Now this strategy is obsolete.

Two things are happening in tandem. First, the United States is abandoning or at least weakening its military obligations to other countries, and in doing so it is reducing the risk of becoming engaged in foreign wars, something that had been the norm in the past. Second, the United States is trying to equalize its balance of trade with the rest of the world. It was happy to float imbalances for decades, but it no longer believes that that’s a price worth paying.

Consider the case of China. China and Russia had hostile relations when they were both communist countries. At about the same time, Henry Kissinger went to China on his famous mission to establish relations, Russia was attacking China along their shared border on the Ussuri River. This and countless previous conflicts like it show the limits of ideology in geopolitics.

After Mao’s death and China’s adoption of controlled capitalism, China began to take Japan’s place as a low-cost, low-quality exporter. The decision to open up its economy was one of the key factors in China’s breakneck economic growth in the late 20th century. Many in the US saw US engagement with China as tantamount to strengthening an enemy. But two considerations took precedence: The US had become addicted to low-cost exports, and engaging China would further drive a wedge between China and Russia.
Central to the China policy was massive investment. China had economic relations with many countries, of course, but the US had (and still has) the largest economy in the world, so access to its markets would be vital for a growing economy such as China’s. Its economy would continue to boom until the late 2010s, when several structural issues and the COVID-19 pandemic slowed growth considerably. Geopolitical shifts are rapid in the face of outright war or economic catastrophe. They are slower when neither is present.
The United States now has three imperatives: end the social crisis of the culture wars; repair the economic realities that have become obsolete; and transform an obsolete institutional system. The socio-economic cycle transitions about every 50 years, the institutional cycles every 80 years. But there is no cycle in geopolitics. It happens when it happens, and it is happening now. This is therefore an intense period as major systems become obsolescent and thus create a crisis, followed by a political storm that disrupts the obsolete systems, followed by a new, engineered reality, and then ending with a calm after the storm. What has happened is all these cycles are hitting at once, and their convergence has led to a period of unusual intensity.
The US has a geopolitical imperative to disengage from the risks and burdens imposed by its involvement in wars globally. Reducing geopolitical risk involves reducing economic exposure to the world and military responsibility. One of the foundations of economic relations was a substantial imbalance in trade, the justification for which is now obsolete.
American security posture shifted over the course of the Ukraine war, when the failure of Russia to defeat Ukraine completely ended the Cold War’s foundational logic. In turn, this led to a shift in security policy as well as a massive shift in economic policy and the United States’ attitude towards free trade. Meanwhile, the end of the Cold War has created a crisis in Europe, which likewise has to redefine itself after 80 years of the status quo. The need is now for the United States to disengage to some significant extent from its global economic policy.
The US’s dramatic introduction of massive tariffs is thus geopolitically driven. Its method is an engineering decision intended to break the old system and open the door for a new one. It created a geopolitical crisis by its engineering.

Here again, China is a useful example. The US has troubled relations with China. The geopolitical problem is mitigated by the economic problem, but with the Cold War over, the cost is no longer essential. The economic problem with China has been integrated with the geopolitical. Relatively free trade with China achieved a geopolitical purpose but weakened the American economy in two ways: Lower labor costs allowed for cheap exports and for the relocation of businesses to China. But the problems went deeper than that. The US became dependent on imports of key components, sometimes entire alternatives, to US production. If those were cut off, it would create a massive crisis that would require Washington to revive domestic production of finished products and essential components alike.
US-Chinese relations may have been poor, but they were never so bad as to threaten war. China could choose to place the US into a very dangerous position, not unlike the Arab oil embargo of the 1970s. A war was fought by Egypt and Syria against Israel in 1973. The attackers were supplied by Russia, the Israelis by the US. Israel’s victory produced anti-US anger in the Arab world. Arab oil producers, who provided the US with a substantial portion of its oil, then imposed an embargo. This came at a great cost to the Arabs, but the geopolitics of the Arab world forced their hand. The loss of an essential energy import pushed the United States into a massive economic crisis. It was a case in which geopolitical necessity overrode economic considerations.

China exports essential industrial components to the United States. It is also a geopolitical competitor with the United States. If events force China to accept economic and financial costs for geopolitical advantage, it could talk itself into imposing an embargo. This results in a massive geopolitical vulnerability for the US. In addition to wanting to change economic relationships on a global level, the US urgently needed to do so first with China.

US efforts to distance itself from the rest of the world have predictably caused internal and external turmoil. Done more slowly, it would have caused merely long-term unease. Unease and turmoil are both parts of obsolete geopolitical models. The evolution of those models is both disruptive and poorly understood because of the perception that the forces of geopolitical necessity seem less deterministic than the forces behind economics.

