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Chinese-India rapprochement is both more necessary and more realistic than US-Russian detente.

India and China’s leaders have an opportunity to do at the BRICS summit what Trump and Putin attempted to do at the G20. The only differnces is, in India’s case the Prime Minister does have the power to change his country’s position against an old ‘adversary’.

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The forthcoming BRICS summit in Xiamen is due to be the most ambitious BRICS summit to-date. Among the wide reaching goals of the summit is an intention to work towards a customs union and the eventual establishment of  fully-fledged free trading zone between the BRICS and their partners.

READ MORE: Here’s what to expect from next week’s BRICS summit

However, the biggest obstacle to this and to BRICS unity as a whole, is India’s position which has become increasingly set in opposition to its neighbour and the most economically vibrant BRICS state, China.

The murmurs throughout the press asking “what will Xi and Modi say to one another” bears a striking resemblance to the “what will Putin say to Trump” innuendo which circulated prior to the G20 Summit in July of this year.

While the idea of two leaders of powerful nations meeting in order to ideally reconcile persistent problems is in fact a theme which the BRICS summit shares with July’s G20, the differences are more far reaching than the similarities.

At a personal level, Donald Trump and Vladimir Putin offered cordial statements about each other prior to their first meeting. After the meeting it was clear that on a personal level, each man found the other to be engaging, helpful, attentive and intelligent.

Such personal admiration does not apparently exist between Chinese President Xi Jinping and Indian Prime Minister Narendra Modi. However, in reality, China and India have far more to gain from a thaw in relations and ultimately, from cooperative relations than the US and Russia could have hoped to have had even if good US-Russia relations were possible.

Russia and the United States have had different spheres of influence during the majority of their shared histories. It was only between 1945 and the end of the 20th century that both Russia and the US competed for influence in Europe. In the end, simple geography and economic realities mean that for the foreseeable future Europe will be politically allied with the US and so too will most European commercial institutions be more American in outlook than Russian or Eurasian. At the same time, Europe remains dependant on Russia for energy and in spite of sanctions and the ideological allure among European extremists for expensive and slowly shipped American liquefied natural gas, the reality is that the EU will need Russian energy in order to survive for decades to come.

The biggest exceptions to this rule are the unlikely triumvirate of Turkey, Serbia and Israel. As a Eurasian state, Turkey has in the last year alone, departed quite dramatically from the US/EU sphere and is engaging in business, financial, technological and increasingly security cooperation with Russia and Russia’s Eurasian partner Iran, as well as China. Israel and Serbia are in a more precarious position. While Israel is arguably little more than a powerful US client state, Tel Aviv continues to defy US and EU sanctions in order to conduct healthy business relations with Russia, this in spite of the Israeli regime’s pathological opposition to Russia’s regional partners Syria and even more so Iran.

In respect of Serbia, the Serbs as a peoples are a fraternal nation to Russia and likewise, most Serbian citizens and many Serbian politicians seek to continue economic and security ties with Russia. At the same time, Serbia is an EU candidate with members of a new political class that seem intent on going in a western direction. It is a balancing act whose outcome will only be revealed when the EU is prepared to either accept or reject Serbia’s application to join the pro-US bloc.

In respect of bilateral relations, the US and Russia have little to offer each other economically. Russian goods are not sought after in the US market and apart from small internationally consumed retail goods, American ultra-hi-technology and military hardware is totally unnecessary in Russia as Russia makes rival products which are as good, in some cases better and in all cases, are produced far more cost effectively than those produced in the US. As two energy exporters, Russia and the US are in some ways competitors even though the markets for US and Russian energy are generally different for both geographical and economic reasons.

In this sense, US and Russian cooperation is primarily an issue of security. No one wants US and Russian nuclear weapons to be fired a war, even though the actual likelihood of this is even more exaggerated today than it was during the Cold War.

The situation between China and India could not be more different.

China and India are neighbours who ought to cooperate on trade in a manner that takes advantage of each country’s unique strengths. The example of Pakistan-Chinese cooperation and its early success which appears to only be growing, makes it clear that China and large South Asian countries have a great deal to offer one another.

Both India and Pakistan were to form an integral part of China’s One Belt–One Road trading initiative, but India’s reluctance to cooperate with China has led many in China to lean more heavily towards Pakistan. India’s intransigence on the matter is increasingly making the Sino-Pakistan border an effective Indian bypass on the New Silk Road.

