Russia Will Be The First To Deploy Hypersonic Missiles On Submarines
As far as hypersonic development, the Russian Navy is far outpacing the US Navy. Russia is expected to be the first country to deploy hypersonic cruise missiles on submarines, reported Forbes.
Earlier this year Russian sources told Forbes that submarine-launched hypersonic missile tests would be conducted in 2020.
The missile in focus is called 3M22 Zircon, a scramjet-powered maneuvering anti-ship hypersonic cruise missile that will be launched from the latest nuclear-powered cruise missile submarine called the K-561 Kazan.
Zircon is a winged hypersonic cruise missile that can travel at Mach 8 to Mach 9 (6,090 to 6,851 mph). The missile’s range is estimated at 620 miles, can already be launched from aircraft, ships, ground-based launch systems, and soon to be submarines.
Forbes said the Russian Navy is going through an unprecedented transformation, ever since it started launching cruise missiles from submarines into Syria. Before that, Russia developed its cruise missiles, fired from submarines, for anti-ship operations.
“For much of the Cold War, the missiles carried by Russian submarines were focused on hitting ships at sea, particularly the US Navy’s formidable aircraft carriers. It was not until the conflict in Syria that Russia began using submarine launched cruise missiles in a similar way to the US Navy’s Tomahawk missile; as a long-range surgical strike weapon.”
The Tomahawk Land Attack Missile is primarily launched from submarines and ships by the US Navy and Royal Navy. It flies at Mach 0.75 (575 mph) with a range 1,550 miles.
Russia’s new missile is so advanced that upon it being deployed by submarines, it would create a significant power shift away from the US Navy. The shift in power would add a new layer of deterrence for Russia that would have the US Navy very concerned, that is because the US Navy doesn’t have any countermeasures against hypersonic weapons.
A submarine-launched missile test of the Zircon could pave the way for deployment in the near term.
Forbes said by 2030 Russia could have at least eight submarines armed with Zircon missiles, and 17 by 2040.
And in a bizarre report earlier this month, President Vladimir Putin revealed he was ready to sell the US some of Russia’s hypersonic missiles, if President Trump was willing to return to serious strategic arms talks after the US-backed out of the Intermediate-Range Nuclear Forces Treaty (INF).
Last year Russia’s defense ministry touted a range of experimental weapons it said could counter and evade any US anti-aircraft defense measures, including a nuclear-powered missile that could traverse the globe endlessly.
For a glimpse of a land-based launch of a Russian hypersonic missile, Russia-24 published a video from the Ministry of Defence of the Russian Federation that shows a successful launch of a new hypersonic interceptor missile.
На полигоне Сары-Шаган (Республики Казахстан) боевым расчетом войск противовоздушной и противоракетной обороны ВКС успешно проведен очередной испытательный пуск новой ракеты российской системы противоракетной обороны (ПРО)#Минобороны#ВКС#ПРО#Казахстан#СарыШаганpic.twitter.com/mhtveLcJ3N
As the year of the 325th anniversary of the Bank of England’s foundation, and as the month of one of the Bank’s more important rate-setting decisions since 2008, September provides a congruous occasion on which to reflect on the history of the BoE and consider what the future holds for it. Founded in 1694 as a private bank to the government, it was in 1998 that the BoE was granted independence from the government in setting monetary policy.
Now the UK faces perhaps its greatest political uncertainty in a generation, it is worth asking the question: to what extent will this independence continue?
We have already seen the effect of populist leaders on central banks that are ostensibly independent. The obvious case is that of the US, but there are other examples to be found of central banks facing political pressure to keep monetary policy easy, from Turkish President Erdogan’s sacking of the then central bank governor, to the ECB’s reaction to persistently low growth in Europe. Even if Trump doesn’t control the Fed directly, he certainly controls the market, which in turn has forced the hand of the central bank and led to the Fed cutting rates with the economy in expansion. And with ever more monetary sweets to choose from in the jar, which politician could resist raiding the cupboard and giving their economy a sugar high of rate cuts, QE and lending?
Pressure on the Fed is likely only to increase as the 2020 elections approach: if President Trump is able to engineer further cuts, and then get the markets soaring with a trade deal and promises of tax cuts just in time for elections, we might begin to agree he is – in his words – “a very stable genius”.
