During the past week, we at GnS Economics forecasted that the Federal Reserve will cut by 25bps. Our reasoning was this:
However, the ‘super-core’, measuring services inflation, less energy services, rose by 4.9%, and 0.4% in month-over-month basis. This was the largest monthly increase in the index since April. We assume that this killed all hopes for a 50bps cut next week, because Fed Chair Jerome Powell has described super-core as the “the most important category for understanding the future evolution of core inflation”.
I still stand by this forecast, from a purely economic perspective, because the numbers were clear. Inflation pressures are picking up again. Moreover, retail sales and industrial production came in stronger than expected (0.1% and 0.8% M-o-M). The ‘green shoots’ of the U.S. economy, I reported a week ago, also suggested that the private sector recession may be ending, while risks are abound. The Fed must have seen the improving credit data.
The last time the Fed cut by 0.5% was in October 8, 2008, three weeks after the collapse of the venerable investment bank Lehman Brothers. This was the time when panic was gripping the markets with the Great Financial Crisis (GFC) surfacing with the failure of Lehman Brothers (the crisis had been brewing under the surface since September 2007).
Make no mistake. 50bps cut, is a panic cut. So, why did the Fed panic?
Most likely, there were four reasons:
The Fed is racking up massive losses.
Political pressure to not crash the markets before the Presidential elections on November 5 (last FOMC meeting before).
The Federal Reserve is genuinely worried about the economy, but especially about debt levels.
Banking sector fragility.
Like I noted two weeks ago, the Fed is accumulating massive losses from its holdings of Treasuries and corporate bonds. This is because it has bought them when they were much more expensive (rates were lower). When rates rose, the value of Treasuries collapsed, generating heavy losses for the Fed.
So, the one reason the Fed wants to lower rates (to increase the value of Treasuries) is because it wants to save its own *ss, by increasing the value of the Treasuries it holds. A central bank that holds large quantities of government bonds is never even semi-independent, because their value dictates the credibility of the Bank. The Fed tried to go around this problem by labelling the losses as deferred assets. That is, it marked losses as “assets” in its balance sheet. It is obvious that such blatant accounting fraud can fly only for so long. So, the Fed needed to cut to ease the financial burden, on itself.
Markets were expecting a 50bps cut, and so were some of the politicians. However, in actuality, a 50bps cut may turn up badly for the markets, because it signals that the Fed sees some serious weakness in the economy.
Banks seem somewhat optimistic and they have eased lending standards. There is not much room for leveraging among corporations and especially among households, though, which shows in the stagnation of borrowing. This indicates that the optimism among banks is likely to be a “false positive”. Their optimism can, for example, be based on the assumption that the Fed easing would create favorable conditions for an economic recovery. Due to the very high level of indebtedness of households and corporations, I consider this to be unlikely. This implies that we could see, possibly a drastic, turn into re-tightening of lending standards and softening of credit demand in the coming quarters.
I think this is the risk the Fed is seeing. There is simply too much private and federal debt and if rates stay high, defaults will start to roll in, with also the likelihood of U.S. sovereign debt rising. This would hurt the economy badly.
U.S. banks continue to struggle under a gargantuan amount of unrealized losses. They arise mostly from the same source as with the Fed, i.e. from Treasuries losing value, en masse. We also noted in the August World Economic Outlook of GnS Economics that the outflow of core deposits seem to have re-started. Deposit outflow is a major risk for the banking sector, because it implies waning trust and, as banking is a business of trust, waning trust implies growing fragility in the banking sector. The Fed cannot stop the outflow of deposits, but it can try to diminish the unrealized losses by cutting interest rates, and hoping that Treasury yields follow. At the time of writing, this was not going well with, e.g. the yield of U.S. 10-year Treasury note shooting up. This is an (early) indication that the bond market now expects inflation to pick up.
Core deposits in the U.S. banking system. Source: GnS Economics, FDIC
Alas, the Fed eased heavily, because of the losses it and U.S. banks are accumulating and because it sees the risk of the economy breaking. These are not encouraging signs.
* * *
P.S. There’s always the possibility that Fed Chair Jerome Powell is a pitiful small man. I don’t believe so, but I of course do not know him personally.
As the saying goes, “It’s not how fast you can go, but how far you can get”—and in today’s world, a dependable car is crucial for getting you wherever you need to go.
Reliability, or how consistently a vehicle performs without experiencing mechanical failures or issues over time, remains a key factor when choosing which brand of vehicle to purchase.
Overall, Asian automakers led in reliability metrics by a wide margin in 2023, with an average score of 63 for the region. Seven of the 10 most reliable brands are from Asian automakers.
Specifically, Japanese vehicle-makers dominate the top of the rankings, making up six of the top 10 and four of the top five most reliable car brands. The only other Asian car brands in the top 30 were South Korean brands Kia and Hyundai, ranked 10th and 11th, and Genesis in the 18th position.
European automakers came in second, with a score of 46 for the region. Along with British car-maker Mini which came in third, German automakers Porsche and BMW were the top-ranked European brands, coming in at eighth and ninth respectively.
The most reliable American brand was Buick, placing 12th overall, and followed by Tesla and Ram in 14th and 15th respectively.
Methodology: Determining Vehicle Reliability
Consumer Reports ranked cars on their reliability based on data from member surveys and analyses of over 330,000 vehicles. Vehicles analyzed included 2000 to 2023 model years, with a few early-introduced 2024 model years.
They looked at 20 trouble areas, from small issues like squeaky brakes to major flaws like expensive, out-of-warranty engine or EV charging issues, and then weighed the severity of each type of problem to create a predicted reliability score for each vehicle, from 1 to 100.
Consumer Reports uses that information to give reliability ratings for every major mainstream vehicle brand sold in the U.S., and then combines that rating with data collected from their track testing, as well as their owner satisfaction survey results and safety data, to calculate each car brand’s overall score.
