miércoles, 18 de julio de 2018

2018/07/17 Political Anticipation - A GEAB by LEAP Press review


The GEAB view on geopolitics : A moribund NATO
As we have explained on other occasions, NATO is still there, of course, but only because there are no better options at hand. Everyone wants to be rid of it – the Europeans who want a common European defence[1] and Donald Trump who wants Europeans to participate more in their own defence. They are all contributing to a slow process in which NATO continues to get in the way whilst Europeans dither between several strategies... (Selected fragment / GEAB 126)

Trump's Putin summit: a slippery slope to a violent, darker world
From Europe to Asia, Trump is destroying alliances with democracies, while making friends with authoritarian leaders. Emboldened by re-election, US president Donald Trump landed in Russia today for the first meeting of the newly formed Group of 3 (G3) with President Vladimir Putin of Russia and President Xi Jinping of China to carve up spheres of influence in Europe and Asia. Trump and Putin’s unholy alliance could lead to war with Iran. Meanwhile, Nato limped along as a shell of its former self, with the US only still technically a member because Congress will not allow Trump to withdraw... (The Guardian)

Brexit – why can’t we just swipe left?
It’s like watching a train wreck, in slow motion, with 3D and Dolby surround sound. The resignations of Boris Johnson and David Davis from the British cabinet have finally thrust into the open what the dogs in the street have known since the Brexit referendum of 2016. Namely, the promises of the Brexit cheerleaders – such as Johnson and Davis – are unachievable, totally unrealistic and are based on a strangely nostalgic view of British history rather than on the realities facing Britain today... (EUObserver)

The Most Overlooked Renewable Energy Source
Battery-powered electric vehicles have been stealing the spotlight from fuel cell vehicle technology, despite the fact that the latter has been around for a decade or two longer than battery EVs. Fuel cell vehicles are powered by the most abundant element in the Universe and the Solar System—hydrogen. But technology costs and the handling of hydrogen, as well as high upfront investment costs for hydrogen station infrastructure, have been the major roadblocks to hydrogen-powered cars... (Oilprice)

The sky’s the limit: The future of urban air mobility
In the sustainable megalopolis of tomorrow, flying cars will lift off from busy streets to swiftly and safely navigate the skies alongside self-piloted electric air taxis and parcel delivery drones. Far from being a scene from Total Recall or some other science fiction movie, this aerial cityscape is set to become our reality in the not too distant future. In the meantime, metro areas are becoming denser, more trafficked and polluted. By 2050, about 2.5 billion more people will be living in cities... (Euronews)

The GEAB view on innovation: NEOM, between a New Jerusalem and the Library of Alexandria
The Middle Eastern mega-city project called NEOM is a real reason to hope. The Saudis would not proceed with this project if they truly had in mind an open conflict with Iran. This project is first and foremost a symbol of the desire for the future, modernity and normality of the Middle East. It is intended to show that the Arab world is capable of producing more than just intolerance, fanaticism and violence. This is an essential message to create the conditions for a return of peace to the region, but also to stop the stigmatisation and even the persecution of Muslim populations throughout the world, which is made permissible by the radicalisation of a very small proportion of them - particularly in India, Burma, Europe, Russia, China, Africa... The cradle of the Muslim world has a duty to conceive a new, modern Islam that contributes positively to global dynamics... (Selected fragment / GEAB 125)

The GEAB view on food crisis: World autonomy threatened by Chinese investments and needs
One of the symptoms of the complete opening up of the market by the Commission that poses a threat to European food security is the acquisition of agricultural land by foreign investors, particularly Chinese investors. Indeed, the investments of the Middle Kingdom in foreign agricultural lands have jumped up in recent years. They totalled at least $94 billion between 2010 and 2017, almost half of them in the last two years, and more than half in Europe, according to a barometer from two American associations, the American Enterprise Institute and the Heritage Foundation... (Selected fragment / GEAB 126) 

The New Development Bank of BRICS: current innovations and challenges, by Prof Roberta Ciampo
The need to face the infrastructural gap and the lack of resources among the BRICS countries had induced governments to create in 2015 their own financial institution, the New Development Bank (hereinafter NDB), whose task was firstly and foremost to coordinate the different infrastructural needs, and secondly to maintain the main focus on sustainable development... (LEAP Laboratory)

