Where finance and media intersect with reality


In the Blind Spot today (Commodity fallout, Gold reserves, Gosplan)

TBS Blog

Commodity carnage:

  • Listen to my Twitter Spaces with Frances Coppola and Chris Cook here. (We’ll be back tomor as well).
  • China is buying up all the collapsing in value commodity assets.
  • Zoltan Pozsar thinks we are about to have a Bretton Woods III. And the bitcoin crew are very excited. (The key bit from his report I think is this though: “every crisis occurs at the intersection of funding and collateral markets and that, in the presently unfolding crisis, commodities commodities are collateral, and more precisely, Russian commodities are like subprime collateral and all other stuff is prime.” and “To make things more complicated, China is probably thinking deep and hard about the value of the inside money claims in its FX reserves, now that the G7 seized Russia’s.” FWIW I was going on about that being a huge precedent with Biden’s de facto seizure of the Afghan Central Bank’s money for a reason.)
  • That time I wrote about systemically important commodity traders.
  • They might be locking down Russia’s gold reserves. (Another precedent that is going to kill the conventional understanding of how the Western financial system is supposed to operate.)
  • Italy may be facing rationing.
  • And now there’s an export ban impacting smartphones, cars and medical equipment.
  • Trafigura is raising a $1.2bn loan to meet soarting commodity prices.

Finance, markets, business etc

  • Are Qatar’s Black Sea gas terminals at risk?
  • The Polish central bank is under pressure to control its CHFPLN exposure.
  • Russian ETFs have been halted from trading for an indefinite period.
  • Bloomberg reports that in mid-February, hackers gained access to computers belonging to current and former employees at nearly two dozen major natural gas suppliers and exporters, including Chevron Corp., Cheniere Energy Inc. and Kinder Morgan Inc., according to research shared exclusively with Bloomberg News. The attacks targeted companies involved with the production of liquefied natural gas, or LNG, and they were the first stage in an effort to infiltrate an increasingly critical sector of the energy industry, according to Gene Yoo, chief executive officer of Los Angeles-based Resecurity Inc., which discovered the operation. They occurred on the eve of Russia’s invasion of Ukraine, when energy markets were already roiled by tight supplies.
  • Fuel exposure is ouch.
  • China is facing a wheat harvest crisis.(Dizard was right. That’s all I’m going to say.)
  • What’s going to happen to all the debt if we have to move to a ration-based economy? Here’s one idea.

WW3 Watch:

  • Four gigantic US bombers have arrived at a UK airbase amid WW3 fears.

Gosplan watch:

  • Russian banks turn to Chinese payments system after Visa and Mastercard suspend operations. (This story is possibly as important as the war story itself. There is a significant risk that if and when the rouble totally collapses, this will be the pathway to Gosbankification and the introduction to a social credit system-based master CBDC economy. Social credit system is another name for a ration-based system.)
  • In that vein, this is the chart my former colleagues made me for my goodbye leaving page:

Essential infrastructure:

From the hindsight zone:

Anyone remember Covid?

New territories, old politics:

  • Fighting Russia in Ukraine sadly appeals to racist, far-right extremists. (Amongst the millions of concerns I have right now, this is one of the gravest. As I mentioned in my newsletter at the weekend, there is a big risk that if Ukraine were to become a failed state, it could become a mecca for Nazis and extremists who decide they are better off fighting together than against each other.)
  • Russell Brand interviews Yanis Varoufakis. (I’m a little concerned about how enthusiastic Varoufakis is about the prospect of a communist revolution 2.0 in Russia. Putin is obviously a problem, but an already centrally structured Russia being retaken by communist revolutionaries is not an ideal outcome either. It is definitely worse than securing an extreme neutrality pact for Ukraine.)

The bigger picture:

From the “Fake News” zone:

  • Is Putin using a green screen or not? And if he is, is Biden also using one? In which case why? (Also mysterious: the sheer abundance of very aggressive responses to anyone suggesting it’s a green screen with the regimented assertion that “it’s compression, you idiot”. I don’t know why but I am reminded of the “carrots make you see in the dark” propaganda spun by the allies during WW2 to disguise the fact that they were using radar. Also, in a similar vein, I am growing somewhat suspicious of anyone who has excessive cat imagery in their profiles.)
  • What’s all the Z stuff in Russia?  (Is it Z for WWZ?)
  • Is it gene therapy or not?

Thoughts Izzy is having today:

  • Is it weird that the same people who were staunchly anti-Trump and anti-Brexit are now blindly in favour of border control, sovereignty and not just walls but NATO intervention to protect borders at any cost? Not trolling, just curious as to how to square the inconsistency?
  • I was speaking to one Ukrainian in Kyiv the other day and she was very critical of Russian liberals because in her opinion they wanted the same thing that Putin wanted: to be able to freely go in and out of Ukraine as if it was the same country.
  • Is Slava Ukraina really an appropriate thing to be chanting? I get the sentiment but how would “Glory to America” or “Glory to UK” sound?
  • International Women’s Day is a Soviet Russian holiday.
  • What happens to mortgage debt in a War Economy situation?

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5 Responses

  1. Hi Izabella, and thanks for the quality content! There was a piece in the DT today claiming that China does not have sufficient refinery capacity to handle (most) Russian heavy crude, effectively locking the product in Russia. Do you have any info on that?

    1. Do you have a link to the original story? Sorry for late reply – been out all day.

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