Beware of economists (and historians) – connecting Anzacs and Armenians

My home country, New Zealand, was privileged last week to be visited by an eminent historian from the United States. Professor Jay Winter teaches at Yale University, and is said to be an authority on the First World War,

Well he had nice but sad things to say about New Zealand’s contribution to that horrendous conflict. It seems servicemen from my country died in greater numbers relative to population than those of any other combatant nation – a dubious honour, you’d have to think. Does that make our boys braver, more stupid, or just unlucky?

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Quite a few Indians were sent too, apparently, to “defend” the Empire

In the interview I read, Prof. Winter then proceeded to devote a lot of words to making a connection between New Zealand’s joining the ill-fated Gallipoli invasion, and another tragedy of the “Great” War, the deaths of thousands of Armenian civilians. The link is the date: 24 April is when Armenians remember the day in 1915 when their ancestors in SE Anatolia were rounded up by the Ottoman government and forced to “relocate” to what is now Syria, a lot of them dying on the way. On 25 April in the same year, the British Empire, following a plan championed by War Minister, Winston Churchill, landed on the beaches of the Gallipoli Peninsula in a vain attempt to take the Ottoman Empire out of the war.

Prof Winter seems to think he has found something very new and exciting, as every academic dreams of doing. Possibly in his professional writing he actually does manage to make some hitherto unnoticed link that will shine the unequivocal light of day on matters that remain highly contentious. After all, says the learned prof, “Historians are in the truth business.”

Naturally, historians, jealous of their professional reputation, would like to think so – but the sad reality is that history, like economics, is a social science, lending itself to interpretation according to the particular political or ideological lens one uses to view the “facts”. Prof Winter gives a clue to his real purpose in visiting NZ when he suggests that the country’s new “Labour” government may be amenable to joining the ranks of other self-righteous nations that have officially designated the Armenian tragedy “a genocide”, for which the modern Republic of Turkey should be held responsible.

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Genocidal violence with a smiley face

He may be right. Self-styled left-wing parties in the wealthy First World, bereft of ideas for actually changing anything important in the lives of the planet’s 99%, tend to offer crumbs of trendy, fashionable issues to their diminishing ranks of supporters. Barack Obama, in his original presidential campaign, wooed the Armenian lobby, but changed tack later, for reasons best known to himself.

Wiser heads may win the day in NZ too, and not simply because they fear that offending Turkey may earn their globe-trotting citizens a chillier welcome on their annual pilgrimage to Anzac Cove on 25 April.

However sincere Prof Winter may be in his search for truth, certain aspects of this interview gave me cause for concern. First, it appeared on News Hub, a NZ news service that airs on TV Three and radio stations run by MediaWorks. A little digging turned up the interesting fact that MediaWorks is a New Zealand-based television, radio and interactive media company entirely owned by Oaktree Capital Management. And Oaktree Capital Management, according to Wikipedia, “is an American global asset management firm specialising in alternative investment strategies. It is the largest distressed investor in the world, and one of the largest credit investors in the world.”

Nothing necessarily wrong with that, of course. Everyone has to make a living, and I’m sorry to hear those guys are distressed. However, the page where that interview appeared contained a link to another article praising “a young Kiwi historian” James Robins, who is apparently “grappl[ing] with the fact that no New Zealand Government has ever formally recognised the genocide of Armenians”. Mr Robins’s “grappling” is supported by a “genocide expert”, Maria Amoudian, and an American heavy metal musician Serj Tankian.

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Genocidal violence with a grumpy face

In the interests of academic objectivity, we might want to also take a look at the work of researchers with less obvious connections to the Armenian diaspora.

One such is Edward J Erickson, a retired regular US Army officer at the Marine Corps University in Virginia, recognised as an authority on the Ottoman Army during the First World War. He makes some interesting points in a paper entitled “The Armenian Relocations and OttomanNational Security: Military Necessity or Excuse for Genocide?” I’m quoting a chunk from it, but you really need to read the whole document. It’s only 8 pages long.

