Seismology and Forensic Accounting

Week ended September 22, 2023, interesting news items to look at this week were:

1. Seismology and Forensic Accounting: I presume few of us would disagree that the laws of nature affects human behaviour. So in this week’s Blog, I intend to draw parallels between the different stages observed in a “natural tsunami” and those of a “financial tsunami”. In the process, it is my prayers that those who care enough to seek truth apart from the controlled MSM may have sufficient time to get to higher grounds before the flood comes.

(i) Seismology, signs before a natural tsunami: When a tsunami approaches, there can be two rather different observations. A more common understanding is a wave crest but it can also be a trough. In a trough the water along the shoreline is dragged back dramatically, exposing parts of the shore that are normally underwater and stranding many marine creatures. (Fig. 1).

Minutes later then comes a wall of water. Sadly, in “trough first” phenomena, there has been victims without knowledge of a fast pulling away of water is a precursor of an inundation and these people got swapped away. (Fig. 2)

(ii) Forensic Accounting 2008 Financial Tsunami - Although the Western MSM quickly changed the term “2008 Financial Tsunami ” to “2008 Global Financial Crisis”, the lingo “financial tsunami” still very much got stuck with the Chinese Press to this day (Fig. 3).

The concept of a collapse of stock market and property valuation in 2008/9 was the tsunami has unfortunately masked the subsequent wall of USD flooding the global financial markets as the real destructive force. This is very dangerous as one may be distracted to correctly monitor the extent of the forced water retreat and the subsequent wall of water (currencies) to follow. (Fig. 4).

(iii) The Receding Waters of 2023 and Exposed Marine Creatures: As compared with recent interest rate hiking cycles we currently face a much more complicated scenario. The complication is we are also in the midst of a fight for repudiation of a dollar hegemony. A fight in substance against former colonial rulers of the “Collective West” by less or undeveloped countries termed by observers called the “Global South”. The stakes are much higher and consequence of defeat far more devastating. The battle field is far and wide because the Anglo Americans have in their hearts a “full spectrum dominance” and have prepared for such dominance since April 2001. Before we get too depressed let us count what previously submerged creatures have been exposed by the receding waters up to September 2023:

(a) Bloated Military Industrial Complex - the war of attrition between Russia and NATO have exposed fat military budgets of the West did not equate to real fighting and munition production capacity. The combined conventional weapons industrial capacity of NATO, including US is way behind Russia.

(b) A major transaction settlement artery can not presume to have exclusive rights over all trade settlements - With prior planning by Russia, the blocking of SWIFT did not stop Russia from conducting energy cross border trades even with an explosive sabotage of the Nord Stream II pipelines.

(c) A Big Buyer cannot throw his weight around the Only Seller - US is loosing its trade war against China and backfired by having its own importers for paying all the import duties when what China produces is TINA. "There is no alternative"

(d) A Technology First Mover need not have all the advantages - With the entire Collective West allied against Huawei of China, Huawei just proved with the launch of their 5.5G mobile phone that an unmoving hard working late comer can still have a shot at the title.

(e) The classic taboo of “Borrow Short to Finance Long” is a killer but so easily forgotten after a prolonged period of low interest rates - First UK Pension Funds, then Chinese Property Developers and Shadow Banking and by 2024 US Commercial Real Estates and almost all the ranking US Regional Banks, then Western Central Banks and eventually the Federal Reserve will fall like dominoes. 

However, still very much submerged and remained hidden are the extent of double agents and traitors on both sides of the conflict. This is the area where the unexpected can still happen. Given the 5 exposed creatures stated above, I am optimistic that treasonous agents could only alter the timing but not the eventual outcome of the ongoing cold war. My chips are down for the Global South. When the final card need to be exposed comes to light, currencies will be junked and a tsunami of hyper-inflation will hit us all.  

The receding of water (USD) is motorized by a destabilization of Europe as well as attempts to Ukrainize Taiwan in Asia. So far the Anglo Americans have partial success but is not without casualties in the Collective West. War efforts and inflation has caused a continuing issuance of US Federal Debt at higher and higher interest rates. De-dollarization by Global South has gone main stream and Ex-US Central Banks have sold down US Treasuries of US$400 billion in 2022 and 2023. However, with Washington administrative edict to move money out of non US allied markets, total investment by US residents outside of US showed a withdrawal of approximately US$1 trillion in a comparable period. (As at end July 2023, US still has $14.5 trillion investments outside of US). The foreign investment liquidation has more than compensated non US Central Banks selling down of US Treasuries. However, high interests paid with US Government bond issuance is a double edged sword, not only it marked outstanding bond prices lower, it also triggered a lower valuation of foreign owned US stocks.Total portfolio investment by non US residents in the US market stood at US$26.2 trillion and there lies the battle line. The Anglo Americans need to destabilize both Europe and Asia to keep such funds in the US but shift the blame of destabilization to Russia in Europe and China in Asia. But as Abraham Lincoln said  'You can fool all people some of the time and some people all the time. But you can never fool all people all the time.” (Fig. 5).

