Chip war escalation or China self sufficiency?

 CHIP COMPANIES IN FOR A ROUGH ROAD

CHINA MAY HOLD THE BEST CARDS

Last week, we saw the U.S. government purchase a 10% stake in INTEL, the premier U.S. technology company. This is in effect a bailout, as this company and other U.S. chip manufacturers are feeling the effects of the effort to restrict sales of their products to China, it is likely to get a lot worse in the near future. China has recently banned the import of chips from the U.S. around 40% their business.

This began under the Biden administration, when U.S. companies were restricted from selling sophisticated chips to China, it was labeled a nation security action.  China responded by building a massive modern technology park and soon was selling the bread and butter chips that are used in auto's, appliances and other electronics at a reduced price, making U.S. manufactures uncompetitive and taking much of their business and placing them in a serious financial bind. China is now set to become self sufficient in chip manufacturing and is working on making those sophisticated chips for AI and military applications.

The most recent escalation concerns ASML, a Dutch company, the only manufacturer of the latest photolithography equipment. China has been a customer for years and has made up 27% of ASML's business around $10 billion in 2025. The U.S. has now pressured ASML to not only end sales to China but to cancel its service contracts with China. China it seems is done with this and is now informing ASML that they have breached their commercial contract and they desire to return all their machinery and expect $28 billion in refunds.  Rather than go through years of litigation and hoop jumping China is also informing ASML that if they don't comply, their contracts with China also make their patents and copyrights null and void, indicating that China is now prepared and possibly equipped to copy all of ASML's latest equipment, a development that would have dramatic effects on the chip business worldwide.

We have seen how restrictions on exports of targeted items by western countries has backfired, an indication of who is actually dependent on who. Japan lost billions of exports to China of machine tools after being pressured by the U.S. to restrict certain tools. China has either made them themselves or found another source. China has ended its purchase of U.S. grains and are now buying them elsewhere. China has also restricted its sales of rare-earths, another retaliation. It is becoming a long list and is going to have severe consequences on many businesses. 

China is also developing a new type of chip, based on Indium Selenide, that will address the limitations of silicon chips, It is a new technology, with much more expensive materials and China has reported they have been successful at making this work, but only at the laboratory level. If able to produce this product it would be superior for high end uses. 

While hoping to replace China business with domestic manufacturing may be sound idea, it will probably take decades if actually possible at all. In the meantime the trade disputes are leading to a new world were the west could be isolated from the developing world, as more countries opt out of taking sides.

Friday thoughts, War, Debt, money.

WILL WAR SOLVE FINANCIAL CRISIS? 

FEAR OF EXCHANGING ASSET PROFITS FOR DEVALUING CURRENCY

The adedge that war is a great stimulus to a struggling economy may no longer apply. France, Uk and Germany all have Debt to GDP ratios over 100%, the U.S. is 125%. In former wars, money was borrowed to finance the war and then stimulated the economy from the increase in deficit spending. Most western countries are already in serious debt problems, they would have to attempt to confiscate assets to fund a war. The head of the EU has suggested using the EXCESS savings of citizens to fund war. I suspect such attempts to fund more war will be resisted very strongly. By the way, Russia has a 19% debt to GDP ratio.

BRICS countries average around a 50% Debt to GDP ratio.

In former wars these countries had extensive manufacturing capacity, no more, it is unlikely they could produce enough for a long war. Leaving only resorting to nuclear weapons as a strategy.

We see all markets at record highs, and without the underlying real value, this would indicate that it would be good time to take profits. Problem is, it feels uncomfortable to take profits, pay taxes and exchange these assets for dollars with an uncertain future. I suspect this is, at least for now, keeping these markets up.

Central banks, on average,  now have the majority of their reserves in gold and not treasury bonds.

It is being reported that the U.S. is withdrawing troops from Iraq, Russia has quietly evacuated its diplomats from Israel. Large amounts of weapons and supplies are being accumulated. Iran is feverishly preparing its defense. Some believe that another Israel/Iran engagement is imminent. Is this why Trump has handed management of the Ukraine conflict over to the EU?

Just a few things to think about over the weekend.

Are new tariffs on India, the last straw?

 INDIA APPEARS UNWILLING TO SUBMIT

WILL IT NOW FOCUS ITS FUTURE ELSEWHERE?

Yesterday the Trump administration at the behest of Lindsey Graham and the U.S. senate put 50% tariffs on India. It is supposedly because India is buying oil from Russia. Oil that mostly ends up being shipped to Europe. India has claimed hypocrisy, as the U.S. is till buying fertilizer, uranium and other products from Russia. It seems both the U.S. and Europe are willing to exempt items that they feel are essential for them, but India cannot. It is reported that Trump called Modi 4 times in recent days, but got no answer or call back. India and others may soon make the decision that trade with the U.S., while important, can be eliminated by nurturing trade with its neighbors and more friendly partners.

We also saw this week a result of trade wars, Intel, once the symbol of the U.S. much touted technology economy, being in effect bailed out by the U.S. government.  Much of this is the result of U.S. government forbidding sales to China of certain silicon chips. China retaliated by going full steam into the chip business and now outselling  U.S. producers by a wide margin. We also see China reduced purchases of U.S. grain and moved their business to Brazil, Argentina and Russia. Then Europe is also being pressured to adopt U.S. policy and with their economies already on life support, it can be expected to cause further loss of market share. The hope of isolating certain countries may end up isolating the 750 million population western countries from the other 6 billion of the world's population. 

India has been in consultation with both Russia and China in the last weeks. India has sought a position of neutrality and non-alignment, while under extreme pressure to take geopolitical sides. Neutrality is no longer allowed, the Bush doctrine of " You are either with us or our enemy " is still in effect. India is already considering cancelling it F-35 orders and buying aircraft somewhere else.

This weekend is the 25th summit meeting of the Shanghai cooperation organization in Tianjin, China. It will be attended by 20 world leaders and 10 international organizations. Xi, Putin, Modi and leaders or representatives of Egypt, Iran, Pakistan, Malaysia, Indonesia, Vietnam, Cambodia, Laos, Myanmar, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Belarus, Afghanistan, Mongolia, Turkey, Sri Lanka, Turkmenistan, Armenia, Azerbaijan, Maldives, Nepal and representatives of the gulf nations. Un.secretary Guterres will also attend. The theme is viewing the multi-polar world.

This makes up the vast majority of the Asian nations and one must wonder how this is viewed by South Korea and Japan, who are also under severe pressure to take sides by supporting Ukraine and sanctions on China. It may become a very hard decision, since they do much business with these countries.

Japan who was pressured by the U.S. to stop selling certain machine tools to China resulted in China cancelling billions in orders and sourcing them from Russia.

We will see how all this works out, can the west pressure the rest of the world to submit or will it end in the isolation of the west from a majority of the worlds commerce.

The EU coalition may be willing, but not able.

 INFIGHTING AND ECONOMIC CRISIS WILL END UKRAINE SUPPORT 

INTERNAL THREATS MORE REAL THAN RUSSIA

We hear all kinds of proposals for the European "coalition of the willing" claiming they are ready to give support to Ukraine. So far Hungary and Slovakia have made it clear they are out, as far as more support for Ukraine. Ukraine has now retaliated by cutting off their oil that transits through Ukraine, even though they are dependent on electric energy from those countries. There is real threat of escalation of this situation between Ukraine and Hungary and Slovakia. 

Poland announced this week that it is cutting off much of the aid to Ukrainian refugees as they can no longer sustain this drain on their resources. Poland also is very doubtful to place their troops at the disposal of this coalition.

Germany, now under Merz is still saber rattling at the same time he has announced an increase taxes, maybe a wealth tax, cutting of pensions, and other social benefits. At the same time he has pledged another 9 billion to Ukraine and a massive plan of rearmament. One must wonder if there is something wrong in those calculations. The German economy is floundering,  mostly due to massive increases in energy costs, due to there embargo on purchasing Russian energy. As the war drags on, they will be getting weaker, not stronger.

Then there is the Uk, where many are predicting actual economic collapse and a need to be bailed out by others. Their debt is exploding, social services suffering and there bond market is suffering. It is amazing that they are still talking massive military spending and recruitment, It appears to be all wishful thinking.

France's economy and military may be in better shape, but they are having serious social problems that can only be magnified by any move to send troops to Ukraine. Much of their country is powered with nuclear energy and has proved to place them in a better place than its neighbors.

Indications are that Italy is not going to war in Ukraine.

Talk of being willing is very costless, anything more will become more unlikely as the days go by.

How the debt and dollar crisis is unavoidable. Part 2.