While China can complete One Belt–One Road without India or even in spite of India, both sides would be better off cooperating, but especially India. India simply does not have the technological or manufacturing capacity of China, but India’s growing markets and young workforce could work in tandem with China to create more economic opportunities for Indians across all levels of society and for Indian infrastructure which could benefit greatly from Chinese investment, just as Pakistan’s infrastructure has been the recipient of such boosts from Beijing.

In order to create an opportunity for India and China to begin meaningful economic/trade cooperation, it is necessary to settle the border disputes between the two countries which are a lingering effect of British imperialism in South Asia.

The appropriate forum to settle border disputes is the Shanghai Cooperation Organisation. Here, both China and Pakistan could work with fellow member state India to resolve  lingering border crises and Russia which maintains good relations with Beijing, Islamabad and New Delhi would almost certainly be happy to mediate such a dispute in a dignified manner. In this sense the SCO is a better forum to settle such a dispute than the UN as while China has a veto on the UN Security Council, in the SCO, all members are technically co-equals.

China’s position on all these matters is clear and China is open for dialogue and discussion with India in order to work towards a fair and expedient resolution.

China wants India to be a good neighbour and a future partner. It is India, especially under the Premiership of Modi whose attitude to China has frankly been downright stubborn to the point of inflicting harm on one’s own nation. India appears to want to engage in economic warfare with China even though this is a battle that India will  objectively lose. This is something that many Indians who are opposed to Modi admit with grace, just as Russia could not and does not try to compete with China in the realm of electronic and personal computer exports.

Russia, in engaging with China as a trusted partner, has not only enhanced the economies of both countries, but Russia is one of the few nations to run a trade surplus with China, albeit a comparatively small one. India could in fact decrease dependency on foreign good by cooperating with China rather than trying to outpace China in areas where China is objectively superior in terms of production quality, consistency and efficiency.

In this sense, India and China can offer one another meaningful economic opportunities, where it is increasingly the case that the US and Russia can offer one another little other than the obtuse assurance that there will be no nuclear war.

While the American deep state is dead set against any rapprochement with Russia, in India there are voices who oppose Modi’s antagonistic stance towards China, however much the vocal pro-government Hindutva press tries to silence such voices.

Good relations between China and India are therefore more necessary and more realistic than good relations between  between the US and Russia. The difference is that in India, the matter rests almost entirely on the Prime Minister and his most trusted advisers, whereas in the United States the President who wants better relations with Russia has been left largely powerless to change the course of US policy.

Modi is in many ways in the same position as Turkey’s President Erdogan has been in over the last few years. In 2015, after Turkey shot down a Russian military jet on the Syria-Turkey border, a situation developed which could have led to war. However, both countries have not only patched up their differences, something which began when Erdgoan apologised to Putin for shooting down the Russian jet, both Turkey and Russia are increasingly partners whose relationship is becoming something of a necessity for Ankara.

If Erdogan and Putin could rapidly patch up their differences, so too can Modi and Xi. Erdgoan took the first step towards mending fences with Russia after the Russian side showed a great deal of restraint amid calls for war with Turkey. China has likewise showed a similar level of restraint during this summer’s Doklam/Donglang border crisis with India. Modi can therefore climb down from his untenable position as Erdogan did, or he can learn the hard way, the lesson that Turkey has learned, namely, that Asian and Eurasian nations who align with the US, ultimately gain less than nothing in return.

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Freethinking Влади́мир
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Freethinking Влади́мир

Not bad of an article. Quite accessible though a clearer explanation on the fundamental differences which leads to the dispute between India and China I would have welcomed. Also the comparison between Russia-Turkey and China-india was cutting a corner a bit. The analogy doesn’t work because of India’s far greater influence and far greater residual potential on the world stage.

Gonzogal
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Gonzogal

The author glossed over the US and Israhell meddling and trying to split India from BRICS/China in order to destroy OBOR/BRI! India will have to make a DEFINITIVE choice, stay attached to the US coat tails as it goes down and suffer the consequences or align fully with the future with BRICS.
https://journal-neo.org/2017/08/11/has-narenda-modi-switched-sides/
http://theduran.com/is-india-now-a-us-ally/

Brooklyn Dave
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Brooklyn Dave

Thank you, you’re right on the money. And maybe, sometime in the future, China may be able to negotiate some kind of an agreement between India an.d Pakistan

VeeNarian (Yerevan)
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VeeNarian (Yerevan)

This is the point of inflexion in the 21st century between India and China. History is being made in front of our eyes as a new world order is born. Watch out for the fireworks this September!