This year, Consumer Reports added three new trouble areas specific to hybrids, plug-in hybrids, and electric vehicles: electric motor, EV/hybrid battery, and EV charging.
Internal combustion engine (ICE) vehicles have 17 potential trouble areas.
Electric vehicles (EVs) can have up to 12 trouble areas. Traditional ICE problems are not included, such as those with the engine and transmission.
Hybrids(HEVs) have 19 potential trouble areas: 17 from ICE vehicles, as well as electric motor and EV battery.
Plug-in hybrid electric vehicles (PHEVs) can experience all 20 trouble areas: 17 from ICE vehicles, as well as electric motor, EV battery, and EV charging.
Here are the 20 possible trouble areas Consumer Reports assess:
Transmission (Major), Transmission (Minor), Drive System, Fuel System, Electric System
Suspension, Brakes, Exhaust
Paint/Trim, Noises/Leaks, Body Hardware
Electrical Accessories, In-car Electronics, Climate System
To learn more about each generation’s preferences when it comes to car brands, check out this graphic that shows the top 10 car brands and their ownership rate according to each generation
“Senators, Calgary is a lot closer to Washington than Riyadh. And you don’t need the U.S. Navy’s Fifth Fleet to patrol the Great Lakes.” So said then-Alberta Premier Jason Kenney at a U.S. Senate Energy and Natural Resources committee hearing in May of 2022, just a few months after Russia’s invasion of Ukraine thrust energy security back into the spotlight.
While global markets have calmed since the 2022 energy crisis, geopolitical tensions have worsened, there is war in Europe and the Middle East, and economic nationalism and protectionism are on the rise. Uncertainty reigns, which makes the North American energy alliance Premier Kenney championed all the more important. However, a sector-by-sector cap-and-trade system designed to meet Canada’s ambitious economy-wide 2030 greenhouse gas (GHG) goals is threatening this increasingly important partnership.
While it should go without saying that U.S.-Canadian energy trade is critical to each country’s energy security and economic prosperity, Canada’s role in responding to U.S. demand with a safe and secure supply of affordable energy is often overlooked or poorly understood by policymakers.
Even though the U.S. is the world’s largest oil and gas producer, it increasingly relies on its northern neighbor to supply refineries with much-needed heavy crude oil and keep power flowing to households and industry. In fact, growth in Canadian imports is an important factor driving America’s reduced reliance on OPEC countries, as the country now accounts for more than 50% of U.S. petroleum imports. Meanwhile, virtually all natural gas coming into the U.S. comes from Canada, and it is also America’s primary supplier of electricity and important minerals such as uranium. In total, two-way energy trade of oil, natural gas, electricity and uranium reached a record total in 2023 of $156 billion USD.
This energy security partnership must not be taken for granted. Potential serious disruptions loom, especially if Canada’s intentions to impose a cap on the emissions produced by its upstream oil and gas sector go forward as envisioned. While Canada’s emissions cap does not directly constrain energy production, it will do so as a practical matter, because the substantial costs and long lead times required to approve and deploy emissions-reducing technologies to power oil and gas operations (such as carbon capture and storage (CCS), waste heat recovery systems, and small modular reactors) leave industry with no other options.
This could force Canadian producers to curtail operations as a compliance measure. Estimates suggest that curtailment could range from 626,000 to as much as 2,000,000 barrels per day—amounts equivalent to 16 – 52% of U.S. imports of Canadian crude oil. Similarly, natural gas producers would need to reduce production by approximately 2.2 billion cubic feet per day, or roughly 76% of imports to the U.S. All this at a time when energy demand is rising, and power sector dependence on natural gas grows in response to coal retirements, transportation electrification, and data center expansion.
Put simply, the de facto production caps under consideration by the Canadian government threaten to severely restrict cross-border energy trade in a way that harms our shared economic and security interests. They should not go forward as proposed, but that does not mean industry opposes ambitious action on emissions. To the contrary, energy companies on both sides of the border are investing billions of dollars on the transition to a cleaner energy future. Progress abounds in both the U.S. and Canada, from investments in multi-billion dollar CCS projects and alternative fuels such as renewable natural gas to clean hydrogen production and world-leading actions to reduce methane throughout the oil and gas value chain. This commitment is unwavering, and promises to enhance North American energy security while meeting international demand for our (lower-GHG-footprint) exports.
Policymakers should seek to strengthen cross-border collaboration on energy security, infrastructure, climate change policy, harmonized standards and development and deployment of key clean energy technologies. This coordination should recognize and protect the fundamental role each country plays in enhancing North American prosperity, meeting global demand and building resilient energy supply chains. Taking this broader view should also consider the increasingly important and integrated role both countries play in providing a safe, secure and clean supply of energy to overseas markets and NATO allies.
Together, Canada and the U.S. have dominated global oil and growth in the past decade, creating an energy secure North America while driving billions into innovation and technologies designed to lower emissions. Policy actions that limit production and export capacity could reverse this progress, leaving us and our allies more vulnerable. We must instead leverage our deeply interconnected energy systems and rock-solid commercial relationships in support of a North American Energy Security framework that will deliver benefits for decades to come. Our organizations and collective membership stand ready to be a fully committed partner in this effort.
Dan Byers is Vice President of Policy at the U.S. Chamber of Commerce Global Energy Institute.
Michael Gullo is Vice President of Policy at the Business Council of Canada.
Populous countries and strong population growth are most often associated with Asia today. But as Statista’s Anna Fleck details below, according to data by the United Nations, come the turn of the century, the balance will be less clear cut.
In 2020, five out of the ten most populous countries in the world were located in Asia – China, India, Indonesia, Pakistan and Bangladesh – while two were in Latin America, one was in Africa and one in North America.
Come 2100, four African nations will place in the world’s top ten: Nigeria, Ethiopia, Tanzania and the Democratic Republic of the Congo.
While some Asian countries will continue to grow, they will do so at a lower rate and will be surpassed in population by African countries exhibiting faster growth. Others, like China and Bangladesh are actually expected to shrink until 2100, mainly a result of higher standard of living and education that has already begun to lower birth rates.
