December 25, 2014

Money and technology are the new weapons as the old powers become inadequate

Posted in Irish Independent · 38 comments ·
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This week, the North Korean cyber attack on the US via Sony Pictures, as well as the collapse of the Russian rouble, reveal to us just how the world has changed and how the threats to countries’ interests and stability can come from strange, unpredictable places. It also underscores quite how inter-related the world has become.

In both cases, it laid bare the inadequacies of old power. Both Russia and the US spend billions of dollars on their nuclear arsenal. This demands massive resources and infrastructure and is supposed to make the countries secure, yet both the cyber warrior and the foreign exchange speculator only need a laptop and a decent internet connection to wreak havoc.

In both cases, the retaliation of the large countries has been ineffective and raises the stakes for further developments that larger, more powerful countries are bound to lose.

In Russia’s case, hiking interest rates to 17pc damages the economy and makes speculative attacks on the currency more likely. In terms of the cyber attack by North Korea, the US retaliation appears to have been the shutting down of the country’s internet. However, in a country where only a handful have access to the internet, does the US retaliation hurt? And while US hackers can turn the lights out in Pyongyang, what does that prove? If, in contrast, North Korean hackers can turn the lights out in New York City with another successful attack, I suspect there’s only one winner in that scrap . . . and it’s the odd dictator with the funny haircut!

In only a few days we have seen that much of what we regarded as powerful – the hard stuff of armies and weaponry – is less important than before. Today, the soft links of money and technology are what binds the world together and makes it vulnerable.

If you want to see what these links look like, consider possibly the most important international speech made in recent years, delivered yesterday by Ali al-Naimi, the Saudi oil minister, who said that he would not cut production if the oil price fell to $20.

He went on the say: “We want to tell the world that high-efficiency producing countries are the ones that deserve market share” and “if the price falls, others will be harmed greatly before we feel any pain.”

This is an extraordinary statement, because what he is saying is that the high-cost oil producers like the US with its fracking and shale, Russia with its expensive Siberian fields and Iran with its outdated machinery, may not survive as oil players.

This shows another weapon of diplomacy being deployed: energy.

The Persian Iranians and the Arab Saudis have been foes for years, not only because of sectarian Sunni and Shia differences, but also because of geo-strategic rivalry in Iraq, Syria, Egypt and Lebanon.

Saudi Arabia has wanted to torpedo Russia and its ally in the Gulf, Iran, for years. As long as the US was treating Iran as a pariah, Saudi was happy to let the Yanks do its bidding.

Now that the US is making overtures to Iran while Russia and Iran’s ally, Assad, is still in power in Syria, Saudi has decided to act by expanding oil supply. This has caused oil prices to halve in a matter of weeks. Oil prices are now at $40 a barrel and Saudi is still competitive at $10 a barrel.

The collapse in the oil price destroys the Russian economy, as it is a massively inefficient but huge oil producer. The Saudi move prompted the ruble’s slide and Russia, for all the might of its military and resources, is quite powerless in the face of a speculative attack on its currency.

As all these geo-political developments are playing out, what does it mean for us economically?

The first issue is whether an escalation of the US/North Korean spat impacts on US business confidence. This is crucial for Ireland, because the US is our biggest trading partner. It is growing at 5pc, which is phenomenal, and the dollar is rising.

We do well when the US is growing and the dollar is rising because a rising dollar makes Ireland’s cost base more attractive for dollar investors, like the multinationals.

It is unlikely that things will escalate so much between Uncle Sam and Pyongyang as to scupper the US growth rate, however, the drop in the oil price might have a negative impact on the US due to the possible default on energy-related company debt.

Remember, the shale gas and fracking boom was based on high energy prices, which led to massive investment, all financed by debt; if the Saudis keep oil prices down, that debt bubble goes up.

In the longer-term, lower oil prices benefit US consumers massively because they use so much energy.

Similarly here, lower oil prices have an unambiguously positive impact on people’s spending power.

Interestingly, a crisis in Russia could similarly have a positive effect on this country through the impact on European interest rates.