 INTEREST PAYMENTS TO EXPLODE

EXPORTED INFLATED DOLLARS TO RETURN HOME

The 1970's saw an average inflation rate of 6.8% and a peak in 1979 of 13%. In 1980 it was 12.5 %. Some of this was due to the policy of OPEC, the "Organization of oil exporting countries", seeking to control the price of oil by production regulation. Before OPEC, the price was set by the New York and London commodity markets and was manipulated to never account for the inflation of the currency. The 1970's saw an increase in the price of imported oil and a embargo in 1974, in reaction to U.S. policy in Israel and an effort to offset inflation of dollars that was the currency that oil was traded in.

Also in the 1970's we saw the introduction of the "Clean Air Act" and OSHA, the "Occupational health and safety act" The increase in energy price and stability,  coupled with these new laws, which were often implemented without any consideration for the ability of many foundries, steel mills and other manufactures to absorb these costs quickly began the deindustrialization of the backbone of a manufacturing economy. Small operators were first to go, but in 2 decades these industries were importing products from Japan and soon China, after the Nixon's softening relations in 1972. 

Manufacturers soon realized they could import products for less costs and avoid the risks of government regulation, labor disputes and unstable material prices. The economy transitioned to a consumer market and manufacturing was replaced by services, entertainment and paper financial transactions. I argue that wealth is created by the combination of materials and labor to produce a product of more value than the imputed materials and labor. China is a perfect example of that reality, as it was for the United States in late 19th and 20th centuries.

At the same time government realized that the combination of lower priced imports and the exporting of inflated U.S. dollars to pay for those goods, kept domestic inflation under control. This was also coupled with taking out of the price index items like energy and other costs that reveal actual inflation.

Exporting countries soon found they had lots of dollars and often placed them to earn some interest on U.S. debt. Government debt was advertised as the safest investment in the world, even though, due to inflation, its buying power was steadily decreasing.

The dissolving of the Soviet Union in 1991, was an opportunity to change direction and address the unsustainable path of debt. It was labeled, " The peace dividend" and the government came close to balancing the budget in 1993, but it was short lived, as there are incentives for more spending and debt. More spending often translates to more political power and more debt is a major industry of Investment Banks who earn steady commissions on all those transactions.

Soon after the collapse of the Soviet Union, many in government saw the opportunity of being the only remaining Superpower to use that power to fashion the world as they saw fit. Again the ability to finance, now war and and rapidly increasing debt was aided by exporting inflated dollars around the world. 

As the 21st century arrived it was becoming apparent to many that the country was on an unsustainable financial path. This coupled with the increase in policy of the U.S. to intervene in the financial and political affairs of other countries to force social, and cultural changes and assume control of the resources of other countries. It began a period of endless war and support for war, all financed with more debt.

The U.S. dollar which was the world reserve currency due to its being, "as good as gold" was now often used as a weapon to force submission to U.S. will and soon there was in increase in resistance to that policy.  This resistance was coming from allies and competitors. 

Japan, China and other holders of U.S. debt began to feel U.S. debt may not be a good investment and started lower their holdings of that debt. At one time transactions in world trade were conducted in over 80%  with dollars, it is now near 50%. Settlements are increasingly being made in other currencies and in platforms not controlled by the U.S. and EU. 

The interest on the debt is now exploding and is the biggest item in the budget and it is about to get much bigger when debt that matures that was 1%, is now going to be over 4%.  $9.3 trillion matures in the next 12 months and 70% of U.S. debt mature in the next 5 years, all at much higher rates than before. This can only result in more deficit spending and more debt, an unsustainable reality.

The other shoe that will drop is that as the world moves away from the dollar transactions and liquidates U.S. debt, where are all those exported dollars going to go? They are going to attempt to be repatriated back to the U.S., one way or another.

We have seen gold buying by central banks around the world with Gold now trading at over $3350. an oz., silver is now beginning to also increase as is other stores of value.  Much of this is caused by the liquidation of dollar reserves into precious metals and other assets.

It took 50 years for the U.S. to export inflated dollars around the world, but it will not take 50 years for holders to attempt cash out. While they can spend those dollars on many things around the world, it may be a declining demand for dollars and then there will be attempts to use them in the U.S.  The U.S. stock market may explode and real estate prices increase, at least until the desire to unload those dollars in realized. 

It is possible that real estate will become unaffordable for Americans and Stocks will be in the stratosphere, but when those dollars are finally repatriated, demand will inevitably disappear and those exported dollars will evaporate, like the dew exposed to the morning sun. 

How the debt and dollar crisis is unavoidable. Part 1.

 50 YEAR ROAD TO FINANCIAL CRISIS

NO LONGER ABLE TO POSTPONE OR MANAGE

The United States now has a national debt of $37 trillion and is growing by the day.  While many now believe this has been talked about forever and the system is still functioning, they assume it can be maintained forever. This crisis has been in the works for over 50 years and all the opportunities to seriously address it have been postponed or managed by covering up with financial gimmicks.

The debate between Keynesian economics and the Austrian school of economics was conducted in the early part of the 20th. century, with the Keynesians winning out in most of the western countries. The Austrians were firm believers that money was an asset and the best store of of wealth was gold and silver. That if the money was secure, market forces would be able to minimize distortions and excesses in the economy. 

The Keynesians believed that the economy could be controlled and stabilized by raising and lower interest rates. Raising rates in periods of overstimulation or speculation and lowering them when the economy stagnated. They also believed that debt accumulated by the government in stimulating the government through deficit spending would be paid off in times of prosperity. 

While all this occured before my time, I did witness the debate in the 1960's and 70's about the idea of engaging in a practice of perpetual deficit spending, targeting a 2% annual inflation rate. The sound money advocates vehemently opposed this idea and the advocates sold the idea that gold and silver backed currency was an antiquated idea and could not allow growth in a modern economy.  While there never was a vote by anybody or a definitive moment of this change in monetary policy, it did happen. 

The results of this debate was already going on in that in the early 60's, the price of silver began to exceed the face value of the currency or coins. Some, my brother was one, who had a lower middleclass income, began picking up bags of silver at the bank and either hoarding them or as more wealthy often did, had then melted and refined, with a profit in paper currency. This led to the elimination of silver by the treasury in 1964. While silver was no longer minted by the treasury, it was still legal to be owned.

This was reminiscent of the executive order by President Roosevelt in 1933 for citizens to turn over their gold coins, under penalty of law, in exchange for a paper $20 currency. One year later, in 1934, He revalued gold at $35.00 an oz., thereby devaluing those paper $20 notes by 60%. The poor and uninformed turned in their gold and were instantly made poorer, while the more sophisticated hid their gold. It was illegal for citizens to own or trade gold until 1974 when it was again allowed by law, under Gerald Ford.

The last balanced budget of the U.S. government was in 1969, much of this had to do with new social programs passed in the late 60's and the Vietnam war. The U.S. has not had a balanced budget for 56 years. 

While citizens were not allowed to own gold, the government still respected their promise that paper dollars could be exchanged for gold at $35 an oz. by foreign governments. Foreign governments soon saw what was happening and began to exchange paper for real gold. This was stopped by Nixon in 1971 when he temporarily closed the gold window, it has never reopened.  He then revalued gold to $42. an oz, another default,  and it remains officially price at $42. an oz. when the market price is now over $3300 an oz.. Question, did gold up in value, or did the currency become less valuable? These developments ended any real connection of paper money having any real backing. In effect, money became a debt instrument of government, rather than asset in your control.

At the end of WW2 the U.S. was the only unscathed developed economy in the world. Many nations had changes of governments, devalued currencies and many were destitute. The U.S. dollar, backed by gold, was considered, " as good as gold" It became the preeminent store of value all around the world. Again, all that began to change in 1969. 

At the end of WW2, the U.S. was the manufacturing giant in the world, It had a world were materials and machinery were needed to rebuild the world and the U.S. was in a position to satisfy that demand. Little competition and growing demand at home and around the world. The best situation possibly in U.S. history.

At the same time as the U.S. began the policy of permanent deficit spending, the world was recovering from WW2. Japan and Germany were growing and soon began offering manufactured goods that were very competitive around the world, including the U.S.  Imports of quality cars, motorcycles, electronics and appliances began to compete with U.S. products, both at home and around the world.

Part 2 tomorrow.

Is Trump moving the U.S. from a co-belligerent to a mediator?

 MOVING THE RESPONSIBILITY FOR UKRAINE TO THE EU

IF U.S. IS OUT, THE UKRAINE PROJECT IS OVER

It is becoming increasingly clear that Trump is in the process of exiting direct involvement in the Ukraine conflict. While he has pledged to continue making weapons available, they are to be sold to the EU countries and then given to Ukraine.  We will have to wait to see if they can come up with the Euro's or if the U.S. can provide the weapons due to a severe shortage of some weapons for the U.S. defense stockpile. 

While we keep hearing that the EU countries are in dread fear of Russia, we see little material evidence that they have increased troop strength, instituted a mobilization or actually increased spending. They have made pledges, but pledges are meaningless without action.