EU pushes China on trade, saying it could open up if it wanted
China could open its economy if it wished, European Commission President Jean-Claude Juncker said on Monday, with the European Union calling on countries to avoid a trade war even as pressure mounts on Beijing over its industrial policies. Playing host to Juncker and European Council President Donald Tusk, Chinese Premier Li Keqiang stressed the need to uphold free trade and multilateralism as the United States and China become increasingly mired in a trade dispute, with no sign of negotiations on the horizon... (Reuters)

Why the Eritrea-Ethiopia peace is good for African politics
Diplomats from Ethiopia and Eritrea are calling it a “joint declaration of peace and friendship” but that innocuous name is masking what may be one of the most important political changes in East Africa in the past 20 years. With a simple, five-pillar agreement the presidents of Ethiopia and Eritrea, which were once one country but were bitterly divided by one of Africa’s most expensive and devastating conflicts, jointly declared its end... (Aljazeera)

Meet Souad Abderrahim – the first ever female Mayor of Tunis
Souad Abderrahim was a remarkable 53-year old pharmaceutical manager before she got elected by Tunis’ municipal office. She obtained 26 votes, 4 votes more than her opponent, Nidaa Tounes. “Abderrahim’s victory is one for the cause of women. It’s empowering in the sense that women can aspire now to be mayors and have leadership positions, regardless of their political affiliation or where they came from,” Ben Abdullah, a 27-year-old Tunisian woman and worker at the Tahrir Institute for Middle East Policy, told The National... (MySalaam)

China says its second-quarter GDP growth was 6.7%, meeting expectations
China on Monday posted second-quarter GDP growth of 6.7 percent from a year ago, slightly lower than 6.8 percent in the first quarter of 2018 as Beijing has been cracking down on risky credit amid escalating trade tensions with the U.S. The official reading was in line with expectations from analysts polled by Reuters. The headline figure was no surprise as any impact from current U.S.-China trade scuffles will only factor in the second half of the year, said Fraser Howie, an independent analyst... (CNBC)

martes, 17 de julio de 2018

Gefira: The global economy is running out of its most valuable resource

Gefira is committed to keeping you informed on the most important trends in geopolitics and finance.
The global economy is running out of its most valuable resource
The current state of the financial markets and the global economy depends on one single resource that nobody, even such renowned economists as Paul Krugman or Robert J. Shiller and dissenters like Max Keiser and Jim Rickards, dares to talk about. In private discussions central bank managers told us that they were aware that none of the existing economic theories and models fit this new situation. Yet, they do not broach it in their public speeches and lectures, preferring to deal with such topics as balance sheets and business cycles. All of which reminds one of a family visiting a terminally sick relative: everybody knows that he will never recover, and nobody whispers as much as a word about it.


  • Trump’s pivot shifts to Asia while the Europe Union disintegration continuous
  • Saudi Vision 2030: The Saudis have given up on their own nation
  • North Korea presents a tremendous investment opportunity
  • Lithium and fuel cells – investing in the future of the automotive industry
 

All productive nations whether in East Asia or the West, have reached the peak of their 250-year-long development. Even the most devastating wars could not prevent their populations from growing in the long run. It is only now, during the many decades of peace and affluence, that the numbers of the inhabitants of the developed countries have been decreasing and the trend continues. The phenomenon has not been brought about by any famine or natural disaster but by the sheer fact that people do not want to have children. 
Japan is an economic bellwether. The country refrained from mass migration and during the 2006-2016 period its population shrank by 0,5%, oil consumption dropped by 21,8%, car sales by 7% and GDP by 4%


Japan is the first country to cope with the new reality and investors need to change their mindset to understand what this new reality stands for. In the past, every business cycle, recession or recovery, ended with a higher GDP and larger economy than before. In the future we will see the opposite:  every business cycle will conclude with a lower GDP and a smaller economy than the previous one.
A shrinking population entails economic consequences. Oil consumption will decline, car sales will go down, and national GDP will be lower and lower. The paradox of it all is that the total economy may be shrinking, and yet people in the US, Europe and Japan will be doing better than before. Why? Because a less crowded country means less dependence on (foreign) oil, lower pollution and CO2 emissions, fewer traffic jams, more space and food abundance.
It is the financial sector that will be afflicted by the new reality, not the people. Without the support of central banks the Western financial industry will not survive a continued depopulation, a situation in which people save and spend less and less money. A buoyant economy invests in win-win deals, a stable economy is a zero-sum game, and in a depressed economy all investors lose. That is why central bankers are considering the imposition of negative interest rates. These are flashing warning signals.
Confronted with this reality, the American and European leaderships have opted for re-population. If the pace of this process remains the same, before this century is over, 50% of the Western states will be replaced with people from the Third World.