In 1950, four European countries were still among the world’s largest. That number will have decreased to one in 2020 and none in 2100.
The number of children born worldwide is already decreasing, but at 2.3 children born per woman, the world’s population is still growing.
UN population researchers found that if the global fertility rate kept dropping at the rate it currently is, it would reach 1.9 children per woman in 2100, at which point the world population would actually be decreasing.
Bulgaria announced on Thursday that it is opening an investigation into a Sofia-based company reportedly linked to the sale of thousands of pagers that were packed with explosives by Israeli intelligence agents and blown up across Lebanon on Tuesday.
Preliminary reports name Norta Global Ltd to the sale of pagers to Lebanese resistance movement Hezbollah, with Hungarian-based shell company BAC Consulting acting as an “intermediary.”
“BAC Consulting Kft was involved in the transaction as a simple intermediary. So much so that the company itself did not actually carry out any activities, it does not have an office, it is only reported to a home provider,” Hungarian news agency Telexreported on Wednesday.
Owned by Norwegian citizen Rinson Jose, Norta Global was founded in April 2022 and is located at a residential address in the Bulgarian capital. Like its Hungarian counterpart, Norta Global is registered with a “headquarters service provider,” which hosts 196 other companies.
Bulgarian state security agency, DANS, announced on Thursday that it is working with the interior ministry to probe the role of an unnamed company registered in Bulgaria in the terror attacks that rocked Lebanon this week.
Furthermore, Bulgaria’s state security agency said it “did not detect any shipments” of the pagers on Bulgarian territory.
According to intelligence officials who spoke with the New York Times (NYT), the attacks that left dozens killed and thousands injured in Lebanon were the result of a “complex and long in the making” Israeli operation.
BAC Consulting reportedly served as a front to manufacture thousands of pagers on behalf of Taiwanese company Gold Apollo that were acquired by Lebanon’s Hezbollah earlier this year.
“BAC did take on ordinary clients, for which it produced a range of ordinary pagers. But the only client that really mattered was Hezbollah, and its pagers were far from ordinary. Produced separately, they contained batteries laced with the explosive PETN,” three intelligence officers who spoke with the NYT are quoted as saying.
Exploding pagers could now be anywhere… and beyond Lebanon.
“At least two other shell companies were created to mask the real identities of the people creating the pagers: Israeli intelligence officers,” the report states.
Saudi Crown Prince Says No Israel Normalization Without Palestinian Statehood
Current events in Gaza and Lebanon, including the Tuesday and Wednesday pager attacks which have sown widespread chaos and death in Beirut, have caused Saudi Arabia to get more vocal in rejecting normalization with Israel.
The US has for several years been pushing hard for it behind the scenes, calling it “the deal of the century” connected with the Abraham Accords, but Riyadh is fast backing off reports of progress. Crown Prince Mohammed bin Salman (MbS) made clear in a Wednesday speech that there will be no official relations with Israel without the establishment of a Palestinian state with East Jerusalem as its capital.
“The Kingdom will not cease its diligent efforts to establish an independent Palestinian state with East Jerusalem as its capital,” he told the country’s Shura Council in Riyadh during an annual address.
“We confirm that Saudi Arabia will not establish diplomatic relations with Israel until that goal is achieved,” he emphasized. He added that Israeli “crimes” in violation of international laws makes this impossible at the moment.
“The Palestinian cause is a top priority for Saudi Arabia, and we reiterate the kingdom’s rejection and strong condemnation of the crimes committed by the Israeli occupation authorities against the Palestinian people, in disregard of international and humanitarian law in a new and bitter chapter of suffering,” he added.
“We extend our thanks to the countries that recognised the Palestinian state in embodiment of international legitimacy, and we urge the rest of the countries to take similar steps,” he said further.
Normalization seemed on the cusp last year, but the Oct.7 Hamas terror attacks disrupted it, and some pundits at the time even said the Palestinian side was intentionally trying to blow up any efforts at Arab-Israeli normalization broadly. Palestinians fear that their cause will be forgotten if the Abraham Accords take wide effect in the region.
Throughout Israel’s military operations in Gaza, the Saudis have warned that normalization could be permanently off unless Israeli forces withdraw from the Stip. Back in May, for example, the kingdom warned that an operation in Rafah “would be a big mistake and would push normalization between the two parties away.”
The IDF of course went forward with a major Rafah operation and across the southern part of the Strip anyway. After that, Riyadh has made clear it is no longer pursuing diplomatic relations with Israel.
And so dies another Middle East dream of the Biden administration.
In televised speech, Saudi Arabia Crown Prince Mohammed bin Salman says the kingdom won’t establish diplomatic relations with Israel without the establishment of a Palestinian state. #SaudiArabia#OOTTpic.twitter.com/Js9NouMLXC
The Saudi royal family has always been more open to ties with Israel than the populace and clerics. It is especially the Wahhabi clerical establishment which frequently issued fiery condemnations of the Jewish state.
MbS has always had to keep this in mind, given persistent fears there could be unrest or an uprising among the ultra-conservative imams and broader population.
In order to understand Russia’s current strength, stance and strategy, it is necessary to understand developments since 1990. Only then will it become clear why President Putin is doing what he is doing and why he will be successful.
Development since 1990
When the Soviet Union collapsed, Russia was devastated. Boris Yeltsin, Russia’s first president, did not succeed in lifting the country out of its misery. There were solid reasons for this, both inside and outside Russia.
The West – under the leadership of the US – pursued an unequivocal strategy of destruction. Sachs provides first-hand evidence that Poland, which later became an EU and NATO member, was helped back on its feet from 1989 with billions in aid from the G7, the IMF and other Western institutions – and very successfully so.
