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Russia to write-off $3 billion in Venezuelan debt

Russia’s move is motivated by pragmatism and good will, but Venezuela will likely recover from her economic woes thanks to the Petroyuan and increased trade in Russian Roubles.

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On the 15th of November, Russia will sign an agreement with officials from Caracas to write off $3 billion in debt which Venezuela currently owes the Russian Federation.

The move is widely seen as a good will gesture to the oil rich but politically embattled South American nation that has been subject to crippling US sanctions which both Russia and China have vehemently opposed.

Professor Alexander Timofeyev at the Russian University of Economics has stated that when Russia writes off the sovereign debt of a partner nation, such things are rarely rewarded with future joint programmes between the indebted state and Russia. In this sense, it is most appropriate to see Russia writing off debt as both an expression of compassionate good will and pragmatism. If a nation does not have the ability pay the debt back, there is little use in straining otherwise good relations by attempting to enforce a collection.

Timofeyev explains,

“When Cuba’s $30 bln debt was written off, they promised us joint projects in energy, transport and healthcare. A year has gone by, and we haven’t heard a peep from them since”.

However, turning to the future, Venezuela does look to sincerely engage in mutually beneficial economic projects with Russia. Because of US sanctions and the generally hostile attitude that Washington takes to the Bolivarian government in Caracas, Venezuela has already begun trading its oil in the Petroyuan. Venezuelan President Nicolas Maduro has also stated that he is keen on exploring the possibilities of trading with Russia in a Petrorouble in addition to the Chinese Yuan.

Venezuelan President Maduro tells Russia its time to ditch the Dollar and embrace the Rouble and Yuan

As China is set to take its spot as the world’s leading economy in areas where it isn’t already number one, the Petroyuan is fast becoming an inevitability. By embracing the Yuan as a means of exchange for oil sales, Venezuela is blazing a trail that many other energy producers will likely follow in the coming years and decades. Venezuela’s economy has suffered, but the Petroyuan gives it an opportunity to not only recover but to gain long-term stability.

Below is a report I recently wrote on the potential of a Petroyuan established under the guise of multilateral agreement:

Russia and China actively collude to bring down the only thing America cares about

Russia is not actually interested in undermining American “democracy”. In fact, the United States isn’t particularly concerned either. But Russiagate continues to give mainstream media a narrative that it can sell to its dwindling core audience. However, when it comes to the real linchpin of American power, the almighty Dollar, things are very different.

Since it typically takes millions of Dollars at minimum, to even enter major US elections, it is clear that the American electoral system, like just about everything in the US, is as tied in to the power of the Dollar as any other institution. The entire contrived narrative about Russia is really a thinly placed mask which hides the real worry in the US about Russia’s latest geo-strategic moves.

Today, Russia’s Prime Minister and Deputy Prime Minister took part in an official visit to China where both countries signed agreements to expand bilateral trade in national currencies, as opposed to using the US Dollar as the standard transaction currency.

In the summer of 2017, the Presidents of Russia and China led a large meeting of top government and private sector officials from both countries. Scores of agreements were signed, including those which set into motion, bilateral trade in national currencies.

Today, Russia’s Deputy Prime Minister Sergey Prikhodko commented on the progress of these arrangements. He said,

“At present, financial regulators of the two countries are working on extending the bilateral currency swap agreement for the next three years.

In 2016, the share of national currencies in payments for exports of Russian goods and services amounted to 13 percent, imports, 16 percent. In the first quarter of 2017, these figures rose to 16 percent and 18 percent, respectively”.

With countries throughout the world, including Turkey, Venezuela and Iran beginning to trade in national currencies or in Chinese Yuan, the power of the US Dollar as a standard trading and reserve currency is being actively and openly undermined by China, Russia and their trading partners. This of course is perfectly legal as countries can trade in any currency they wish. They can even use barter as a means of exchange, as Iran sometimes still does with Russia.

This year has been a watershed in the de-Dollarisation of world trade. China’s willingness to sell oil futures contrasts in Yuan, the easy convertibility of the Yuan to gold on the Shanghai and Hong Kong gold exchanges, multiple bilateral agreements signed with China and her partners to trade in national currencies and the possibility of a new BRICS-wide currency, currency basket or BRICS crypto-currency, have all led to a perfect storm which is set to slowly but surely capsize the Dollar.

I previously outlined why this has geo-political implications that are already being felt, beyond currency markets. As I wrote at the time:

The US has again sailed a Naval destroyer, this time the USS Chafee, through Chinese waters in the South China Sea, in direct violation of Beijing’s sovereign maritime claims over the sea. The US repeatedly provokes China by sailing its vessels through the South China Sea, in a deceptively named strategy called ‘freedom of navigation’, which seeks to undermine Chinese claims to its neighbouring south sea. While other countries with regional maritime claims, including Philippines have begun cooperating with China, the United States continues unilateral provocations against China.