But the truth—and this is the point of this story—is that the forces of humanity as a whole generate impersonal pressures that overwhelm human preferences as they define reality. The transition to new realities was less bloody than the end of the European age in 1945 and the emergence of the American age. But on the other hand, it did not change the fundamental geopolitical reality. Where Europe was replaced as the center of the world, the US remains the center, so the turmoil is not the beginning of the storm, but the last storm before the new calm.
.
optimistic? I hope so

 

[qldfrog]

There's no real geopolitics thread... I don't want to land this in one of the Trump threads as it would be lost. Searched hegemony, and here are. It is American.

​

A Geopolitical Tale: How We Got Where We Are​

by George Friedman​

This is the story of how we got to a moment in history defined by global and national crises. It is the story about how a radical geopolitical transition is taking place as old socio-economic and institutional cycles in the US end and new ones begin. But there is also a massive global geopolitical crisis taking place. The story is long and complex. I wish it were shorter, but the complexities are such that there is no way to tell it simply. It began 80 years ago and brings us to our current crises. We are in the storm before the calm, and it’s as intense as storms can be.
During the Cold War, the geopolitical system had an anchor: the confrontation between the United States and Soviet Union. All other nations had three options. They could align with the US, align with the Soviet Union, or be neutral. This did not define all international activity, of course, but the Cold War set the rules around which international activity took place. The Cold War was based on the assumption that a Russian invasion of Western Europe was a genuine threat to the US, and that NATO and US forces were therefore indispensable. If anything, they might have been insufficient to stop a determined Russian assault, or so the thinking went.

The Cold War did not end with the fall of communism; it ended with Russia’s invasion of Ukraine in 2022. Some say Russia intended only to seize the parts of Ukraine it now holds. But this belies the nature of the invasion. Russia invaded Ukraine on four axes: an attack from the east, a second thrust from the north down the country’s center, a third from the north meant to occupy the capital, and a fourth one from the south. It was an all-out attack whose only purpose was to occupy the whole of Ukraine. Had Russia’s intentions been more measured, Moscow might have massed its forces against Eastern Ukraine. But that isn’t what it did.

This is important to the new geopolitical reality because the Russian invasion, in no uncertain terms, failed. It failed so badly that Vladimir Putin sent in mercenaries from the Wagner Group to bolster Russia’s conventional military. The mercenaries feuded with, but were not completely under the command of, Russian military leaders. So bad was the animosity between them that the Wagner Group staged an insurrection against Putin. This, too, failed, leading to the group leader’s death in a plane crash some weeks later.
Russia’s failure to rapidly subdue Ukraine, a much smaller and seemingly weaker country, was the point at which the Cold War really ended. After three years of war, it was clear that Russia was not the threat many had believed. Ukraine may have been receiving weapons and supplies from the West, but there were no Western troops on the ground. It became clear that the foundation of the Cold War—the Russian capacity to invade and occupy Western Europe—was not possible without radical reconstruction that would take many years to achieve. And perhaps not even then. The war in Ukraine showed that Russia could not invade and occupy Europe.

From the 1940s to the 1990s, the US justified its defense of Europe on moral grounds. It was framed as liberal democracy against tyrannical communism. This was true but not the whole truth, which lay in the geopolitical imperatives of the US—imperatives deeply embedded in US strategic reality. That reality rested on US geography.
The US is the dominant power in North America by massive degrees. It is one of the few countries in the world—and the only major power—that cannot be invaded by land. To the north is Canada, to the south Mexico, and neither is a conceivable military threat. Any threat to the US mainland would have come from the Atlantic and Pacific oceans, which are more reliable as buffers to attack than a source of it.

In 1890, Adm. Alfred Thayer Mahan wrote a book called “The Influence of Sea Power upon History,” which is the intellectual foundation of US grand strategy to this day. US national security, he argued, depends on command of the sea. So long as there is no threat in the Atlantic or Pacific, US security is assured. And by logical extension, the US does not have an interest in the Eastern Hemisphere.
Thus the US did not get involved in World War I until U-Boats started attacking Atlantic shipping lanes and sank the Lusitania, at the cost of many American lives. The US joined the war to block the German navy from accessing the Atlantic. Years later, Washington passed the Lend-Lease Act, an agreement with Britain aimed at making sure Germany didn’t invade, defeat, or take control of the Royal Navy and, in doing so, challenge the US. In fact, there was a proviso in the agreement that said that in the event of British capitulation to Germany, the Royal Navy would move to North America. Only after all this, when Japan devastated the American Pacific fleet at Pearl Harbor, did Washington conduct a strategy to drive Japan out of the Pacific.