Then, without U.S. overseeing the EU, it can be expected that squabbling will increase to see who is going to exert leadership, the usual, French, who have a bigger army and the English who still think they are the British empire and worst of all, are they really ready to encourage German rearmament. That will be another story in itself.

It is unlikely that any of the current EU leadership is capable of engaging in negotiations with the Russians. They may have all burned their bridges. It may require new leadership, but the reality is that a fire is under their behinds as Russia is continuing to move west every day. Someone has to step up and open up communications with Russia. I expect that Trump's strategy is for them to start talking to Russia.

Then the question is, is the U.S. going to pull their advisers out of Ukraine? These are people that operate sophisticated Hi-Mars and Patriot systems. Then there is a large number of CIA and other operatives in the country. One of the reasons for a call for a ceasefire is Russia is now more effectively targeting NATO personnel. When you see apartment buildings and hotels hit, you can assume they are housing foreign advisers.

Of course, this will all be severely objected to by those who are willing to fight to the last Ukrainian.

As for Ukraine, the proposed meeting between Putin and Zelinsky is not yet scheduled, We can expect that Trump wants Zelenitsky to open a dialogue with Putin and then he will act as mediator. It would be a very difficult meeting.

A leaked document from the Ukrainian defense department revealed that Ukraine has suffered 1.7 million deaths and missing. It was 188.500 in 2022, 405,400 in 2023, 595,000 in 2024 and so far 621,000 in 2025. It can be expected these numbers will find their way into the Ukrainian public.

It seems Russia has not altered their strategy of just exerting continuous pressure everywhere. Ukraine has launched several counter offensives and Russia has moved back, as has been their policy. Inevitably Russia will retake those areas in the future. Russia seems to believe that time is on their side as Ukraine and its supporters are being weakened by this attritional strategy.

Are security guarantees NATO expansion by another name.

 EUROPEAN SECURITY ARCHITECTURE SHOULD INCLUDE RUSSIA 

STILL STUCK IN US VS THEM

We now hear that Russia proposes that negotiations on security guarantees need to include Russian input.  This is considered by the European countries as outrageous and impossible. Any peace deal that does not address the long standing and divisive political situation will only insure more war in the future. And more war can inevitably lead to a catastrophic result for Europe and the world. 

In every discussion with the EU its always about maintaining and strengthening a military alliance in opposition to Russia. With the end of the Soviet Union in 1991 there was a opportunity for another arrangement to replace the cold war and the NATO/Soviet Union situation. There is much evidence thats what Russia wanted, but it seems there were many in the west who desired the cold war to continue. That fear of a permanent villain enabled continued military expenditures and covert intrigue for power to actually never end. There now may be second chance to pursue a new agreement that leesens this mentality and is the only real opportunity for lasting peace.

A peace deal to end the hostilities in Ukraine without a serious reevaluation of the political situation will only be temporary respite. It seems the EU wants a ceasefire or temporary pause to rearm and continue this confrontation with Russia. Sadly, many here in the U.S.  have the same desires. 

This Ukraine project, which was born in the U.S. intelligence and state department, has moved to divide the world. While they want to blame Russia, the result has been a Russian/China alliance and the escalation is now pushing India into a military alliance with Russia. It has encouraged a growing economic alliance that further divides the world. The western world has been weakened politically, economically and militarily, yet refuses to acknowledge that only decline and disaster will be the result.

While Russia proposed a new architecture before the breakout of the Ukraine conflict, even discussion was rejected, there is now another opportunity and it may be the last.

It would need to address covert political interference that seeks to deny any country to seeking a neutral status, The Bush policy of you are either with us or our enemy is a juvenile, divisive and destructive policy. The expansion of NATO to include the former Soviet countries is just one example. The same mentality is at work in southeast Asia, South America and Africa. Switzerland and Sweden were neutral countries for decades with great success and a stabilizing influence. 

We as Americans have witnessed the covert policies of the U.S. intelligence agencies, perfected around the world,  being employed right here at home for political advantage. Not only the world, but this country will not survive if a change of direction is not made, now.  Limiting the CIA to the collection of  accurate intelligence information would be good first step.

We have witnessed the demonization of many counties and political leaders by our media in cooperation with their intelligence community handlers and it is till going on. An independent media should have no connection to covert intelligence operators. 

While many will reject and deny any reevaluation, particularly if it is proposed by Russia, it is now an opportunity for a new era of cooperation and mutual prosperity. Why are they so afraid to engage in discussion and negotiation? What good can come of a policy that refuses to listen and hear and only demands submission and compliance? Are they afraid that possibly others may make valid points that they cannot refute?

Everyone is saying YES, waiting for the other to say NO.

 KEEPING U.S. IN, OR WAR IS OVER

 IT WILL BE SETTLED ON THE BATTLEFIELD

We have witnessed 2 pivotal meetings in the last week, and much progress has been made with normalizing relations between the U.S. and Russia. These meetings happened because Ukraine is now in a desperate situation. The EU and Ukraine wanted a ceasefire to allow a regrouping and resupply of the Ukraine army. It did not happen, and it will not happen. Russia and now Trump understand the futility of the situation, but both Ukraine, pressured by the EU members, and those members do not want to admit the futility of further fighting. They are believing their own narrative that Russia is weak and on the verge of economic collapse and that in 3 years have been unable to conquer Ukraine.

The reality is that this has been a war of attrition, not taking territory, whoever wins the war of attrition will win the territory. The hope of the U.S. strategists was that Russia would dive deep into Ukraine and be subjected to a long insurgent war. When Russia invaded, they never had sufficient troops to control Ukraine, it was mostly a show of determination to force negotiations. Negotiations were underway in the first few weeks and when those negotiations were scuttled by western insistence, Russia, understanding that they could not defend the territory that they had moved into, withdrew to defensive positions. They then called up reserves and fortified those areas that they sought to defend. Eventually, Ukraine amassed a big army and unlimited NATO equipment for their much touted counter offensive, it retook nothing. Russia destroyed billions of NATO equipment, all part of their strategy of attrition, not only attrition of the Ukraine manpower, but attrition of NATO equipment.

After the counteroffensive collapsed, Ukraine sought to defend its territory and was reluctant to engage in strategic withdrawals. no matter the cost, this played into Russia's strategy of attrition. Russia moved west incrementally and then created defenses and then again moved forward. They often withdrew, if needed, and then moved forward somewhere else. Much of their offense was with standoff weapons and long range artillery. Many Ukrainians never saw a Russian.

While we hear the narrative that the Russians have lost millions, the reality is that the best estimates from independent analysts who viewed cemeteries with aerial photos and obituaries, estimated that Ukraine has suffered 1.8 million deaths, the Russian's 200 or 250 thousand. That does not include possibly 3x that many severely injured. Russia has much better evacuation and medical facilities and  better prospects for recovery. When there are body exchanges the Russians are returning thousands and the Russians receive hundreds. 

Today, Ukraine has reported 500,000 deserters and many have fled the country. Russia continues to voluntarily recruit 30,000 a month, which allows its troops to rotate out and have RR away from combat. Many of Ukraine's troops have been on the front line since the beginning, they are exhausted and in an impossible situation. 

The U.S. and NATO have depleted their supply of weapons to a point of an inability replace them, some estimate it will take several years to replace their materials to an adequate amount for their own security. 

It is evident that Trump, who has expended weapons on other places, is attempting to move this conflict into the responsibility of the Europeans. While we hear much about the coalition of the willing, without the U.S. they will be unwilling and unable, economically, politically and materially.

Trump has told them the U.S. will supply weapons to the Europeans, when they pay for them, and they can supply Ukraine, an unlikely prospect. The U.S. still does not have the weapons and it is unlikely the Europeans will come up with the money.

Meanwhile Ukraine and its supporters are saying yes, to all proposals, fearful that no, will give Trump the excuse to blame them and exit. Russia is saying yes, knowing that Ukraine and its supporters are likely to eventually say no. Again giving Trump a way out.

Without the U.S., the war cannot continue and even with material support,  without western boots on the ground the war is lost. The UK has a total army of only 47,000, they are the most adamant about continuing. The French and the Poles have more, but are they really willing to send them across the border. Does anyone in Europe really want the Germans to rearm and become a serious miltay power?

The U.S., is overextended around the world with its firefighting ability stretched to the limit, and then there is the ultimate risk of a financial crisis in the very near future. It is all unsustainable.

While I hope a deal can be made and Ukraine preserved without any further loss of men or territory, I suspect the war will continue until it is evident that it is impossible to continue.

Domestic minefields and more for Trump and Zelensky.

 DON'T DOUBT THAT MANY WANT TO SABOTAGE PEACE PROGRESS 

CAN PUTIN AND TRUMP PREVAIL OVER WARMONGERS?

I am convinced that Trump is making a sincere effort to end this Ukraine conflict. I also do believe that Putin is also sincere in his desire to come to a resolution, but I suspect very apprehensive due to the history and the continued demonization of both him and Russia. I also believe that both Trump and Putin, at least for now, have confidence in each others sincerity. That may be the most important ingredient in these negotiations.