It is sometimes overlooked that there are 6,000 German companies registered in Russia with a combined turnover of €40bn and employment of around 270,000 people.

In Germany, 350,000 jobs are estimated to depend on business with Russia. German firms that have invested in excess of €22bn in Russia are household names, with Siemens, Volkswagen, BASF, Metro and Henkel among the leading players.

A crisis in Russia would mean German business confidence falls. This will make the weak EU economy weaker and will keep eurozone interest rates at zero for a long, long time.

This is positive for Ireland because we are still hugely indebted and lower mortgage rates can only help indebted homeowners. In addition, the weaker euro makes us more competitive against our major trading partners the US and the UK.

It is a measure of how interconnected the world is that people’s disposable income here is affected by America’s cosying up to Iran; or that the crisis in the ruble could have a materially positive impact on the average person’s debt burden here.

But this is how the new world works and the combination of technology and money will make this level of connectivity more, not less, intense.

But as the North Korean cyber-attack indicates, the consequences of the nexus of technology and money is not always healthy, nor desirable.


  1. Proxy Power with Hard Support

    Russia will not allow the oil price remain at $20 as this would eat into the annual national surplus of the country and drain on the remaining dollar reserves that would eventually deplete everything Russia owns .Then Russia will be doomed and their people power cannot not save it .

    Russia’s enemy now is Saudi Arabia .With all their friends in the middle east they can be used as proxies to defeat Sunni Saudi and this means supporting the Shias wherever they are .Their agenda will be to destroy oil supply hardware .

    Saudi only decided to over supply oil because it feared the Shias and blamed the Americans for transgression .Their weakest point has been revealed for enemies to know .

    Proxy will be Russia’s new soft power and will be used in a significant way that will bring results cheaply otherwise the alternative is their national reserves and earning power will disappear faster than the speed of light .

    We may be discussing the symptoms of the economic progressions we read but what relevance is it if we do not include the causes too .

    • jackofalltrades

      +1

      global financial terrorism , warfare rather but there is a flip side and is embodied by the BRICS nations and the sphere of Action that they collectively represent .Neighbours helping neighbours. We’ve all seen how China recently has openly supported Russia , so there we have it – the bankrupt West juxtaposed with Asia’s missions of delivering real growth,in a real way.

      [Putin doesn't suffer fools gladly ,or posers and certainly not liars - all qualities that are in abundance when referring to Obama .... How further will the neocons push and will Putin
      continue to yin to the yang? ]

      Happy holidays

      Special thanks to David for puttin up with me…

      • Blood Moon 4th April 2015

        We have read about this biblical prophesy earlier this year on this site and so much happened since . The process of the unfolding blood moons continue and the Middle East & Jews are a cornerstone of what will dominate 2015 .

        Putin maybe an instrument to these upcoming events .

  2. Happy Christmas David … enjoyed your articles through 2014 & I look forward to reading your thoughts in 2015 …

    T

  3. Bamboo

    Not a great topic to be reading during a peaceful Xmas period but we have been confronted by sheer modern world reality of the new wars in the last week.

    Meanwhile some old fashion war instruments have been showcased in Indonesia.
    http://asia.nikkei.com/magazine/20141218-MORE-MONEY-MORE-GUNS/Cover-Story/Indonesia-busy-playing-catch-up

  4. What’s the conclusion in relation to Ireland?

    As far as I’m reading Ireland can’t lose either way, which barely seems credible

    Fact is we have no leverage or influence over any of this kind of stuff so we just have to try to put our own house in order – which is unlikely if not impossible.

    • Deco

      In the current power play between vested interests, and politicians, it is impossible to see the institutional state reforming itself.

      Of course the EP elections indicate candidates with no money, no media coverage, and no backing from IBEC or ICTU – like Ming, Harkin, and Childers – can emerge as victors entirely on the basis of taking on the racket and declaring it for the scam that it is.

      The scenario of Eamon Gilmore’s missus getting half a million for a site in village in the rural West with a declining population, proves that there is a lot of resource misallocation going on in the Institutional state.

