Watch out for whale-size risks - btbirkett@gmail.com - Gmail

Watch out for whale-size risks - btbirkett@gmail.com - Gmail June’s jobs report keeps the Federal Reserve on track to raise interest rates this month. You’ll need to make an appointment at an Apple store if you want to buy its Vision Pro headset. Want a full-time remote job? There are coaches charging $3,000 to help. The volatility in the safest markets in the world has been stunning. Over the past two weeks, two-year Treasury yields surged more than 25 basis points into late Thursday, going above 5% for the first time since 2007. The 10-year rate jumped to above 4%. Although there was a paring of short-term yields on Friday in reaction to the jobs report, the overall direction is pretty clear: Interest rates are going higher. There’s even more to this story. The inversion of the yield curve—which has persisted for more than a year and is typically a recession signal—hit its most extreme position since the early 1980s. “It’s a dangerous situation,” says Barry Knapp, founder of Ironsides Macroeconomics. He says that there’s likely to be a “nonlinear credit contraction” and that the Federal Reserve has to be careful because “this deep inversion of the curve is a big problem for the banking system, and there’s no easy way out of it.” A surge in interest rates around the world has led to blowups like a pension fund crisis in the UK, which was forced to sell bonds en masse, and a spate of banks failing in the US. Everywhere you look, there are serious risks tied to the safest bonds in the world. “You throw dynamite into the ocean and see what starts floating to the surface and eventually a whale comes up,” Knapp says. As stunning as the move in short-term rates is the adjustment of longer-duration bonds. In a July 4 note from a team led by Apollo’s Torsten Slok (yes, they still publish on holidays), he writes: “The Fed has started to increase its estimate of the long-run Fed funds rate. … The implication is that the Fed is beginning to see the costs of capital as permanently higher.” Permanently higher?! There’s a whole generation that has grown used to money being free. With a market still wrapping its head around the effects of higher interest rates, it’s worth considering just some of the ripples that are being felt right now. Fed Chair Jerome Powell. Photographer: Nathan Howard/Bloomberg Bank stresses. After this spring’s bank failures, the Fed set up a funding program that had more than $100 billion lent out as of the week ended July 5. That means banks are still being meaningfully propped up by extraordinary borrowing, while facing a trickle of deposit flight. Risky lending. With banks seeking a different business model, driving up their own cost of borrowing, they may stretch to make riskier loans to drum up greater profits. There’s a danger that regional banks could just become zombies, as my Bloomberg colleagues write for The Brink newsletter. Money-market movements. With rates rising, money is still flowing to more lucrative money-market funds. Deposits are bleeding from the system by the tens of billions. Bankruptcies. It’s getting more expensive for companies to finance themselves, so you’re seeing Chapter 11 filings tick up at the fastest rate since the financial crisis. They’re nowhere near where they were in 2008, but it’s an open question whether they’ll keep ticking up if rates stay high and a recession hits more companies. High-yield questions. For all the selloffs in safe, government bonds, global high-yield debt has been one of the better performers this year. Why aren’t recession concerns keeping people away from risky debt? One reason is how closely it tracks to equities. Leveraged loans have done even better this year, mostly because they have a floating rate. Both, however, are vulnerable in a downturn—meaning investors could lose a lot of money if things go south. Consumer stresses. Higher interest rates mean higher mortgage rates, which have hit their highest levels since November. Student loan repayment is set to begin soon, adding $200 to $300 to an average American’s tab each month. Apollo’s Slok also points out that credit card delinquency rates are at 2008 levels and auto loan delinquencies are rising. Spending on items that require financing such as furniture and electronics is also slowing, he notes. “That is the old adage: The Fed hikes until something breaks,” says Jim Bianco of Bianco Research. He says he’s watching liquidity closely, including the rate at which Treasuries are issued and purchased, as well as the Fed’s quantitative tightening program. “Maybe there's something more to break here, we’ll see. But the direction of rates is still higher, and the market isn't fully embracing this idea.” All of this is a good reminder that we all as humans, corporations and governments are vulnerable to the surge in the cost of debt, especially after an entire era in which debt was essentially free. Knapp calls it a “nonlinear credit contraction,” but big hedge funds have a different name. A “slow-motion car crash” is how Brian Higgins of King Street Capital put it, according to a Bloomberg story discussing his plans to raise money. His firm and others, like Angelo Gordon and Brookfield Asset Management, are building war chests, readying for shake-ups in credit markets. They expect that crashes may not be swift and abrupt, but instead may be like hiccups in fits and starts, as they have been for the past year. “The last chapter of this story will be written when the Fed eventually starts cutting rates, but that's not happening soon,” Bianco says. —Sonali Basak, Bloomberg Television’s global finance correspondent