In response to the USS Chafee’s presence in the South China Sea, Beijing scrambled a missile-guided frigate, helicopter and two fighter jets to intercept the US vessel.

China also issued a stern warning to the United States against further provocations. Chinese Foreign Ministry Spokeswoman Hua Chunying has said,

“The US destroyer’s behaviour violated Chinese law and relevant international law, severely harmed China’s sovereignty and security interests, and threatened the lives of both sides”.

Hua further warned that any further such provocations could result in “unwanted incidents”.

She continued,

“In the face of repeated provocation by the US forces, the Chinese military will further strengthen preparation for combat at sea and in the air and improve the defences to resolutely defend national sovereignty and security interests”.

As the US continues to feel threatened by Chinese economic dominance in the global marketplace, Washington’s military provocations in the South and East China Seas, its militarisation of the Korean peninsula and proxy wars along China’s One Belt–One Road trade and infrastructure routes, are likely to increase.

While the US has long felt threatened by Chinese trade and industrial dominance, now the US Dollar is being actively challenged by the growing power of the Chinese Yuan. The Yuan is now positioned to threaten the hegemony of the Dollar as a major trading and reserve currency.

This has expressed itself in the following ways:

–China offering the sale of oil futures contracts in gold backed Yuan

–Countries as wide ranging as Venezuela, Turkey and Russia conducting major bilateral trade in national currencies (as opposed to the US Dollar)

–The possibility of a new BRICS trading standard based on the Yuan, gold or other ‘eastern’ currencies

–The possibility of a BRICS regulated crypto-currency

Additionally, other nations which have been hit by unilateral sanctions, including Iran, have also showed a willingness to embrace a new Dollar free trading regime with its existing and new partners.

Most worryingly for the US, its longtime Middle Eastern ally Saudi Arabia, may find itself trading oil in Chinese Yuan in the coming years. Chief economist and managing director at High Frequency Economics, Carl Weinberg has spoken with the US based finance outlet CNBC and stated the following, 

“I believe that yuan pricing of oil is coming and as soon as the Saudis move to accept it — as the Chinese will compel them to do — then the rest of the oil market will move along with them”.

Saudi’s infrequently discussed but good economic relations with Beijing, as well as its warming relations with Russia, indicate that Riyadh is looking towards the wider global ‘east’ and in so doing, may find it self moving towards an energy trade that is independent of Dollar hegemony. This may be accelerated as the US becomes a net energy exporter while China’s demand for oil increases, leaving Saudi and fellow OPEC members in a position where it would become not only necessary but inevitable to trade in Yuan. OPEC member and Sino-Russian partner, Venezuela has already ceased trading its oil in US Dollars. 

In this sense, while the US has often criticised China for pegging the Yuan to the Dollar, the combination of China being willing and able to convert Yuan to gold in respect of oil futures contracts, as well as the increasing global confidence in the Yuan as a reliable trading and reserve currency, may eventually lead to China floating the Yuan or pegging it to another standard.

As China holds billions in US sovereign debut, China holds the fate of the Dollar in its hands more than ever, as now China has many other options at its disposal when it comes to diversifying its monetary policies.

In this sense, it is important to see US military provocations against China as symptoms of the wider economic and now monetary pressure the US is feeling as China moves to take its place as the undisputed leading economic power of the world.

In spite of many figures in the US ranging from neo-cons to Steve Bannon, being united around an anti-Chinese campaign, many members of the US armed forces are apparently growing demoralised with their country’s increasingly frequent, yet unfruitful missions to Asia.

In a recent report form the US based Navy Times, journalists interviewed sailors aboard the USS Shiloh cruiser. The ship which is based in Japan, has been running missions throughout East Asia in an attempt to allegedly deter North Korea.

But far form deterring North Korea, the American seamen have stated that their conditions have left them demoralised and even suicidal.

According to the report,

“Each survey (of US sailors) runs hundreds of pages, with crew members writing anonymously of dysfunction from the top, suicidal thoughts, exhaustion, despair and concern that the Shiloh was being pushed underway while vital repairs remained incomplete.

It feels like a race to see which will break down first, the ship or it’s […] crew”.

The report was commissioned after many members of the USS Shiloh’s crew anonymously contacted the Navy Times to complain of dire conditions.

One American sailor stated,

“I just pray we never have to shoot down a missile from North Korea, because then our ineffectiveness will really show”.

Others described the conditions aboard the USS Shiloh as “prison like” while others warned that “it’s only a matter of time before something horrible happens”.