While everyone was on their best behaviour yesterday, we can bet behind the scenes the EU leaders with the exception of Meloni of Italy, are plotting ways to sabotage actual peace. There are many who have invested much and for a long time in their hope of defeating Russia, ousting Putin and covet the resources of Russia. I assume they were concerned that open hostility would drive Trump away from NATO and support of Ukraine. 

The intelligence community of the U.S., Uk, Ukraine, which is an arm of the CIA and MI6, and others will do everything that they can to derail any real peace agreement.

The domestic ultra-nationalists of Ukraine will not go quietly or support any ceding of territory or peace with Russia.  Zelensky is treading on very dangerous ground. 

In the U.S., the Intelligence and state department deep state will do whatever they can to undermine Trump and any peace with Russia. 

The continued interference in the domestic politics of Romania, Moldova, Georgia and Azerbaijan also needs to be addressed for lasting peace. Some may expect to shift their focus to those nations in their attempt to undermine Russia.

We can expect actions that attempt to undermine Russia's sincerity either by sabotage or actions that they will attempt to blame on Russia. The hope is that both Trump and Putin keep open lines of communication to not let that affect their progress.

An indication for all this was aired yesterday. John Brennan, former CIA director and co-collaborator of the Russian hoax, was outraged that Trump allowed Putin in his security limo, claiming that Putin may have used the opportunity to plant listening devices in the car. It shows that Trump did the right thing by revoking his security clearance.

In the meantime the war will go on and pressure will be exerted on all that negotiated peace is paramount in preserving a viable Ukraine in the future. I suspect that pressure is necessary to bring everyone to the table. We can only hope for all concerned, that this conflict can come to a resolution and lasting peace and prosperity for all.

No surprises in Alaska meeting.

 THE ANSWER FROM EU AND ZELENSKY IS PREDICTABLE

ALL WILL BE WILLING TO BLAME TRUMP FOR UKRAINE FIASCO

The big meet-up in Alaska has probably resulted in some possible improvements to the US/ Russian relations, but as predicted, no ceasefire. They have now agreed that a comprehensive peace deal is the only way this will end. This will now have to be agreed to by the EU and Ukraine and that may be answered as soon as today. If there should be an agreement to work on such a peace treaty, I would expect the conflict will continue a minimum of several more months. 

In Alaska, Putin has agreed to give up its claim on the Kherson oblast on the west side of the Dnieper river and also on the parts of the Zaporizhia oblast still controlled by Ukraine. This would be on condition that Ukraine would surrender the 30% of the Donetsk oblast and 10% of the Luhansk oblast that it still controls. It would also be on condition of no NATO membership, no NATO troops in Ukraine and a neutral non aligned Ukraine. There would also be a lot of other details that would need to be part of real peace treaty. I suspect this offer will have a short expiration date.

Shortly after the beginning of this conflict, the deal would have been Ukraine retaining all its borders, except Crimea and no NATO etc.. That was rejected by NATO and the U.S. and is no longer a possibility.

I no longer have cable TV in my home, but I was away visiting family this weekend and was amazed when watching Fox at the litany of insults and vitriol about Putin, war criminal, brutal dictator, habitual liar. Things that could be said about some of the U.S. favorite allies with more truth. It was one former CIA or state dept official one after another. Many were criticizing Trump for not joining their narrative or even meeting Putin at all. There will not be any peace with Russia as long as these people have power in forming U.S. foreign policy. This is also very obvious to the Russians, who believe it or not, have access to all the U.S. news and bureaucratic narratives.

So today, the EU representatives and Zelensky are coming to Washington. There answer will be NO and it will be encouraged by many Senators and other bureaucrats demanding Russia be defeated. The war will go on.

There are 3 options available. 

1. Make the deal with Russia and do the best that can be negotiated and free up the country to pursue other critical and pending crisis in other parts of the world.

2. Stay the course, send more weapons to Ukraine, weapons that neither NATO or the U.S. is able produce and deliver without diminishing their reserves for own defense. This will most likely end with Ukraine losing all its territory east of the Dnieper river and another 100,000 men. Sanctioning India, China and Brazil will damage the U.S. economy and will not change their trade policies with Russia. I would expect that when Russia gets to the Dnieper, they will be willing to end the conflict with just no NATO and no NATO troops in the remaining Ukraine.

3. Give Russia an ultimatum of leave Ukraine or it will be a declaration of war by NATO and they all can proceed to voting for war in their legislatures. Declare mobilization and federal control of industry.  Russia will not leave and it will be war with the ultimate consequences unknown.

There should be an incentive to Ukraine for the west to help fund its reconstruction, since this Ukraine project was their baby for 2 decades, their people died, at least the west should take responsibility for some of the damage. Russia will reconstruct the territory under their control.

This NATO expansion into Ukraine and Georgia was bad decision, a fiasco for everyone involved, only some humility and acknowledgment of the error will save Ukraine and the world further damage. Again, I suspect they are still not ready to pull the plug on this misadventure.

Is the deep state ready to declare victory in Ukraine ?

 MANY QUESTIONS TO BE ANSWERED BEFORE THE END OF CONFLICT

RESIGNATION MAY BE FINALLY SINKING IN

The Russian delegation is now in Alaska and Putin is expected to arrive just on time for the 11 AM beginning of talks. While many believe that this summit is destined to failure, as it does not seem to have been properly prepared for, there are indications that more talks have been going on under the radar for some time. I do believe that Putin and his delegation would not have come to Alaska for a photo-op or a failure of results. We must now assume that some fundamental decisions have been made.

While a ceasefire is not likely and a complete end of the hostilities is impossible at this time, it is likely that some fundamental decisions have been made between Russia and the United States. 

Last night, I watched of clip of former Gen Jack Keane, who never criticizes Trump, since he is a guest on Fox news, but his analysis was that Putin wanted this meeting, it has publicly been stated it was prompted by Trump. He then went on to declare that Putin wanted the meeting because he is afraid of sanctions and tariffs and also now fearful of Trump, due to his bombing of the nuclear facilities in Iran. The latest threats of tariffs on India has actually pushed India into an alliance with Russia and possibly China. It was an outrageous narrative that I suspect is believed by very few. 

It seems that Keane, who has consistently voiced the neocon position on Ukraine, is indicating that preparations are in the works to declare victory in Ukraine and let details to be settled later.

Lindsey Graham also gave a speech last night and never mentioned Ukraine, but he did state that if the U.S. does not support Israel, it will be punished by god. Are we to assume that the focus is soon going to focus back on the middle east.

The reality is this meeting has been made while Ukraine is on the verge of collapse, both militarily and politically. The conflict maps are unanimous that Ukraine's last major defense networks are almost surrounded and their last supply routes are within range of Russian artillery. The last ditch effort at tariffs on Russian energy buyers has been a dismal failure and Russia has all the leverage in these negotiations.

Professional diplomats, Russia has the best, know that allowing your opposition to save face is the best strategy for long term peace. It is in the best interest of all for some positive results and, of course, a positive narrative to come out of this meeting. 

As for the Europeans and Ukrainians, without the U.S., no war can be waged. The reality is that there is no longer a unlimited supply of weapons available and a Ukraine defense in manpower is reported to be as low as 25% of optimum force. After these last defenses are breached there is little defenses to the Dnieper river. There are indications that Russia has no intention of crossing the Dnieper, but it is the ideal border for a partitioned Ukraine.

The leverage that is going to be exerted on Ukraine and the EU is that it is best to save face and make a deal now or the next boundary will be the Dnieper river and Ukraine will be 30 % smaller.

I suspect that while Russia will make a deal now, it understands that the Dnieper is best natural boundary for a post war Ukraine/Russia long term peace.

Putin must believe meeting is meaningful.

 IS NEW DETENTE A POSSIBILITY?

LOTS OF SPECULATION,  RISKS AND OPPORTUNITIES

Tomorrow is the much anticipated meeting in Alaska between Donald Trump and Vladimir Putin. Their first in this term of Trump, after a lot of hostility and decline of relations since their last meeting. If we remember the vitriol that broke out in the first meeting, not by Trump and Putin, but the naysayers and the others who desire a permanent cold war and a constant demonization of everything Russian. 

One of Trump's campaign promises in his first run for president was to seek a better relationship with Russia. The long knives came out immediately and culminated with the Russian collusion hoax. I would not doubt that any agreement made tomorrow will rekindle the same Russian agent or Putin apologist claims. Some believe that the world is better off with a constant risk of nuclear catastrophe. Or should it be that the merchants of death and destruction are better off, by keeping the populations in constant fear that we are surrounded with enemies hoping to destroy us.

