Monday, September 26, 2022

After The Vote Conflict Areas In Ukraine Will Be 'Russian Territories' - NATO's War Will Become A War Against Russia - Then What?

What Was Washington Thinking?

What in the hell were those bloody-minded Washington/NATO neocons thinking? At any time in the last nine months they could have had a diplomatic settlement with Russia that would have:

  • Avoided/ended the war in Ukraine, thereby saving tens of thousands of Ukrainian lives and hundreds of billion of economic cost and destruction;

  • Allowed the Russian speaking population of the Donbas a substantial degree of self-governance and autonomy from the hostile government in Kiev;

  • Permitted the historic Russian territory of Crimea to remain under Russian control per the wishes of the overwhelming share of its Russian-speaking population;

  • Kept NATO out of Ukraine and its missiles away from Russia’s doorstep;

  • Removed NATO missile bases from the the old Warsaw Pact countries, where NATO had expanded in breach of Washington’s solemn promise made at the time of the German reunification to not extend NATO “one inch to the east” .

Would this have furthered the national security of the US and Europe, permitted Europe’s then flourishing peaceful commerce with Russia to continue and avoided the current global plague of soaring energy and food prices caused by the Sanctions War?

Yes, it would have. In spades!

So the question recurs. What alternative path did Washington/NATO envision and how could the likely consequences have improved upon either the above summarized settlement, which has been possible all along or, far worse still, the disastrous end game which is now unfolding?

The fact is, after Putin’s speech of yesterday the phrase “disastrous end game” is barely adequate to describe the scenario ahead. 

That’s because it signaled that the relative restraint of Russia’s “Special Military Operation” (SMO) is now over, and what lies ahead is full scale political and military warfare that can only end in calamity for Ukraine, NATO and indeed the world:

The heart of the matter is that Putin is now :

  • Mobilizing Russia’s entire GDP, which is at least 15X greater than what’s left of Ukraine’s;

  • Mustering 300,000 fresh reserves or double the number of Russian forces now deployed in the SMO;

  • Abandoning the policy of not attacking Ukraine’s civilian electric power grid and railroad system, which has been crucial to Ukraine’s survival to date and the West’s massive supply of weapons across the western border and through the interior rail network;

  • Preparing to annex the two breakaway Donbas republics in the east and the Kherson and  Zaporizhzhia regions in the south after hurriedly called referendums, which will transform the war into an explicit NATO-enabled attack on Russia proper.

To be sure, Kiev and Washington are screaming loudly that these referendums are “shams”, and it’s probably the case that the ballot counting will be no better than what occurred in the state of Georgia in 2020.

But the fact is, these regions are populated by Russian-speakers who have no love for or loyalty to the anti-Russian government in Kiev; who have already lined-up for Russian citizenship in large numbers; and who, in any case, fear the retribution of the Ukrainian military and secret service far more than they fear the Russians.

Stated differently, the populations of the Donetsk (DPR) and the Luhansk People’s Republics (LPR) and those of the Kherson and Zaporizhzhia regions are not begging to be “liberated” by Ukrainian armies, which are every bit as brutal and vindictive as the Russian military has been alleged to be, and surely don’t give a whit about Washington/NATO’s hypocritical malarkey about the rule of law and the sanctity of borders.

In fact, the overwhelming share of the populations (75-90%) of these regions have voted for the pro-Russian candidate in every presidential election held in the Ukraine since the Soviet Union’s mailed fist was lifted from their governance in 1991.

But now, within a matter of weeks, Ukraine’s borders will be restored to the pre-WWI status quo ante. Whether fair and square or not, the vote will be overwhelmingly in favor of separation and upon the request of the peoples of “Novorussiya”, Putin has indicated that these regions will once again become formal Russian territories.

What that means, in turn, of course, is that NATO’s war in support of the Kiev regime will become an explicit war on the territory of Russia. 

And that surely portends a bloody and disastrous end game because the only way it does not end up in an armistice after untold more deaths and destruction, followed by secession of the new “Russian” territories...

Once Moscow takes the gloves off and savages Ukraine’s electric power grid and railway system it will be all over except the shouting. The massive flow of western armaments, which has kept Kiev in the game to date, will be drastically curtailed; and the civilian population in the Kiev-controlled areas will be left high and dry, preparing to shiver in the dark as the severe Ukrainian winter approaches.

