Korea

Twitter, Twitter on the wall who should we shutdown after all?

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Black conservative Candace Owens gets a 12-hr Twitter ban for replacing the words of Sarah Jeong from “white” to ”black” or “Jewish”. Good to see the consistency in double standards from The Left. Of course Jeong suffered no such fate.

Candace Owens is an extremely articulate and intelligent person in her own right. Good to see more hypocrisy called out by her. If only Jeong could get as many likes or retweets. Perhaps Ann Coulter said it best, “Luckily for Jeong, the way “white men” saw the world in the 50s was that South Korea should be free.

#CancelIdentityPolitics

Koreans rake sour Krauts over hot goals

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Not a sight you see every day but hearty congratulations to the Koreans who defeated Germany 2-0 to send the reigning world champs to the bottom of their pool and out of the World Cup. The Germans looked wooden the whole match. The Korean goalie had a blinder. Korean defence seemed everywhere. Was it a case of Sth Africa vs Japan in the 2015 Rugby World Cup where the favorites treated the game as a formality? Certainly felt like that. When the German goalie left to play attacker the final goal summed up how embarrassing the match was. Not even 9minutes extra time could see the Germans penetrate the Korean goal line. It would have been nice to see the German side shake the hands of the Koreans to acknowledge the achievement rather than sit solemnly on the pitch and contemplate the lashing to be received in the press. Good sportsmanship is the sign of good champions.

Xi and Trump summit In Singapore

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On May 25th, CM wrote after the spat between Trump & Kim, “It will be China sending Kim back to the meeting table with Trump because it will ultimately be managing the protectorate after any peace is signed for its own geopolitical aims. China does NOT want US friendly forces on its border. Best keep the buffer by getting Kim to accept a lesser deal where he gets to keep his life. For a man in his early 30s he can either choose to go down fighting or see out his days with the embezzled billions and bevy of beauties in his concubine.

Shouldn’t the fact that China provided Kim Jong Un with a “private” jet to get to the summit speak volumes about who his interests represent? While the US State Dept might quibble over minibar expenses at his hotel in Singapore, President Xi is showing he’s truly behind the outcomes from North Korea’s side. The Chairman is but a puppet.

China only wants reunification if that means US Forces leave the South. That is unlikely to be on the cards so Kim can de-nuclearise and clutch to the bosom of Xi.

As CM wrote back in August 2017, China will turn North Korea into a puppet state. Kim knows it is best to hitch his wagon to the world’s most ruthless regional power in coming decades. He only needs to bear 6.5 years of Trump. President Xi will be around for decades.

Who will get the Nobel Peace Prize for helping end the Korean War – Kim, Moon & Xi or Trump?

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Will President Donald Trump be awarded the Nobel Peace Prize for getting Kim & Moon to the peace table? It is unlikely in so far as the Norwegian Nobel Committee would fear the full weight of international opinion (aka mainstream media) for doing so. Surely they wouldn’t risk making a mockery of such a coveted award? Then again a one Barack Obama was handed one less than 9 months into his first term on the stated basis of a noble quest for the Holy Grail of world peace rather than anything actually achieved. In 2016 alone, the Obama administration dropped 26,171 bombs on enemies. Not bad for a serial appeaser. A Nobel prize has even been awarded to a multi billion dollar embezzling terrorist of a self appointed authority, so Kim Jong-un is in with a shot.

Will Trump receive any credit (even without a Nobel) for pushing ‘Rocketman/The Fat Kid’ to the negotiating table? Probably not. How come no other administrations were able to achieve something that was relatively easier when the state of the North’s arsenal was considerably less lethal? Kim threatened Guam less than half a year ago. Trump didn’t back down and the North Korean dictator clearly realized from Twitter that the most powerful man in the world wasn’t all bluster. President Xi may well have played a solid hand in pushing Kim to sue for peace negotiations. In the interests of President-for-life Xi, his foe Trump has a maximum 7 years left to meddle. If Korea gets a peace deal, Xi can play hardball on the peninsula if a softer President enters the White House thereafter. Then he can take a stab at Taiwan. Xi can afford to wait.

We should not forget that Kim Jong-Un travelled to China on his first ‘overseas’ visit earlier this year. Best get the approval of a real dictator before progressing. Kim was there to get Beijing’s blessing to ensure North Korean sovereignty come what may so as to maintain the desired geographical buffer to pro-US nations.