      We even have the state (working taxpayer) bailing out a bank, and that bank then bails out a newspaper oligopoly. Whenever there is an EU referendum, the news media tries to bailout the chancers in Brussels, like Hogan, and the EU Commissar for low (corporate, not worker !!!!) taxes.

      We have a Santa state – with one important caveat – Santa state seems to prefer kids who have been reckless, selfish, nasty, and downright useless. Just look at the current clown heading up BoI. The stuff seems to come from out of then air. Just keep sticking it onto the national debt. Another quango job for the Taoiseach’s wife’s cousin – no problem. The minister says he has the “credentials” when clearly he has no clue.

      The Irish state will go bankrupt, before it reforms itself. In fact this is not just an Irish problem. We see the same thing playing out in Greece, and it might move next to Spain, or Belgium. It might even eventually arrive at Sweden ( a housing bubble attached to a population) or California ( a corrupt one party state in charge of a desert).

      Across the board, in the West, our politicians have taken charge and led the entire state apparatus to a land of sheer make believe.

      And you are correct – it all comes down to whether the state can get itself in order.

      The problem is that there are two many people in the political and media establishment on the take from the current racket.

      And as long as it continues as it is currently, the sums will not add. [ Therefore the numbers can be fudged….well, that did not work out for the USSR, but Brussels is on the road towards that, and likewise the statistics coming from Washington are a bit unusual – an economy that grows, alongside a food stamp line up that grows ? ).

    • Mike Lucey

      David says,

      “……. US business confidence. This is crucial for Ireland, because the US is our biggest trading partner. It is growing at 5pc, which is phenomenal, and the dollar is rising”

      The claims are 4.6% in the second quarter and 5% in the third. However its only ‘Magic Growth Numbers for The Government’ according to Paul Craig Roberts and I think he has done his homework for stating such.

      His article may be located here, http://www.paulcraigroberts.org/2014/12/26/magic-growth-numbers-paul-craig-roberts/

      Why do us Irish place so much stock in the multinationals and chase them around the globe with offers of virtually zero tax deals for quite often short term employment figures which often move to other locations offering better deals?

      We need a big indigenous industry! We seriously need to get thinking about how we can take back our rightful fishing territories (ten times the area of Ireland) and create a sustainable sea food industry capable of employing 300,000+ on this little island.

      The EU entry deal back in the 70s needs to be revisited, its a long time ago. The fishing grounds should not have been taken from the Irish nation in the first place no more than Germany or France gave up their natural territory resources.

      Food and shelter will always be needed much more so than Mercs and this should be the foundation on which Ireland builds a world leading sustainable industry on a par and possibly surpassing our World class agricultural industry.

      If it means pulling out of the EU, so be it. The world is now a global market place which will need more and more food as the human population expands.

      If only we had a leader with the vision and balls to enact such a plan!

      • jackofalltrades

        The vision is one thing, but the execution is another. That person [or organisation] would need to be one serious individual, possess multi disciplinary know-how, technical expertise, credibility, political savvy, be creative,courageous, consistent , possess integrity and maybe above all – to be incorruptible.

        Big ask ? She / he would need a lot of help to cross that finishing line.

        • jackofalltrades

          Flatulent applicants need not apply !!

          short
          https://www.youtube.com/watch?v=sh6vqhOUX8Q

          • jackofalltrades

            but jokes aside, this “leader”, this pioneer,would have to be fearless of the unknown Mike,or put another way,he/she would have to embrace the unknown – A Captain Kirk type …. few and far between

            but they are out there

          • michaelcoughlan

            Hi,

            The solution will not come from one charismatic leader in a top down approach. Europe tried that in the 30′s with lither and Russia with Stalin. Millions and millions of dead people later everything these head cases tried either turned into or was bombed into rubble.

            Change is happening already my friend where individuals or small groups of individuals acting locally in a classic bottom up grass roots movement are making an enormous difference and by leading by personal example are inspiring others yo do likewise.

            Look here what Keiser, Herbert and brand in their own way are achieving:

            https://www.youtube.com/watch?v=FdoOqLGKj00

          • jackofalltrades

            @Michael

            “will not come” eh…How sure are u about that?

