Archive for November, 2015

A Turkey geopolitical game

Posted: November 30, 2015 in Uncategorized

Due to Thanksgiving..we should talk about turkey (funny but not so funny).

In 2013 I wrote that the strategic retreat from the middle east from the US will bring to us the raise of the old empires…Iran and Turkey. The Saudi are another element but without a serious military power and now they are flat in the Yemen quagmire reminiscent of Afghanistan and Vietnam.

Turkey play to raise as new Ottoman Empire is multiple.

1. Substituting Assad with a pro Turkey government (hence the issues with Russia).
2. Use the migrant crisis to get money from the EU and ultimately be part of the European Union( even as not really democratic country and first Muslim majority country in Europe).
3. Become a regional superpower.

Erodogan play is card ruthlessly well up to this point.

It sent a clear message to Russia do not mess with us as we are US backed and successfully blackmailed Europe.

Now the next phase it would be the good guy pacifing Russia and be the saviour of Europe.

He is already trying to stem the flow of migrants and he suspended the flight over Syria just in case the Russian decide to retaliate.

This is a very delicate phase as Putin naturally is aware of this and really piss off.

Putin finds himself at odds. In order to hit economically Turkey seriously he should cut the energy supply (60%), but in this case Russia would lose precious billions of dollars. Also, in retaliation, Turkey could close the Dardanelles which would be a declaration of war with Russia.

Nobody wants a war with Russia. Apart that even in this decreased status the Russian army will be able to inflict substantial losses to NATO.

NATO as it is more technically advanced will probably win, but once in crisis Russia would use a nuke in Turkey and everything would be stalled (hopefully).

For those who do not believe me the top Russian general  declared in 2014 that it is a normal procedure for the Russian Army to deploy tactical nuclear device even without central authority in case Russia gets under attack (strategic nukes are for Putin only and he just updates 2 subs with 16 nuclear strategic missile each containing 10 independent nuclear bombs…just to be clear).

So a NATO Russia confrontation is highly unlikely.

But Putin will play other cards like help the current divisions in Europe to fracture it.(France and Greece are already more aligned with Russia than Germany/US).

On top of all this the US is entering its Presidential election year where get President is kind of a lame duck.

Interesting times


Great article from the best “on the ground” magazine by far. Close to the truth find the truth

Russia Turkey, different take

Posted: November 26, 2015 in Uncategorized

I strongly believe that Turkey shot down the Russian plane as a warning as Russia is really crippling IS (while Turkey wants to crippled Assad) and hitting the Turkey /IS lifeline for oil and troop reinforcement.

But it is impossible that Putin did not know it could happen and he could have send some air superiority fighter to protect the SU 24 bomber.

A few ideas.

Putin could not risk that Russian warplane shot down Turkish plane first.

Putin could want this to happen so to expose Turkey / IS connection

Putin is realigning with France so this create a wedge between France Nato and Turkey US

It could be a distraction for Ukraine 

Ankara defends ISIS, Russia has data on Turkey’s financial interest in oil from ISIS – PM Medvedev

It www known…but now it is official

Well what are the consequences of the downing of the Russian warplane (and the rescue helicopter that was downed with one Russian marine killed).

As Putin cannot back down from his “macho” posturing there will be a lot of words and more Russian bombings, but not much else. Also the markets got partially saved by Thanksgiving holiday (Thursday) .

The real issue is that there will be no second accident.

On saying this I mean that everyone got more hostile and if a second accident really happen a full air/sea battle will take place with not only air engagements, but also warships involvement…there are more than 30 of them…even Chinese.

In that case…start running.

Update ..again the narrative does not make sense.
On Turkey side they said they alerted the Russian plane 10 times. Even NATO logs show that the plane was in Turkey for 17 seconds. Try call someone 10 times in 17 seconds.
The reality is that the Turks, enboldened by being a NATO member, wanted to protect the Syrian Turkmen which by the way shot the helicopter with a US Tow missile probably initially given to the Free Syrian Army.

Consequences (without being too doomsday)
1. Economic retaliation (Turkey depends 60% from Russia as of energy …but also Russia needs money)
2 More issues in the Turkey Armenian Georgian region
3 A further split in Europe /Nato. After the France attack France and Russia were coming togheter. There is a general tendency pro Russia in Southern Europe and towards US in Northern Europe +Turkey

It is just me that I noticed that the SU 24 went down in a very mountainous zone and already there are several pics and video of the airplane coming down and there have been no picture of the big and cumbersome MH17 shot down in Ukraine close to 2 towns?

Even the Russian civilian plane was pictured over Sinai (a populated but desertic area).

Turks shoot down Russian warplane

Posted: November 24, 2015 in Uncategorized

Well quite a while ago I posted that was the main issue…a lot of monkeys with big sticks in a small area.

It is not clear if F16 shoot down the SU 24 or from the ground. The big issue is the Russian already says that it was in Syrian airspace and they can prove it.

The pilots parachuted out (thank God) and a Turkish helicopter went to retrieve the pilots. Apparently it was shot at by Syrian Turkmenistan (technically pro Turkey but forgotten and apparently pissed off) and the fate of the pilots is unclear.

Naturally the stock market future sank.

Hopefully everybody will try to de escalate. Let’s not think alternatives.

The US Fed rates and markets

Posted: November 24, 2015 in Uncategorized

What happens on average when the Fed start rising rates?

Usually initially the US market performs well (not extremely good but positive), but nn US markets outperform after a shaky start.

The US dollar decreases and treasury yields rise.

The classic defensive sectors lose out to cyclical.

Emerging market have no consistent pattern and commodities rise (funny apart the talk gold does not react badly).
Usual best sectors are tech, financials and healthcare (all sectors that in this case already ran a lot)

We do not know what will be happening this time.
Main differences
Commodities are in a four and credit spreads are widening not contracting.

So history has no good indicators this time as situation is too different.

In my opinion there could be a wobble and a counterrally…but all eyes will be then in understanding the pace…so in reality not much will happen

Bloomberg – China Cracks $64 Billion `Underground Bank’ Moving Money Abroad

Comment…part of the money smuggled outside to buy…Autralian real estate..just stopped …wonder why our real estate market slowing down.. ..

Hollande to tell Obama Europe can’t wait for US war of attrition with ISIS to succeed – report