For now the UK seems to have escaped the global disinflation which started in Japan and is now being seen in Europe. That fits the BoE’s line, which is that they plan to hike rates, irrespective of the outcome of Brexit. Mark Carney has even warned investors that they are underestimating how much interest rates could rise. Does the market believe him? It’s certainly not our base case: the strategy of hawkish language to prep the market for rate hikes evidently didn’t work for Jerome Powell. If the UK does leave the European Union on 31st October without a deal, UK growth is likely to suffer – if the BoE’s goal is financial stability, it would be hard to justify a rate hold, let alone hike. So far the BoE’s forecasts are based on the assumption of an orderly Brexit, but they have made no public change to this in light of the ever-growing likelihood of a hard exit.
Some investors argue that a lower sterling (inevitable in the event of a ‘no deal’ Brexit, and also likely if the BoE engages in quantitative easing) would lead to considerable imported inflation due to increased export demand. This would justify a hawkish policy response. Here, however, a direct parallel may be drawn with that which we have witnessed in the US this year. The data in the US (strong wages, low unemployment, a solid consumer) may well justify a continued hiking cycle, but with a nervous market which has been placated by the promise of monetary easing, would a rate hike really help economic stability? The Fed evidently asked themselves this question and didn’t think so. Unlike in the US, rate cuts are not priced in by the UK market so far: currently, the implied probability of no change at the next MPC meeting is close to 100%, while in the US the implied probability of another cut in September’s FOMC meeting is close to 100%. But in the event of a ‘no deal’ Brexit in a month’s time, market expectations going forward may well be very different.
There are other uncertainties which will follow Brexit. Many now expect a general election to take place shortly after 31st October. Would a Corbyn-led government follow a similar nationalization of governmental institutions as of infrastructure? It would certainly increase fiscal spend, leading to considerable debt issuance and downward pressure on gilt prices from increased supply. And given that higher interest rates promote the interests of asset-owners/lenders over borrowers, it is likely that such a government would seek to lower the cost of borrowing in any way possible.
And which rate should be thought of as “neutral” anyway? The 2% CPI target which the BoE follows has been changed in the past. In a post-Brexit world of potentially dampened growth prospects, it may be that this already fairly arbitrary number faces pressure. With low inflation and growth around the world, we would argue that it is fiscal policy which should concern itself with growth, and monetary with inflation.
For now the Bank of England continues to plough its lone furrow of hawkishness. But as the clock ticks down to 31st October and a hard Brexit seems ever more likely, it may be hard for the new BoE governor to avoid joining the loose money bandwagon.
Democratic Donor And ‘Dangerous Sexual Predator’ Ed Buck Arrested After Third Man Overdoses In LA Apartment
Democratic political activist and noted donor Ed Buck was arrested Tuesday night at his West Hollywood apartment where two men died of meth overdoses and a third, 37-year-old man, overdosed last week. The arrest came hours after President Trump was in the area for a fundraising blitz.
Ed Buck and current House Intelligence Committee Chairman Rep. Adam Schiff (D-CA)
Buck has been charged with one felony count each of battery causing serious injury, administering methamphetamine and maintaining a drug house.
Prosecutors have accused Buck of injecting the latest victim with two large doses of methamphetamine at his apartment on September 11, causing the man to overdose according to the indictment. After Buck refused to help the man and thwarted his attempts to get help, the man was able to flee the apartment and call 911 from a nearby gas station from which he was taken to a local hospital for treatment.
Notably, the Daily Mail documented a young black man with a bandage on his arm visiting Buck’s apartment on September 11.
Hundreds of photographs of men in compromising positions were found in Buck’s apartment according to court records.
Screenshots of Damar Love (friend of Gemmel Moore)and Ed Buck allegedly at Buck’s home., summer of 2017 via Weho Times
and have characterized him as a “violent, dangerous sexual predator,” who uses drugs, money and shelter to lure black men struggling with addiction and homelessness into his home where he “manipulates them into participating in his sexual fetishes,” according to KTLA. Accordingly, his bail has been requested at $4 million by prosecutors, who argued that he is a threat to the community.