Nor does the alleged surprise victory of Ukrainian forces in the Kharkiv area in recent weeks change the scenario. What that actually accomplished was the sacrifice of thousands of Ukrainian troops in the apparent faint attack on Kherson in the south in order to regain a few thousand square miles of lightly populated open steppe around Kharkiv.

Even then, the alleged hastily retreating Russian army was not that at all. The area had been mostly occupied and defended by the lightly trained volunteers of the Republic of Luhansk, not the trained professionals of the Russian armed forces.

Now that the Ukrainian army has driven out the Luhansk volunteers and occupied the open steppe lands, it remains for Russian dominance of the air and artillery war to encircle the alleged victors and pulverize them from the air and via long-range artillery that is even now being brought into position.

That is to say, in a few weeks the Ukrainian “victory “will disappear from the MSM, just as have so many other alleged setbacks to the Russian cause.

Instead, the news will be about the brutality of the Russian attacks on Ukraine’s energy and transport infrastructure; the roadblocks it will put in front of what has been the demolition derby of US/NATO supplied weaponry to the battle front; and the fact that without massive new aid from Washington beyond the $50 billion already authorized, civilian life in the Kiev-controlled portions of the country will be on the verge of collapse and the regime in Kiev will be on virtual life-support from Washington.

In short, the end game in lieu of the diplomatic settlement which could have been had long ago will be either a more unfavorable partition of Ukraine, leaving Kiev and the western regions as a bankrupt landlocked rump state and ward of the west, or an escalation that involves direct military engagement by NATO and leaves the world teetering on the edge of nuclear war.

So much for using Ukraine as cannon fodder to drastically “weaken Russia” and to force the demonized Vlad Putin from power. To the contrary, by the time Europe’s cold and dark winter is underway, it will be European governments, which slavishly did Washington’s bidding, that will be falling like dominoes.

Russia To U.S.: 'Back Off' - 'There Is An Anti-Russian Consensus Of The Elites'

Russia tells US to ‘back off’ its ‘aggressive’ course

The US is taking an increasingly aggressive stance towards Moscow, but no amount of economic sanctions and political pressure can sway it from defending its national interests, a top Russian diplomat said.

Moscow’s diplomacy regarding the US is an exercise in “crisis management”, Deputy Foreign Minister Sergey Ryabkov said in an interview on Russian television on Monday. He described US behavior as being “increasingly confrontational and worrisome.”

“We can see how [the Americans] are trying to mobilize their satellites, their vassals to confront Russia in a more aggressive and hardline manner,” the diplomat said. “Washington’s irresponsible, extremely aggressive, extremely assertive course is bringing us all to the dangerous line. We are warning against maintaining this course.”

The brinkmanship has been evident not only when it comes to the crisis in Ukraine, but also in the all-important issue of nuclear non-proliferation and reduction, Ryabkov said. Washington has pretty much dismantled the entire architecture of strategic arms control and is threatening the last remaining bilateral treaty of that kind with Russia, the New START, he pointed out.

The deputy minister said he didn’t expect US policy towards Russia to change anytime soon, because “there is an anti-Russian consensus of the elites” in the US. But the only viable solution is for Washington to recognize that Russia will not be bullied and act accordingly, Ryabkov added.

“Time and time again we’ve told our American interlocutors, to use the most neutral term, that they have to back off and stop escalating the situation,” he said.

European nations, which sided with Washington’s anti-Russian drive, are suffering because of it, the Russian diplomat pointed out. In fact, their subservience to Washington makes them vulnerable to American exploitation, Ryabkov said.

“[The Americans] are undermining Europe’s competitiveness, pumping their products into European markets, be they military equipment or hydrocarbons, which the Europeans would rather get from alternative sources under different circumstances,” he said.

But Washington lacks global support, regardless of what American officials claim Ryabkov said. Dozens of nations representing half of humanity either backed Russia’s position on Ukraine or at least acknowledged the merits of Russia’s reasoning about it, he explained.

EU: 'The Outlook Is Darkening'

EU central bank warns ‘outlook is darkening’

Europe is facing lower-than-expected economic growth as inflation continues to climb, European Central Bank chief Christine Lagarde revealed on Monday, explaining that the ECB had raised interest rates by 75 basis points in an attempt to control soaring prices.

Speaking before the European Parliament’s Committee on Economic and Monetary Affairs on Monday, Lagarde admitted that “inflation remains far too high and is likely to stay above our target for an extended period.” 