            I’ll watch the link later hopefully and yea MK and Brand are revolutionaries and do a solid job [ although too theatrical for my taste]of communicating the anti-banker message and i’m all for that!!

            Now,that said,,, how about Indian Prime Minister Modi’s future growth plans and job creation,or the plans of Ibrahim Mahlab’s Suez Canal project,or Xi Jinping’s [ Hamiltonian /Keplerian}lunar programme ,- these are the quantum leaps desperately needed Michael.These nations’ hi-tech missions represent the principle of life, that of wilfull growth by creativity and such projects are more prolific to support ,especially considering our advanced stage of human misery and degradation,i say.

          • michaelcoughlan

            sooner or later I knew I would out you bonbon.

          • jackofalltrades

            Yea i just watched the link and yea it’s grand , as far as it goes…

            So “embracing technology” is now crowd funding and crypto currencies to these aficionados ??.Ughhh! and lest we forget mention of unions, MSM and fracking yada yada…just lo-ball stuff. Derivatives, the real threat gets skimmed over?The “take the teddy” flippancy has a pungent pong of ” I’m alright jack,keep your hands of my stack”.That vibe does him /them no favours.
            [ I will say that they did open with the future reality of bail-ins -wages,savings,pensions) which certainly needs air-time.]

          • jackofalltrades

            and while i believe that jesus is a fraud, I do find the jesus behind the sofa both insensitive and offensive (as i imagine do most Christians)..there’s just no need for it,,,it only serves to cheapen and discredit the programme. And smiley Russel could surely engage a consultant to school him in physical economics, if he’s really ‘that’ interested..I have grave doubts.. I mean,it’s v.worrying that I might know more than Brand about economics and lets face it,i’m not the sharpest knife in the drawer.

            No smiling in this clip

            https://www.youtube.com/watch?v=9ALOI63X_CE

        • Talking about Putin, are we??

      • DB4545

        Mike skip the leader bullshit. Michaelcoughlan is right top down nonsense doesn’t work. Who leads Switzerland or Norway? I don’t know either but they have democratic accountable local government with control of their economies and resources and they are some of the wealthiest democratic Countries on the planet. We’ve discussed this to death. Do what they do and the rest follows no need to re-invent the wheel. What leadership will we get after Etna leaves office? More of the same bought and paid for third rate teachers/solicitors/gombeens and shills. Trust your wallet your vote has already been subverted by vested interests.

        • Mike Lucey

          I think we already may have a man that could pull this big indigenous industry idea off with some support.

          I’ve been following Éamon Ó Cuív (Young Dev) for some time and agree with many of the stances he has taken as a TD, particularly his stance on the European Fiscal Compact Treaty which ended up with the Irish becoming the laughing stock of Europe. We lost ‘The Fighting Irish’ banner after that second vote.

          Ó Cuív has stated his opinion on Irish Fisheries. This is what he says,

          “Ireland has 18 per cent of the fish of the European Union in her territorial waters, but only 4 per cent of the quota. It is very important that Fisheries Ministers continue to raise this issue every time there is a discussion on the Common Fisheries Policy and in particular when the Policy is up for review.

          Minister Coveney seems not to have addressed this issue and therefore, is indicating that Ireland is satisfied with this underlying inequality in the European Common Fisheries Policy.

          Fishing could be one of the major industries in Ireland if we had adequate access to our own resources. For years Ireland has been subsidising the European Union to the tune of €2 billion a year and this is now set to continue.

          Although the industry at present employs 11,000 people and is worth about €700 million annually to the national income, this number could be quadrupled to over 40,000 people and it could contribute €2.8 billion to our national economy, if we had access to a proportionate amount of the seas of the EU.

          In this time of hardship and when many have talked about the use of natural resources, it is tragic that an island people such as ours do not have access to our full marine resource.”