“The historical context that led to the events of 1915 is crucial for understanding the framework within which the relocation decision was cast. There are four main historical antecedents that must be understood in order to establish this context:

  1. the activities of the Armenian revolutionary committees (particularly the Dashnaks);
  2. the activities of outside powers supporting the Armenian committees;
  3. the contemporary counter-insurgency practices used by the Great Powers; and
  4. the Ottoman counter-insurgency policies and practices in the late nineteenth and early twentieth centuries.

“Many historians view the outbreak of the First World War as the proximate cause of what some historians refer to as the Armenian Genocide, others as massacres and relocations, and still others as the Events of 1915. To this day, interpretations of this question remain hotly contested by the advocates of the opposing positions. However, both sides agree on the fact that the Ottoman approach to the problem of quelling an insurgency clearly and dramatically changed in 1915 when it shifted from a historical policy of kinetic direct action by large-scale military forces to a new policy of population relocation. The problem then becomes that of explaining how the First World War created the drivers of change that caused this fundamental policy shift. Similarly to the four elements of the historical context, there were also four principal drivers of change created by the war:

  1. the actuality of an insurrection by the Armenian revolutionary committees;
  2. the actuality of allied interventions and support;
  3. the locations of the Armenian population as an existential threat to Ottoman national security; and
  4. the inability of the Ottomans to mass large forces effectively and rapidly to quell the insurgency.

“With respect to the question of whether the relocation was necessary for reason of Ottoman national security in the First World War, the answer is clearly yes. There was a direct threat by the small but capable Armenian revolutionary committees to the lines of communications upon which the logistics of the Ottoman armies on three fronts depended. There was a real belief by the government that the consequences of failing to supply adequately its armies that were contact with the Russians, in particular, surely would lead to the defeat of the Ottoman Empire. The Ottoman high command believed it could not take that chance. Pressed by the imperative of national survival to implement an immediate counterinsurgency strategy and operational solution, and in the absence of traditionally available large-scale military forces, the Ottomans chose a strategy based on relocation— itself a highly effective practice pioneered by the Great Powers. The relocation of the Armenian population and the associated destruction of the Armenian revolutionary committees ended an immediate existential threat to the Ottoman state. Although the empire survived to fight on until late 1918 unfortunately thousands of Armenians did not survive the relocation. Correlation is not causation and the existing evidence suggests that the decisions leading to the Armenian relocations in 1915 were reflexive, escalatory, and militarily necessary, rather than simply a convenient excuse for genocide.

Another article you might want to take a look at appeared in The Washington Times, in 2007, around the time Barack Obama was running hot on the Armenian issue.

“Armenian crimes against humanity and war crimes against the Ottoman Turkish and Kurdish populations of eastern and southern Anatolia during World War I and its aftermath have been forgotten amidst congressional preoccupation with placating the vocal and richly financed Armenian lobby.

“Capt. Emory Niles and Arthur Sutherland, on an official 1919 U.S. mission to eastern Anatolia, reported: “In the entire region from Bitlis through Van to Bayezit, we were informed that the damage and destruction had been done by the Armenians, who, after the Russians retired, remained in occupation of the country and who, when the Turkish army advanced, destroyed everything belonging to the Musulmans. Moreover, the Armenians are accused of having committed murder, rape, arson and horrible atrocities of every description upon the Musulman population. At first, we were most incredulous of these stories, but we finally came to believe them, since the testimony was absolutely unanimous and was corroborated by material evidence. For instance, the only quarters left at all intact in the cities of Bitlis and Van are Armenian quarters … while the Musulman quarters were completely destroyed.”

“Niles and Sutherland were fortified by American and German missionaries on the spot in Van. American Clarence Ussher reported that Armenians put the Turkish men “to death,” and, for days, “They burned and murdered.” A German missionary recalled that, “The memory of these entirely helpless Turkish women, defeated and at the mercy of the [Armenians] belongs to the saddest recollections from that time.”

capitalism

and all the world will live happily ever after. No need to study history.