The incidents aboard the USS Shiloh are not unique. Multiple incidentals, including deadly collisions have recently plagued US Navy ships in Asia over the last year.

In this sense, one sees US sailors used and abused by their chiefs, preparing for battles which many believe cannot be won, all the while, provoking the Chinese superpower in its own maritime territory.

At the same time, it is crucial to understand that the military endeavours of the US have nothing to do with security the territory or people of the US, but instead follow on from the perceived financial and monetary benefits that the US intends to achieve by disrupting the peace and stability of regions vital for Chinese trade. At the same time, the US is surprised and reacting unreasonably to the reality that as China’s trading, logistical, fiscal and monetary might grows, so too will its geo-political influence necessarily grow. The US being so keen to protect its hegemony, a hegemony built increasingly on excessive military spending and the power of the Federal Reserve’s monetary manipulation, seems unwilling to gracefully accept China’s rise to global prominence as a leading power of the 21st century. China is consequently faced with the perfect storm of the US fighting for its monetary hegemony using its military, all the while attempting to restrain China’s growing political clout.

In short, the US is not fighting for the security of its realm, but for the security of the Wall Street based financial industry and that of the Federal Reserve, in addition to the overarching geo-political hegemony that both have allowed the US to exercise with impunity.  It is not a transparent war, but it may become a deeply ugly war, nevertheless.

With its weakening domestic industrial base, high-tax and investor unfriendly regulations and its soaring national debt, the primacy of the US Dollar as the go-to reserve currency and means of international trade, is one of the only things which is keeping the US economy buoyant in the eyes of medium and long term speculators.

Should the US Dollar’s value plummet as a result of international markets losing confidence in the USD, the US economy and those which are directly tied into it, will feel the sting.

These developments also call into question, the long term feasibility of the Yuan being effectively pegged to the Dollar. The moment that China feels that floating the Yuan will incur greater aggregate advantages vis-a-vis the pegged Yuan, China will float its currency.

While it used to be received wisdom that it was the Dollar which gave the Yuan its value, the new dynamics in international trading markets and the sheer size and diversity of the Chinese economy, are changing this reality and changing it rapidly. If the Yuan is allowed to float on currency markets, the US Dollar is the currency that has the most to lose from such an event and it is now an event whose proximity in time is becoming ever closer. It will also be a further sign of China diversifying its international points of sale away from the US.

While people like Steve Bannon speak of China frequently, most US commentators and politicians are focused on Russia. The reason for this is because Russia is still considered to be more geo-politically active superpower in areas which cause embarrassment for the US, primarily Syria. The other reason is that because of the US economy being so dependant on China and because China owns so much US sovereign debt, many in the US are still more afraid of fully alienating China, whilst Russia by contrast, has comparatively few economic ties to the USA.

The flip side of this reality, is that Russia is in many ways even more free when it comes to developing new anti-Dollar currency solutions. China still needs the US consumer market and thus, things will have to necessarily progress in a gradual manner in respect of the inter-dependant but mutually distrustful economic and monetary ballet between Beijing and Washington.

Russia has no strings attached in this sense and US sanctions against Russia and many of her traditional partners, only serve to further drive home the importance of de-Dollarising Russia’s trading networks. This indeed is one of the reasons that Russia is set to launch a crypto-Rouble which will compete directly with both the Dollar and existing western cryptocurrencies for small and medium sized international transactions.

As I recently reported,

“Russian monetary experts and political leaders have recently begun engaging in a debate which pitted monetary conservatives against monetary radicals. Most Russian officials agreed that allowing the use of western designed (though not western state endorsed) cryptocurrencies such as Bitcoin, was not compatible with Russian financial security concerns. China, for example, reached a similar conclusion about existing cryptocurrencies.

In Russia, the debate then quickly evolved into to a question over what role if any, a government and central bank should have in respect of cryptocurrencies. Conservatives argued that the entire process of blockchain cryptocurrency technology should not be accepted as a legal alternative to traditional state issued notes, while radicals argued for the creation and regulation of a uniquely Russian cryptocurremcy. The radials have clearly won and appear to have been embraced by President Putin.

Here’s What We Know About CryptoRouble

The CryptoRouble is being worked on at the moment and should be available soon, although a precise timeline is not yet available.

According to Sputnik,

“They can be exchanged for regular roubles at any time, though if the holder is unable to explain the source of their CryptoRubles, a 13 percent tax will be levied. The same tax will be applied to any earned difference between the price of the purchase of the token and the price of the sale”.

Existing cryptocurrency exchange rates are based on the supply of a given cryptocurrency, in proportion to demand for converting such a cryptocurrency into a traditional currency, at a given time. By contrast, it is expected that the CryptoRouble will have an exchange rate related to the Rouble, although it is not clear if it will be formally pegged to the Rouble. Such a pegging scenario does however seem initially probable.