The approach to Russia was completely different. Russia was never supposed to become a partner of the West and Professor Sachs shows how, as an advisor to Gorbachev and then Yeltsin, he failed to organize support from the West. The US’s goal was not the recovery of Russia, but the disintegration of the country into small, digestible portions, which would then be taken over by puppets from the US. This plan is still being pursued today with enormous effort and is currently culminating in the war in Ukraine. We already reported on this last summer in an article entitled “The planned dismemberment of Russia”.
Russia after the planned dismemberment
The high point on the road to Russia’s destruction came in the late summer of 1998, when Russia’s economy collapsed, the rouble lost 99.9% of its value and the state could no longer service its debts. The US was almost at the end of its rope.
Things turned out differently – a previously inconspicuous and little-known man came to the levers of power – Vladimir Putin.
Russia’s development under President Putin
President Yeltsin first appointed Vladimir Putin as Prime Minister in 1999. On the last day of the same year, he was then inaugurated as President of the Russian Federation.
Vladimir Putin, the new president, was faced with the ruins of a once dreaded world power. The economy was in ruins, the infrastructure practically non-existent, the people disillusioned. A few oligarchs who, with the help of American investment banks, had snatched up Russia’s prime assets, controlled politics in order to steal even more at the expense of the general public. The army – at all times the backbone of the Russian state – was a mere shadow of its former self and NATO’s eastward expansion was in full swing.
In short, Russia was in a deplorable state and many observers did not give the country much chance of survival as an entity.
President Putin achieved the almost impossible. First of all, he removed the oligarchs from power politically in a way that was highly publicized. He ensured that wages, salaries and, above all, pensions were gradually paid again – regularly and in accordance with the law. In doing so, he created a basis for later trust. As a result, the foundations were laid in all areas of life and the economy, which enabled the subsequent upswing.
These few words describing this unprecedented process of change do not begin to convey the colossal problems that had to be solved. It took years for the first successes to become visible and tangible for the population and this development continues to this day.
The course of the young president’s first years in office are the source of the phenomenon that the political West simply cannot understand and is not willing to comprehend, and which can be described in its own way as basic trust in Putin. Putin ensured wages, pensions, food, basic compliance with the law, stability and prosperity – the basis for modern Russia.
In terms of foreign policy, President Putin initially sought proximity to the West and pursued a policy aimed at making Russia a partner of the EU on an equal footing and developing friendly relations with the US. After 9/11, Putin even allowed the US to use Russian airfields.
Munich speech – Georgia – Maidan – Syria
In his famous address in Munich on 10 February 2007 at the Munich Security Conference, President Putin criticized for the first time the monopolistic dominance of the US and its almost unchecked use of force in international relations as well as the unstoppable eastward expansion of NATO. A surprising turn of events for the West. It was forced to acknowledge that Russia would no longer accept this development.
Georgia’s 2008 attack on its breakaway territories under Russian patronage – organized and orchestrated by the US – meant that Russia was forced to reassess the structure and armament of its military in light of the given threat situation. Under the pretext of reclaiming former Georgian territories, the real aim of the aggression was to create the conditions for the admission of new countries to NATO – namely Georgia and Ukraine and thus, above all, to weaken Russia.
The admission of Georgia and Ukraine was to be approved at the NATO summit in Bucharest in 2008. Surprisingly, Russia was also invited to the summit as a guest – proof of how weak the US considered the Russian Federation to be at the time.
All these events forced Russia to devote a great deal of energy to rebuilding its military. This was only possible because the economic and political conditions had been created in the meantime.
Maidan 2013/14 and an eight-year covert war by the West against the ethnic Russian Donbass confirmed the decisions Russia had made in 2008.
Non-compliance with the Minsk I and II agreements – initially expressly welcomed by Russia, in reliance on Germany in particular, as an effective instrument for settling the cruel intra-Ukrainian disputes – ultimately put an end to any trust Russia had in the political leaders of the West and Western diplomacy as a whole. They did not want a peaceful solution.
Russia first demonstrated its new military strength in Syria in 2015. Through its intervention, the American plans to destroy Syria as part of the Wolfowitz Plan of 1992 failed. Russia achieved the turnaround in Syria with a skilful military approach using a very manageable force.
The strategic capabilities of the Russian leadership
Clearly defined overall strategy is being consistently implemented
President Putin sees the war in Ukraine as just one piece in a big chess game that began with the fall of the Soviet Union with its 64 squares spanning the entire globe. He repeatedly referred to this in his speeches. In my opinion, it borders on imbecility that the West does not give President Putin’s speeches the attention they deserve. Unlike many Western leaders, Putin is a prime example of strategic transparency. He implements exactly what he articulates in his speeches. This may come as a surprise to the West. It is also becoming increasingly evident that Western strategy is limited to being against Russia. As a result, the West has no strategies at all for its own interests. The economic and social downfall of Germany as a de facto colony of the US is a prime example of this. See my article “Germany is a naive pawn of the US with no power to turn things around”.
The fact that Russia is stronger today than at any time in its recent history is based on a rational, systematic and forward-looking long-term strategy, not just by Putin, but by the entire Russian leadership over the last 24 years.
The reasons why Russia has not only survived the biggest sanctions storm ever organized by the West, but has actually prospered, can be found precisely in these factors. The Russian leadership anticipated the West’s policy and made the necessary and, above all, correct political and economic decisions years in advance. Today, despite the Western sanctions storm, Russia has healthy economic and social foundations that allow it to react quickly and efficiently to any new economic attacks.
The result has astonished the West: Russia is one of the few countries without net debt. This year it can boast economic growth of over 5%. In contrast, the US and the EU are effectively in recession and bankrupt by any balance sheet standard, which is becoming increasingly evident as the manipulation of economic figures becomes less and less effective at disguising the truth.
The political West’s view of President Putin as a dictator who does and controls everything himself cannot be any further from reality. Putin has gathered a team around him that largely consists of absolute top people who understand their tasks and can fulfill them competently. In recent months in particular, this has included an uncompromising fight against corruption throughout the country, which does not even stop at ministers and takes place very publicly. The consistency shown here is extraordinary and shows that Russia is preparing for a long conflict, even if not all the swamps have been drained yet.