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FBI recommended Michael Flynn not have lawyer present during interview, did not warn of false statement consequences

Flynn is scheduled to be sentenced on Dec. 18.

Washington Examiner

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Via The Washington Examiner…


Former FBI Deputy Director Andrew McCabe, who arranged the bureau’s interview with then-national security adviser Michael Flynn at the White House on Jan. 24, 2017 — the interview that ultimately led to Flynn’s guilty plea on one count of making false statements — suggested Flynn not have a lawyer present at the session, according to newly-filed court documents. In addition, FBI officials, along with the two agents who interviewed Flynn, decided specifically not to warn him that there would be penalties for making false statements because the agents wanted to ensure that Flynn was “relaxed” during the session.

The new information, drawn from McCabe’s account of events plus the FBI agents’ writeup of the interview — the so-called 302 report — is contained in a sentencing memo filed Tuesday by Flynn’s defense team.

Citing McCabe’s account, the sentencing memo says that shortly after noon on Jan. 24 — the fourth day of the new Trump administration — McCabe called Flynn on a secure phone in Flynn’s West Wing office. The two men discussed business briefly and then McCabe said that he “felt that we needed to have two of our agents sit down” with Flynn to discuss Flynn’s talks with Russian officials during the presidential transition.

McCabe, by his own account, urged Flynn to talk to the agents alone, without a lawyer present. “I explained that I thought the quickest way to get this done was to have a conversation between [Flynn] and the agents only,” McCabe wrote. “I further stated that if LTG Flynn wished to include anyone else in the meeting, like the White House counsel for instance, that I would need to involve the Department of Justice. [Flynn] stated that this would not be necessary and agreed to meet with the agents without any additional participants.”

Within two hours, the agents were in Flynn’s office. According to the 302 report quoted in the Flynn sentencing document, the agents said Flynn was “relaxed and jocular” and offered the agents “a little tour” of his part of the White House.

“The agents did not provide Gen. Flynn with a warning of the penalties for making a false statement under 18 U.S.C. 1001 before, during, or after the interview,” the Flynn memo says. According to the 302, before the interview, McCabe and other FBI officials “decided the agents would not warn Flynn that it was a crime to lie during an FBI interview because they wanted Flynn to be relaxed, and they were concerned that giving the warnings might adversely affect the rapport.”

The agents had, of course, seen transcripts of Flynn’s wiretapped conversations with Russian then-ambassador Sergey Kislyak. “Before the interview, FBI officials had also decided that if ‘Flynn said he did not remember something they knew he said, they would use the exact words Flynn used … to try to refresh his recollection. If Flynn still would not confirm what he said … they would not confront him or talk him through it,'” the Flynn memo says, citing the FBI 302.

“One of the agents reported that Gen. Flynn was ‘unguarded’ during the interview and ‘clearly saw the FBI agents as allies,'” the Flynn memo says, again citing the 302.

Later in the memo, Flynn’s lawyers argue that the FBI treated Flynn differently from two other Trump-Russia figures who have pleaded guilty to and been sentenced for making false statements. One of them, Alexander Van der Zwaan, “was represented by counsel during the interview; he was interviewed at a time when there was a publicly disclosed, full-bore investigation regarding Russian interference in the 2016 election; and he was given a warning that it is a federal crime to lie during the interview,” according to the memo. The other, George Papadopoulos, “was specifically notified of the seriousness of the investigation…was warned that lying to investigators was a ‘federal offense’…had time to reflect on his answers…and met with the FBI the following month for a further set of interviews, accompanied by his counsel, and did not correct his false statements.”

The message of the sentencing memo is clear: Flynn, his lawyers suggest, was surprised, rushed, not warned of the context or seriousness of the questioning, and discouraged from having a lawyer present.

That is all the sentencing document contains about the interview itself. In a footnote, Flynn’s lawyers noted that the government did not object to the quotations from the FBI 302 report.

In one striking detail, footnotes in the Flynn memo say the 302 report cited was dated Aug. 22, 2017 — nearly seven months after the Flynn interview. It is not clear why the report would be written so long after the interview itself.

The brief excerpts from the 302 used in the Flynn defense memo will likely spur more requests from Congress to see the original FBI documents. Both House and Senate investigating committees have demanded that the Justice Department allow them to see the Flynn 302, but have so far been refused.

In the memo, Flynn’s lawyers say that he made a “serious error in judgment” in the interview. Citing Flynn’s distinguished 30-plus year record of service in the U.S. Army, they ask the judge to go along with special counsel Robert Mueller’s recommendation that Flynn be spared any time in prison.