While advocates of autonomous cryptocurrency exchange will almost certainly adopt the traditional ultra-libertarian line that any government regulation into cryptocurrencies makes them scarcely different from using traditional currencies in the online domain (Paypal for example), long time advocates of cryptocurrency in the retail and wholesale sector will almost certainly look with interest to this new development.

The Benefits 

A Russian CryptoRouble that can be easily exchanged for traditional Roubles in Russia and ostensibly anywhere else in the world, will automatically give the new cryptocurrency a marketplace  confidence that many alternatives currently lack. Such a phenomenon will de-mystify the process for many possible cryptocurrency users.

At the same time, if in the eyes of the Russian government, a CryptoRouble is as legitimate a currency as the Rouble, it will allow wholesalers, retailers and possibly even independent financial traders to use the CryptoRouble to avoid the sanctions against Russian banks which their own anti-libertarian western governments have imposed.

Additionally, if the CryptoRouble becomes easily convertible to popular western originated cryptocurrencies such as Bitcoin, it would solve the problem of Bitcoin users being ‘shut out’ of the Russian market. All one would need to do in order to engage in transactions with Russian businesses using a cryptowallet, would be to digitally exchange one’s Bitcoins (or any other existing cryptocurrency) for a desired amount of CryptoRoubles. The aforementioned process would generally take the same amount of time or even less than a traditional online bank transfer.

In this sense, the CryptoRouble helps open up Russia for new entrepreneurial ventures while insuring that possible fraud and money laundering loopholes are closed.

The Potential 

During September’s BRICS Summit in Xiamen, there was a great deal of discussion regarding the establishment of a cryptocurrency for the BRICS nations (Brazil, Russia, India, China South Africa) and their partners.

Such a coin would have all of the advantages of the CryptoRouble with the added benefit of instant legitimacy and even desirability across some of the world’s most dynamic and growing economies. It could also facilitate easier money transfers between BRICS members. This would be particularly helpful for Chinese businessmen who often have trouble getting large sums of Yuan out of the country in single transactions. A BRICSCoin, if based on the Russian security net could plausibly alleviate similar existing Chinese concerns about cryptocurrencies. As China has begun trading oil futures contracts in Yuan which can be converted to gold at the Shanghai and Hong Kong gold exchanges, one could foreseeably be looking at a BRICScoin that would effectively be backed by gold, in certain instances.

Furthermore, Russia has become the number one global market for the Chinese mega online retailer AliExpress. An easily convertible CryptoRouble has the potential to make such transactions even more beneficial in the future.

India, which is currently suffering a monetary crisis after Prime Minister Narendra Modi eliminated the 500 and 1,000 rupee notes, could stand to benefit from a new, legal and legitimate means of monetary exchange. A BRICSCoin could help to stabilise India’s monetary markets after Modi’s decision to ban the 500 and 1,000 rupee notes, hit the incomes of many working class Indians. In a country where more people have modern phones than old fashioned bank accounts, a BRICSCoin could be a form of salvation, as well as a way to modernise the monetary sector with few infrastructural requirements.  In this sense, a BRICSCoin could also help to draw India back into the BRICS fold after the recent Doklam/Donglang border dispute caused tension between New Dheli and Beijing.

Overall, having a cryptocurrency that is directly tied to a traditional Rouble, could end up making the Rouble an increasingly popular international currency of exhcange and in so doing, take a bite out of Dollar dominance for small and medium exchanges just as Russia’s commitment to conduct bilateral international trade in national currencies, is steadily doing in respect of large sovereign transactions and deals between major corporations.

The Rationale 

While monetary radicals throughout Russia have welcomed the move, President Putin justified the creation of the CryptoRouble on far more pragmatic grounds. He stated,

“I confidently declare that we run CryptoRuble for one simple reason: if we do not, then after 2 months our neighbours in the EurAsEC (Eurasian Economic Community) will”.

In other words, ‘if you can’t beat them join them’. Implicit in this logic however, is that since Russia has blazed a self-described inevitable trail, others will now be even more likely to get on the state sanctioned cryptocurrency bandwagon. Thus, Russia could be at the forefront of a pan-Asian phenomena that could eventually go global. This will also translate into Russian blockchain technology becoming uniquely attractive to other states looking to develop their own ‘official’ cryptocurrency.

In this sense, Putin has done what the music industry infamously did not do in the late 1990s. In the late 1990s, illegal peer-to-peer music download services allowed web users to download free music that did not pay the owners of the copyrighted sound material. Using Metallica as the public face of the lawsuit, the major western record labels sued the largest such service, Napster. The record labels won the lawsuit and the battle, but ultimately lost the war.  By the time the legal actions against Napster were won in favour of the record companies, the cat was out of the bag and new illegal file sharing services popped up every day, but more importantly, entrepreneurs from the e-commerce and software world, developed legal alternatives to Napster that continue to dominate the marketplace (iTunes, Spotify, Amazon, Google Play etc).