In addition to the economic strengthening during this crisis and the clear military victory on the front, Russia has managed to become the foreign policy and diplomatic heavyweight of the Global South alongside China. Russia’s partnership with China is reflected in an increasingly effective coordination of their decision-making. With the BRICS and SCO organizations, these two giants are forging economic and security policy organizations that will bid farewell to the hegemonistic system of the West and turn this world into a multipolar community of states.
Kursk and further Western escalation
Ukraine’s attack on the Kursk region caught Russia by surprise. The reaction of the Russian leadership and the population made it clear almost from the outset that even this action, which was simply impossible without Western coordination and material support, would not be able to divert Russia from its path. It will be weeks before the Ukrainian troops are driven out, but ultimately the invasion of Kursk will only accelerate the end of the current political Ukraine. The operation has already failed and will probably go down in history as being the last stand of a loser.
This is also reflected in the fact that Kiev is constantly trying to re-explain the purpose of this military suicide mission. If the declared aim was to obtain a bargaining chip by occupying the Kursk nuclear power plant, for example, this aim was not achieved. The explanations were then changed to the effect that the aim was to force the Russians to withdraw their units from the Donbass to Kursk in order to ease the pressure on the Ukrainian troops. This did not happen either and the actions of the Russian troops even accelerated.
The aim of terrifying the Russian population was also not achieved. The fact that Russian territory was attacked for the first time since 1941 had the opposite effect on the Russian population. Estimates show that up to almost 30 thousand Ukrainians and Western mercenaries invaded Kursk and that over 12,000 of them have already been killed. It can be assumed that the remaining troops will be wiped out over the coming weeks and months. These forces are now missing at the front in the Donbass; they were the best that could still be assembled.
I expect the Americans to escalate the conflict further. The Americans will probably supply the JASSMs, which can be fired from the F16s. This weapon will – depending on the design – theoretically be capable to reach even Moscow; theoretically, because to reach Moscow it would be necessary to bring an F-16 to the east of Ukraine, which is not impossible due to the dense Russian air defense, but should be associated with considerable difficulties – and impossible without Western logistical support.
Such long-range weapons will go down in history as the next new wonder weapon, which will change the course of the war, but – like all others – will have no influence on the course of the war. We already explained this 18 months ago in our article “Wonder weapons, weapon systems and gibbeerish” and we were right.
Will President Putin allow himself to be provoked by these ultimately militarily ineffective provocations, which will have no influence whatsoever on the final outcome?
True strategists have endless patience
The patience of President Putin is repeatedly pondered – by both pro-Western and pro-Russian exponents. One commentator on our article “Kursk: invasion, start of war, distraction, pledge?” quoted the proverb “Beware the fury of a patient man.” by John Dryden.
In my opinion, however, describing the attitude of President Putin and his team as patient is an oversimplification and in no way captures the essence of Russian strategy. A chess player without patience inevitably loses. A gifted chess player creates the conditions for victory over his opponent by patiently implementing a strategy once it has been recognized as correct.
Putin’s chessboard stretches as far as Russian interests extend. He will not change his strategy, which has proven its worth over the last 24 years, by reacting emotionally to the events in Kursk or the missile strikes in Russia, which are very painful for the affected population. In my opinion, anyone who believes that Russia can be provoked in this way is wrong and has – once again – failed to understand Russia’s strategy and its implementation. The fact that the entire West is pursuing this course of provocation and believes in it is by no means an argument for its success, but rather shows that the West has no strategy at all. The lack of strategy is easily demonstrated: In our article “The consequences of the intercepted German Luftwaffe conversation mean war”, we described a possible target for Russia in response for the use of Taurus. Let’s assume that Russia would carry out such a strike, which, by the way, would be unproblematic. What would Germany’s reaction be? – Screaming, nothing more. The whole of NATO in Europe would have no instruments to respond in a serious manner. NATO would have no chance in a conventional conflict. That is not an assertion, but a fact. NATO has been getting a bloody nose in Ukraine over the past two and a half years, at the expense of the Ukrainians. The NATO forces themselves do not have any serious armed forces in Europe, neither in terms of size nor quality. The only first-class army in NATO is that of Turkey and it will certainly not march against Russia. Germany invaded the Soviet Union in 1941 with an army of almost four million men, and the Soviet Union was poorly prepared militarily at the time. The result is a well-known fact. What would happen if NATO were to invade Russia with a few hundred thousand soldiers from various NATO member states, a Russia that has never been so militarily strong and war-tested? A downright ridiculous thought.
Thoughts on Russia’s next steps
Fundamental principle
Any reaction by Russia must be understood in the context of the overall situation on the global chessboard. With regard to Ukraine, President Putin’s goals are known in principle and have been clearly communicated time and again since February 2022: Denazification, demilitarization and neutrality of Ukraine (NATO) and the retention of Crimea (Istanbul 2022) as well as the retention of the regions of Lugansk, Donetsk, Saparoshia, and Kherson (Istanbul+) by Russia.
As President Putin is aware of the US’s long-term strategy (dismemberment of Russia) and the broken agreements (1991 and Minsk I + II), Russia will not be willing to agree to a ceasefire followed by negotiations. Negotiations will take place at the earliest when there are no more Ukrainian soldiers on Russian soil; this includes the four regions mentioned above, which are now part of Russia.
These goals are currently within Russia’s grasp. The situation in Kursk, i.e. the deployment of Ukrainian troops, has accelerated in recent days and it can be assumed that this suicide mission by the West will very soon be history. If one follows the developments on the Donbass front, one can see that the advance of the Russians is accelerating daily and it is only a matter of time before the Russian forces are on the Dnieper. The Ukrainian armed forces are virtually disintegrating. There is a shortage of soldiers and material.