“A March 23, 1920, letter of Col. Charles Furlong, an Army intelligence officer and U.S. Delegate to the Paris Peace Conference, to President Woodrow Wilson elaborated: “We hear much, both truth and gross exaggeration of Turkish massacres of Armenians, but little or nothing of the Armenian massacres of Turks. … The recent so-called Marash massacres [of Armenians] have not been substantiated. In fact, in the minds of many who are familiar with the situation, there is a grave question whether it was not the Turk who suffered at the hands of the Armenian and French armed contingents which were known to be occupying that city and vicinity. … Our opportunity to gain the esteem and respect of the Muslim world … will depend much on whether America hears Turkey’s untrammeled voice and evidence which she has never succeeded in placing before the Court of Nations.”

“The United States neglected Col. Furlong’s admonition in 1920, and again last Wednesday. Nothing seems to have changed from those days, when Christian lives were more precious than the lives of the “infidels.”

Will we ever know the truth? Who knows? But one thing is for sure: if you want to stand a chance of learning it, you need to keep an open mind and do your own searching. And beware of “expert” historians (and economists).

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‘US mercenaries’ hired to ‘torture’ Saudi royals

Well, I now you’ll tell me the UK’s Daily Mail is not everyone’s first choice for sourcing reliable news stories. On the other hand, I have to tell you, I’m pretty sceptical about the reliability of the New York Times, The Washington Post, and the UK’s very own Guardian and Daily Telegraph. So where does that leave us?

Saudi USAThis item is all over the web, although the source seems to be the same – some guy tweeted, twittered, or whatever whistle-blowers do these days, that Saudi princes and billionaire businessmen arrested in a power grab earlier this month are being strung up by their feet and beaten by American private security contractors.”

“According to sources quoted by Dailymail, ‘Blackwater’ has been named as the firm involved, and the claim of its presence in Saudi Arabia has also been made on Arabic social media, and by Lebanon’s president.

“Lebanese authorities have unconfirmed information that the Blackwater firm is guarding Hariri and his family – not official Saudi security forces,” tweeted Michel Aoun, the President of Lebanon, last Wednesday.

A high-profile Saudi whistleblower, one who is said to have inside information, also claimed Salman has brought in at least 150 ‘Blackwater’ guards. “The first group of Blackwater mercenaries arrived in Saudi Arabia a week after the toppling of bin Nayef [Salman’s predecessor as crown prince]”, he tweeted.

Saudi & hillary“One of the most important tasks of these aggregates are escorting and guarding bin Salman (especially confidential visits) and implementation of important and sensitive commands in addition to guarding the Princes and officials cut the ways their communication with the outside world.”

The source confirmed that the name ‘Blackwater’ is being circulated as the company providing the mercenaries; the controversial private security company, however, no longer exists under that name and is now known as Academi.

A spokesperson for Constellis, Academi’s parent company, denied the claims. The spokesperson told Dailymail that it has no presence in Saudi Arabia and does not carry out interrogations. “Constellis through Academi does not now or have we ever provided interrogative services,’ they said.

‘We do not provide security services in KSA (Kingdom of Saudi Arabia), we have no contact or connection with any government official or private party regarding this allegation.’

index-1-e1510746655829When asked if Academi workers were involved in any kind of violence during these interrogations, the spokesperson said: ‘No. Academi has no presence in KSA. We do not have interrogators, nor do we provide any interrogators, advisors or other similar services.’

They added: ‘Academi does not participate in interrogative services for any government or private customer. Academi has a zero tolerance policy for violence. We operate legally, morally, ethically and in compliance with local and US laws.’

A zero tolerance policy for violence! Blackwater! Words fail me!

So what do I take from all this? Saudi Arabia has some very serious internal ideological problems. The ruling elite have been stooges of Britain and the United States since their oil rich desert land achieved “independence” after the Ottoman Empire vanished at the end of the First World War.

Saudi Arabia contains within its borders the two holiest sites of the Muslim religion: Mecca and Medina. Their state religion is an extremist Wahhabi version of Sunni Islam. A good number of devout Saudi Muslims are seriously outraged by their governing royal family’s venal relationship with the United States of America and their grasping capitalist overlords. They are further outraged by the fact that the USA has military bases on their holy land.

5b86ed125e68cba0a17be861f531442f--political-cartoons-atheismThe September 11, 2001 attack on the United States, if it wasn’t actually perpetrated by the Bush administration for their own nefarious purposes, was, at the very least, carried out by Saudi Arabian nationals, the most notorious of which was Osama bin Laden, scion of one of Saudi Arabia’s wealthiest families.