A Working Greenwich CT Farm Owned By a Finance Exec Is For Sale - Bloomberg

A Working Greenwich CT Farm Owned By a Finance Exec Is For Sale - Bloomberg PursuitsHome & Design A Former Finance Exec’s Working Greenwich Farm Hits the Market Steve McMenamin, the executive director of the Greenwich Roundtable, is selling his popular Versailles Farm in Connecticut. The house and barn on the six acre property. The house and barn on the six acre property.Source: Brown Harris Stevens ByJames Tarmy July 5, 2023 at 3:19 PM GMT+1 Listen to this article 5:45 Share this article Gift this article Follow the authors @jstarmy + Get alerts forJames Tarmy In this article 1376332D INDIAN HARBOR LLC Private Company In the early 1990s, Steve McMenamin was doing the reverse commute from Manhattan to his job as a portfolio manager with Gabelli in Rye, New York, when he decided enough was enough. “I wanted to eliminate the commute,” he says, and so, together with his wife, Ingrid, found a one-acre plot of land in nearby Greenwich, Connecticut (“Greenwich had lower taxes,” in comparison to Westchester he explains), which over time he expanded by acquiring an adjacent property. The couple became so integrated with the community that eventually they purchased a well-known restaurant in town and then developed an even better known farm, which they’ve worked on nearly full time for over a decade. relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market Built in 1997, the house is based on a colonial design.Source: Brown Harris Stevens relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The barn has a three-bay garage.Source: Brown Harris Stevens But at 66, McMenamin finds himself slowing down. “Doing this by ourselves is like climbing Mount Everest every year,” he says. “People say ‘this must be your passion’ and I say ‘no, my passion is actually skiing in Switzerland. This is hard work.’” And so they’re putting the entire six acre property–house and farm together–on the market for $4 million with Joann Erb of Brown Harris Stevens. “Our commitment is that we’ll still be here in Greenwich, and I’ll spend one year with whoever takes over the property. I want someone to carry on the tradition of growing nutrient-dense food for the community.” Banker to Farmer McMenamin was not initially an obvious candidate for farming. relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The lower floor of the house is devoted to entertaining.Source: Brown Harris Stevens relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The living room.Source: Brown Harris Stevens By the mid ’90s he was an executive in Cantor Fitzgerald’s equities division (he worked in the World Trade Center). “One day I looked down, and I said, ‘There’s no rope that goes down 1,000 feet,’” he recalls, and duly opened a Cantor Fitzgerald office in Stamford, Connecticut, with about 40 employees in 1997. The year before he set up the Stamford office, he also created the Greenwich Roundtable, an organization devoted, McMenamin says, “to educate sophisticated investors and create code of best practices for the investor community around the world.” He started his own company, Indian Harbor LLC, in 1999. “I helped start the hedge fund industry,” McMenamin says. “So I was running around the world basically creating a code of best practices, but also opening up sovereign wealth funds to all this new alternative investment.” relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The crops are laid out in tight rows.Source: Brown Harris Stevens In 2008, as he was sitting with a friend in the Versailles Restaurant in downtown Greenwich, he learned its owner had suddenly died. After looking into the restaurant’s books, he realized “they’re doing $250,000 in revenue and their costs were $140,000,” he said. “That’s a profit.” After buying the restaurant for what he recalls was about $130,000, he and his wife moved it to a nearby space, brought in a new chef, and, in McMenamin’s telling, grew its business but only managed a two to three percent profit margin. In running the restaurant, though, the couple noticed that “there are no growers here or anywhere–people are getting food from Salinas, California,” McMenamin says. And so in 2012 they bought the property adjacent to their house, “knocked the house down, and built a crop field.” They sold the restaurant in 2013. McMenamin shut down Indian Harbor in 2015 (“pricing became efficient—these people were still charging 2-and-20 for subpar returns, and I didn’t want to be a part of it”) and then devoted himself full time to growing several dozen crops, which he and Ingrid then sold, first through a farm stand and then via a wholesale business, catering to, among others, a handful of the area’s country clubs. The Property At the time the couple bought it, the original land only had a small cottage. “It’s an eminently historical area,” McMenamin says, “and I looked at the land and said what kind of house should we build here?” The logical conclusion, he continues, was a colonial house. relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The dining room.Source: Brown Harris Stevens After finding an architect in Castine, Maine, who created designs for colonial-era houses, they purchased the plans for a center-hall colonial. “It has all the earmarks of an authentic house built in the era,” he says. The house, completed in 1997, covers just over 3,000 square feet. The ground floor has a large kitchen, living room, dining room and library. Upstairs are three bedrooms and two baths. The basement level has a massage room, Moroccan hammam and sauna. Get the Paris Edition newsletter. What's happening in France’s finance industry, delivered weekly. Email Enter your email Sign Up Bloomberg may send me offers and promotions. By submitting my information, I agree to the Privacy Policy and Terms of Service. Next to the house is a barn with a three-bay garage, a vegetable washing and packing facility and a workshop; on the barn’s second floor is an office, bedroom and bath. With its eight inch-thick concrete walls, the basement of the garage qualifies as a nuclear blast shelter. And so McMenamin installed a radiation Hepa filter classified for the use of 24 people, and connected it to what the home’s marketing materials say are “military grade security and emergency communications.” “I’m not a prepper or anything like that,” McMenamin says. “We were just seizing the opportunity.” The Farm Versailles Farms, as the farm came to be known, is a small operation. “I didn’t hire anybody,” McMenamin says. Instead, he continues, “there’s this wonderful thing called YouTube, and I learned absolutely everything from it.” The couple supplemented their digital education with trips around the world; they acquired mushroom spawn in Japan, small tools in South Korea, and, in the process, became versed in various growing practices. relates to A Former Finance Exec’s Working Greenwich Farm Hits the Market The open kitchen.Source: Brown Harris Stevens The farm, which uses regenerative growing methods in which crops are cultivated in biologically active soil and spaced tightly together, quickly took off. “I had a list of the chefs at the country clubs, and I started a wholesale business selling to them,” McMenamin says. “Demand went through the roof–it exceeded supply, and we were selling everything we were growing.” Among the 52 crops he grows, McMenamin says the farm is the largest grower of shitake mushrooms in Connecticut; it also has a fresh cut-flower business. “There are too many people who have farms for aesthetic or cocktail party reasons,” he says. “But this isn’t about that–this is an economically viable enterprise.” The couple might be done with this farm, but they’re not quite ready to walk away from growing altogether. “At the risk of sounding like a masochist, I’ve just bought nine-and-a-half acres right next door,” McMenamin says. “We’re building an orchard.”