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Macron offers crumbs to protestors in bid to save his globalist agenda (Video)

The Duran Quick Take: Episode 36.

Alex Christoforou

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The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris take a quick look at French President Macron’s pathetic display of leadership as he offers protestors little in the way of concessions while at the same time promising to crack down hard on any and all citizens who resort to violence.

Meanwhile France’s economy is set for a deep recession as French output and production grinds to a halt.

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Via Zerohedge


As if Brussels didn’t have its hands full already with Italy and the UK, the European Union will soon be forced to rationalize why one of its favorite core members is allowed to pursue populist measures to blow out its budget deficit to ease domestic unrest while another is threatened with fines potentially amounting to billions of euros.

When blaming Russia failed to quell the widespread anger elicited by his policies, French President Emmanuel Macron tried to appease the increasingly violent “yellow vests” protesters who have sacked his capital city by offering massive tax cuts that could blow the French budget out beyond the 3% budget threshold outlined in the bloc’s fiscal rules.

Given the concessions recently offered by Italy’s populists, Macron’s couldn’t have picked a worse time to challenge the bloc’s fiscal conventions. As Bloomberg pointed out, these rules will almost certainly set the Continent’s second largest economy on a collision course with Brussels. To be clear, Macron’s offered cuts come with a price tag of about €11 billion according to Les Echos, and will leave the country with a budget gap of 3.5% of GDP in 2019, with one government official said the deficit may be higher than 3.6%.

By comparison, Italy’s initial projections put its deficit target at 2.4%, a number which Europe has repeatedly refused to consider.

Macron’s promises of fiscal stimulus – which come on top of his government’s decision to delay the planned gas-tax hikes that helped inspire the protests – were part of a broader ‘mea culpa’ offered by Macron in a speech Monday night, where he also planned to hike France’s minimum wage.

Of course, when Brussels inevitably objects, perhaps Macron could just show them this video of French police tossing a wheelchair-bound protester to the ground.

Already, the Italians are complaining.  Speaking on Tuesday, Italian cabinet undersecretary Giancarlo Giorgetti said Italy hasn’t breached the EU deficit limit. “I repeat that from the Italian government there is a reasonable approach, if there is one also from the EU a solution will be found.”

“France has several times breached the 3% deficit. Italy hasn’t done it. They are different situations. There are many indicators to assess.”

Still, as one Guardian columnist pointed out in an op-ed published Tuesday morning, the fact that the gilets jaunes (yellow vest) organizers managed to pressure Macron to cave and grant concessions after just 4 weeks of protests will only embolden them to push for even more radical demands: The collapse of the government of the supremely unpopular Macron.

Then again, with Brussels now facing certain accusations of hypocrisy, the fact that Macron was pressured into the exact same populist measures for which Italy has been slammed, the French fiasco raises the odds that Rome can pass any deficit measure it wants with the EU now forced to quietly look away even as it jawbones all the way from the bank (i.e., the German taxpayers).

“Macron’s spending will encourage Salvini and Di Maio,” said Giovanni Orsina, head of the School of Government at Rome’s Luiss-Guido Carli University. “Macron was supposed to be the spearhead of pro-European forces, if he himself is forced to challenge EU rules, Salvini and Di Maio will jump on that to push their contention that those rules are wrong.”

While we look forward to how Brussels will square this circle, markets are less excited.

Exhausted from lurching from one extreme to another following conflicting headlines, traders are already asking if “France is the new Italy.” The reason: the French OAT curve has bear steepened this morning with 10Y yields rising as much as ~6bp, with the Bund/OAT spread reaching the widest since May 2017 and the French presidential election. Though well below the peaks of last year, further widening would push the gap into levels reserved for heightened political risk.

As Bloomberg macro analyst Michael Read notes this morning, it’s hard to see a specific near-term trigger blowing out the Bund/OAT spread but the trend looks likely to slowly drift higher.

While Macron has to fight on both domestic and European fronts, he’ll need to keep peace at home to stay on top. Remember that we saw the 10Y spread widen to ~80bps around the May ’17 elections as concerns of a move toward the political fringe played out in the markets, and the French President’s popularity ratings already look far from rosy.

And just like that France may have solved the Italian crisis.

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Watch: Democrat Chuck Schumer shows his East Coast elitism on live TV

Amazing moment in which the President exhibits “transparency in government” and shows the world who the Democrat leaders really are.

Seraphim Hanisch

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One of the reasons Donald Trump was elected to the Presidency was because of his pugnacious, “in your face” character he presented – and promised TO present – against Democrat policy decisions and “stupid government” in general.