          I actually corrected a typo in his (above) statement, €700 billion should have read €700 million. I must inform him above this error. This statement may be viewed here, ttp://www.eamonocuiv.ie/ga/nuacht/preaseisiuinti/276-statement-from-eamon-o-cuiv-td-on-the-common-fisheries-policy

          I also think that his 40,000 related jobs is quite a low figure when one considers the number of jobs created in Spain from fish caught in Irish waters.

          Éamon Ó Cuív has very strong connections to the western sea board where this indigenous industry would be based and he also has a background in co-op management at a hands on level for many years.

          Regarding how Switzerland’s democracy works. We had in the Constitution of the Irish Free State under ‘Initiative and referendum’, a defined procedure as follows,

          ‘Initiative: Ordinary citizens would have the right, through an initiative process, to draft both constitutional amendments and ordinary laws, and insist that they be submitted to a referendum.

          The constitution provided a general frame-work for how the initiative would work, empowering the Oireachtas to fill in the details with legislation. It required that a proposal could be initiated by a petition of 50,000 registered voters.

          Once initiated a proposal would be referred to the Oireachtas, but if the Oireachtas did not adopt the law it would be obliged to submit it to a binding referendum. The constitution gave the Oireachtas two years to adopt a law allowing voters to introduce initiatives.

          However after this time voters had power to force the issue. This is because the initiative process itself could then be made the subject of an initiative. After two years the introduction of an initiative process would be put to a referendum if demanded by a petition of not less than 75,000 voters on the register (not more than fifteen thousand of whom could be voters in any one constituency)’

          http://en.wikipedia.org/wiki/Constitution_of_the_Irish_Free_State

          We need this ability back as soon as possible. Politicians won’t willingly agree to this as it would be akin the turkeys voting for Christmas, however I feel if enough Irish people put their name to a ‘crowd petition’ it might happen start the ball rolling.

          I am aware of a number of ‘crowd petition’ sites and might well put my efforts where my mouth is and get something going. I’ll keep you all posted ;-)

          • DB4545

            I think there’s some merit in that Mike but I’m completely opposed to top down centralised government it just doesn’t work. We copy the UK model and it just doesn’t deliver except to an elite. I think if people exercise more prudence and control over their wallets it’s a start. Austerity has forced us to do some of that. One topical issue is petrol prices unleaded is currently Euro 1.29 a litre in my neck of the woods. Crude oil is currently Euro 50.00 a barrel equivalent to roughly 31.5 cents a litre.(Brent crude is 60 dollars/50 Euro and a barrel is approx 159 litres) Distribution and refining and storage costs plus an 11 cent margin take that to about 50 cents a litre on Irish forecourts and the rest is tax currently 80 cents approx. Yet people will walk into a petrol station and pay Euro 1.30 for a litre of water after all the protests about water charges for a product that costs approx 10 cents to put on the shelf and has nowhere near 80 cents in tax costs. No wonder one major player can afford to employ an incompetent former Taoiseach with margins like that. My point is that there is a lot of wealth being sucked from the average punter between high taxation and insane margins because the average punter is too lax in demanding accountable government and sensible margins. No wonder Tesco call us Treasure Island. For Pirates.

  5. Pat Flannery

    I watched “The Interview” last night here in San Diego. It is a very funny movie. But what is even funnier is the way the world has been “honey-potted” by Sony Pictures into believing that they suffered a real life cyber attack by North Korea.

    This elaborate hoax will probably go down in movie history as the greatest publicity stunt ever. The Sony marketing team must be peeing their pants with laughter. It worked! Their unlikely zany PR stunt outdid the movie’s zany story. It is now part of Hollywood lore. They even managed to get the real-life POTUS (President of the United States) into their outrageously funny scam.

    What a kick. Don’t you just love Hollywood? The lines between their tinsel and real life are henceforth forever blurred.

  6. Deco

    To be honest I stopped lining up in a queue up for the latest show, from Hollywood, years ago. Since the invasion of Iraq actually.

    Specifically, the jeering which Michael Moore got treated over Fahrenheit 9/11, made me alert to the fact that Hollywood was in the business of an agenda. He even got the Saudi connection to the top correct. 10 years on, and it is bang on the money.