Ocomtún: A long-lost Maya city that was just discovered - BBC Travel

Ocomtún: A long-lost Maya city that was just discovered - BBC Travel ...Commonly considered one of the greatest civilisations in the Western Hemisphere, the Maya ruled over much of Central America during their peak between 200-900 CE. Perhaps best known for their towering pyramid temples and more than 40 grand cities carved out of stone – such as Tikal, Uaxactún and Copán – the Maya were also obsessive astronomers, brilliant mathematicians and prolific scribes. They kept detailed records of eclipses and solstices and aligned their cities' most important structures to the celestial movements. They invented the concept of zero roughly 1,000 years before Europeans and developed a calendar in the 1st Century BCE that was more accurate than the Julian calendar used across the UK, Europe and Asia for the next 1,700-2,000 years. They were one of the world's earliest civilisations to devise a system of writing (as early as 300 BCE) and went on to create thousands of paper books. They likely invented chocolate, the world's first ball game and rubber. ...In the 8th and 9th Centuries, the Maya started suddenly abandoning their cities and these once-great Mesoamerican metropolises constructed using highly sophisticated science and engineering techniques mysteriously fell apart. Šprajc and others have long pondered whether this was due to warfare, prolonged droughts, soil depletion, climactic change or a combination of factors, but by roughly 1,000 CE, Šprajc explained that almost every settlement in the central and southern Yucatán Peninsula – including Ocomtún – was abandoned.