The Washington establishment began with the acceptance of unprecedented numbers of migrants from Latin America while the enlargement of the European Union made up for the lack of people, at least for the time being. As under the banner of the free movement of labour, Germany, the UK and the Netherlands got a fair share of migrants from Central Europe, this part of the continent has been deprived of its youth. For example the Polish generation in the age bracket 15-20 is 30% smaller. Now it is Ukraine's turn to hand over its youth to Western Europe. After the 2014 revolt in Kiev the European Union was in a desperate hurry to grant Ukrainian "patriots" the right of visa-free travel, so that they could leave their allegedly beloved home country.
Demographics is quite precise, and those in power saw the coming "disaster" in advance. Peter Sutherland, a former Goldman Sachs banker, became an advocate of mass migration. In 2008 he said: "Rich countries should not try to restrict migration from poor countries, even during the economic slowdown." Alas, migration is not about helping the poor – there are just too many of them – migration is about re-populating Europe. Migration is also about economics and finance.  
All theories, all models that we know about the economy, finance and markets were developed when the European populations grew. The global economy is dependent on the industrialized world. Without Europe, the Sheikhs of Dubai would relapse into the life in tents, Africa's population would be about 90 million instead of 1.2 billion, and today's US would be a sparsely populated country with very few nomad tribes. 
Prestigious consultancy firms have told their corporate clients that all societies are in essence the same and well on the way to becoming like Western economies. The Africans only need to change the law, and they will be as productive, diligent and efficient as people in Europe. Those pundits believe that if car sales stall in Europe, China will be the next market; if the Chinese market is flooded, we have still India, and then – probably around 2040 – the Africans will be the new customers.
We believe that the world's economy is concentrated in East Asia and in the West, with all other economies being but satellites, and it is not going to change, at least in the foreseeable future. If the West together with Eastern Asia collapse, the rest of the world will follow suit. If the West and Eastern Asia stop being interested in African resources, the Black Continent will crumble. We remind the reader that all African countries are dependent on food imports which they finance with the exports of commodities.
Africa cannot sustain its current population let alone the doubling of it within 25 years. 50% of the African youth is younger than 25. The consultancies of Ernst and Young call these youngsters "demographic dividend", a treasure trove for the global companies to reap. If they cannot capitalize on them in Africa, they have to bring them to Europe, as we see it happening now. The current migration process which goes by the name of crisis is engineered and promoted by an influential lobby.  


The Gefira financial bulletin is a monthly periodical that the Gefira team releases ten times a year. We give a clear projection of the future of energy and politics.From Trump's election to the steep incline in oil price and the value of bitcoin, it was all in the Gefira before it happened.
According to the Gefira team, the next systemic crisis will happen around 2020 as the oil price is back at 100 dollar and German mass retirement begin. There is a high risk of war on the Old Continent. However, it is not Russia but Turkey that is the most prominent threat.
It is not the emerging markets, nor public or private debt that should be of interest to investors but instead the shrinking populations in the developed world. Japan is the first country that experiences a declining people, and for that reason, it pursued extraordinary monetary and fiscal policies. The decrease in the European and US population will have dire economic consequence, and after 2025 China will join the club of dying nations.
Apart from China and Russia, economic growth in Africa, the Middle East and South Asia is dependent on the developed countries which see a dramatic decline in their populations.
In the Gefira bulletin we provide investment suggestions and give a coherent vision of the time ahead from a macroeconomic perspective.
On our Website, we have articles from our research team whereas in the Gefira Financial Bulletin we give a comprehensive explanation of the coming world. We focus primarily on economic, investment and strategic subjects. We focus on 2020 as the financial breaking point.

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From the perspective of investors and financial planners we focus on such issues as:
  • Geopolitical risks
  • Demographics
  • Private and public debt
  • Assets bubbles
  • Cryptocurrencies
  • Energy security
The Gefira Financial Bulletin is a confidential briefing paper on the current economic events for investors and generally the business community. It is accompanied by our website, where you will find articles on social issues. The Gefira research team is the only one that is acutely aware of the importance of the current unprecedented demographic changes not seen before in all of history.
The Gefira research team elaborates its anticipation, drawing on:
  • an extensive knowledge of finance and banking;
  • a comprehensive understanding of geopolitics and history;
  • detailed data analyses of millions of records;
  • computer-aided simulations.
With best regards
T.Dankers, Editor-in-chief
editor@gefira.org