Diplomacy
Trump’s candidate for the vice presidency, Senator Vance, explained the peace proposal that Trump would probably put forward: (1) A demarcation line along which the then existing front line would run and be fortified so that the Russians could not attack again; (2) Guarantee of Ukraine’s neutrality towards Russia, i.e. no membership in NATO or other allied institutions. (3) The Germans and other European countries should finance the rebuilding of western Ukraine.
As expected, the Trump-Vance campaign’s proposed policy on Ukraine is nothing less than forcing the Government of Ukraine to formally cede all occupied territory and abandon accession to NATO or other “allied institutions” with a guarantee of neutrality to Russia. pic.twitter.com/ycfqDSv3s1
By November, the Russians will probably be on the Dnieper and thus have achieved militarily what Vance and Trump intend territorially – or even more.
(President) Zelensky will be fuming if this plan is implemented. He himself exercises his power without a legal basis because his term of office expired in May and he did not stand for re-election. How could he? He no longer has any popular support and the war is lost. He must fear not only for his power, but for his life. Anyone who believes that he will lead a sweet life in exile – for example in Miami – with his stolen billions does not have a clue about the Americans. The American plan in Ukraine has failed, so the US no longer needs this man in Kiev and the heavily cocaine-addicted Selenski knows too much. He will probably suffer the same fate as Ngo Dinh Diem, who was executed – probably on US orders – on November 2, 1963. Problem solved.
The typical end of an American puppet: Ngo Dinh Diem
Europe, especially Germany, will be furious. As a loyal vassal of US interests in Ukraine, Germany has ruined itself economically and socially and contributed to the destruction of Ukraine with its military and financial support. If Trump becomes president, he will abandon Germany and leave the bill for reconstruction on the table in Berlin.
However, the peace plan is not only a disaster for Selenski and Europe, but also for the deep state in the US. Trump realizes that the US cannot afford a war against Russia, not even financially, and he would accept another foreign policy and military defeat. The deep state does not. I explained why in my article “US Elections Decide War or Peace”. The aforementioned plan to dismember Russia would be set back decades or made completely impossible by a Trump-style peace. The fact that the Deep State is doing everything it can to prevent a Trump election was already evident in this week’s debate: the two ABC “journalists” who were supposed to conduct this debate neutrally were actually fighting for Kamala Harris, who has close ties to the head of ABC.
It is not clear who will win this election, but I suspect that Donald Trump’s life is in danger.
American pressure on BRICS countries
It is obvious that the U.S. is putting massive pressure on the BRCS countries – especially Brazil and India – to get Russia to negotiate. These countries, which do business with both the Global South and the Collective West, are trying to pass this pressure on to Russia.
China is also being pressured, with the result that payment transactions between Russia and China are currently being disrupted due to pressure on Chinese banks. China’s relationship with Russia is characterized by strong economic cooperation, but strategically – especially for the Chinese – it is military. China’s interest in a Russian victory over NATO in Ukraine is vital to the survival of the Middle Kingdom. As the declared main enemy of the U.S. in its struggle to maintain its hegemony, China will only be able to withstand this pressure as long as Russia is strong on its side. China’s chances of winning this battle – which will be fought over the next few generations – depend militarily on Russia. Although China has a very large army, which is constantly being expanded, and an impressive high-tech arsenal of weapons, China has no experience of war – in stark contrast to Russia. Andrei Martyanov convincingly argues that Russia today has the only armed force in the world that masters “combined warfare,” an indispensable prerequisite for winning a real military conflict. Real means against a serious enemy. This is precisely why Ukraine – even with the active help of NATO – has no chance against Russia.
Russia is certainly taking these calls from its BRICS partners seriously at the diplomatic level, but will not deviate from its strategy in any way.
Russia’s reactions to the Western escalation
The attack on the Kursk region has already had consequences, such as the destruction of the NATO-run training center in Poltava at the beginning of September. In this center, Ukrainian troops were trained by NATO officers for drone and missile attacks on Russia. According to my sources, around 720 soldiers were killed in this attack, including a large number of NATO instructors from Sweden, Germany, France and Poland. Not mercenaries, but NATO officers.
Large numbers of personnel were trained in Poltava to operate drones and for electronic reconnaissance. Sweden intended to sell two SAAB 340 AEW Erieye aircraft, a smaller version of the American AWACS aircraft.
SAAB 340 AEW Erieye
Sweden also trained personnel for this purpose in Poltava. The completely surprising resignation of the Swedish foreign minister the morning after the Russian attack should not surprise anyone.
An indication that this information is true are the movements of some huge Lockheed Martin K 130 aircraft, which in the Medvac version can transport 74 wounded. A large number of Medvac flights were carried out by Poland, Germany and Romania. This makes the claim that many NATO personnel were injured very credible.
President Putin comments on the use of long-range weapons against Russia on September 12
President Putin does not see the permission of the US and the UK to use Western long-range weapons against Russia as permission, but as a clear and direct entry of NATO countries into a war against Russia. He justifies this view with the fact that these attacks cannot be carried out by Ukraine without NATO support. On the one hand, Ukraine has no satellite reconnaissance of its own and, on the other, it does not have the personnel to provide technical support for the weapons systems.
President Putin’s conclusion verbatim:
If this decision is taken, it will mean nothing other than the direct involvement of NATO countries, the United States and European countries in the war in Ukraine. This is their direct involvement, and this, of course, significantly changes the essence, the nature of the conflict.
It means that the NATO countries, the United States and the European countries are at war with Russia. And if that is the case, then given the changed nature of this conflict, we will make appropriate decisions based on the threats that will arise for us.
These statements by President Putin are once again a brilliant move. They automatically provide him with a legal basis for an attack on any NATO member in the event that these long-range weapons are used. He doesn’t have to – but he can – at any time.
Conclusion
President Putin is well aware of the long-term U.S. strategy toward Russia: the dismemberment of Russia.
During his first 22 years in office, Putin tried to solve this problem diplomatically by refraining from the use of armed force until February 2022. On the one hand, this prolonged use of diplomatic means by Putin is hushed up by the West or interpreted as weakness. On the other hand, this angelic patience is sometimes blamed on him within his own ranks.