In a photo obtained by DailyMail.com, Buck smokes meth with a painfully thin, drug-addicted homeless young black man in his apartment – a partner he had found on the street and offered $300 to carry out his bizarre ‘fetish’ requests. Buck ordered the man to wear dirty white long johns and black leather ‘f***ing boots’
The 65-year-old gay rights activist was notably given a pass after the first two men died in his apartment in what were ruled accidents.
The first man, 26-year-old Gemmel Moore, died on July 27, 2017. Prosecutors cited insufficient evidence in declining to press charges against Buck in connection with Moore’s death, which was ruled an accidental methamphetamine overdose.
“The full scope of his consistent malicious behavior is unknown,” said prosecutors, adding “It is only a matter of time before another one of these vulnerable young men dies of an overdose.”
Buck has been a prominent figure in Democratic circles, associating with and donating to the likes of Democrats Ted Lieu, the Clintons, Adam Schiff and former California Governor Jerry Brown.
Ed Buck with Democrats Ted Lieu, Clinton, Adam Schiff and former California Gov Brown. pic.twitter.com/1cTDT9GQMx
Photos Emerge Of New Supersonic Spy Drone At Chinese Military Parade Rehearsal
New images have surfaced on social media earlier this week revealing China’s supersonic spy drone rolling through the streets of Beijing during a rehearsal ahead of a parade to celebrate the 70th anniversary of the founding of the People’s Republic of China.
The rehearsal was conducted on Sunday and lasted through Monday morning. Observers across the city were able to take pictures of advanced weaponry and share them on social media platforms, domestically and internationally.
The photos sparked a firestorm of conversation on social media platforms, partly due to an unassembled supersonic DR-8 reconnaissance drone was spotted on the back of a military truck. The drone has never been seen before in public.
The South China Morning Post said the DR-8 would play a vital role if a shooting war breaks out with the US in the South China Sea or Western Pacific.
Rick Joe, a Chinese military analyst and author at The Diplomat, tweeted that the DR-8 has similar characteristics to a Lockheed D-21 supersonic drone that retired in the early 1970s.
The new high speed UAV seems similar to D-21 in some respects, but differences exist:
– big delta wing with ?winglets vs D-21 wing and fin config
– likely chin intake vs nose intake on D-21
– landing gear ?present, i.e. likely reusable rather than expendable like D-21 pic.twitter.com/Eo6sX7F3Zp
The DR-8 reconnaissance drone will allow China to coordinate strikes on US vessels with DF-21D anti-ship ballistic missiles, and the DF-26 ballistic missiles.
Zhou Chenming, a Beijing-based military commentator, was cited by the Post as saying the DR-8 has a maximum speed of Mach 3.35 (2,570 mph).
Shanghai-based military commentator Shi Lao told the Post that the People’s Liberation Army (PLA) has been testing the drone extensively, says it can easily reach Guam where a major US military installation resides.
“In fact, this UAV [the DR-8] entered into service a while ago,” Shi said.
Another military observer on social media said the drone was “the biggest surprise so far.”
Also spotted in the rehearsal was China’s hypersonic DF-17 missile, which can penetrate American missile defense networks through evasive maneuvering while traveling between Mach 5 (3,836 mph) and Mach 10 (7,672 mph).
Zhijun Cai, deputy director of the military parade leading group office, told local media that the weapons in the parade are all active and deployed with the PLA.
A previously undisclosed main battle tank of the PLA that entered service last year was also spotted.
“There will be some exciting new weaponry on show at the parade this year,” Zhou said.
Hundreds of thousands of people are expected to attend the celebrations in Tiananmen Square on October 1, which will showcase how China, the rising power of the world, is ready for a fight with the US.
Following a ban on virtually all semi-automatic firearms, New Zealanders face 5 years in jail if they refuse to hand them in.
A France 24 report on the government’s new buyback scheme showed a line of gun owners wilfully giving up their guns in response to the Christchurch massacre earlier this year.
This despite the fact that the shooter himself said in his own manifesto that provoking mass gunfiscation was one of his intended goals. Mission accomplished.
Since the buyback scheme began, 19,000 firearms have been handed in. Most of the guns seen being handed in looked like ordinary rifles, not AR-15s.