Giant 'Gravity Hole' in the Ocean May Be the Ghost of an Ancient Sea - Scientific American

Giant 'Gravity Hole' in the Ocean May Be the Ghost of an Ancient Sea - Scientific American ...“When the temperature anomalies causing this low geoid shift out of the present-day location,” Pal says, “the geoid low will start to dissipate.”

Unlocking the secrets of the world's oldest computer - BBC Reel

Unlocking the secrets of the world's oldest computer - BBC Reel

Russia’s Farcical Mutiny Is Deadly Serious for Iran, China: Niall Ferguson - Bloomberg

Russia’s Farcical Mutiny Is Deadly Serious for Iran, China: Niall Ferguson - Bloomberg

Niall Ferguson

Russia’s Farcical Mutiny Is Deadly Serious for China and Iran

Today’s geopolitics and economics have more in common with the 17th century than the 20th. Is that a greater threat to the democracies or the autocracies? 

The embattled tsar.

Photographer: Mladen Antonov/AFP/Getty Images

By

Niall Ferguson

July 2, 2023 at 5:00 AM GMT+1

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Niall Ferguson is a Bloomberg Opinion columnist. He is the Milbank Family Senior Fellow at the Hoover Institution at Stanford University and the author, most recently, of “Doom: The Politics of Catastrophe.” He is the founder of Greenmantle, an advisory firm, FourWinds Research, Hunting Tower, a venture capital partnership, and the filmmaker Chimerica Media. @nfergus

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In Friedrich Schiller’s The Death of Wallenstein, the downfall of a mercenary has a dark, tragic majesty. It was the first play I ever saw in a German theater, in Hamburg in the late 1980s, and I still remember the way Schiller’s verse thundered through the auditorium, the quintessence of Sturm und Drang.

Albrecht von Wallenstein was one of the towering figures of the Thirty Years’ War. Born into a poor Bohemian Protestant family, he converted to Roman Catholicism and acquired wealth, power and ducal status in the service of the Holy Roman Emperor Ferdinand II. In a singularly bloody career, he fought the Turks, the Venetians, the Danes, the Swedes and even his own countrymen — in short, he fought whomever the emperor paid him to fight.

But Wallenstein’s unauthorized attempt to negotiate peace in 1633 finally convinced Ferdinand — who already suspected him of plotting a coup — to dispense with his overmighty commander. In 1634, Wallenstein was charged with high treason and, within a week, assassinated.

It remains to be seen if a similar fate awaits Yevgeny Prigozhin, the modern-day Wallenstein who last weekend briefly but spectacularly defied Russia’s would-be emperor, Vladimir Putin, by proclaiming a mutiny, seizing control of the city of Rostov, and sending a well-armed convoy of his Wagner Group cutthroats northward toward Moscow.

The genius of a Schiller will not be required, should anyone ever decide to dramatize the Prigozhin putsch. This strange affair was not so much Sturm und Drang as Rowan & Martin. Readers old enough to have watched NBC’s late-‘60s comedy show may remember the bespectacled German soldier who would lisp from behind a potted plant: “Very interesting … but stupid.” That pretty much sums up the Putin & Prigozhin Laugh-In.

At the height of the farce, Putin gave an address that was fire and brimstone. “Exorbitant ambitions and personal interests have led to treason,” he declared. “Our actions to defend the state will be harsh.” Russians should remember that the Bolshevik Revolution of 1917 had led to “an enormous collapse, the destruction of the army and the fall of the state, the loss of huge territories, and in the end, the tragedy of civil war.” But this was more The Godfather than Battleship Potemkin: a blustering attempt by the capo dei capi to put a rebellious mafioso in his place. The reality is that the abortive mutiny revealed how badly Putin’s failed invasion of Ukraine has eroded his domestic power base.

His military leaders were divided, some condemning Prigozhin, others lying low and waiting to see what happened. As Anne Applebaum observed, ordinary Russians watched the antics of Wagner in Rostov with a mixture of apathy and excitement, taking selfies of themselves with Prigozhin and his men. You don’t do that sort of thing if you really fear the Godfather in the Kremlin. Never has the English journalist Xan Smiley’s old line describing the Soviet Union as “Upper Volta with rockets” seemed more apt.