In the period up to 2022, Russia flourished thanks to an unprecedented economic and social policy that can only be compared to Germany’s postwar recovery after World War II, although the comparison is not entirely accurate: Germany was backed by huge resources, mainly from the US, to make its success possible. Russia did not have this privilege, but achieved it on its own, which makes Russia’s recovery since 2000 all the more impressive.
Putin’s strategy is a holistic, global chess game, balanced down to the last detail and based on such a stable foundation that even the biggest storm of sanctions ever initiated by the West not only failed to damage the Russian economy, but actually led to an economic upturn.
Militarily, Russia today has no opponents: the West has no strategy – neither geopolitical nor military – but uses propaganda as its main weapon and is embarrassing itself on the battlefield to such an extent that it would make you laugh if schadenfreude were appropriate – it’s not: countless people are dying as a result of these cynical games organized by a few sociopaths, and the media in the West are either bought or so stupid that you can’t laugh.
Russia is going to end this war and dictate the terms. What’s amazing is that according to Vice Presidential candidate Vance, a possible President Trump would come very close to the Kremlin’s terms. However, it’s anyone’s guess whether Trump will live to see the election, as the Deep State will do everything it can to keep the war ball in play; it can only succeed without Trump.
My guess is that the attacks on Russia with drones and missiles – including long-range missiles – will continue and intensify. Like the Kursk adventure, these actions will have no impact on the overall military situation. The situation on the main front is increasingly becoming a disaster for Ukraine: Russian territorial gains are developing rapidly, and Ukrainian losses are mounting as conscripted soldiers desert in increasing numbers. This has even been reported by CNN, another indication of the catastrophic situation in which Ukraine finds itself.
I do not rule out a Russian attack on a NATO base outside Ukraine – one should never do that – but I think it is unlikely at this point. However, if long-range attacks on Russia were to be staged from Poland or Romania, they would also be legally justified.
The Russians are known to react unconventionally, so American bases in the Middle East are obvious targets that the Russians could attack – this time through their proxies.
Let’s hope for some residual sanity in Western decision-making centers so that things don’t take a turn for the worst.
An FBI informant who shared his home with two of the 9/11 hijackers has been accused in civil court of being “co-opted” by Saudi Arabian intelligence to help carry out the Sept. 11, 2001, terrorist attacks.
That informant, Dr. Abdussattar Shaikh, was presented in the 9/11 Commission Report as “an apparently law-abiding citizen with friendly, long-standing contacts among local police and FBI personnel.” Shaikh was recruited as an informant in 1994, according to his handler.
But according to plaintiffs suing Saudi Arabia for its role in 9/11, at some point Dr. Shaikh was “hired” by Saudi intelligence agent and Omar al-Bayoumi to house the two hijackers, Nawaf al-Hazmi and Khalid al-Mihdhar.
“It was a plan that had been carefully and meticulously developed by Bayoumi in conjunction with other Saudi officials,” a plaintiffs’ lawyer argued at a July 31 court hearing, according to the Florida Bulldog.
“Dr. Abdussattar Shaikh, the FBI informant who shared his home with Flight 77 hijackers Nawaf al-Hazmi and Khalid al-Mihdhar, had in fact been “co-opted” by a Saudi intelligence asset.”https://t.co/tyakThqWIF
The Saudi government denied that al-Bayoumi hired Dr. Shaikh, reportedly arguing in a court filing that “there is no evidence he had anything to do with [the hijackers] moving into Shaikh’s house.”
Dr. Shaikh’s FBI handlers have also defended the man. His handling agent, Steven Butler, told the 9/11 Commission that Shaikh was “duped” by the hijackers, while former San Diego FBI chief William Gore recently told the Florida Bulldog that Shaikh was “one of the finest guys I ever met.”
Dr. Shaikh, for his part, was reportedly “too old and ill” to be formally interviewed for the long-running civil litigation. A New York federal judge is expected to rule soon on whether the lawsuit against Saudi Arabia will be allowed to continue.
The allegations against Dr. Shaikh follow several other revelations that have come out in recent months, implicating Saudi Arabia in 9/11.
Those revelations included a long-suppressed video showing al-Bayoumi “casing” Capitol Hill in June 1999—months before al-Qaeda made the decision to include Washington DC in its terrorist plot. Numerous investigators believe the Capitol building was the target of Flight 93, which instead crashed in Pennsylvania.
More recently, last month it was revealed that sketches plotting the 9/11 attack belonged to al-Bayoumi.
Pretty interesting development in the long-running 9/11 civil litigation. It was revealed earlier this month that attack plans pictured on the left belong to the man on the right–a Saudi agent and alleged CIA asset pic.twitter.com/wNTvS0GTpB
Families of 9/11 victims argued in a 71-page brief filed on May 7 that al-Bayoumi operated under the directions of the Saudi Kingdom. Along with “casing” the Capitol, he served as the handler for al-Hazmi and al-Mihdhar.
Additionally, new evidence in recent years has suggested that not only was al-Bayoumi a Saudi agent; he was also an asset of the CIA. That information has been coming from the proceedings against 9/11 defendants at Guantanamo Bay.
According to Office of Military Commissions investigator Don Canestraro, at least two FBI agents told him that the CIA had attempted to recruit two of the hijackers as informants. The CIA was directing its recruiting efforts through al-Bayoumi, according to Canestraro.
Canestraro has also implicated Dr. Shaikh of having received money from the Saudis while working as an FBI informant.
Undercover Serial Predator: CIA Officer Drugged & Molested Dozens Of Women While Stationed Abroad
A career CIA officer was sentenced to 30 year in federal prison on Wednesday for drugging,raping and sexually assaulting over two dozen women across multiple countries while doing official work for the agency. The CIA veteran, identified as Brian Jeffrey Raymond, had actually documented his own crimes in photographs and video. The FBI is in possession of some 500 images showing him molesting his nude, unconscious victims.