Where the music industry used to handle the distribution of recorded music, often up to and sometimes including the retail point of sale, today, the music industry is having to work in a largely subservient role, with companies that are newer than many of their best selling digital albums. The music industry tried to sue technology into oblivion and instead, the next generation of technology companies have largely consigned the music industry to being a shell of its former self in both North America and much of Europe.

Conclusion 

Russia has avoided the pitfall of the 1990s US/EU music industry, albeit on a much more substantial scale. Just as Paypal and other online apps have destroyed many physical bank branches, in the coming years, there is a very real possibility that as cryptocurrencies get easier to use and become more widely accepted for day-to-day transactions, they could supplement the largely old fashioned banking/monetary system. When this happens, countries that reject cryptocurrencies for fear of not being able to collect revenue from such transactions, will find themselves totally shut out.

Russia has avoided this pitfall by embracing technology and making it work both for Russia, for consumers and for commercial interests. It’s a win-win situation and this is almost certainly, only the beginning”.

Russia is therefore very much at the forefront of challenging US Dollar hegemony, which is itself, the bedrock of US geo-political hegemonic power. With two of the three superpowers openly working on systems of exchange to dig into the Dollar’s market share, it is no wonder that the US is working so hard to undermine the Sino-Russian partnership. This is the real story, not the Russiagate myth.

 

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Judicial Watch Calls for Re-Opening of Hillary Email Investigation After More Classified Info Found

Judicial Watching is calling for a re-opening of the investigation into Hillary Clinton’s emails after finding more classified information on the former Secretary of State’s non-“state.gov” email system.

The Duran

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Authored by Joseph Jankowski via PlanetFreeWill.com,


On Thursday, the watchdog revealed that it had received two batches, 184 pages and 45 pagesof newly uncovered emails belonging to Hillary Clinton from the U.S. Department of State sent and received over her unsecured server.

The emails were uncovered by a FOIA lawsuit filed on May 6, 2015, after the State Department failed to respond to a March 4, 2015 FOIA request seeking all emails sent or received by Clinton in her official capacity as Secretary of State, as well as all emails by other State Department employees to Clinton regarding her non-“state.gov” email address.

Judicial Watch broke down what they found:

  • On June 7, 2011, Clinton received classified information on her non-secure email account from former British Prime Minister Tony Blair, which Blair also forwarded to Jake Sullivan, about Blair’s Middle East negotiations with Israel, the Palestinians and the French
  • On January 26, 2010, Clinton’s Deputy Chief of Staff Jake Sullivan sent classified information via his unsecure Blackberry to Huma Abedin’s State Department email account that he’d earlier sent to Clinton’s and Abedin’s non-secure @clintonemail.com email accounts about U.K. negotiations with Northern Ireland.
  • On October 28, 2010, Clinton exchanges information with her friend Marty Torrey – a congressional aide – who asks Clinton in an email if she would advise that Torrey meet with former Pakistani President Pervez Musharraf. Clinton responds through her non-secure email account approving the meeting and notes that she is emailing him from Hanoi, Vietnam.
  • An email chain dated April 8, 2010, which contains a memo from Sid Blumenthal to Hillary Clinton related to the change of government in Kyrgyzstan, contains information classified “confidential” and is redacted as “foreign government information” and “foreign relations or foreign activities of the United States, including confidential sources.” Blumenthal urges Clinton to “develop relations” with the new government in Kyrgyzstan.

These emails caused Judicial Watch founder Tom Fitton to call for the Department of Justice to re-open the investigation into Clinton’s use of a private email server during her time in office.

“These emails were undercovered from the emails that Hillary Clinton tried to delete or otherwise hide from the American people,” Fitton said in a video posted Thursday. “These new emails once again show why the Clinton email investigation needs to be re-opened by the Justice Department.”

The batch of emails also disclosed a January 26, 2010, email to Hillary Clinton’s private server from her deputy chief of staff, Jake Sullivan, that is classified “confidential” and contains a “call sheet” that Clinton received prior to a call with Northern Ireland political leaders.

Interesting, but not surprising, is also an email that shows a meeting scheduled between Hillary Clinton and leftwing billionaire George Soros.

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Doug Casey on Social Media: “Facebook enshrines stupidity”

“Just as Myspace was displaced by Facebook, I predict Facebook 2.0 will come along and replace Facebook.”