What is the wider significance of the crisis in Russia? Two weeks ago, I warned that the geopolitics of Cold War II seemed to be pitting Halford J. Mackinder’s vast Eurasian “Heartland” against Nicholas J. Spykman’s “Rimland.” If the Heartland consists of a new “Axis” of China, Russia and Iran, the Rimland is the coalition the US has formed with its European and Asian allies to support Ukraine. But I worried that the Rimland was showing signs of division. A couple of officials in President Joe Biden’s administration took the time to challenge my argument. The Prigozhin mutiny seems to have proved them right. Maybe it’s the Heartland, not the Rimland, that’s cracking up.

The striking point about the past year is that all three members of the new Heartland Axis are afflicted with internal problems. It’s not just that a mercenary warlord could march on Moscow apparently unimpeded. Last year, the Iranian regime was rocked by the protests that followed the death in custody of Mahsa Amini, just the latest bout of popular unrest following episodes in 2009, 2012, 2017, 2018 and 2019. And the Chinese Communist Party was forced to abandon zero-Covid in the face of a wave of student protests — not the first time in Chinese history that Beijing undergraduates have challenged the country’s leadership. All in all, this is pretty heartening for Team Biden. It would appear that the major authoritarian regimes are afflicted with the usual pathologies of unrepresentative government. 

But what if democracies are also vulnerable to such internal crises? After all, it’s not that long ago that a coup of sorts was attempted in the US, not forgetting the copycat affair in Brazil. Even if he did not plot an insurrection on Jan. 6, 2021, Donald Trump tried in several ways to challenge the 2020 election result. He has just been indicted for wrongfully retaining highly classified documents in his possession, sharing their contents with people who lacked appropriate clearances, and then seeking to cover up these actions. And yet none of this appears to have dented his popularity with Republican primary voters.

Meanwhile, Biden is falling over himself to make nice with Narendra Modi, whose government in India looks increasingly like one of those illiberal democracies that Fareed Zakaria warned us about back in the 1990s. Like Hungary. Or Turkey. All in all, it might be said, there are quite a few “mini Putins” among America’s allies. A significant number, including Modi, don’t seem especially keen to help Ukraine beat Russia.

Confused? Well, my framework for understanding what is going on today is not 20th-century, but three centuries older. Sorry, Putin, the events of last weekend were not your version of 1917, with Prigozhin as Lenin to your Nicholas II. (Or Kornilov to your Kerensky? To be frank, I’m not sure where Putin was going with that analogy.) I suspect Russia is heading rapidly toward a new Time of Troubles, the period of anarchy between 1598 and 1613 that followed the death of Ivan the Terrible. When Putin falls, I predict there will be more than one claimant to the throne, just as there were multiple “false Dmitrys” in the early 1600s, all pretending to be Ivan’s youngest son.

 

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The early 17th century was a time of troubles in many places. In Europe it culminated in the Thirty Years War, which dragged on for another 14 years after Wallenstein’s assassination, reducing Germany to one vast charnel house. In the British Isles, it was a time of internecine conflict — known variously as the Great Rebellion, the Puritan Revolution, the English Civil War, the English Revolution, or the Wars of the Three Kingdoms — that produced just under five years of republican government (the Commonwealth), followed by dictatorship under the “Lord Protector” Oliver Cromwell. In France, Cardinal Richelieu battled the Protestant Huguenots at home and the Catholic Emperor Ferdinand abroad. In China, the same period saw the fall of the Ming dynasty, its control of northern China lost to the Jurched leader Nurhaci, its fate sealed in 1644, when the rebel Li Zicheng captured Beijing and the last Ming emperor hanged himself.

Why was this such a time of crisis? When I was an undergraduate, historians liked to blame it on cooling global temperatures — the “Little Ice Age” — though the role climate change played has probably been overstated. As the chart below shows, temperatures in Central Europe trended lower in the 17th century, compared with the previous and subsequent centuries.

Even if one does not buy the evidence of global cooling, it was certainly an era of plagues, of famines and of inflation. This chart shows the spike of inflation in the German lands in the 1620s, when coin debasement was rampant — the memorably named Kipper- und Wipperzeit, literally “the Tipper and See-saw time”:

The Thirty Years’ War and Inflation

Source: Paul Schmelzing

Note: Seven-year averages.