The reality is that much of the world has learned by America's former example that cooperation and trade can make them all more prosperous. Many realize that war is a big loser for all those involved, mostly the poor citizens who have to die and lose everything. While the world is on the verge of new economic and political reality it can be a era of opportunity or, if all resources are expended on trying to reverse the moving and evolving geopolitical realities, it can lead to everyone's destruction.

Much of the U.S. staggering $37 trillion debt is a result of that effort to hold on the present dying system. Are we better off today than we were in 1990 when the first gulf war began. A war that began by baiting Saddam Hussein to invade Kuwait.https://en.wikipedia.org/wiki/April_Glaspie   . I propose that it has all been downhill for the U.S. foreign policy ever since. Being the only remaining superpower can be a dangerous reality.

So, we will see, tomorrow could be the start of a change of direction for the United States and Russia. We can expect that many diverse powers will seek to derail this effort in many different ways. It will be a positive result for everyone if a new Detente can be started.

Hungary and Slovakia opt out of Ukraine support.

 EU PLEDGES TO SUPPORT UKRAINE

U.S. DECISION MAY BE DECIDED FRIDAY

Yesterday the EU voted to continue to support Ukraine in the Ukraine/Russia conflict. Two EU members voted to no longer support Ukraine. Both Viktor Orban and Robert Fico voiced their decision by proclaiming the war is essentially over and further support will not change the outcome. They have both voiced opposition to the war for some time.

While the war is not over, in the last few days Russia has essentially surrounded and cut off support to Pokrovsk, a major defense city in the Donbas region. Russia has also made major advances in other areas of the conflict line and they will soon be past most of Ukraine's major defensive networks. 

Of course, the big meeting in Alaska between Russia and U.S. will be critical for the direction of this conflict. The war will not be over in the near term, but the groundwork for an end could be started. It is anticipated that Trump is ready to exit this affair, but it is not clear if the Senate will approve of any change in direction concerning Ukraine.  The Senate is floating bills to give Ukraine over $50 billion in more aid. The reality is that the U.S. stockpiles of war materials are critically low and cannot be replaced for possibly years.

As for Russia, it can be assumed they will continue to advance until all sides, Ukraine, the EU and the U.S. are willing to insure a long term end to the conflict. A ceasefire or a frozen conflict, that will fester until the next round of hostilities, will not be acceptable.

There is a possibility that Russia and the U.S. will agree to some sort of truce between the two countries without actually ending this war. This would allow more cooperation in other areas. It could also set the stage for a resumption of some of the nuclear arms treaties that were ended by Trump in his first administration. Trump was poorly advised to end this treaty and pursue a joint treaty with Russia and China, that could have been pursued without ending the existing treaty. Russia unilaterally stood by the treaty until recently when it declared they would no longer adhere to it.

There is much anticipation for some resolution on Friday, it is likely many will be disappointed. This conflict has been underway in some way since 2008 and when Bush 2 announced NATO expansion into Ukraine and Georgia. Both NATO and Russia began preparing for this showdown since that time. Russia considers this expansion an existential threat to their security and the west also considers a loss a blow to their credibility and pride. 

Sooner or later this will all end, the question is, will it be by some peaceful recognition of everyone's security and sovereignty or will it be mutual nuclear annihilation.

Is Trump conflicted on how to make America great again?

 NEEDS TO FOCUS ON HISTORY AND PRIORITIES

AMERICA DID NOT BECOME GREAT BY TRYING TO BE #1

It does appear that President Trump does desire to restore the country to its former dynamic and supreme place in the world. It is also evident that while he does want to restore the countries manufacturing base, possibly the most important factor in the countries former place in the world. He is also sometimes not yet able to form policies in international relations that will restore the countries integrity and  credibility. 

On an individual basis, few people become wealthy by focusing on making more money. The reality is they become wealthy by taking pride in providing a product or service that people want and are happy to purchase or use that product or service, they strive to provide the best they can. If they soon become focused on more money, quickly they often stray in quality or satisfaction of their customers and once that become evident they are destined to decline. Of course, then some hope to keep their success going by hoping to force the desire for their product by stifling competition either by sabotage or government collusion. Inevitably they would be better off by going back and understanding what made them successful in the first place. 

This allegory does apply to nations as well. America became wealthy and strong by providing a system that encouraged entrepreneurship and innovation, This was maintained by a system of law that protected individuals, and their property. It sought, by copyright and patents to ensure these good ideas would benefit those who developed the innovations. It has been a great success.

At the end of WW2 the United States had the greatest manufacturing output in the world. It was blessed by the protection of oceans on both coasts. It had a reputation of excellence and fair play with most of the nations in the world. Of course, we can always point to failings and mistakes, but generally that was the case.

Within 20 years of the end of WW2 the world began to change. Germany and Japan were recovering and both were focusing on manufacturing quality and desirable products for the world, rather than aggression. We saw Germany 's quality optics and manufacturing equipment increase in quality and desirability. We watched as Jaqan provided motorcycles and cars and other desirable products and both soon became increasingly wealthy. They accomplished much of that by mimicking U.S. policies.

The Soviet Union, which had adopted the popular idea of communism was increasingly seeing a lack of initiative and a failure of human fulment and the generation after the original revolutionaries sought to reform to a more capitalist or freedom of market place system. Actually reforms began immediately after the death of Stalin and continued and culminated with the end of the communist system in 1991.  Their hope was to also mimic and develop a system that would be as successful as that witnessed in the U.S. and Germany and Japan. They openly desired to become part of the world system and sought a reduction of nuclear arms by numerous treaties. There is a long list available at the U.S. state department web site. It was in fact a marvelous undertaking of peaceful transition that was one of the most amazing developments of the 20th century. This process has been attested to by some who were there in their hope of assisting the leadership in that transition. Jeffrey Sacks, a U.S. economist, is daily still pointing out this fact.

There were those in the U.S. who saw this growing increase in wealth by these former opponents as a dangerous trend. At the same time the U.S. economy was increasingly hampered by regulation and lack of incentive and began transitioning to a system focused on making money by acquisition and dismemberment, loaning money at interest for consumer goods, importing from cheaper producers and selling to higher standard of living consumers. Its focus was on making money. It is a policy that can only lead to debt, a lower standard of living and weak manufacturing base. While the end is inevitable, it can be a slow decline or possibly a drop over the cliff.

Policy makers, rather than go back to the basis for the U.S. success, decided its ability to stay on top should be insured by diminishing and containing its economic competitors either by sanctions, monetary manipulations or outright military power. Of course, this is a short summary, but in effect that is were we are and now our failure to address this decline is on the precipice of even being in the position that military power is being challenged and soon we will not have the capacity to endure a sustained conflict.  

The U.S. was the first nation to make a break from the age old system of plundering those who have what we want. From Greece to Rome to the British Empire it was focused on taking by colonialism both militarily or economic. Some  European powers still strive for those days and would like the U.S. to assist in their taking. I suspect that some in this country would gladly revert to that system. 

While we continually hear the demonization of Russia, China and others, the biggest threat is right here at home and hoping to be successful by diminishing others will not have any effect on making America great again. A policy of military confrontation needs to be replaced by a policy of cooperation and mutual prosperity, it is the only policy that will insure the wellbeing of all. 

Don't expect Ukraine deal immediately.

 NO CEASEFIRE, UNTIL DEAL COMPLETED

LOTS OF COMPLICATED DETAILS

While it seems many expect some kind of deal to be reached this week on the Ukraine conflict, it is highly unlikely that a deal will be consummated much before the end of the year. There are lots of complicated details to be reached and Russia is not going to scrap its present advantage for some undetermined outcome. 

Trump, and I am sure still in consultation with NATO, is hopeful to get a ceasefire, as Ukraine is now about to lose its last strongholds in the Donetsk region. When those cites fall, they are now near cut off from supplies and partly surrounded, there will be little fortifications between there and the Dnieper river. 

Whether anyone wants to admit it, this conflict is about Russia's desire for security, not about land, but land and geography are always important for security. Natural barriers, high ground and distance all are important in determining a secure border.

While much of the West desires more access to resources, Russia is not in need of resources, Russia has the most valuable and abundant resources in the world. Now and historically, their most vital concern is security. So, without a settlement that is able to make Russia confident in their security for the long term, there will not be a quick settlement.

At present both Ukraine and the EU are not ready for a serious settlement. They are still talking about mustering and sending troops into Ukraine. They may still attempt to derail any agreement or attempt a false flag plan with Russia. 

Russia still wants a no NATO pledge, no Western troops in Ukraine, no Western bases in Ukraine. there is little reason for trust by Russia, at present the west is building bases in Romania and interfering in the politics of Moldova to further expand NATO. It also building NATO bases in Finland. All this will likely be need to be resolved for any settlement or ceasefire. That is a lot of negotiating and it still needs to include more than just Trump and Putin. 

Before this conflict started, Putin had offered to negotiate a comprehensive security arrangement for Europe, the answer was FU. There is little indication that the answer is any different now, other than Ukraine is about to go belly up. 