Noone said peace isn’t desirable. The question is what price must one pay to get it? There are too many incidents in the past where signing peace treaties with dictatorial regimes have ended in disaster. Hitler/Chamberlain (Munich Agreement), Hitler/Stalin (Pact of Steel), Putin/Merkel/Macron (suggestion of UN in Ukraine), Le Duc Tho/Kissinger (Paris Peace Accords over Vietnam), Xerxes II/Leonidas (Greece) etc.

Will part of the denuclearization ‘deal’ call upon a withdrawal of US Forces from the Korean Peninsula? Would the US go for that? Highly unlikely. Would Moon be so gullible as to suggest a (slow) withdrawal? Of course he has the right to demand a foreign garrison pack up and go home. Trump may have pushed China and NK to act but he’d prefer the status quo than to roll over and vacate the premises. China wins in either scenario. America certainly doesn’t want to pay for the same real estate twice. Some quarters in South Korea must surely want the US military to stay as an insurance policy. Afterall how can one trust someone who comes from a dynasty that kills its own people and assassinates family members? Worryingly Moon looks to have a certain ring of Chamberlain about him.

It was clear that North Korea was dictating the moves at the Winter Olympics. It was South Korea who funded the $3mn in travel costs for the cheer squad. Anything that looked to mock the North Koreans was swiftly dealt with. It spoke volumes about which Korea was calling the shots. Anyone impersonating any other world leader could do so with reckless aplomb. Anything resembling Kim Jong-un  was quickly removed from sight. Tyrannies rarely do humour and sadly not enough democracies defend it. Still it is hardly an encouraging sign for even handed peace talks when one side looks to appease in this way.

Kim Jong-un is smart enough to realize at such a youthful stage in his life that he probably has another 40-50 years left in him. Reunification only works if he is given sanctuary. Idi Amin saw the beauty of a life in exile in Saudi Arabia. If Kim Jong-un can relax in Sichuan Province it maybe a dignified way out. One can bet his ‘some are more equal than others’ inner sanctum would rather the two stay separated. They would stand to lose way more than Kim.  It would be ridiculous to assume that Kim could be a major cog driving a reunification process with such an abysmal human rights record. Name a despot who would willing cede authoritarian rule much less without a deal which would exonerate him from any international criminal court that he would be held accountable for under a functioning democracy?

The South Koreans have had a think tank in Berlin researching the effect of reunification in Germany. The former West is still heavily subsidizing the former East. Depopulation (-15% between 1989 & 2013), unemployment rates (higher today that 1989) and inferior GDP per capita (27% less) are all a feature of the former communist state vs the federal republic over the last three decades.

How easily could South Korea absorb the North? West Germany had a population of 63mn in 1989 vs 16mn in East Germany or 4:1. South Korea has 53mn vs North Korea’s 24mn or 2:1. West Germany had a 2.3x GDP/capita ratio to the East in 1989. South Korea has a 52x GDP/capita ratio to the North. Reunification for Korea isn’t an apples to apples comparison with Germany. While Samsung might relish the prospects of tapping a cheap labour pool to build washing machines, the South would likely face far higher integration costs than the Germans. Even 30 years ago East Germany had a GDP/capita 17x that of North Korea.

In any event the only sure outcome of peace on the Korea Peninsula is that President Trump will get next to zero credit in the media. Wailing about the reckless diplomacy of an unhinged dictator will be the main with a few conceding it was at best a fluke.

Gold Coin vs Bitcoin – just go on a crypto blog and invite a fatwah by criticizing it

The Bitcoin debate rages again. I’ve been asked more times by friends about whether to buy Bitcoin in the last 3 months than I care to remember. This video is about as telling as it gets about understanding raw value. At the moment Bitcoin pricing is as random as a Lotto ball dispenser although only higher numbers are being drawn for now (despite the 20% flash crash yesterday, shows panic is a server outage away). My answer to them is I wouldn’t touch it with a barge pole but everyone’s risk is their own. I answered along the lines below.