The Duran

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Authored by Joel Bowman via InternationalMan.com:


Joel Bowman: G’day, Doug. Thanks for speaking with us today.

Doug Casey: No problem, Joel. It’s a pleasure to hear your Australian accent come across the ether from Mexico.

Joel: Let’s dive right in. A week or two ago, Facebook registered the largest single day loss for any one company in stock market history – roughly $122 billion. CEO Mark Zuckerberg lost around $15 billion himself, as much as the annual GDP of several resource-rich, West African nations.

Looking back to 2000, during the go-go days of the dot.com boom, Intel and Microsoft both registered staggering single-day losses, too… $90 billion and $80 billion, respectively. And we know what happened next in that case…

So, investors want to know… is past prologue? What’s next for Silicon Valley’s tech darlings?

Doug: Talking about losing multiple billions in a single day, it’s really a sign of the times. I remember when the only billionaires in the world were Howard Hughes, John Paul Getty and John Beresford Tipton– the mythical billionaire on a 1950’s-era show called “The Millionaire.”

These days, however, it seems everyone’s a billionaire. In fact, there are several thousand billionaires roaming the planet today, with new ones being minted almost every day.

Of course, much of this so-called wealth is just paper. It’s not real. In fact, it’s pretty clear to me that we’re in a stock market bubble. Which is being driven by the bond market hyper-bubble. And that, in turn, is fueling a real estate bubble, which I believe is just now beginning to deflate in major cities around the world.

None of this augurs well for the stock market. You’ve got bubbles all over the place. Except in the resource market. That’s the one place that hasn’t inflated. In fact, it’s been going down since it’s last peak in 2011.

Getting back to Facebook, I hope it goes bankrupt. I hate it as an institution. I hate what it does. I don’t like its policies. I don’t like its management. I don’t like the fact that it’s causing people to destroy whatever privacy they have left. While turning their brains to mush sending out selfies all day.

Joel: You’ve put a lot on the table there, Doug. Let’s unpack a bit of that, starting with the general tendency toward cerebral rot…

Many younger readers may not remember this, but there actually existed a time before everybody knew everything, when people had to read books and discuss them, engage in healthy debate and rigorous dialectic in order to learn and develop intellectually.

Now that everyone apparently has plenty of time to Instagram their kale salads and “like” one and other’s cat pictures, are we to assume mankind has finally reached the End of Learning…some new Age of Enlightenment?

Or might Facebook and its (anti)social media cousins represent – in addition to the potential fallout for investors – another, hidden cost to society?

Doug: Perhaps humanity is bifurcating into the Morlocks and the Eloi at this point. It’s true that people used to go to libraries. But even the Library of Congress has only a tiny fraction the world’s data available; libraries are quaint and delightful, but they’re dinosaurs.

All the knowledge in the world is now at our fingertips on the Internet. The Internet is one of the greatest inventions in history, on a par with moveable type and the Gutenburg printing press. A few people are using it to educate and better themselves—but relatively few.

Most people just use it for trivial amusement, as you mentioned. Facebook adds very little value to the equation. In fact, I can’t see that it does much that’s productive. It’s basically a vehicle for gossip and watching cat videos.

Joel: And it’s less than that. Aside from the general degradation of public discourse, social media also represents a kind of unalterable historical record of bad jokes and regrettable moments, accessible to anyone who may wish to besmirch one’s character or skittle one’s reputation.

We’ve all said things we wish we hadn’t. To err is to be human, after all. What do you make of a world in which everyone’s worst moments are readily available to everyone else – including potential enemies – at the click of a mouse?

Doug: Facebook enshrines stupidity. A heavy Facebook user is, in effect, saying: “Look at me! I’m a thoughtless person who doesn’t have anything better to do with his time”. That’s on top of the fact that users are exposing their thoughts, actions, and whereabouts to the NSA, the FBI, the CIA and any of a hundred other nefarious agencies. In fact, there are credible allegations that Facebook, along with Google and Amazon, are willing tools of these intelligence agencies. No good can come of being a Facebookista.

But that’s about whether you should use Facebook. Whether you should own Facebook stock is a different question. Even after the recent selloff, Facebook still has a market cap of about $500 billion, which impresses me as a lot for a chat site cum advertising vehicle. Especially one where most of its growth is behind it. A lot of users are getting hip to the fact they’re not customers, they’re the product.

Facebook was a clever innovation ten years ago. But you know, there’s an old saying in the stock market: High Tech, Big Wreck!

Just as Myspace was displaced by Facebook, I predict Facebook 2.0 will come along and replace Facebook. My understanding is that kids now see Facebook as something used by old people– people over 21 years of age. So if it’s going nowhere with the younger generation, where’s it’s future? Maybe it picks up a billion new users in the Third World. Ultimately, what’s that worth?