Does anyone believe that Europe or the U.S. is really ready to negotiate a long lasting security arrangement for all of Europe. History and the present dialogue indicates the western goal is the hope of dismemberment and subjugation of the Russian federation.

While such an agreement would be in the best interest everyone, I suspect the EU,  NATO and the neocons in the U.S. are not ready to give up on their decades old plans and Russia is no longer naive enough to believe otherwise.

Will Trump get it right, after trying all options?

 TRUMP'S FIRST 6 MONTHS SEEM MUCH LONGER

ZIGGING AND ZAGGING, WITHOUT CATASTROPHE

So far, Trump has not yet made any permanent catastrophic decisions.  We see trial balloons for lots of ideas and we even see trial policies that often are either postponed or withdrawn. Sometimes we must wonder if Trump, who is undoubtedly being pressured and influenced by a host of  parties to go in one direction or another is hoping to discredit his adversaries by openly giving credence to their pressure.

Trump's entire political career has, whether intentional or just by his existence, exposed so much of the hypocrisy and corruption in many of the institutions of America. We could list the mainstream media, the Intelligence community and the bureaucracy in general. Some of these exposures have been more subtle and just seem to come about on their own. 

So far, Trump has successfully navigated the pressure to escalate the war in Ukraine. One must speculate that the war in Ukraine, if left to a natural conclusion will soon come to an end.  It will come to an end when all sides realize that further fighting is useless.  It appears that Ukraine is entertaining that idea, but the European powers, not yet. There will not be some dramatic breakthrough of diplomacy, but the just the grinding reality of an end.

Trump's use of tariff's to bring about negotiations to address unfair trade practices has a hope of being successful. This applies to Canada, Mexico and the EU who are the most dependent on U.S. trade. As for China, an adversarial approach will not yield results and China has a lot leverage to make such tariff's, mutually painful. Trump's approach with China in his first term, was much more respectful and more successful. Again, I suspect that Trump has a lot of pressure to be tough on China, trash narratives and disrespect will not be productive with China.

It is no secret that the use of tariffs as a weapon in the Ukraine conflict was pushed by the Senate and it will be dismal failure, it will be counter productive and needs to be walked back to avoid permanent damage to relations with India. Maybe the Senate can be blamed for this misstep and silenced for some time.

Then, of course, there is the pressure to go to war with Iran, Trump has, at least for now, sidestepped that pressure, by declaring victory and allowing Israel to feel the possible pain of all out war with Iran, especially without total support from the U.S. Again, time may hopefully help to resolve some of these issues.

Trump seems to have been successful in curtailing much of the illegal entrance into the country and removing the worst criminal elements. He has also exposed the cities who have resisted. I believe this is political loser for all those who defend illegal immigration.

It is true that many of Trump's cabinet were not the most qualified, it is true they were picked for loyalty first. It is also true that in Trump's first term many of his picks were disloyal and in fact were motivated to undermine and damage him. 

Trump has sustained much criticism by adversaries and supporters, it is obvious that Trump does not have total unaccountable support from his supporters. He does have one quality, and that is the ability to change direction when it is obviously a failed path. Trump's path is lined with minefields and obstacles in abundance and it will not be straight path to a successful term. We can only hope that it will be successful.

Ukraine conflict, permanent negative results still expanding.

 UKRAINE, BIGGEST U.S. BACKED DIPLOMATIC FAILURE

REPERCUSSIONS ARE CHANGING THE WORLD

While the accepted narrative is that Russia invaded Ukraine in an unprovoked attempt to begin the process of restoring the former Soviet Union. Many observers do understand that this was in fact a calculated plan to force or bait Russia to protect its security and sovereignty by resisting at all cost further expansion of NATO on its borders.

The hope was that Russia could be drawn deep into Ukraine and systematically destroyed, resulting in a regime change and dismemberment of the Russian federation. The hope was to make its resources available and controlled by the western powers. It is ironic that possibly it will be more damaging to the perpetrators than to Russia.

Then hear the hypocrisy when anyone brings up the question, "What would the U.S. do if Russian or Chinese military bases would be installed in Canada or Mexico, it seems such an analogy is just not relevant to those who have been well programed for decades that Russia is evil and the U.S. is always right.

One other instance of the hypocrisy of U.S. policy was recently exposed when the U.S. general in Europe bragged that Kaliningrad, a small enclave of Russia in the Baltic, was surrounded by NATO nations and was vulnerable to be overrun in a short time. So much for NATO being a defensive alliance.

So, back to the long turn effects of this Ukraine conflict. The first casualty has been of course the people of Ukraine who have died at an alarming rate. It is now estimated that they have experienced 1.8 million casualties, some say that is actually those killed. Then there is near 10 million who have fled the country, many who will never return. It is also reported, by Ukraine that they have now 400,000 deserters, who also may never return. No one mentions those who are maimed and now disabled. Then of course there is loss of at least 25% of the country that will not be recovered.

Meanwhile Europe who has lost its availability of moderate priced Russian energy is slowly being deindustrialized and with the animosity toward Russia may never be available in same fashion in the future. Europe has a bleak future without access to Russian oil.

Geopolitically, Russia is now, by necessity, strongly allied with China and Iran. With the latest desperate effort to force India to stop using Russian oil it is forcing India, who has resisted taking sides, into the same alliance.  India is now in the process of buying Russian arms including air defense and now fighter jets. 

Then there is growing expansion of BRICS, which was formed in 2008, ironically when the U.S. first proposed NATO expansion into Ukraine and Georgia. It has expanded from 5 countries to now 10 members and 10 partners  combined it represents 56% of the world population and 44% of the world GDP. It is an economic alliance that is tariff free, and is increasingly transacting in their national currencies, rather than U.S. dollars. It also rejects sanctions as a political weapon. It has 30 other countries considering becoming affiliated.

Much of the world is moving away from domination of the western powers, this is happening from Asia to Africa and South American.

Much of this move is a reaction against war, intrigue and regime change politics, much of coordinated by the western powers intelligence agencies with full support of their governments. It is now possibly going to be very hard to reverse this trend.

Then there is the United States, laden with a $37 Trillion debt and growing, much of it accumulated in participating and financing war around the world. Most all, not in actual security threats against the United States, but a lust for power to rule the world. The same policies that have historically resulted in the end of Empires.

Trump's Senate forced deadline is a bust.

 SENATORS GO HOME AND TARGETS SAY NO

MORE SANCTIONS RISK ALIENATING INDIA

Senator Lindsey Graham claims he has 80 senators who want to put huge sanctions on any country that does business with Russia. The threat forced Trump to put a 50 day deadline on Putin to end the war or else. The deadline was then reduced to expire on this Friday. The sanctions would be in the form of tariffs of 100% on China, India, Brazil and others, the response has been an overwhelming rejection by all. The Senate went home without passing the bill.

Most importantly India, who has been fighting for years to position itself as a neutral and non aligned country, seems to be the major target, realizing that Brazil and China were always a no go.

The continued pressure on India, a country that has always had good relations with U.S., is soon going to be pushed further into an alliance with Russia and maybe even China. In the past few years we have witnessed an effort to cause internal problems in India by Canada making claims of assassinations of Indian dissidents in Canada, most likely orchestrated by U.S. intelligence. Recently we see actual fighting between India and Pakistan after a Pakistani terrorist attack on India. Pakistan's military is under control of the U.S. for decades and was instrumental in forcing its popular leader Imran Kahn out of power, attempting to assassinate him and he is now in prison. Khan offense was his hope of making Pakistan an neutral non-aligned country and spare his country from geopolitical intrigue.

This week, India has been airing all its complaints against the U.S. going back over 50 years. and is threatening to cancel its purchase of F-35's. If they do, will they be buying Russian or Chinese options? The outrage is India is becoming overwhelming and Trump is still promising big tariffs  on India for buying Russian oil.

India is exposing that the U.S.. has issued waivers on sanctions on U.S. importers of Russian Uranium, Palladium and fertilizer. It also points out that much Russian oil and gas still finds its way into the EU countries. Some believe it is more about the BRICS trade group than Ukraine.

So now we will see the risk of making deadlines that may be unenforceable or will cause some other escalation to save face. It is becoming apparent that the ability of the U.S. to force compliance from other countries by the use of sanctions may be coming to an end,  maybe it will be replaced with actual diplomacy.

Playing Russian roulette with the Russians?