Pay Attention America!
Six months after Christchurch massacre, a farewell to firearms in New Zealand
If New Zealanders fail to turn in their banned weapons by Dec. 20, they could face 5yrs in prison.
Inspector Terry Van Dillen said he “accepted” that some people would be emotional giving up their guns due to them having been handed down by families for generations.
I’m sure any potential future mass shooters are gleefully handing in their firearms to police as I write this.
New Zealand’s gang members even publicly announced they would refuse to hand in any of the “banned” firearms.
Disarming responsible people and making them easier targets for actual criminals.
Genius idea.
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Only 38% Of Americans Believe Humans Mainly Responsible For Climate Change
By now, most people have accepted that climate change is real, and that it is happening. What we can’t all agree on though, is what the main cause is. As Statista’s Martin Armstrong notes, close to an absolute majority of the world’s scientists are adamant that we as humans are the main factor behind the speed and extent to which our climate is changing.
When though, like YouGov, you ask the people what they think, the picture becomes a bit cloudier.
As this infographic shows, of the countries surveyed, India has the largest share of people that think human activity is mainly responsible for climate change (71 percent).
At the other end of the scale however, only 35 percent of respondents in Norway and Saudi Arabia believe we should take the lion’s share of the responsibility. In Norway, the most widely held belief is that while human activity is partly responsible, there are other factors which should be taken into account (48 percent).
When it comes to outright climate change deniers, the survey suggests that the USA harbors the largest share. There, 6 percent say the climate is not changing, and 9 percent say it is changing but not at all due to humans.
The United States and Russia have quite the bumpy relationship. Talk of war between the two powerful countries isn’t anything new, and anyone who is paying attention knows that such a war would be devastating for much of the world.
Two recent research projects show just how bad things would be if the US and Russia unleashed their nuclear arsenals on each other.
A war between the US and Russia would cause a global nuclear winter.
Several months ago, researchers from Rutgers University, the University of Colorado Boulder, and the National Center for Atmospheric Research ran a simulation to see what a nuclear war between the US and Russia would do, and the findings were not pretty: Such a war would plunge the planet into a nuclear winter, with clouds of soot and smoke covering the planet. The study, published in the Journal of Geophysical Research: Atmospheres, found that the nuclear detonations would inject about 147 million tons of soot into the atmosphere. That soot would then spread around the stratosphere, blanketing the Earth in darkness.
Not only would explosions, fires, and radiation exposure kill millions in targeted cities, but the resulting nuclear winter – which could last many years- would drastically alter the Earth’s climate. The growing season would be slashed by nearly 90 percent in some areas, and death by famine would threaten nearly all of the Earth’s 7.7 billion people.
According to the model, the soot would not visibly clear for around seven years. Temperatures would drop by an average of 9 degrees Celsius (16 degrees Fahrenheit) across the globe, the researchers wrote, and it would take around three years for surface light to return to 40 percent of its pre-attack level.
More than 90 million immediate casualties would result.
Researchers at Princeton University created a simulation to see just how bad a nuclear war between the US and Russia would be for humanity, and the picture they paint is terrifying. The team used the Pentagon’s own plans (which were recently leaked) to “highlight the potentially catastrophic consequences of current US and Russian nuclear war plans,” a press release states.
The risk of nuclear war has increased dramatically in the past two years as the United States and Russia have abandoned long-standing nuclear arms control treaties, started to develop new kinds of nuclear weapons and expanded the circumstances in which they might use nuclear weapons. (source)
Researchers at Princeton’s Science and Global Security Lab created this video, which shows just how widespread the devastation from a nuclear war would be.
Does that simulation remind anyone else of the 1983 movie War Games? In that film, a young hacker accidentally accesses a US military supercomputer system called War Operation Plan Response (WOPR). Believing it is a video game, the hacker gets WOPR to run a nuclear war simulation – and the computer nearly starts World War III.
At the end of the movie, the computer tells Professor Falken, who is attempting to stop the WOPR from launching war, that nuclear war is “a strange game” in which “the only winning move is not to play.”
How many nuclear weapons are there?
Nine countries together possess nearly 14,000 nuclear weapons. The US and Russia have the most (6185 and 6500, respectively).