Facebook may not be a terminal short sale, but I certainly won’t be putting any of my own money into the stock.

Joel: Assuming you’re correct and Facebook 2.0 does displace the current market leader, are you hopeful that such a platform may serve to promote a heightened level of discourse? Perhaps people might find their way into “phyles,” that is, subgroups based on commonly shared values that actually have real world meaning?

Doug: I hope that, in a year or two, International Man itself grows into a community of likeminded people with above average I.Q.s, libertarian values, and real world experience. IM might, itself, even branch off to become its own kind of Facebook. A private version.

I know there’s a lot of talk about regulating FB, or breaking it up. That’s a bad idea; the government should have zero to do with business in general—and areas related to free speech in particular. I’m disgusted by the fact FB has kicked Alex Jones and others off their platform. But they have a right to do so, as a private company. Although, on the other hand, they’re almost a creature of the State.

But that’s not an excuse for the government to “step in”. What will happen is that a newer, better Facebook lookalike—or a dozen of them—will replace them. FB will self-destruct. It’s a non-problem.

To be frank, you and I don’t really have that much in common with most of the 7.3 billion people on this planet. In fact, while I like many individual humans, I despise humanity in general. The more people you put together in a group, the more they act like chimpanzees. Big groups force down the lowest common denominator.

There’s some cause for optimism, but only on a person-to-person basis. I prefer the company of people who value free minds and free markets—and I suspect most people who are reading this now feel the same way.

Joel: That’s probably a very good note to end this conversation on, Doug. Thanks, as always, for taking the time.

Doug: Meanwhile, we’ll look for something with the potential of Facebook in 2008… and stay away from Facebook today.

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Why did Erdogan free two Greek soldiers after six months in a Turkish prison?

The Duran – News in Review – Episode 83.

Alex Christoforou

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Two Greek soldiers freed after months in a Turkish prison returned to Greece by government jet after their unexpected release by a Turkish provincial court.

Greece’s Defense Minister Panos Kammenos said he phoned his Turkish counterpart to express his satisfaction with the soldiers’ release and invite him to visit Greece.

Kammenos told reporters, referring to the Feast of the Dormation, which falls on August 15 and to the Italian torpedoing on a Greek warship on this day in 1940…

“This is a great day for our motherland, the day of Our Lady, the day of Tinos in 1940.”

“I hope that their release…will herald a new day in Greek-Turkish relations. We can live together peacefully, for the benefit of both our peoples.”

The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris examine the reasons behind Erdogan’s unexpected overture to Greece, with the sudden release of two Greek soldiers held in a Turkish prison for nearly 6 months.

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Via Ekathimerini

The soldiers – 2nd Lieutenant Angelos Mitretodis and Sergeant Dimitris Kouklatzis – were met by Kammenos, the army chief of staff and an honor guard after their arrival at 3 a.m. at the airport in the northern city of Thessaloniki.

“All I want to say is thank you,” Mitretodis told reporters.

The men were arrested on March 1 for illegally entering Turkey after crossing the heavily militarized land border. Greece strongly protested their long detention in the western town of Edirne, arguing that they had strayed across during a patrol of a trail of suspected illegal immigration amid poor visibility due to bad weather.

Prime Minister Alexis Tsipras welcomed their release as “an act of justice,” and provided the jet he uses on official foreign journeys to bring them back.

Their release “will contribute to strengthening friendship, good neighborly relations and stability in the region,” Tsipras said in a statement. “I want to congratulate and thank (the two men) and their families for their fortitude, patience and trust in our efforts, which were finally justified.”

In Athens, the Foreign Ministry said: “We welcome the release of the two members of the Greek armed forces … following more than five months of unjustified custody in Edirne prison. This decision by the Turkish authorities is positive and will contribute to the improvement of Greek-Turkish relations and the friendship between our people.

“The constant efforts exerted by the Prime Minister, the Foreign Ministry and the diplomatic and consular missions of Greece in Turkey have borne fruit. Once again diplomacy is the biggest winner.”

The men’s arrest had considerably strained Greek-Turkish relations. Kammenos had claimed that they were being held “hostage” by Turkey, which is trying to secure the extradition of eight Turkish servicemen who fled to Greece after the 2016 failed military coup in Turkey.

Ankara accuses its servicemen of involvement in the coup, but Greek courts have refused to extradite them, arguing they would not get a fair trial in Turkey and their lives would be in danger there.

The two Greeks were released Tuesday pending the outcome of their trial by a Turkish court. Turkey’s state Anadolu Agency said that in a court hearing to review a request for their release the two said in their defense that they had crossed the border by mistake.

Mitretodis’ father told the AP that his son had shown great strength in prison.