    Another interesting production was the Hunger Games. And there is a fascinating analysis of the deeper themes in the Hunger Games, in which certain undercurrents are explored.

    Likewise the “Wolf of Wall Street” which is bang on the money concerning the sort of stupidity that prevails in the financial sector. It could have just as easily been written about Anglo Banglo.

    “Wolfhound of D4″. Bankers sniffing cocaine, getting on free helicopter rides to free treatment in the corporate box in Old Trafford or Parkhead. Living in mansions in Delgany or Malahide, or Straffan. Playing golf with the new developer speculator set, before getting in a chopper to Ballybrit. Golf balls in Drurys Glen, Portmarnock, or the K-Club. And along the way signing loads of deals, without reading the fine print. Except maybe the fine print in the IT BS every Friday, under columns by Dan McLaughlin and Austin Hughes. All “bullishly optimistic”.

    And of course, in Wolf of Wall Street, the cop was Irish, and he was serious about the job. As shown by Ming, the Irish cops in Ireland are useless, and easily compromised. The financial regulators even manage to become part of the scam.

    Then there was life inside a bank that decides that it can no longer sell subprime junk to investors, and that decides to liquidate everything as fast as possible, looking for other suckers. I think that was called “Inside Job”.

    Some productions from Hollywood, are relevant, useful, and accurate. And a lot of Hollywood is propaganda. It is not as absurd as what comes from Pyongyang. But there is a subtle undercurrent of messages there, concerning happiness, shopping, getting what you want, and patriotism.

    All that is required is a discerning mind to figure this out.

    • Pat Flannery

      Deco, I guess Hollywood appears a little differently to me living as I do less than 100 miles down the road in San Diego. It’s a bit like how people living in Mullingar might think of Dublin.

      Anyway, I see the whole thing up there as just a bunch of kids, from all over America, indeed from all over the world, having fun and getting paid for it – which is how they see themselves, which is why I like going up there and hanging out with them, for a day or two.

      When you get in amongst them in real life they are just like the rest of us. There is very little glamor I assure you. That only exists on the screen. Most of the workabies live in cheap 1950s apartments, drinking beer around patched-up 1950s swimming pools, waiting for their clothes to dry in old coin-operated laundry rooms. But they are fun to have a beer with.

      The weather is always great and as Neil Diamond so eloquently put it “palm trees grow and rents are low”. The feeling is definitely always “lay back”. Only a tiny minority actually make it to real money.

      So next time when you think of Hollywood think of their eager young Dublin brothers and sisters who live in flats in Ranelagh and Rathmines, dreaming of how they will be somebody one day and make a difference in this world. Long may they all dream.

      • Spot on Pat, I worked in the movie business for about 6 months in 2009 – based in Des Moines and Minneapolis, but had to go to LA a couple of times for “meetings”. It’s all a facade and you are very lucky if you make it big, but most of the people are nice. It’s the ruthless sociopathic backstabbers that go further but in the immortal words of Ronnie Drew: “there but for the grace of God go I”. Merry Christmas from Dominica.

        • I was cast for Laws of Attraction to act as legal advisor to Pierce Brosnan to be shot in Ardmore during the month of August many years ago . As it was family holiday time for me I refused ……and my agents ejected me .

          I appeared in a few episodes of Fair City acting as the Court Registrar during a murder trial . For me it was fun and my daughter had a feast of a day during the shooting .

      • Deco

        Pat,

        I am thinking in terms of content. In terms of the intellectual honesty/dishonesty of the output.

  7. Christmas Card Children

    David wrote a book ‘ the Pope’s Children’ . On Christmas Eve I noticed all the cards for ‘wives’ were completely sold out the day before in all the main card shops and many husbands were doe eyed scanning the displays very disappointed and in vain .Never before in recent years has this happened .Perhaps this the sign of a Buzz renewal in the nations once more .

    Strangely I visited Lydle and ….not one card to wives was sold ….their racks were completely full .

    This is all strange evidence and an omen to the immediate future . Maybe we should be happy again that the economy will rise once more .The cards seems to say so.