According to ICAN, “The United States and Russia maintain roughly 1,800 of their nuclear weapons on high-alert status – ready to be launched within minutes of a warning. Most are many times more powerful than the atomic bombs dropped on Japan in 1945.”
If all of the nuclear weapons in the world were detonated at once, what would happen? The YouTube channel Kurzgesagt – In a Nutshell attempts to demonstrate the aftermath in this video.
Is nuclear war between the US and Russia inevitable?
Such a war would be suicide for both countries, so why either would resort to such a thing baffles the mind. Earlier today, CNBC reported that Russia is conducting massive military drills with China, India, and Pakistan, in what experts say could be Moscow “sending a powerful message to the West.” Some sources report that tensions between the US and Russia are escalating to “new Cold War” levels. Others believe that the ousting of war hawk John Bolton might be a sign of the potential for a Russia-China-US alliance.
Mutual Fund Chaos After Investments In Opioid Companies Plunge
Earlier on Monday morning, we detailed how the embattled US drugmaker Purdue Pharma filed for Chapter 11 bankruptcy protection, a long-anticipated move aimed at shielding the company and its owners, the Sackler family, from financial ruin as they shoulder the brunt of the blame for igniting the opioid crisis with their aggressive marketing tactics of OxyContin.
Now we’re starting to hear additional reports, specifically in recent filings, that the bust of Purdue and other big pharmaceuticals, thanks to nearly 2,000 litigants, has resulted in at least five mutual-fund companies reporting their returns have been affected after they made risky bets in pharmaceutical companies with opioid-related businesses.
Nick Mazing, the research director at investment research platform Sentieo Inc., told The Wall Street Journal that the number of times companies had mentioned opioids in their annual shareholder reports is up 300% in last eight years.
Walmart Inc., which operates pharmacies across the country, was forced to start disclosing opioid-related litigation as a risk in early 2018, and insurance company The Travelers Companies, Inc. began to disclose opioid-related litigation earlier this year.
Mazing said 55 companies mentioned opioids in their annual shareholder reports filed with the Securities and Exchange Commission as a significant risk factor. This is up from 41 last year and 37 in 2017.
At a time when some 130 Americans are dying every day from opioid-related overdoses, drugmakers like Purdue Pharma, Mallinckrodt, and Endo International are being sued by thousands of municipalities across the country and even individual states.
Mutal funds are worried that their investments in these drugmakers could be severely impacted, as those companies are now paying hundreds of millions of dollars, if not billions, to settle with litigants. In some cases, like Purdue, these companies are filing for bankruptcy.
Miller Value Partners LLC said its Miller Opportunity Trust fund had lousy performance in the last six months, mainly because it had too much exposure to Endo and Teva, two companies that have been cited as significant contributors in the opioid crisis.
“We considered the prospective opioid liabilities but judged them manageable,” Miller Value said in its semiannual report for the period ending June 30. “We didn’t anticipate just how myopically focused the market would become on this point, which was our main error.”
Ohio National Fund said it cut Teva from a foreign-stock portfolio because the shares have been in a bear market for more than one year after a settlement of an opioid-related lawsuit.
Penn Series Funds Inc., an affiliate of Penn Mutual Life Insurance Co., said the 91% crash in Teva’s stock in the last 50 months has absolutely “decimated” the company’s midcap value fund.
American Funds Insurance Series, which is affiliated with Capital Research & Management Co., and Franklin Templeton Investments were others who saw depressed returns thanks to their exposure to opioid-related pharmaceutical companies.
With President Trump’s long overdue firing of John Bolton on September 10th, a window into the battle between neocon zombies infesting the White House and Donald Trump was made visible once more. As much as people enjoy oversimplifying American politics- clumping all “right wing politicians” together as ideological war mongers, the reality as showcased again this week, is that things are more nuanced and that President Trump is not just another neocon.
To begin to appreciate this fight, it is useful to conduct a short survey of the 3 weeks of fanatical neocon maneuvers led by Bolton, Defense Secretary Esper, Sen. Marco Rubio, and VP Pence. These maneuvers were instigated by two “unforgivable sins” conducted by Trump when the latter: 1) stated his wish that Russia be re-introduced to the G7 on August 21 stating “I think it would be better to have Russia inside the tent than outside the tent”, and 2) his defense of President Xi Jinping as “a great leader” who must resolve the Hong Kong chaos without American interference. These initiatives had to come undone at all costs.