At the root of the crisis in the Western world, however, was technological change. The printing press had spread throughout much of Europe in the course of the 16th century, propelling not only religious reformation but also religious war. Improvements in naval technology, meanwhile, were allowing European traders to cover ever larger distances in their voyages and European warships to win ever more battles. On land, as the historians Michael Roberts and Geoffrey Parker have described, a military revolution produced standing armies and significant improvements in weaponry.

Taken together, these changes weakened the hold of established medieval institutions such as the Roman Catholic Church and the Holy Roman Empire. All the great kingdoms of Europe found themselves, at least for a time, in a state of chaos. Power could be seized by warlords such as Wallenstein and Cromwell.

Most commentators on current affairs are weighed down by their knowledge of the 20th century, which is taught to excess in schools and colleges. This distorts our perspective, leading us to underestimate the profound differences that have arisen since our grandfathers were young men. The 20th century was a time of astonishing centralization of both economic and political life, which made possible feats of mobilization — not only the world wars but also grandiose and generally disastrous economic plans of Stalin, Hitler and Mao — that are unthinkable today. The most the 21st-century state can do, as became clear in 2020, is to lock people up in their homes. And only the Chinese were truly serious about lockdowns. (In the West, there was rampant cheating of the sort that would have got you shot or at least jailed during World War II.)

As Nadia Schadlow argues in an excellent new essay for the Atlantic, the US federal government today operates at a snail’s pace. The 20th-century national security state gave us the Manhattan Project, the Marshall Plan, the interstates, the Apollo program. Such feats are unimaginable today. Just replenishing existing weapons stocks takes years.

By contrast, I think there is no period in history more akin to our own than the 17th century. In our time, as has often been remarked, the internet has played the role of the printing press. The drastically reduced cost of reproducing text and images broke the church’s monopoly on both, just as the internet has enabled everybody who wishes to express and disseminate an opinion to do so — no matter how idiotic or illiterate.

In the 17th century, a certain amount of what was printed contributed to what ultimately became a Scientific Revolution. But a great deal more was devoted to alchemy, astrology, witch-finding and obscure arguments about the difference between transubstantiation and consubstantiation — in short, to superstition. (Wallenstein was one of many people who based his decisions on bogus horoscopes.) In our time, I have long marveled at how much more attention is paid on social media to conspiracy theories than to theories based on evidence.

Four hundred years ago, it was regarded as perfectly normal that a monarch might delegate economic and military functions to private actors such as monopoly trading companies and mercenaries (or, at sea, “privateers,” a category not wholly distinct from pirates). No corporations in the 20th century were as powerful as the Dutch and English East India Companies in their heyday.

In our time, too, power has seeped away from the state, back to private corporate entities. Wagner, whose mercenaries have been deployed from Syria to Mozambique to Venezuela, is only one of many nonstate actors engaged in organized violence around the world. And, of course, the big tech companies now dominate the innovation frontier in artificial intelligence, as well as owning a rising proportion of the communications infrastructure on which modern states rely.

As American University’s Audrey Kurth Cronin argues in a new paper, “companies such as Alibaba, Amazon, Apple, ByteDance, Meta (Facebook), Google (Alphabet), Microsoft and Tencent are geopolitical actors with more resources and power than most nation-states.” 1  Think only of the role of SpaceX’s Starlink, Elon Musk’s brainchild, in helping the Ukrainians defend their country.

As Cronin notes:

The Starlink satellite app was Ukraine’s top downloaded app in March 2022, and it kept President Zelenskyy online, even when high earth orbit Viasat satellites went down. There are some 15,000 Starlink user kits in Ukraine, mostly donated by SpaceX or by private sources — though USAID may have paid for some 1,300 of them. … And when Elon Musk decided that Starlink should not be used for offensive targeting against Russians [e.g., in Crimea], the US government was powerless to change its stance.

This is not a world Vannevar Bush would recognize. Cronin shares my view that it much more closely resembles the world of the 17th century. If Prigozhin is a poor man’s Wallenstein, then Musk’s satellite network resembles the East India Company’s merchant fleet. It was “John Company,” not the First Lord of the Treasury, who decided the extent of Britain’s Indian Empire. It is SpaceX that determines the battlespace in Ukraine.