After US President Trump visited Saudi Arabia in May this year, the Saudi government joined forces with the United Arab Emirates, Bahrain and Egypt to implement a trade embargo on their Arab neighbour Qatar. We can be sure there were many voices within the Saudi kingdom raised against this action.

If I were a betting man I would say this is a power play within Saudi Arabia by Crown Prince Mohammed bin Salman, supported by the United States and Israeli governments to get rid of dissenting voices and ensure that the kingdom continues to be a loyal ally and supplier of oil into the future. What do you think?

If you don’t think there’s a conspiracy, you’re not paying attention

An interesting article I came across in Time Magazine: “Why Smart People Still Believe Conspiracy Theories”

wall street conspiracyA coterie of academic stooges set out to prove that people who believe in “conspiracy theories” are of sub-normal intelligence. Unfortunately for them, their findings did not confirm their initial hypothesis – so they had to come up with another one, ie people believe what they want to believe. Which is probably equally true of people who insist that there is no conspiracy.

The researchers’ fundamental error was to assume that people who believe there is a conspiracy have no solid evidence to support their belief. Not true, guys and girls.

  • Take a look at the Roman Catholic Church. One huge international conspiracy to keep the poor in slavery.
  • Take a look at Wall Street and the world of international banking and finance. Another monumental conspiracy to hide the truth behind global economic imperialism.
  • Take a look at the United States political system. Another major conspiracy aimed at convincing poor Americans that they actually have a say in how their government rules the country.

trumps-favorite-mcdonalds-meal-is-a-catholic-conspiracyA few extracts from the Time article:

“Millions of Americans believe in conspiracy theories — including plenty of people who you might expect would be smart enough to know better.

Despite mountains of scientific evidence to the contrary, at least 20% of Americans still believe in a link between vaccines and autism, and at least 37% think global warming is a hoax*, according to a 2015 analysis. Even more of us accept the existence of the paranormal: 42% believe in ghosts and 41% in extrasensory perception. And those numbers are stable. A 2014 study by conspiracy experts Joseph Uscinski of the University of Miami and Joseph Parent of Note Dame University surveyed 100,000 letters sent to the New York Times and the Chicago Tribune from 1890 to 2010 and found that the percentage that argued for one conspiracy theory or another had barely budged over time.

Now, a study published online in the journal Personality and Individual Differences provides new insights into why so many of us believe in things that just aren’t true: In some cases, we simply want to believe.

The second study was similar but also sought to correlate belief in conspiracy theories and the paranormal with overall cognitive ability. To determine this, the people answered a number of questions that measured their numeracy — or basic mathematical skills — and their language abilities.

us democracyWhat’s most troubling — and a little mystifying — is the fact is that so many people in the studies score high on all of the rational and intellectual metrics and yet nonetheless subscribe to disproven theories. That’s the case in the real world too, where highly educated people traffic in conspiratorial nonsense that you’d think they’d reject. In these cases, the study concluded, the reason may simply be that they’re invested—emotionally, ideologically—in believing the conspiracies, and they use their considerable cognitive skills to persuade themselves that what’s untrue is actually true. If you want to believe vaccines are dangerous or that the political party to which you don’t belong is plotting the ruination of America, you’ll build yourself a credible case.”

_______________________________

*Interestingly US presidents and CEOs of large corporations seem to subscribe to this one!

Who us? Plot against another country’s government?

US calls Turkish gov’t accusations of plot in Zarrab case ‘ridiculous’

shocked-woman-600_e6fkxk

Would we do something like that?

“The United States on Nov. 21 called the Turkish government’s accusations of a plot in the case of Turkish-Iranian businessman Reza Zarrab “ridiculous,” referring to an earlier response by Washington on the alleged involvement with last year’s failed coup.

“We’ve heard that story, that old same song and dance from Turkey before, and I would have to give you the same answer as last time they accused us of trying to foment some sort of a coup. And I would say that is ridiculous. We are not engaged in that. Anything related to that particular case, I’d just have to refer you to the Department of Justice,” State Department Spokesperson Heather Nauert said during a daily press briefing.