 IMMEDIATE CEASEFIRE OR ELSE

POOR PLAYERS ALWAYS WANT TO QUIT WHEN THEY ARE LOSING

It seems every day a message is sent that the west is about to escalate to the point of nuclear war. It is good that, so far, Russia has not taken them very seriously. We have seen an attack on the Russian nuclear deterrent air force, can Russia not wonder if this is a testing of its ability to respond.  Then the U.S.. makes it known that nuclear arms have now been positioned in the UK., can Russia not wonder if this is indeed preparation. This week the U.S. general in charge of Europe stated that they can and have practiced and are capable of invading and taking Kaliningrad in very short time. Kaliningrad is a small 40 mile wide of Russian territory in the Baltic. Does anyone wonder why or what would happen after that? Would Russia then come to their senses and surrender? Trump has also stated that he has sent 2 nuclear armed submarines to be stationed off the coast of Russia. I assume Russia has its own submarines stationed within striking distance of the U.S. and now maybe it will be time to up the preparedness level. This all seems to be an exercise in juvenile gunboat diplomacy.

All this trash talking and actual moving of nuclear resources can only indicate to Russia that in their desperation the United States is considering a pre-emptive strike against the the leadership of Russia. This is indicated when the former leader of Russia responded to trash talking from the United States when he commented to not forget Russia's "Perimeter " or "Dead Hand" system. This is a reference to a system designed to automatically launch nuclear missiles if it detects a pre-emptive strike, even if it decapitates the leadership. It is no secret that some delusional people in Washington believe that they could do a preemptive strike on Moscow and all their problems would be solved.

It will be a sad day for the world if Russia begins to take the U.S. seriously and believes that a pre-emptive strike is imminent, it will leave them only one option.

This is all about the fact that Ukraine is in very bad straits. The plea is made that they want to stop the dying, but I suspect that if the roles were reversed it would be a completely different story, It would be onward to Moscow and reparations and dismemberment. The reality is, as it has been since the beginning in 2014, Russia is not going to accept NATO expansion in Ukraine and it will not stop until that is reality. If the west insists that not happen, and continues to escalate there will only be one ultimate result. 

The other option is to admit a miscalculation, an error of judgement, and agree to a neutral Ukraine and save as much of Ukraine as possible. It is the only way to really stop the dying. Stop with the, "Russia want to occupy Europe nonsense", who would want to rule over that mess? Europe has nothing that Russia needs.  This fiasco has been a tragedy for Ukraine, a loss of resources and young men for Russia, a lose of economic viability for Europe and a drain on the heavily indebted U.S. taxpayers. Only vanity and hubris is keeping this going, if only everyone could declare victory and go home, but that is not the reality of this dire situation. 

Why is U.S. losing its economic leverage?

 CHINA IS NOW THE DOMINANT TRADE PARTNER FOR 70% OF COUNTRIES

50% OF COUNTRIES HAVE DOUBLE TRADE WITH CHINA THAN US

We often hear how China is taking advantage of the U.S. in trade and the U.S. must now use its economic power to limit China's growth and economic expansion. A look at the 2 maps below indicate the difference in China vs U.S. trade performance with the world. I would say that horse is long out of the barn and the U.S. no longer has the economic leverage to block or diminish China's trading strength around the world. Sanctions and tariffs will not be able to stop the economic expansion of China nor will threats of war.

Lowy Institute graphic

The graphic is telling, but it also does not take into account that much of this growth has occurred in the last 10 years. It is no coincidence that this expansion has occurred after the onset of the U.S. wars in the middle east, efforts by several U.S. administrations to engage in trade accords with China and others. It is also interesting that this growth has occurred in spite of a U.S. policy of containment focused on China. A policy of sanctions, tariffs, embargo's of certain materials have all resulted in China actually becoming more self sufficient and continuing to expand.

Embargos of computer chips reversed China's $400 billion annual import of chips from the U.S to its being now a major exporter of computer chips at far less cost. It has been a negative effect on U.S. chip makers. Other efforts at embargos has resulted in China restricting the sale of vital rare earth minerals in response. 

The reality is that China has continued to enjoy a trading volume with the rest of the world, without threats, intimidation or sanctions, but by offering the best deal and opportunity for its partners to both prosper, always the best interaction in trade. 

The U.S. should take into account that the ability to buy low cost merchandise from China has kept the inflation rate low in the U.S. even with its habit of massive deficit spending. Sadly, China has enabled the U.S. federal government to be very fiscally irresponsible for all these years.

As for the U.S. losing its competitiveness, that is largely due to the massive repressive regulation and taxation that makes, made in the USA, increasingly prohibitive. If the U.S. would correct it all its disincentives to produce here it would take 30 years to become a positive reality.

While many will take this reality as offensive it is the world as it is today and requires a reexamination of policies both at home and abroad to ever hope to be successful. What is needed is more cooperation for mutual prosperity, rather than threats of economic or military force.

World support for Israel on life support.

 DENIAL AND RATIONALIZATION, NO LONGER WORKING

OWN POLICIES MAY BE ITS BIGGEST THREAT

It appears that a critical time in Israel's experiment may have now reached its most dangerous threat to its existence, not from Iran or other opponents in the region, but from its own policies that are in the process of alienating most of the world. The situation in Gaza and it seems a desire for endless war have piece by piece caused the biggest lose of world support in its history. 

While much of this is labeled as defensive strategies it is no longer being accepted by a growing majority of world opinion. Israel is a small country with a big powerful ally that has historically had the support of most of the world. Sadly that support has evaporated due to its polices in the last 2 years. Claims of opposition psych ops and other excuses are no longer credible. Israel needs a change of direction quickly or its future is going to be dire.

Not only has it lost world support, but it is fragmenting within, with an effort to keep its population up, but forbidding travel out of the country, other authoritarian measures and the economy is losing its vitality quickly. The country is likely in its most critical situation in it's history. 

The latest debate of whether people are starving in Gaza or not? If Israel is intentionally committing genocide or not? This is not the debate that will encourage support for Israel. 

Then there are public statements from high ranking Israeli politicians that state that the whole population of Gaza is Hamaa and should be treated as such. That babies will in 15 years  be terrorists and that food, water and medicine should be cut off until Hamas surrenders. All this is soon heard by the world.

Then there is the plan to displace the whole population of Gaza into a small area in the south in preparation for their removal to some still unknown place. There are reports that Israel and the U.S. is negotiating with Libya and some other African nations. Will these people actually end up being sold on the slave markets of Libya? Doesn't anyone realize that all this unacceptable, or have they come under some delusion, that everything is acceptable.

Today,  real solutions are harder than ever. The animosity is deeper and stronger than ever. It has been a great failing that real solutions have never been seriously attempted. Now the situation has deteriorated and it is doubtful if any of the population in the region will survive, including Israel.

More interesting facts about Epstein/ Maxwell case.

 LOTS OF UNANSWERED QUESTIONS

WHY DID BANKS PAY $365 MILLION IN DAMAGES

In the last few days it has been revealed that only 2 witnesses testified in both the Epstein and Maxwell Grand Jury trials. Only 1 FBI agent testified in the Epstein trial and the same agent testified in the Maxwell trial along with a N.Y. city policeman.

Epstein never went to trial but 4 victims also testified at the Maxwell trial along the same FBI agent. Maxwell never testified in her trial as both herself and her attorneys believed she would be acquitted.

It is interesting that J. P. Morgan Chase paid out $290 million dollars in compensation to over 100 alleged victims. Deutsche bank also paid out $75 million and the Epstein Estate paid out $121 million. This was all part of agreement that they would not seek any other action against the Epstein estate. One must wonder why these banks paid this money. 

One has to believe that Maxwell knows all about what went on in this affair, it appears she was around for much of the time cooperating with Epstein. It is reported that she was associated with Epstein from 1990 to around 2006 and she claims she was a property manager. It is not clear if she was actually involved after 2006, that is when Epstein was arrested and eventually received immunity from any other prosecution as part of his plea deal. This is why Maxwell is appealing to the Supreme Court claiming she is also covered by that Immunity agreement.

It seems that the allegations are concerning activities before 2006, It is not clear if any is concerning later activities, which lasted  for another 10 years.

Maxwell claims she wants to testify, but after a ruling by the Supreme Court, and also wants immunity for testifying. She cannot be forced to testify without the immunity deal. 

Many claim that there are hundreds, if not thousand of victims. Are we to believe that all these women were recruited for Jeffrey Epstein's personal activities?  Is that the accusation? If they were recruited to be coupled with Epstein's clients or guests, then they are accessories if not perpetrators. Are we to believe that Maxwell was able to recruit this massive number of women by herself ? All those associated are also accomplices. Sorry, the more that is revealed the more questions appear to be unanswered.

Maxwell was convicted of trafficking and sentenced to 20 years, are we to assume that all this was just to satisfy desires of Jeffrey Epstein?

I would expect that Maxwell could negotiate at least a commutation or a reduced sentence if she agreed to expose the whole truth. It is doubtful that the elite ruling class ever wants that to happen.

It will be interesting to see the how the courts and the legislature deal with these developments. We can only assume that many do not want any more revelations about this affair. Does anyone really believe the truth about the extent of this operation will ever be revealed?

Ukraine desperation, Will sanctions, tariffs work?