It goes against the 21st-century grain to be told we have anything in common with the men and women of Shakespeare’s time. But I was reminded by the German author Andrea Wulf earlier this month — when we participated in a fascinating conference at the Santa Fe Institute — that Shakespeare had periods of unfashionability after his death. He owed his revival in the 19th century partly to German Romantics, notably his translator into German, August Wilhelm Schlegel (one of the many flamboyant literary types brought to life in Wulf’s book Magnificent Rebels). In the 20th century, George Bernard Shaw sneered at “bardolatry.” I have a hunch that today’s audiences get more from, say, The Tempest than audiences in the 1920s.

As Henry Kissinger argued in a remarkable essay published in the Atlantic five years ago, the rapid progress of artificial intelligence may well herald the end of the Enlightenment. “Paradoxically,” he wrote, “as the world becomes more transparent, it will also become increasingly mysterious. … What will become of human consciousness if its own explanatory power is surpassed by AI, and societies are no longer able to interpret the world they inhabit in terms that are meaningful to them?”

 

On My Radar: The Russian Situation - CMG

On My Radar: The Russian Situation - CMG

did Putin and Lukashenko cook up a deal for the chef that means Putin has just effectively annexed Belarus and put his private army in charge there?

The Spy, The Chef, The Actor: Russian Theater Here’s a different take on events in Russia. Could the whole “coup” have been a theatrical production? There is a school of thought that Putin, a long-time spy (Siloviki), and his former chef, Prigozhin, orchestrated this coup and the reversal. One ex-CIA analyst says it’s a classic false flag. But was it? Why did The Chef and his Wagner Group march into Rostov-on-Don, then nearly to Moscow, and then reverse? Did Prigozhin really “cut a deal” with The President of Belarus, Lukashenko, whose family had left Belarus at midnight for Bodrum on the day of the coup attempt making sure the transponders were off as they passed over Russia? One theory is that it was one way for Russia to exit its position in Ukraine while saving face. Another is that Wagner is now 100 miles closer to Ukraine than before. The Telegraph reports that the Russian FSB, the Silovoki, who are Putin’s power base, threatened the Wagner family members and that that was enough to assure that Prigozhin would head back south and leave Moscow alone. Another is that Putin, the spy, had given the order for Prigozhin’s assassination. In anticipation of this, the Chef, Prigozhin, effectively took the entire Russian Army hostage. Or did Putin and Lukashenko cook up a deal for the chef that means Putin has just effectively annexed Belarus and put his private army in charge there? Kremlinology has always been notoriously difficult, even for the most experienced Kremlin watchers. The joke is that the actor in Ukraine, President Zelensky, and his Ukrainian compatriots are so intrigued that there has been a run on popcorn. But, we have not seen the end of this play yet. We are all now sitting in the Proscenium Arch of history. Another view is that Prigozhin correctly anticipates that Russia is now at risk of breaking up into smaller parts. The area he knows best is exactly where he was, in Rostov, where the crowd chanted his same. This notion gets a firestorm of reaction on social media. But, this is what happened when the Soviet Union fell. I have argued for some time that The Soviet Union was effectively appropriated by the Russian intelligence services and reconfigured. So the Soviet Union didn’t actually fall. It just fell into new management. That group is now being challenged, so the risk of a real breakup of what we now call Russia is much higher than before. If, for a moment, we accept that there is a risk, then it makes sense that Prigozhin wants to be King of a new country. Imagine if that new country has nukes. Understand that Voronezh has nukes in a factory known as “375 Facility “C.” What could someone like that do with even one nuclear weapon? Maybe he could not launch it, but the fissile material has value. Such a weapon has value, both for the purposes of negotiation and on the open market. Remember that the CIA has been openly promoting “walk-ins,” meaning extending an open invitation to any Russians for amnesty and safe haven. If anything happens to Prigozhin, the US may be even more flooded with requests to change sides. Russian military leaders used to have direct contact with their American counterparts. They know who they can trust. Former CIA Director Gen David Petraeus suggests that The Chef “lost his nerve” and saved himself but lost control of The Wagner Group. He now needs to avoid being on high floors of tall buildings or risk the standard Putin exit, defenestration according to Petraeus, meaning The Chef is toast. I am not so sure. The real issue for NATO and the G7 now has nothing to do with who is up or down here but rather with what is loose. Putin’s favorite props are nukes. If President Putin was mad before, he’s bound to be madder now. So far, we’ve been lucky or blessed that the Russian military has not executed the order for him. He can’t launch without the military.