When asked whether the latest remarks by Ankara would lead Washington to review its stance on Turkey’s alliance within NATO, Nauert likened it to a “marriage,” stating that relations with some countries “can ebb and flow sometimes.”

john bass

Former US ambassador in Ankara banished to Afghanistan. Better luck there, John!

“And so somebody may say something that later they regret saying. They are a NATO member. They are a valued ally of the United States. We have had a strong relationship with Turkey. But really, just making comments about the United States trying to foment a coup is just – is simply ridiculous. And I think they recognize – I think they recognize that as well,” Nauert said.

Thanks for the reassurance, Heather. So why did you guys send your former Ankara ambassador to Afghanistan for his next assignment? Reward for a job well done? Yeah, sure!

At the same press conference, Ms Nauert had this to say about what’s going on in Yemen:

A horrific situation that is going on in Yemen. It is something that our team has watched very closely. The ambassador to Yemen and I were exchanging emails just yesterday about the situation on the ground there. He is not in Yemen right now because we don’t have that operation there, but he recently visited to take a look himself.

احباط عملية انتحارية بصعدة واستشهاد 135 بتفجيرات صنعاء

US humanitarian assistance in Yemen

I can tell you we’re working very closely with the Government of Saudi Arabia – as you well know, we have a good relationship with the Government of Saudi Arabia – to try to encourage better humanitarian assistance.

We recognize the food and the aid and the supplies that are needed in Yemen. The Government of Saudi Arabia has assured us that all the ports under control of the Government of Yemen have been opened to humanitarian aid and access. We have concerns, certainly, that that’s not moving quickly enough. I mean, you saw the pictures on 60 Minutes – many of us did – about the dire situation, especially for young, young children, and how terrible that is.

So we’ll continue to have conversations, and those conversations, I can assure you, are happening between our government and the Government of Saudi Arabia to try to facilitate better and faster humanitarian assistance.”

Come again, Heather? The USA is supplying weapons to Saudi Arabia which they are using to bomb the living bejesus out of the people of Yemen – and we should believe that crap about “humanitarian assistance”. And we should also believe your government is not trying to depose Turkey’s democratically elected president?

Plots against Turkey

I don’t know what sort of coverage it got in your part of the world. I did find a piece or two in the UK’s Guardian, and on the BBC, linked to a lot of “related” pieces about Turkey’s “Islamic dictator” imprisoning poor innocents merely because they tried to have him ousted by a military coup last July. Both articles make judicious use of words like “allegedly” and “reportedly”, but there doesn’t seem to be much doubt about the facts.

erdoğan foeTurkey had sent 40 soldiers to participate in a NATO training exercise in Norway. Well, even military exercises need an enemy, and apparently the NATO organisers in their wisdom chose to use the name of Turkey’s much-maligned President Erdoğan, alongside a picture of the revered founder of Turkey’s republic.

Understandably, the Turkish government was not amused and withdrew its participants from the exercise. NATO Secretary-General Jens Stoltenberg promptly issued an apology, followed by a statement by Norway’s minister of defence expressing his “concerns about the incident”. So, it seems pretty clear that the facts are essentially as reported.

Stoltenberg’s statement claimed the incident was the result of an “individual’s actions” – a Norwegian civil contractor seconded by Norway, and not a NATO employee – and did not reflect the views of the alliance.

Turkey, it seems, is not to be so easily appeased. The country’s EU Minister asked, with some justification, “Is there no chain of command? Does he [the civilian contracted person] not have a commander?” A government spokesman, addressing a press conference, said “We welcome the apologies issued. We welcome the removal of those responsible from office and the launching of an investigation. But we don’t see these incidents as solely extending to individuals. It’s not possible to explain these incidents merely in terms of individual responsibility,”

reza zarrab

Reza Zarrab in custody in the USA

Meanwhile, a curious court case is proceeding slowly in the United States. An Iranian-Turkish businessman, Reza Zarrab, was arrested in the US last year “on charges that he conspired to conduct hundreds of millions of dollars in financial transactions for the Iranian government and other entities to evade U.S. sanctions.”