 TRUMP THREATENS RUSSIA, END WAR OR ELSE

THREATENING BRICS WILL SPEED ITS ADOPTION

Yesterday, Trump made it clear that he has shortened his ultimatum to Russia to now 10 or 12 days. One must assume that his analysts have made it clear that Ukraine is about to go belly up and that only a ceasefire will enable them to rearm and reorganize. Of course, Russia will not submit to these threats nor will the BRICS members, who Trump is threatening to put 100% tariffs on all of them. If enacted, it will be a signal to most of the world that the U.S. is desperate and it may be time to pull the plug on cooperation with the western world.

It should be clear that these new sanctions are to placed on Russia's trading partners, who are not going to jeopardize their economies to placate Washington.

It is unlikely that Trump will pull the trigger on these sanctions as it would be a dangerous gamble for the U.S. and western worlds economy. I suspect that Walmart, Amazon and other U.S. companies will advise him, that if enforced, it will destroy the U.S. retail market. Now that he has publicly made these threats, he is in a no win situation.

Then there is Europe, much of this Russian oil ends up in the EU market via India and others, if cut off, it will add to their economic woes. I also suspect that are not willing to put such tariffs on their BRICS suppliers.

So the danger is, that now that Trump has issued an ultimatum and he may not be able to enforce such a threat, he may be enticed to do some other escalation, like a long range attack on Moscow or an attempt take over Kaliningrad, Russia's territory in the Baltic. This coupled with the recent news that the U.S. has sent nuclear warheads to the UK, is again threatening to make a bad situation much worse.

Russia is not going to engage in a ceasefire without a plan to satisfy their security concerns and objectives. They have made this clear and should be believed.

The best outcome would for the west to swallow hard and make peace with Russia by insuring their security and thereby saving Ukraine from further devastation. That would need a large dose of humility and rational thinking, something that seems to be in short supply.

Navigating through a minefield of misinformation and disinformation.

 MORE INFORMATION AVAILABLE THAN EVER

DISCERNING THE TRUTH OFTEN DIFFICULT

The reality of the information world today is that we are bombarded with unlimited access to facts and also attempts to create a narrative that attempts to conceal or cloud what is true. There was a time when your news was limited to 3 Television channels and a local newspaper, while I am sure there was always attempts at disinformation, it seems that it was much more accurate in times past. Today the major news sources are now the most distrusted, because of their apparent partisanship. They have destroyed their own credibility by their own actions that eventually were exposed. 

At the same time, government agencies, that are often the sources of information, have also proved to be either clouding the truth or outright lying. Their credibility has also been enormously damaged, either motivated by partisanship or attempts to cover up wrongdoing. The reality is, that there is not much that can be trusted today.

It is not only what is reported falsely, but more often what is not acknowledged or reported on at all.

The internet does have access to many people who are on the ground around the world and is also accessible to most everyone on the planet. It seems everyone has access to the internet, except North Korea, and there is someone somewhere that is in close proximity to most every event that is newsworthy. It is a remarkable situation that allows for near instant access to events as they happen. It is increasingly evident that even these sources are being used by those in power to create a narrative that is in their favor. The internet is now the major source of information for most everyone, globally. It is, predictably, now a tool for those who seek the truth and those who wish to conceal it. 

There are no casual observer of the news, in fact, many have tuned out all news, feeling that there is nowhere that is honest or trustworthy. It is likely that no one source is reliable enough to be completely accurate. Only a wide range of sources allows some ability to gather a picture of what is really happening and then some sort of putting the pieces together, aided by experience and objective thinking will hopefully put one on the right path. This and hopefully the ability to admit error and not be locked into some sort of preconceived conclusion make everything a moving and evolving outcome. That is the reality of the world we live in today. 

Personally, having been an observer of things for 60 years, I do have an advantage over youth in that I remember many things that I can attest were facts, even when a different narrative is often put forth. Once you see things that you know are untrue, it is easier to question other things that are put forth. Then the methods and patterns are continually being reused and replayed, because they worked in the past and are more easily understood by those who have seen all this before. 

So, good luck, to all those who are interested in the world today and remember that, it is true, the truth does seem to prevail in the end, even when it often takes many detours and seems like a maze of dead ends and other roadblocks on the way.

West still all in on defeating Russia.

 POWER WITHOUT HUMILITY OR RESPECT WILL NOT SUCCEED

GOING DOWN WITH THE SHIP IS NOT GOOD POLICY

It seems at present there is a lull in the world conflict, but it continues in preparation for more activity. The Russians continue to steadily advance everywhere and the battle of Provosk is the next major battle. Russia has surrounded this city on 3 sides and it is promising to be a major pivotal battle. Again, Russia seems to be not motivated by time, just the same steady grinding conflict that has been their strategy. I suspect they believe that time is on their side.

Not much talk about Iran, who it seems is readying for the next fight expected possibly in September, after Israel is rearmed and reorganized. We continue to see attempts at destabilizing Arzebigan, Armenia and Georgia in an attempt to pressure Russia from the south and Iran from the north. Also the attacks by Pakistan on India must be noted that the Pakistani military is mostly controlled by U.S. intelligence and it is also likely an attempt to pressure India into siding with the west. Intense Psych ops in Iran, still hoping for revolution, but again, the Iranians have been dealing this for 45 years. 

It is also evident that the west still hopes it can persuade China to ally with the west against Russia or at least cut economic ties with Russia. A very unlikely expectation, as China understands that it is next, if Russia should succumb to west. 

Iran, China and Russia have the BRICS economic hope for their future and it is under threat in many places. Their hope is for an economic future not dependent or subservient to the west and it should be realized that no matter how the pressure increases, this alliance, now mostly economic, will not be broken.

Much has been made of the fact that neither Russia or China came to the military aid of Iran in the 12 day war. This was mostly because Iran refused an offer of a military alliance with Russia, claiming that they felt they could stand on their own. The reality is that if Russia or Iran appear to be on the brink of defeat, China will be forced to come to their aid as they understand they will be next.

We are in fact already in WW3, but at his time it is still mostly economic and political, because the west realizes it is not equipped, except for nuclear weapons, to prevail. Time is on the side of the opposition as the west has lost its manufacturing capacity, its unity and is losing its economic clout to force submission. 

As this conflicts continues Europe is weakened by shortages of energy and the U.S. is further damaged by a loss of military equipment, it cannot replace quickly. The rapidly increasing debt will soon create an economic crisis in most western countries, yet they still double down on their strategy, rather than seek a new era of cooperation and mutual prosperity. It seems they are destined to go down with the ship and possibly take the world down with them.

 

Will there be a real effort at "Russian collusion" accountability?

 TALKING ABOUT OBAMA AND CLINTON IS NOT HOW YOU DO REAL INVESTIGATIONS

INDICTMENTS START AT THE BOTTOM

We hear in the last week much talk about accountability for past administrations abuse of power and conspiracies to perform a soft coup on the president of the United States. While that is all likely true, we will know if it is serious, if we see indictments and actions taken from those at the lowest rung of the ladder. 

There is substantial proof that there was many instances of perjury from officials who signed FISA documents, when they knew it to be false. We have televisions proof of former DNI, James Clapper, lying under oath, in testimony to congress that the NSA does not gather information on all American citizens. Then the true whistleblower Edward Snowden, needed to flee the country, knowing he would be killed if apprehended for revealing just the opposite. Snowden should be pardoned if there is really an effort to make people accountable. I suspect that illegal collection of information is still ongoing.

How about the phony indictment by the Muller probe of Russian hackers, when they knew and there is documentation that there was never a hack of the Clinton emails or the DNC, but it was saved to a thumb drive and handed to Wikileaks. Julian Assange should also be pardoned and asked to testify. If you remember the Russian lawyers showed up and asked for disclosure to go to trial and Muller suddenly ended the indictment. Many of Muller's team knew they were chasing lies.

How about the documented proof that CIA director Pompano wanted to assassinate Assange and his family.

What about the 51 former intelligence officials who lied on the eve of an election that the Hunter Biden laptop was Russian disinformation, many had first hand knowledge that it was not.

Then there is collaboration between Adam Schiff and so called White House whistleblowers who started the Ukraine impeachment hoax.

How about Vidman and others who leaked White House conversations to discredit the President when he asked crooked Zelensky about the Ukrainian corruption with the Biden's.

There is a long list of low hanging fruit down at the bottom of the ladder, that is where the real accountability needs to happen.

Then there is Victoria Nuland, instrumental in the $5 billion of U.S. funds spent on the Ukraine revolution and other regime operations. I suspect there is a long trail of money to be followed.

I could go on and on, the abuses and lying and disinformation will take years to unravel, this occurred in both Democrat and Republican administrations and has resulted in a serious loss of credibility both at home and around the world. The methods and disgraceful tactics taken around the world have come home and have become the methods used to retain power and damage adversaries, if not dealt with, no matter how painful, this country will not survive.