As a contrarian investor, this video warms my heart. When everyone seems to love something it tends to be a sign that ‘greater fool theory’ is alive and kicking. The video shows a woman unwilling to trade a stick of gum for a 1oz gold coin. If there was ever a better example of mean reversion, this must be it. Mark Dice did a similar video with people asking if they wanted a Hershey’s chocolate bar or a silver bar. Everyone chose the Hershey’s! While I am sure the response on Wall Street would elicit a different response it shows how few people understand the value of barbarous old relics.

The biggest issue with Bitcoin or any other crypto is that it is mined in cyber space. Do you ever wonder why you need to update your Norton anti-virus software every other day? Yes because some criminals are phishing/hacking your data trying to rob you blind. That’s just the amateur cowboy stuff by the way.

Gold needs to be dug out of the ground with considerable effort. The thing that spooks me about crypto (without trying to sound conspiracy theorist) is that state actors (most top end computer science grads in China end up working in the country’s cyber warfare teams), hackers or criminal minds (did you know 70% of top end computer science grads in Russia end up working for the mob (directly or indirectly) the value of coins in the system could be instantaneously wiped out at the stroke of a key. We’ve had small hiccups ($280m) only last week. So as much as the ‘security’ of these crypto currencies is often sold as bulletproof, none of them are ‘cyberproof’. Just like your home software, crypto at every stage has to constantly update its protection to prevent vulnerabilities and it is naive to think it can keep a 100% safety record.

It only takes one serious hack to bring most if not all the crypto down as vulnerable. In order for Auric Goldfinger to crush prices in Gold he’d need to smelt lead bars and paint them, were any left over from the pail and brush used on Jill Masterson. Gold is one currency that governments often threaten to confiscate (India springs to mind). Imagine if North Korea turns Bitcoin into the state currency?

I have just been on a Bitcoin forum and the insults being hurled at disbelievers has all the hallmarks of Tesla share ownership. It is a religion. Not an investment. I was accused of having no idea on crypto to which I argued 90%+ of those that own it probably don’t either. So having owners in Bitcoin or other cryptos knowing a tiny fraction of the risks means they’ll stampede faster than the servers can process data should ‘bit hit the fan’. One crypto ‘expert’ tried to tell me that artwork has no value as it is not tradable. It is tradable, just illiquid. I argued that the latest sale of DaVinci’s artwork fetched $450mn or 45,000 bitcoin. Storage costs aside over the long run I’ll have a Leonardo thank you!

As Mark Twain said, ”It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

My assessment is that the fascination of those around me about Bitcoin suggests that many of the fan base are punters trading on the greed of others. It has no underlying core value other than those prepared to pay more for it. That indeed is the tenet of all investment but like most manias, the risk/reward ratio can turn on a dime (no pun intended). At some stage the fall out from crypto will be ugly. As financial pundits know

the market can stay irrational longer than you can stay solvent”

Kim sends more firecrackers across Japan that could hit Guam

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This cannot continue. Another missile fired across Japan’s shores. This missile flying 3,700km. Guam is technically in range by that measure. As I said on The Bolt Report, Kim’s technology will get to a point where he can become a serious threat. Taking out the threat before it gets even more capable is the only credible option. Even more biting UN sanctions haven’t stopped his quest to launch more missiles in utter defiance. My key thought is that China will be coerced into forcing regime change. It cannot afford to lose the strategic buffer North Korea provides but it can even less afford US military action on its back door. Unilateral action by China will not be frowned on by the majority of the rest of the world if Kim Jong Un is neutered.

Some discussions have also questioned whether he lobs missiles over Tokyo airspace. The danger here is a failure through dense commercial air traffic lanes. In any event the world community can’t sit by and let this oppressive regime continue a weapons program to use for extortion. Trump was on a morning breakfast program yesterday discussing North Korea where he effectively said for “China to start taking action”.

As I wrote last week, Japan’s entire Aegis destroyer fleet from Maizuru is at sea. They carry the SM-3 anti-ballistic missile system. Japan cannot take North Korea’s actions as anything other than the gravest threat to national security.

This crisis has to have an ending. It can only be Kim Jong Un’s. Watch China’s movements closely from here. They’re reaching breaking point on strategy.

Full interview on Bolt Report on Japan’s regional security conundrum

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The full interview can be found on the August 30 podcast from 21:17-34:30  where I discuss Japan’s Constitution Article 9 and 96 and the changing face of Japan’s Self Defense Force moving from “static deterrence” to “dynamic deterrence”  The wheels to defend herself are already well under way