Friday, June 6, 2014

Russia Quits G8

President Vladimir Putin's press secretary Dmitry Peskov said Wednesday that Russia is not pondering returning to the Group of Eight.

"At this time, there is no framework for discussion," Peskov told the Russian News Service.

The G7 met without Russia for the first time in 17 years on Wednesday, leaving  Putin out of the talks in retaliation for his actions to protect Russian navy access to the port that Russia legitimately leased in Crimea.



  1. For this reason it is far too simplistic for western commentators to analyse Russia and China in western terms. Both nations from the top down, in common with the whole Asian population, have no illusions about national currencies which always devalue over time, compared with gold which for them will always be the most secure store of value. And unlike western governments the Chinese and Russian governments regard themselves as being business-like in their affairs and so care very much about the quality of payment they receive for their nations' exports.

    This is why it is likely gold will play a major role in cross-border trade in Asia. It is also worth noting that the Chairman of the State Bank of Russia is Putin's personal appointee, a woman who previously had been his own economic adviser. She would not have got this position by parroting anti-gold Keynesian and monetarist theory. All the indications are that Elvira Nabiullina is at one with Putin and that she, like him, is a commercial and economic realist. She is also one of very few central bankers who refuses to rescue insolvent banks.

    The State Bank of Russia under her chairmanship is also accumulating gold, allocating what a western central bank would regard as precious foreign reserves that should be used to protect the currency in troubled times. So Russia's view on gold is in line with China's, giving force and validity to Putin's statement.

    China's long-term plans

    1. One Ton Gold Shipment Into Hong Kong Revealed To Contain Just Worthless Metal

      As South China Morning Post reports, police were last night making arrangements with a mainland businessman to check whether HK$270 million of gold bullion he bought in Africa was genuine after part of the consignment was swapped with metal bars.

      On Wednesday, Zhao Jingjun, 43, opened part of his shipment in front of his buyer in Hong Kong and discovered the gold had been switched for worthless metal.

      A senior officer said it would be the city's biggest heist in a decade if it was confirmed that all the gold had been stolen.

      An initial inquiry showed Zhao purchased 998kg of gold bars from a company in Ghana in mid-April, police said.

      The consignment, in 14 cases, was escorted by his staff and delivered from Ghana on a chartered flight late last month.

      "Officers were told that his employee confirmed the cases contained the gold before it was loaded onto the chartered flight in Ghana," a police source said.

      The source said the employee left Hong Kong after the consignment was handed to the staff of a logistics company at Chek Lap Kok airport. It was then couriered to a Tsuen Wan warehouse.

      The businessman arrived from Hebei province on Monday and checked into the Kowloon Shangri-La hotel in Tsim Sha Tsui. On Wednesday, he had five of the cases couriered to his buyer's Hung Hom office.

      "When he opened the boxes, he found they were filled with metal bars instead of gold bullion," the source said. "He told officers the cases appeared to have been tampered with."


      A police investigator said: "We don't rule out the possibility that the gold bullion may have been switched for metal bars before being delivered to Hong Kong."

      Zhao has reportedly made several such transactions. His business activities include the purchase of iron ore from Australia, Africa and South America.

      Four years ago, 265 gold bars were taken from a Yuen Long company. Police arrested three men and recovered most of the HK$90 million in bullion stolen.

      We can't help but feel this is not the last time as commodity-backed financings are unwound en masse and the underlying collateral found missing... sourcing the underlying by any means will be on the rise.

  2. The G8 (now G7) is largely irrelevant when compared to the G20, in which China and Russia are emerging as leading nations. Russia has a vast amount of natural resources (natural gas, oil, platinum, and palladium) and available trading partners (China being one, probably the most important one). China, acutally produces things, unlike the US, generally speaking. Their debt to GDP is about 22.4% as well. They have some difficulties on the horizon (real estate / ghost cities), but should be able to manage through any prolonged market down turns because they, as country, are not highly leveraged and are nowhere near as corrupt as the government of the US.

  3. Supermarket Supervillains

    Published on Jun 4, 2014
    In the past we talked about monopoly pricing and oligarchical pricing.What i am talking about today applies to everything in America pricing is now set to beyond what the market can bear.
    Today we have between 2 and 4 companies colluding to dominate each sector of our economy which means that market forces and competition no longer drive decision making. With the Clayton and Sherman anti-trust acts being voided just the same way Glass Steagall has been voided, it is very unlikely that we can break up these monopolies without without having a catastrophe. It would be better to go with the momentum and have an overview by making all large companies provide a utility function. This idea is not discussed in this presentation beyond the point that is is better to have integrity in a system than to have a system with no integrity.

    At present, I suggest that that we are not much different from, and in some ways worse off than the Soviet System. Food is a necessity, but in modern day america food is becoming something that is aspiration rather than something that is obtainable.

  4. I hope that by "legitimately leased", you mean it in the best sense that a criminal gang, which is the Russian Government, can "legitimately lease" something since the funds were stolen.

    1. The Russian government's counterpart - in terms of Gangland - can easily be found on the American soil, no doubt about that!