The US approached the Soviet Union from an ideological position, but the fundamental geopolitical reality was that if Moscow took Western Europe, it would be able to hold Atlantic ports, construct a significant navy, and threaten the US via the Atlantic. In the third world, now called the Global South, the US and Russians competed for the most part through proxies for dominance. Neither really wanted dominance, but neither did they want the other to dominate. All of this dissolved with the outcome of the war in Ukraine. Now that it is unanchored by the Cold War, the US faces a new geopolitical reality that is redefining the global system and America’s place in it.

The end of the Cold War means the Russian threat to the Atlantic is gone. From the US perspective, China is a threat in the Pacific, but it is a future threat because it lacks the naval capabilities to control the seas. China cannot, for example, reliably navigate warships through waters in ready range of US drones. Even if its navy could break into the Pacific at some point, the ability of its vessels to return to base for supplies—or for supplies to reach the vessels—in amphibious operations would be a high risk.

The US has, then, returned to a familiar geopolitical reality: It controls the Atlantic, and there is only a limited threat in the Pacific. It has rebuilt its national security on its former foundations. The US has command of the seas, and its geopolitical imperative in Europe and the Third World has been achieved. The US national strategy must change accordingly, and the change is radical. Since the end of World War II, the US has been heavily involved in the Eastern Hemisphere. In Europe, it stood guard against Russia. In the Pacific, it built alliances with nations and islands to limit China’s access to the Pacific in the event of war.

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Source: Geopolitical Futures​

The US no longer needs a major forward deployment on the ground in Europe and needs only minimal exposure in the Pacific. Nor does the US feel the need to block Russian influence in the Global South. In other words, the need the US once felt to deploy major forces on a global basis is gone because the geopolitics of the Cold War are gone. The current US geopolitical imperative is to minimize the risk and cost of extensive engagement in the security of the Eastern Hemisphere. What was unthinkable for 80 years is now rational.

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Russia’s greatest weakness was its economy. America’s greatest strength was its economy. The Russians might be able to guarantee the security of a nation, but not its economic growth or well-being. US strategy, therefore, had two dimensions: the martial and the economic. This was first made clear in the Marshall Plan, which was pivotal in resurrecting European economies. It also gave NATO members, for example, an opportunity to recreate their militaries and array them against the Russian threat. In creating this program, and then in creating an economic system that allowed them access to the powerful American market, the US used economic strategies to improve the internal security of militarily allied countries. This strategy was pursued geopolitically in the competition of the US and Russia in the Global South. Access to the Russian market was limited by both Russian policy and necessity. A relationship with Russia did not bring economic rewards. The US used foreign aid and access to American markets as an incentive to governments and the public to remain in the American sphere of influence. The method, beyond foreign aid, was in allowing the United States to maintain negative balances of trade with many countries.

Given the geopolitical situation, it was a cost-effective strategy, much cheaper than waging war, which in many cases was waged anyway. First, the US resurrected former enemies such as Japan to have favorable access to the American economy. “Made in Japan” was a common substitute for cheap and poorly made products. But it helped rebuild Japan as it did Europe and turned it into a military asset of bases and cooperation. Again, the US policy of ready access to US markets and initial aid was a powerful geopolitical tool Russia didn’t have. It was instrumental in winning the Cold War. Now this strategy is obsolete.

Two things are happening in tandem. First, the United States is abandoning or at least weakening its military obligations to other countries, and in doing so it is reducing the risk of becoming engaged in foreign wars, something that had been the norm in the past. Second, the United States is trying to equalize its balance of trade with the rest of the world. It was happy to float imbalances for decades, but it no longer believes that that’s a price worth paying.

Consider the case of China. China and Russia had hostile relations when they were both communist countries. At about the same time, Henry Kissinger went to China on his famous mission to establish relations, Russia was attacking China along their shared border on the Ussuri River. This and countless previous conflicts like it show the limits of ideology in geopolitics.