The 48-year old’s crimes often took place in government-leased apartments abroad, presumably while he was ‘under cover’ or on assignment in a covert capacity. The assaults go back to 2006 and there are victims across Latin America – including Peru and Mexico – and other countries.
Prosecutors described a 14-year rampage: “The defendant’s goal was simple: to sexually and physically assault women when they were at their most vulnerable and to create a lasting collection of photographs and videos memorializing his abhorrent deeds,” they wrote. The case specified that the attacks took place at his “government-leased housing.”
His crimes began to be uncovered following a May 2020 incident in Mexico City during which time he was attached to the US Embassy there. A woman was heard screaming for help from the balcony of his residence, after which federal agents upon further investigation searched his electronic devices and found hundreds of images of women being abused.
He would meet women on dating apps, lure them to his apartment on dates, and then spike their food or drinks to make them unconscious. The AP describes, ironically enough, the following of the case as it finished up in federal court this week:
…an emotional hearing in which victims described being deceived by a man who appeared kind, educated and part of an agency“that is supposed to protect the world from evil.”
It appears he often specifically used his position with the government to gain the trust of his victims (either as a CIA agent or US ‘diplomat’ with the embassy). NPR writes:
Court filings reviewed by NPR said they found 487 videos and images of unconscious women in “various states of undress” on multiple devices belonging to Raymond, as well as searches for terms including “passed out,” “ambien,” “ambien and alcohol and pass out,” “Zolpidem and pharmacies” and “deep sleep” between 2010 and 2011.
The FBI said almost all of the women involved “experienced memory loss during their time with Raymond and had no knowledge of the photographs, videos or any physical contact.”
“For 14 years, Raymond exploited his trusted position as a U.S. government representativeto lure women into his confidence,” said FBI Assistant Director in Charge David Sundberg.
Once they were unconscious, he spent hours posing their naked bodies before photographing and assaulting them. He opened their eyelids at times and stuck his fingers in their mouths.
One by one, about a dozen of Raymond’s victims who were identified only by numbers in court recounted how the longtime spy upended their lives. Some said they only learned what happened after the FBI showed them the photos of being assaulted while unconscious.
A US government employee pleaded guilty last week to drugging & sexually abusing multiple women.
Over a 14yr period, he drugged, sexually assaulted, & recorded/photographed 28 women in multiple countries.
“My body looks like a corpse on his bed,” one victim described of the photos to the court. “Now I have these nightmares of seeing myself dead.” US Senior Judge Colleen Kollar-Kotelly said while imposing the 30-year prison sentence, based on a plea deal: “It’s safe to say he’s a sexual predator.”
Clearly his position in the CIA enabled this serial predator to keep assaulting women in secret over such a long span of so many years. This comes as the CIA deals with additional pending investigations related to sexual assault and misconduct allegations. How many more serial predators are out there, using their ‘cover’ and security clearance to harm and abuse women?
The FBI released a new batch of records on the white nationalist group Patriot Front on Tuesday, revealing that its members have been talking to the feds.
The 112 pages of FBI records are almost entirely redacted, but the reason for some of the redactions is noteworthy: The FBI cited section B7(d) of the Freedom of Information Act, which is an exemption designed to protect the identities of confidential sources—or, in other words, FBI informants.
Headline USA found at least three records citing B7(d) while skimming through the records.
One of the few unredacted records in the new batch also shows that a Patriot Front member agreed to a voluntary interview with FBI agents.
The FBI released another batch of Patriot Front records today. Interesting thing is they’re littered with B7(d) FOIA redactions — which are used to protect … informants!
Also, a member agreed to a voluntary interview w/ agents. Don’t those boys know not to talk to the feds? pic.twitter.com/e18BtUoUDD
According to that record, the Patriot Front member told agents that Patriot Front was a group that peacefully demonstrated, encouraged its members to get off drugs, and promoted physical activity. However, several portions of the interview are redacted, including the member’s information about his social media activity. The redactions cited in this portion of the FBI file were those designed to protect privacy.
Tuesday’s FBI document dump is the latest evidence of federal infiltration in the Patriot Front. It follows a New Yorker article from last month, which revealed that the group may have provided information to the FBI about a left-wing Antifa member who infiltrated and doxxed its members.
“The exposed Patriot Front members were furious at Vincent [after he doxed the group]. To strike back, they appear to have enlisted an unlikely ally: the F.B.I.,” the New Yorker reported.
Another batch of records released in July showed that the group was infiltrated by at least one undercover informant.
“On February 11, 2019, FBI Charlotte received Confidential Human Source (CHS) reporting from [REDACTED] Division regarding [REDACTED],” the record stated.
Patriot Front member Kai Nix was 17 when this picture was taken of him w/ FBI informant Michael Alan Jones.
The New Yorker and SPLC both reported on the now-20-year-old Nix’s arrest this week, but you won’t find any mention of how the FBI ran a sex-offender informant at the young… pic.twitter.com/R1KNGeG9SC
An FBI informant who was once a member of the Patriot Front was charged in 2022 with unlawfully possessing a firearm and ammunition by a convicted felon—a charge stemming from a March 2022 traffic stop in upstate New York, where police officers allegedly found him in possession of an illegally modified AR-15.
That informant, Michael Alan Jones, may have been the CHS discussed in the above-mentioned FBI memo, given that he lives close to Charlotte—the office that received information from a Patriot Front CHS in 2019. If that’s the case, it would be the first public confirmation that Jones was acting as an informant while in the Patriot Front—court records only confirmed that he spied on the Proud Boys.
Jones, who reportedly stormed the Capitol on Jan. 6, 2021, has been referred to as a “fed-ophile” by his former comrades, due to him previously being convicted of two felony sex crimes.
Despite all that evidence, Patriot Front leader Thomas Rousseau has downplayed the threat of federal infiltration.
“The FBI, I don’t believe, engages in the type of undercover infiltration that a lot of people attribute to it as much as people think,” he said in June.