Rubio, Esper, Pence and Bolton Push For War
First, neocon war hawk Marco Rubio ranted at length in the Washington Post calling for the US government to intervene into the Hong Kong mess which itself has been stirred up by American intelligence outfits like the CIA-affiliated National Endowment for Democracy.
In his September 3 editorial, Rubio stated “the administration should make clear that the United States can respond flexibly and robustly in Hong Kong” and called for the Congress to pass the Hong Kong Human Rights and Democracy Act co-sponsored by Rubio, Ben Cartin (Democrat), James Risch (Republican), and Robert Menendez (Democrat). The act, if passed would force the US government to fully support the Hong Kong color revolutionaries while sanctioning all
Chinese officials who “have undermined the city’s autonomy”.
Just before Rubio’s belligerent words went public, US Defense Secretary Mark Esper had already exclaimed publically that America had to confront China directly in support of US allies in the Asia-Pacific over territorial issues and containment of China’s growth. Esper shocked many Asian and western statesmen alike when he stated that there is a “coming shift” from “low intensity conflict… to high intensity conflicts against competitors such as Russia and China”.
In this surreal relay race to Armageddon, Vice-President Mike Pence next took the baton during his September 2 speech in Warsaw, Poland alongside Polish President Andrzej Duda. It was here that Pence here took the opportunity to demonize Russia when he said “with its efforts to meddle in elections across Europe and around the world, now is the time for us to remain vigilant about the intentions and the actions taken by Russia.” Pence went further to state without any evidence that “Russian forces still illegally occupy large parts of Georgia and Ukraine.”
Pence was joined in Poland by ex-US National Security Advisor John Bolton, who ended his tour of four former Soviet nations begun a week earlier (Ukraine, Moldova, Belarus and Poland). Beginning his tour on August 26 in Kiev, Bolton took the opportunity to attack Ukraine’s growing relationship with China which is on the verge of finalizing a deal to purchase the beleaguered Ukrainian aerospace giant Motor Sich. Ever since the Russian sanctions began, the Ukrainian company has lost over 40% of its markets with the Chinese providing the only chance for its salvation. Exhibiting his usual flare for hypocrisy, Bolton attacked China saying: “The Chinese are not afraid to use corruption – or to put it bluntly, bribes – to get the decisions they want”, calling for Ukraine to reject the deal.
The New Silk Road: A Nightmare for all Neocons
It is important to note that Ukraine signed an action plan to join the Chinese-led Silk Road Economic Belt and 21st century maritime Silk Road already 18 months ago with recent plans to accelerate that cooperation. Ever since the BRI and Russian-led Eurasian Economic Union increasingly began merging into a unified program, western NATO-philes have realized that their years of hard work to de-rail a pro-Eurasian alliance in Ukraine could easily come undone.
Having made a mess of Ukraine, Bolton then headed to Belarus, and Moldova pushing an anti-Russian line, ending his trip in Poland where he solidified the location for the additional American 1000 troops to be added to the 4500 US troops already operating in the nation- many of whom operate America’s anti-Russian ABM system.
The ABM system which has been built up around Russia’s southern perimeter and which Poland plays a key role, is part of a larger agenda identified by the Russian government as “Full Spectrum Dominance” and seeks a unipolar nuclear first strike monopoly. Poland’s only hope to avoid being caught in the middle of a nuclear exchange between NATO and Russia is to break free of this program and accept China’s offers to join the BRI which experts have recently stated would make Poland “The Buckle of the Belt and Road”.
It was not lost on Bolton and Pence that Poland is also a key member of the 17+1 Central and Eastern European nations + China group which has deeply tied itself to the BRI while Belarus is a member of the Eurasian Economic Union- making their allegiance to the western technocracy more fragile than some would like to admit.