Whatever we may think about the rest of the world being expected to support corporate America in its vendetta against uncooperative foreign leaders, it struck many people as strange that Mr Zarrab would voluntary enter the USA knowing that he would probably be arrested.

An opinion piece in Turkey’s English language Hürriyet Daily News voiced these concerns, suggesting CIA involvement:

ny times

What’s changed since 1974?

“It was never convincing that Zarrab, known worldwide for breaching the U.S.’s Iran sanctions and getting arrested in Turkey in the Dec. 17- 25, 2013 corruption and bribery operations, came to the U.S. to take his child on a trip. 

His arrival in the U.S. was thought to be the result of a negotiation. It is claimed that he negotiated to become a confessor in return for a permission that will allow him to keep his assets outside Turkey and continue commercial activity.

If he becomes a confessor, the story will widen more and a new indictment will be written.

‘It smells fishy,’ President Recep Tayyip Erdoğan had said about it.

The writer, Abdulkadir Selvi, goes on to say, “The U.S, after failing to overthrow Erdoğan through FETÖ on Dec. 17 – 25, 2013, stepped into the issue with the Zarrab case.”

Turkey’s Deputy Prime Minister, Bekir Bozdağ said the other day, “We make no secret of it: This is a political case and does not have a legal basis. It is a plot against Turkey. The prosecutors have been openly imposing pressure on the accused. . . [Zarrab] is in a sense taken hostage,” Bozdağ said, claiming that Zarrab is “under pressure from prosecutors to become a confessor and to make accusations against the Republic of Turkey.”

venezuela

Bringing democracy to the developing world

Another writer in Hürriyet, Barçın Yinanç, no slavish supporter of the government, made some apt observations about negative portrayals of Turkey and its government in foreign media. In a piece entitled “Who is losing Turkey? She wrote:

“Turkey lives in a troubled neighborhood and the Western world has often had problematic relations with its neighbors.

There has been a bad guy in Damascus, Bashar al-Assad. No one was supposed to cooperate with him and Turkey was once asked to follow suit.

There was also a bad guy in Iraq, Saddam Hussein. Sanctions were applied against his regime and Turkey was asked to abide by those sanctions.

In Iran, there has been a bad regime ever since the Islamic Revolution. Tehran has been continuously under sanctions, which Turkey has been under pressure to abide by.

There has also been a bad guy in Russia, the Kremlin. Sanctions have been introduced and Turkey has been required to follow them.

People sometimes forget that economically thriving nations trade with their neighbors. Some also forget that while the EU wanted Turkey to abide by the sanctions it imposed on countries to its east, north and south, it did not exactly have its arms wide open when Turkey turned to Europe.

Currently, when a foreign observer looks at Turkey, they see an Islamist leader distancing Turkey away from the transatlantic alliance. But the same observer may forget that it was that same leader who once undertook the most sweeping democratic reforms Turkey has ever seen. They may also forget that when Ankara knocked on the EU’s door in the 2000s, Germany’s Angela Merkel and then French President Nicolas Sarkozy effectively closed the door in its face. It also suited Europe’s interest to keep Turkey at arm’s length, hiding behind the Greek Cypriot administration which has been blocking accession talks.

This has all been forgotten. No one in Europe is questioning who caused the EU to lose Turkey. Why should they?”

germany-lead

New election coming up in Germany? Wasn’t the September result satisfactory? German voters should think again!

Economic gobbledegook – and why the world is going to hell on a fast train

This is by some guy called Ambrose Evans-Pritchard, writing in the UK’s Daily Telegraph. Well, with a name like that you wouldn’t imagine he’d have missed too many meals in his life. He’s probably right in picking that it’s not a good sign for the future of the world when someone can pay $450 million for a painting, even if Leonardo da Vinci did paint it. Reading between the lines of overblown pretentious verbiage, I reckon he’s saying the world is in for another major financial crash, engineered by the same grotesquely over-paid, grasping, selfish “financiers” that brought us the last one.

Cy twomble

$46 million painting by Cy Twombly

Leonardo da Vinci has special cachet. What is striking about the Christie’s soiree in New York last week was not so much the US$450m ($661m) paid for his rediscovered Salvator Mundi but the prices fetched by everyone else.