The narrative of Russia and China are the aggressors have been repeated ad nauseam like a broken record just like Hitler’s große Lüge. (Fig. 6).

No wonder the Collective West all throw their support behind Stepan Bandera’s Ukraine (Fig. 7).    

   

But evil politicians, like Zelensky, are fixated with their own political survival above all other considerations. I therefore expect markets, economies and the precious lives of citizens will all be thrown under the bus until judgement day. For the time being,I have penciled in judgement day to occur sometime in the fall of 2024 but need more work to confirm.

2. G77 + China Meeting in Havana: Few MSM actually reported on the meeting. The Group of 77 (G77) at the United Nations (UN) is a coalition of 135 developing countries, designed to promote its members' collective economic interests and create an enhanced joint negotiating capacity in the United Nations.  There were 77 founding members of the organization headquartered in Geneva, but it has since expanded to 135 member countries.  Cuba held its chairmanship for 2023, succeeding Pakistan. Although China is not a member, China is specifically invited to help G77 to achieve fairness against unilateral hegemons. (Fig. 8).

Part of the Joint Declaration is reproduced on Fig. 8 Interested readers can read the full text G77 on the attached link. https://www.diplomacy.edu/resource/g77-havana-declaration-on-current-development-challenges-the-role-of-science-technology-and-innovation/

3. Sitrep Ukraine War:

(a) Ukraine losses 500,000 soldiers since February 2022 (Fig. 9)

(b) Foreign mercenaries start leaving Ukraine to survive (Fig. 10)

(c) Prepare for long war - NATO chief (Fig. 11)

(d) Economic pain will change EU position on Ukraine - Orban (Fig. 12) 

4. IEA - Oil production cuts that Saudi Arabia and Russia extended to the end of 2023 will create a “significant supply shortfall” and threaten a renewed surge in price volatility, the International Energy Agency (IEA) warned. “From September onwards, the loss of OPEC+ production... will drive a significant supply shortfall through the fourth quarter,” (Fig. 13)

This week’s financial markets:     

A.  Stock Market: (Fig. 14): Dow closed at 33,964 for the week, a loss of 654 points or -1.93%. S&P 500 -3.09% and NASDAQ -3.34%. 

The FOMC meeting did not further raised interest rate as expected but a hawkish Powell’s mantra “higher for longer” spooked the market and trigger a stocks sell down. Apple stocks fell another 1.0% for the week . AI darling stock Nvidia was marked down 2.58%. Cloud darling stock Microsoft down 3.26%. As liquidity is corralled into US Treasuries and technology lead against China challenged by Huawei, the over-hyped and over-valued US tech stocks are leading the charge down and reversion to mean is on the cards.

 

B.  Debt Market: (Fig. 15): USGG10YR ended the week at 4.438%, a rise of 10.2 basis points.

 The market appears to accept short term rates are near its peak but the risk of recession seems in the immediate future looks unlikely. Medium Treasury Notes and Bonds as a recession hedge are in in favour and rates have climbed 15 to 18 basis points over a two week period.

 

C.  FX, Commodities and Precious Metals: Trading results for the week: (Fig. 16)

Silver (+2.16%) Rubble (+1.52%), Bitcoin (+0.56%), Oil (+0.09%), Gold (+0.04%), Euro (-0.25%), Rmb (-0.33%), JPY( -0.39%), GBP (-1.29%), Uranium(-2.63%), S&P 500 (-3.09%), NASDAQ (-3.34%). Energy prices continued to be firm although some profit taking were seen with Uranium. Russia announced an indefinite suspension on export of diesel and gasoline to stabilize prices in domestic market. Outlook for energy prices for the balance of the year is on an uptrend again.

 

Galatians 6:7  Be not deceived; God is not mocked: for whatsoever a man soweth, that shall he also reap. 8  For he that soweth to his flesh shall of the flesh reap corruption; but he that soweth to the Spirit shall of the Spirit reap life everlasting. 9  And let us not be weary in well doing: for in due season we shall reap, if we faint not. 10  As we have therefore opportunity, let us do good unto all men, especially unto them who are of the household of faith.