  8. michaelcoughlan

    Hi all,

    I hope you all had a peaceful and happy Christmas.

    “The first issue is whether an escalation of the US/North Korean spat impacts on US business confidence’

    I would think that the first issue is whether the spat between Saudi and the US is more important. I’d say Saudi’s action is aimed at putting manners on Obama for kissing Iranian ass. The article hints at concerns in the US with defaults on debt related to fracking which is very insightful because whoever is holding the county part risk for the hedges in a fall in the price of oil is getting rightly screwed.

    There will be a clamour of people banging on the door of the white house to get the price of oil back up from hedgers to oil execs to diplomats. It will be interesting to see how the US responds to Saudi on whom they might even threaten sanctions etc. The US aswell as Russia, Iran, Iraq everyone basically desperately needs to cut the flow of Saudi oil.

    Russia is still very strong though as Putin knows that the oil price cant remain this low forever and his country’s finances are in the best shape.

    Interesting times.

  9. joe sod

    It is true that Russia is hurting from the sanctions and fall in oil prices. But many respected commentators are saying that the fall in oil prices is not real but is being manipulated by the financial markets and Saudi Arabia working in concert. The oversupply was only 1% above demand anyway which hardly merits such a huge fall in price. Saudi Arabia may have said that it can cope with $20 oil but it expects oil to be at $80 in 2015. This is a short sharp shock not a new era in low energy prices. Also the instability in the middle east is reasserting itself with the fall in supply from libya because of Isis. Also the shale oil bonanza only applies at $80+ oil, already high cost producers in the north sea have cut production and let workers go. It is also a fact that europe especially Germany and Eastern europe are highly dependant on russian energy and cannot do without it or switch suppliers. If russian energy was taken off the market nobody could replace it not even Saudi Arabia.
    While soft power is effective in hurting Russia, it will not make it change course. This is because the US and europe are afraid to use hard power because it will hurt them even more than Russia. The Ukraine crisis will only be solved by the West agreeing not to let Ukraine join NATO or the EU. Putin is portrayed as a tyrant, but he is a very clever astute man. His intervention last year in Syria stopping the US from attacking Assad was shown to be correct. This would have resulted in Isis controlling Syria and then maybe drawing in Israel into a war. The intervention in Iraq was a disaster along with the overthrowing of regimes in Libya and egypt. All of these changes were resisted by Russia and Putin, he was shown to be correct.

  10. joe hack

    “This week, the North Korean cyber attack on the US via Sony Pictures” this is echo journalism based opinion but presented as fact and not an opinion.

    Abusing reserve currency status – an 1944 agreement -and using it as an act of aggression against others countries will ultimately result in the removal of that status.

    Russia has now recently made its intention public: the Yuan and possibly further along the Rupee will be part of a multi polar reserve currency, there is little the USA can do about it once all the pieces are in place -at present Russia does not envisage the Rouble becoming part of a multi polar reserve currency – this will happen and this is good news – the empire of chaos is in self destruct mode. China is building infrastructure all over the planet while Rome is collapsing and the only thing they have to prevent a total end of the dollar as the reserve currency is the strength of their overstretched military -130 + bases in other peoples countries- the world is turning against the USA and having a multi-polar world is a balance I look forward to .

    The USA is slowly running out of plausible Emmanuel Goldstein’s, Kim Jung Un is just Xmas side show to distract the plebs – outrage bait- but just as the Asians were starting to get along the USA does pivot to destabilise it – warship bobbing all over the south china sea – while others are doing the polka or foxtrot to draw fire the USA does know where, who, or what to point its gun at – from Ukraine, Syria, ISIS to the south china sea the USA is a rudderless delinquent.
    When one points a gun at everyone be assured that everyone is pointing back including south America. Not only are the Russians -dance tutors – wining Strictly Come Dancing they will likely do some great ballet moves maybe even a black swan will arrive on stage if they choose but they are well aware that when you have dollars in your wallet you don’t use the economic WMD as that would be MAD.