One of the reasons President Donald Trump is reviled is because of his pugnacious, “in your face” character he presented – and promised TO present – in the American political scene.

In other words, there are two reactions to the same characteristic. On Tuesday, the President did something that probably cheered and delighted a great many Americans who witnessed this.

The Democrats have been unanimous in taking any chance to roast the President, or to call for his impeachment, or to incite violence against him. But Tuesday was President Trump’s turn. He invited the two Democrat leaders, presumptive incoming House Speaker Nancy Pelosi, and Senate Minority Leader Chuck Schumer, and then, he turned the cameras on:

As Tucker Carlson notes, the body language from Schumer was fury. The old (something)-eating grin covered up humiliation, embarrassment and probably no small amount of fear, as this whole incident was filmed and broadcast openly and transparently to the American public. Nancy Pelosi was similarly agitated, and she expressed it later after this humiliation on camera, saying, “It’s like a manhood thing for him… As if manhood could ever be associated with him.”

She didn’t stop there. According to a report from the New York Daily News, the Queen Bee took the rhetoric a step below even her sense of dignity:

Pelosi stressed she made clear to Trump there isn’t enough support in Congress for a wall and speculated the President is refusing to back down because he’s scared to run away with his tail between his legs.

“I was trying to be the mom. I can’t explain it to you. It was so wild,” Pelosi said of the Oval Office meet, which was also attended by Vice President Pence and Senate Minority Leader Chuck Schumer (D-N.Y.). “It goes to show you: you get into a tinkle contest with a skunk, you get tinkle all over you.”

This represented the first salvo in a major spin-job for the ultra-liberal San Francisco Democrat. The rhetoric spun by Mrs. Pelosi and Chuck Schumer was desperate as they tried to deflect their humiliation and place it back on the President:

With reporters still present, Trump boasted during the Oval meeting he would be “proud” to shutdown the government if Congress doesn’t earmark cash for his wall before a Dec. 21 spending deadline.

Pelosi told Democrats that Trump’s boisterousness will be beneficial for them.

“The fact is we did get him to say, to fully own that the shutdown was his,” Pelosi said. “That was an accomplishment.”

The press tried to characterize this as a “Trump Tantrum”, saying things like this lede:

While “discussing” a budgetary agreement for the government, President Donald Trump crossed his arms and declared: “we will shut down the government if there is no wall.”

While the Democrats and the mainstream media in the US are sure to largely buy these interpretations of the event, the fact that this matter was televised live shows that the matter was entirely different, and this will be discomfiting to all but those Democrats and Trump-dislikers that will not look at reality.

There appears to be a twofold accomplishment for the President in this confrontation:

  1. The President revealed to his support base the real nature of the conversation with the Democrat leadership, because anyone watching this broadcast (and later, video clip) saw it unedited with their own eyes. They witnessed the pettiness of both Democrats and they witnessed a President completely comfortable and confident about the situation.
  2. President Trump probably made many of his supporters cheer with the commitment to shut down the government if he doesn’t get his border wall funding. This cheering is for both the strength shown about getting the wall finished and the promise to shut the government down, and further, Mr. Trump’s assertion that he would be “proud” to shut the government down, taking complete ownership willingly, reflects a sentiment that many of his supporters share.

The usual pattern is for the media, Democrats and even some Republicans to create a “scare” narrative about government shutdowns, about how doing this is a sure-fire path to chaos and suffering for the United States.

But the educated understanding of how shutdowns work reveals something completely different. Vital services never close. However, National Parks can close partly or completely, and some non-essential government agencies are shuttered. While this is an inconvenience for the employees furloughed during the shutdown, they eventually are re-compensated for the time lost, and are likely to receive help during the shutdown period if they need it. The impact on the nation is minimal, aside from the fact that the government stops spending money at the same frenetic pace as usual.

President Trump’s expression of willingness to do this action and his singling out of the Dem leadership gives the Democrats a real problem. Now the entire country sees their nature. As President Trump is a populist, this visceral display of Democrat opposition and pettiness will make at least some impact on the population, even that group of people who are not Trump fans.

The media reaction and that of the Democrats here show, amazingly, that after three years-plus of Donald Trump being a thorn in their side, they still do not understand how he works, and they also cannot match it against their expected “norms” of establishment behavior.

This may be a brilliant masterstroke, and it also may be followed up by more. The President relishes head-to-head conflict. The reactions of these congress members showed who they really are.

Let the games begin.

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