Buyers forked out $46m for vermilion spirals from the Bacchus series by Cy Twombly, executed 12 years ago with a paint-drenched brush on a pole. Soothing sands called Saffron by Mark Rothko fetched US$32m.

The week’s haul at Christie’s and Sotheby’s topped US$1.5 billion, with Asian buyers snapping up Monets. Fernand Leger’s abstract Contrastes de Formes fetched US$62m.

It screams late-cycle liquidity, recalling Japan’s impressionist fever in the late Eighties before the Nikkei collapsed and the bottom fell out of the art market.

092216-best-paidBitcoin clinches the argument. It has risen more than 1,200 per cent over the past year to more than US$8000 – five times an ounce of gold – on a “greater fool” presumption.

This is not a criticism of blockchain technology. It will flourish. But you cannot yet buy and sell things in any meaningful way with cryptocurrencies worth US$180b.

Bitcoin will end badly, either when the Chicago Mercantile Exchange launches its futures contracts in two weeks and allows traders to short it, or when the global cycle turns. A runaway asset boom can last a long time when the G4 central banks are holding real interest at minus 1.5 per cent and spending US$2 trillion a year soaking up “safe assets”

And here’sAcademic bulls say the stock of central bank assets is still growing. Market bears counter that the flow is falling, which matters more to them. Hence the recent rout in high-yield credit. Junk bond funds saw the biggest outflows since 2014 last week.

A parallel retreat is under way in East Asia where US$800m of bond sales in steel, solar and palm oil were cancelled. These are minor tremors. What threatens the universe of stretched asset values is the return of US inflation. The boom is built on the premise that the Fed will bathe the global system with ample liquidity.

banking-2015

2015 figures for the UK

Yet that is precisely what is now in doubt as US unemployment drops to a 17-year low and the dormant Phillips curve reawakens. The New York Fed’s underlying inflation gauge has jumped to a post-Lehman peak of 2.96 per cent.

All it will take from now on is a single piece of hard data to confirm this trend and the markets will reprice interest rate futures abruptly, shaking the whole edifice of global risk appetite.

Staccato rate rises by the Fed would ignite a dollar surge, squeezing an estimated US$10.7t of offshore dollar debt. There is a further US$14t of global dollar debt hidden in derivatives and FX swap contracts, pushing the total to US$25t.

The Wolf of Wall Street

“Watching with wolfish concentration . . . “

I didn’t want to upload the whole pretentious, jargon-loaded article – just give you a taste – but here’s Evans-Pritchard’s conclusion:

“Major players in the City are watching with wolfish concentration. Bank of America says the air is getting thinner for risk assets but tells clients to stay with the “Icarus trade” as long as you can still breathe.

Mark Haefele, investment chief at UBS, says it is too early to bail out but the coming inflection point is “something we think about a lot”.

George Clooney to run for US President?

From the people who brought you Governor Arnie . . .

arnold-schwarzenegger-

and Trumpeter Trump . . .

trump condom

What’s next?

clooney-tunes_o_2002469

George Clooney, actor, director, Nespresso man and universe’s gift to humankind, has been working very hard lately – but most of his work in acting and directing has not been well-received.

The media is now speculating whether there is a bigger role awaiting Amal’s husband.

Looking through Clooney’s filmography in recent years, he has been involved in a number of movies with a political theme.

Now an article in the Guardian has boldly speculated that Clooney’s foray into fictional politics is a hint at what could be coming next.

“What could Clooney do next? Let’s think: universally popular, high-powered wife, buddies with Obama, fundraiser for the Democrats.. Why is Clooney making oblique political movies when he could simply run for office?”

The article also points out that Clooney has not acted in two years (which is fine, since he has a habit of picking well-intentioned box office flops) and, like his high-profile human rights lawyer wife Amal Clooney, he is very engaged in politics.

He is a fundraiser for the Democratic Party and a good friend of former US President Barack Obama.

In the past, Clooney shrugged off the idea of a presidential bid, claiming to not understand why anyone would want to do that job.

However, when asked again recently whether he’d consider running for President of the US, his answer was that it “sounds like fun”.

amal clooney

George – Just buy your wife a good square meal!