    • joe sod

      I not agree with the analysis that the demise of the US will lead to a safer world or that the US is even in decline. I think the crisis in Ukraine is actually not a big crisis and can easily be solved. The crisis in the middle east is the big crisis and this is a result of the cack handed intervention by the US and its allies which Russia was against from the start. In the bi polar world of the cold war I dont think the US would have intervened at all in the middle east. It was the demise of the soviet union and the over confidence of the US and its allies which resulted in the mess there. I dont think a multi polar world would be very safe, we have had that before in the lead up to the first world war. In the nineteenth century a bi polar world order existed between Britain and France which maintained peace for 100years. This was then disrupted by the emergence of Germany especially. After the second world war peace was maintained because the world order was controlled by the US and Soviet Union. But the demise of the Soviet Union and the emergence of China, India, and an emboldened Russia has again placed the world in a dangerous position. I think the West needs to back down a bit over Ukraine and then work with Russia and China to resolve the problems in the middle east. It is also the case that the West, China and Russia are on the same page when it comes to eradicating fundamentalism there.

      • joe hack

        “a bi polar world order existed between Britain and France which maintained peace for 100 years” I disagree with that however even if it were true you are saying a bipolar was more peaceful!

        The usa is not interested in peace it thrives on chaos to gain control mostly manifested in the middle east it has been at war continually for over 70 years 10 of millions are dead as result. Make no mistake about it the uSA is far from altruistic.

        “I not agree with the analysis that the demise of the US will lead to a safer world” I am not a soothsayer nor do believe the uSA will not be a relatively big player for the foreseeable future but “Safer” that perspective depends on where you live and the conditions that you live in eg ask the people of haiti… who are enslaved to them and at a different level Ireland is enslaved to the banker /imf, water charges/eu/usa

  11. Deco

    I think that will 2015 will have a second “Gulf of Tonkin” / “Sinking of the USS Maine” / MH370 type incident. One was not enough.

    The Western banking and economic policy was bankrupt in 2008.

    Now, foreign policy is being proven morally bankrupt.

    We as a societal concept are sliding one step at a time into the abyss. Rights are being rolled back.
    The concept of community is under continual attack, with values of consumerism and status obsession.
    Wage-earners are being sucked dry with taxes, and levies.
    We are being monitored like lab rats.
    2014, was the year of propaganda, and lies, that exceeded even 2008.

    Enter the growth of the mega-state.
    TINA – There Is No Alternative.

    In 2015, your rights, your freedom, your sovereignty, your access to truth will be under assault, like never before. All being justified by false moral pretence.

  12. joe hack

    What is happening in this soon to be multi-polar world will affect Ireland more that most – our dependence on the debt ridden USA will sink us, it is time we went east.
    Germany will go east and engage with Russia and China. China while building infrastructure will be expanding its market in Asia to partly compensate for oncoming a loss of market in the USA the Asian market is the only “growth” market – 4 billion peoples!- and Germany has allot to offer it.

    If Germany hangs out much longer in Europe it will sink like the rest of Europe. Russia is the play maker here and it has the resources to feed this market and the know how in science to help drive and protect this new engine from physical attack although one suspects the US is mad enough to go and take it on and still think it will live the USA it is deaf and it’s MSM is even deafer.

  13. Mike Lucey

    @ Tony Brogan

    Yes, Direct Democracy have the ‘People Power’ referendums idea on their agenda but also a lot of other matters which dilute this one simple and powerful ability for the man on the street.

    @ DB4545

    ‘No wonder Tesco call us Treasure Island. For Pirates’ So true.

    I was in Hungary recently on business and asked my Hungarian host (who works in Ireland also) about the shelf pricing system in the Tesco branches there.

    The item price tags are electronic and controlled by Tesco central office. By law they must reflect the correct price of items and all times otherwise they have big problems with the consumer rights authority. Its been a long time since I have been to a Tesco here in Ireland but I don’t remember such a system here.

    While Hungary is far from being perfect there is very strong consumer protection in place. My host thinks the Irish system is a huge joke when it comes to consumer rights. I think I’m inclined to agree with him now.

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