Breaking Free of the Self-Destructive Psychology of Empire
When objectively assessing the psychological state of the western oligarchy at this particular moment in history, it must be concluded that certain forces operating on behalf of the City of London and Wall Street would go to any length– not excluding nuclear war- in defense of their failing system. There is thus no solution to this dark chapter of the human experience unless:
The bankruptcy of the financial system now sitting atop a $800 trillion derivatives bubble is fully acknowledged such that a serious discussion centered on bankruptcy re-organization can finally occur.
That the neocons and other deep state operatives be flushed from power- following Bolton into the trash bin of history.
That the need for a new system premised upon cooperation and long term development is adopted post-haste. This new system would have to contain certain non-negotiable features such as nationally-guided capital controls to prevent speculative fluctuations of currencies and other vital resources, the separation of investment banking from normal commercial banking functions as was done under the 1933 Glass-Steagall Act (repealed in 1999 in the USA), and long term credit generation for major infrastructure projects.
The BRI as the Foundation for a New System
Russia, China and India are increasingly becoming the foundation for a new multipolar world order founded upon the respect for sovereign nations and improvement of conditions of life of the people driven by Putin’s Far East/Arctic vision and China’s New Silk Road which are winning over dozens of nations to a new paradigm of political economy.
For all of his problems, Donald Trump has maintained a generally consistent (albeit flawed) intention to re-build American industry and infrastructure after decades of post-industrial decay and combat the Deep State which has worked on overtime to overthrow his presidency. On top of this, he has seriously worked to keep the nation out of foreign entanglements while avoiding any new wars (a first for any president in over 50 years). Most importantly, he has attempted repeatedly to create positive relations with Russia and China.
Whether the neo-cons infesting the US administration successfully subvert this potential for a new paradigm which would be unstoppable under a Russia-China-India-USA alliance, or not remains an open question, but Trump’s firing of Bolton will hopefully represent a new purge of war mongering sociopaths while opening the door to a new foreign policy doctrine.
The global automotive industry has been nothing short of a full fledged wreck over the last 12 to 18 months, with major markets like China, Europe and the U.S. all slipping as overextended consumers struggle to find the means necessary to purchase vehicles – even with interest rates worldwide near all time lows.
And according to S&P, it’s going to get far worse before it gets better.
S&P predicts that global light vehicle sales will fall by 2%-3% in 2019 and, to add insult to injury, there will be “no growth” throughout 2020 and 2021.
In a new research note out Tuesday, S&P says that sales in China will decline by 7%-9% this year and that U.S. sales will see a 3% decline. It also predicts a 2% drop for European sales for 2019.
The note’s base case assumptions for 2020 and 2021 are 0% to 1% growth in global light vehicle sales. S&P also expects weakness in “all market regions except China, which may see a modest rebound, not before 2021”.
S&P believes that manufacturers will grapple with margin erosion in the mass market segment and will struggle to pass through increased costs of connectivity, electrification and autonomous driving.
Days ago, we just noted that the world’s biggest auto market, China, plunged deeper into recession, with the country’s China Passenger Car Association releasing preliminary data for August that in no way indicates that the trend could be slowing.
The CPCA reported last week that sales of sedans, SUVs, minivans and multipurpose vehicles in August fell 9.9% to 1.59 million units.
It has been the industry’s largest downturn in three decades. China has tried to roll out several stimulus measures to help the industry, including loosening car purchase restrictions, but they have done little to encourage consumption thus far.
Top Chinese SUV maker Great Wall Motor Co. saw its first half profit lower by an astounding 59% and SAIC Motor Corp., China’s biggest automaker, also cut its sales forecast recently and predicted its first annual sales decline in at least 14 years. Geely Automobile Holdings Ltd. saw sales fall 19% in August.
U.S. auto sales have followed suit and are expected to continue to fall (formerly 2.2%, now 3%) in the back half of 2019. General Motors has found itself dealing with its first UAW strike in 12 years and now, the warning bells are also starting to be audible from Mexico. We noted this week that Mexico’s total export volume for August was crushed 12.7%.
It marks a sharp drop for one of the biggest exporters of vehicles in the world, according to new data from FreightWaves. Companies like Ford, Honda, Fiat-Chrysler, Toyota, BMW, GM, Kia, Mazda, Nissan, Volkswagen, and Audi all have manufacturing plants in Mexico.