“My wife phoned and told me the news, and at once I called the Greek consul (in Edirne) and confirmed that the lads have been set free,” Nikos Mitretodis said. “They didn’t do anything wrong, and they spent a long time in prison. But they were strong during all that time, and remain strong, they have to be.”

“I want to thank everyone for their solidarity – the media, our political leadership, the Church and anonymous people who stood by us,” he added.

Greek President Prokopis Pavlopoulos said the release of the two soldiers “on the one hand constitutes a basic act of justice on the part of the Turkish authorities. On the other hand, it shows how Turkey can and should continue to fully reestablish the climate of friendship and good neighborliness with Greece”.

Main opposition New Democracy leader Kyriakos Mitsotakis said: “The release of the two Greek officers is happy news amid the gloomy summer that our country is experiencing. All Greeks await their return with joy and emotion.”

In Brussels, European Commission President Jean-Claude Juncker said he was delighted by news of the Greek soldiers’ imminent release. “As I said (before) … Turkey has nothing to fear from its European neighbors. We want to see a democratic, stable and prosperous Turkey,” he posted on Twitter.

Authored by Raul Ilargi Meijer via The Automatic Earth blog:

On August 15, Greeks celebrate the “Dormition (or the Assumption) of the Virgin Mary (in Greek: Koimisis tis Theotokou). The holiday commemorates the “falling asleep” or death of the Theotokos (Mary, translated as “God-bearer”). August 15, one of the most important holidays in the Orthodox calendar, is celebrated across the country, and is a date when many Greeks leave the towns and cities where they live and work to return to their home villages.”

Stole that bit from the local Kathimerini paper. And I would add: while most Athenians leave for the islands, along with about 2 billion tourists. Thought I’d bring up the national holiday because in Turkey, they celebrate the same. The orthodox church is still going strong in both countries. Even if Turkey is leaning increasingly towards Islam. And even then: the House of the Virgin Mary shrine in Turkey, which the Apostle John is supposed to have built for her, on a mountain overlooking the Aegean, the place where Mary is said to have spent her last years, sees both Christian and Muslim pilgrims.

All this can’t be seen apart from some recent developments between the two countries. Turkey had been holding two Greek servicemen in jail after they crossed a border in bad weather early March.

Athens got a phone call from Ankara, probably to Kammenos, not Tsipras, that said: you come get them. Whether that call was before or after the court decision we’ll probably never know. A bit of a shame, because it could tell us a lot of where the decisions are made in Turkey. Then again, we do have an idea. A mere provincial court that could make decisions that go completely against what Erdogan desires? What are the odds? But stick around.

Here’s what’s interesting about this: the two soldiers, who had been in detention for almost half a year, were released by a provincial court, and got back home on a joint Turkish/Greek national holiday. What’s not to like?

But then this: a few hours after they arrive home on PM Tsipras’ own government jet at 3pm, another Turkish court decides that an appeal for American pastor Brunson to be released, is denied. Brunson is the guy Trump wants freed. John Bolton has said there’ll be no more talks until that is done. But if one court takes a decision that at least on the face of it goes against supreme ruler Erdogan’s demands, and another decides differently, Erdogan can claim the pastor’s fate is out of his hands: it’s the court system that decides.

That victory over Trump, concerning not freeing the pastor, is apparently worth more to him than the defeat of not exchanging the soldiers for the 8 Turkish servicemen who have gotten asylum in Greece. Something Erdogan is allegedly very angry about, because he accuses them of being party to the 2016 ‘coup’. He’s trying to play chess with Trump.

*****

And then Reuters has this just now:

Erdogan Spokesman Says Problems With US Will Be Resolved

Turkish President Tayyip Erdogan’s spokesman said on Wednesday he expected problems with the United States, which helped drive the lira to record lows, to be resolved but Washington must stop trying to influence Turkey’s judiciary. Ibrahim Kalin also told a news conference that Turkey would exercise its rights if the U.S. does not deliver F-35 jets to Ankara. The lira, which has rallied after hitting a record low of 7.24 to the dollar, would continue to recover, he said.

Via The Automatic Earth blog:

A masterstroke? Did Erdogan just succeed in making everyone, including Trump, believe the Turkish judiciary system is impartial, and he’s not the one keeping Brunson from leaving the country? Sure looks like he tried. “Sorry, Mr. Trump, it’s out of my hands.. A judge let the Greek soldiers go, and I didn’t want that either..”

Problem is, everyone knows Erdogan fired half the judiciary system and 90% or so of the press, accusing them of being part of the same coup plot as Gülen and the pastor Brunson. It’s almost amusing. Almost, because innocent people’s lives are being played out on some primitive chess board and sacrificed against dreams of ever more power. Only a pawn in their game.

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