The ECB chief warned that the “economic consequences for the euro area” of “Russia’s unjustified war of aggression on Ukraine” had spiraled further since June, a reference to Western sanctions on Russian oil and gas, which have sent fuel prices skyrocketing. 

The outlook is darkening,” she said.

While the European economy grew 0.8% in the second quarter, Lagarde said the ECB expected activity to “slow substantially” over the rest of 2022, to a total of 3.1% over the year and a mere 0.9% for all of 2023. Things will improve marginally in 2024, with growth projected at 1.9%, she said.

High inflation is being “reinforced by gas supply disruptions,” she said, adding that “uncertainty” and “falling household and business confidence” were also contributing to the bleak predictions.

U.S. Continues To Poke Russia: Deploys HMARS To Latvia

US to deploy HIMARS to Russian neighbor

The US Army Europe and Africa command announced on Sunday it would be sending two High Mobility Artillery Rocket Systems (HIMARS) along with approximately a dozen personnel to Latvia, to take part in NATO-led national readiness military exercises.

The M142 HIMARS systems are set to arrive in the Baltic state on Monday to take part in the fall phase of the so-called NAMEJS exercises, lasting from September 5 to October 9. The US-made artillery systems will be used on September 26 and 27 in order to demonstrate the rapid deployment of long-range precision launches to NATO’s eastern border.

“NAMEJS is designed to increase readiness, lethality, modernization and interoperability by exercising U.S. Army Europe and Africa’s ability to rapidly deploy long-range precision fires capabilities in coordination with our allies and partners, and integrate joint fires in a multinational environment,” reads a statement on the command’s website.

The exercises will also reportedly involve Spain’s National Advanced Surface-to-Air Missile System (NASAMS) to provide training for antiaircraft protection, according to Captain Matiss Students, a planning officer with NATO’s Air Force, who warned Latvian residents that there will be low-altitude military training flights in the eastern regions of the country during the exercises.

Aside from NAMEJS 2022, NATO intends to carry out additional exercises in the region under the moniker “Silver Arrow.” The US-led bloc announced that some 4,200 troops from 17 member states will be taking part in these exercises, which are meant to “strengthen the unity of land and air forces” and improve their combat capabilities and readiness to “deter and defend.”

The exercises come as tensions between Moscow and NATO continue to grow amid the ongoing Ukraine conflict. After Russian President Vladimir Putin announced a partial mobilization last week, which seeks to draft some 300,000 reservists into the Russian armed forces, several Baltic states and Poland have called for an increased NATO presence on the bloc’s eastern flank.

Moscow, meanwhile, has warned that it will not hesitate to use “any means at its disposal” to protect its territorial integrity and would respond in kind if NATO decided to carry out an attack on Russia using nuclear or other weapons of mass destruction.

Worst Bond Market Crash In 70 Years Coming

Worst bond market crash in over 70 years coming – Bloomberg

Global government bonds are on course for their worst performance since 1949 as losses mount in the face of aggressive central banks, Bloomberg reported over the weekend citing Bank of America projections.

According to the report, the escalating losses reflect how far the US Federal Reserve and other central banks have shifted away from the monetary policies of the Covid pandemic, when they held rates near zero to keep their economies going. The reversal has hit everything from stock prices to oil as investors brace for an economic slowdown.

On Friday, the UK’s five-year bonds plummeted by the most since 1992 after the government rolled out a massive tax-cut plan. Two-year US Treasuries are in the middle of the longest losing streak since at least 1976, falling for 12 straight days.

“Bottom line, all those years of central bank interest-rate suppression - poof, gone,” Peter Boockvar, chief investment officer at Bleakley Advisory Group told the media outlet. “These bonds are trading like emerging market bonds, and the biggest financial bubble in the history of bubbles, that of sovereign bonds, continues to deflate,” he explained.

The Fed raised its policy-rate range to 3.25% on Wednesday, which is its third straight 75-basis-point hike, hinting further increases beyond 4.5%.

“With more Fed rate hiking coming and quantitative tightening, as well as the possibly more government debt issuance down the road amid less Treasury buyers out there now, it all just means higher rates,” managing director at Mischler Financial Glen Capelo said, adding: “The 10-year yield is definitely going to get closer to 4%.”

According to Bloomberg, in the coming week the market may face fresh volatility from the release of inflation data and public speaking engagements by Fed officials. Also, the sale of new two-, five- and seven-year Treasuries will likely spur trading volatility in those benchmarks, it reports.