After Mao’s death and China’s adoption of controlled capitalism, China began to take Japan’s place as a low-cost, low-quality exporter. The decision to open up its economy was one of the key factors in China’s breakneck economic growth in the late 20th century. Many in the US saw US engagement with China as tantamount to strengthening an enemy. But two considerations took precedence: The US had become addicted to low-cost exports, and engaging China would further drive a wedge between China and Russia.
Central to the China policy was massive investment. China had economic relations with many countries, of course, but the US had (and still has) the largest economy in the world, so access to its markets would be vital for a growing economy such as China’s. Its economy would continue to boom until the late 2010s, when several structural issues and the COVID-19 pandemic slowed growth considerably. Geopolitical shifts are rapid in the face of outright war or economic catastrophe. They are slower when neither is present.
The United States now has three imperatives: end the social crisis of the culture wars; repair the economic realities that have become obsolete; and transform an obsolete institutional system. The socio-economic cycle transitions about every 50 years, the institutional cycles every 80 years. But there is no cycle in geopolitics. It happens when it happens, and it is happening now. This is therefore an intense period as major systems become obsolescent and thus create a crisis, followed by a political storm that disrupts the obsolete systems, followed by a new, engineered reality, and then ending with a calm after the storm. What has happened is all these cycles are hitting at once, and their convergence has led to a period of unusual intensity.
The US has a geopolitical imperative to disengage from the risks and burdens imposed by its involvement in wars globally. Reducing geopolitical risk involves reducing economic exposure to the world and military responsibility. One of the foundations of economic relations was a substantial imbalance in trade, the justification for which is now obsolete.
American security posture shifted over the course of the Ukraine war, when the failure of Russia to defeat Ukraine completely ended the Cold War’s foundational logic. In turn, this led to a shift in security policy as well as a massive shift in economic policy and the United States’ attitude towards free trade. Meanwhile, the end of the Cold War has created a crisis in Europe, which likewise has to redefine itself after 80 years of the status quo. The need is now for the United States to disengage to some significant extent from its global economic policy.
The US’s dramatic introduction of massive tariffs is thus geopolitically driven. Its method is an engineering decision intended to break the old system and open the door for a new one. It created a geopolitical crisis by its engineering.

Here again, China is a useful example. The US has troubled relations with China. The geopolitical problem is mitigated by the economic problem, but with the Cold War over, the cost is no longer essential. The economic problem with China has been integrated with the geopolitical. Relatively free trade with China achieved a geopolitical purpose but weakened the American economy in two ways: Lower labor costs allowed for cheap exports and for the relocation of businesses to China. But the problems went deeper than that. The US became dependent on imports of key components, sometimes entire alternatives, to US production. If those were cut off, it would create a massive crisis that would require Washington to revive domestic production of finished products and essential components alike.
US-Chinese relations may have been poor, but they were never so bad as to threaten war. China could choose to place the US into a very dangerous position, not unlike the Arab oil embargo of the 1970s. A war was fought by Egypt and Syria against Israel in 1973. The attackers were supplied by Russia, the Israelis by the US. Israel’s victory produced anti-US anger in the Arab world. Arab oil producers, who provided the US with a substantial portion of its oil, then imposed an embargo. This came at a great cost to the Arabs, but the geopolitics of the Arab world forced their hand. The loss of an essential energy import pushed the United States into a massive economic crisis. It was a case in which geopolitical necessity overrode economic considerations.

China exports essential industrial components to the United States. It is also a geopolitical competitor with the United States. If events force China to accept economic and financial costs for geopolitical advantage, it could talk itself into imposing an embargo. This results in a massive geopolitical vulnerability for the US. In addition to wanting to change economic relationships on a global level, the US urgently needed to do so first with China.

US efforts to distance itself from the rest of the world have predictably caused internal and external turmoil. Done more slowly, it would have caused merely long-term unease. Unease and turmoil are both parts of obsolete geopolitical models. The evolution of those models is both disruptive and poorly understood because of the perception that the forces of geopolitical necessity seem less deterministic than the forces behind economics.

But the truth—and this is the point of this story—is that the forces of humanity as a whole generate impersonal pressures that overwhelm human preferences as they define reality. The transition to new realities was less bloody than the end of the European age in 1945 and the emergence of the American age. But on the other hand, it did not change the fundamental geopolitical reality. Where Europe was replaced as the center of the world, the US remains the center, so the turmoil is not the beginning of the storm, but the last storm before the new calm.
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optimistic? I hope so

Interesting.
The risk are twice imho:
The decoupling (and mostly seen as "Trump policy") could just fail..as dependency to China is too high to revert smoothly.
A change of US government and policy which would try to unravel Trump policies.
But lost alliances and mistrust can not reverse, the geopolitical facts stated in the article are will remain valid, and this would just speed the downfall of the previous status quo.
So TDS or not, you'd better hope that. Trump succeed or we will pay dearly to our new Chinese masters

 

[divs4ever]

Interesting.
The risk are twice imho:
The decoupling (and mostly seen as "Trump policy") could just fail..as dependency to China is too high to revert smoothly.
A change of US government and policy which would try to unravel Trump policies.
But lost alliances and mistrust can not reverse, the geopolitical facts stated in the article are will remain valid, and this would just speed the downfall of the previous status quo.
So TDS or not, you'd better hope that. Trump succeed or we will pay dearly to our new Chinese masters

well we did have a chance of forming tighter relations with India ( in parallel to trading with China ) but we threw that in the bin

Trump will have his hands full trying to save some of the US to worry about us , the US will be lucky if Trump can do half of what he wants in eight years ( assuming a MAGA-friendly wins in 2028 )