- The charge into havens this month has been spurred by flashing recession indicators, trade-war tit-for-tat and data disappointments -- all amid thin liquidity
The c21st real time not only unfolds itself at the speed of light but is full of mind bending twists and turns. Jeffrey Epstein ''had a collection of eyeballs on his wall'' [Counter punch].
The eyeballs make sense, because Epstein was a watcher. ..Is it a coincidence that we all live in a watch-and-collect digital economy? maybe. But we feast upon each other in the 21st century.
He was, in the words of the New York Times, “not closely monitored.” Jeffrey Epstein was a spy, in a society of spies. He was a collector, in a collector’s economy. He was a watcher, and he died while nobody was watching.
“To the millennials who are looking at the world through their phone Johnnie Walker is way more aspirational than any other brown spirit in East Africa,” Andrew Cowan told African Business Magazine.
The point is that the smart phone is ubiquitous even in the furthest corners of the World and we are all peering at a newsreel. Except, of course, if you are in Kashmir which was described by Nehru as “the snowy bosom of the Himalayas” and which is currently switched off from the c21st.
Prime Minister Narendra Modi revoked Article 370, which protected Kashmir’s demography by restricting residency to Kashmiris alone and, under a sub-section known as Article 35A, forbade the sale of property to non-Kashmiris. Essentially, Modi is seeking to flood the zone. The Periphery is a Tinderbox in many parts of the world. Xinjiang in China is also under lock down and a c21st experiment. Writing in the Washington Post earlier this year, Xiao Qiang, a professor of communications at the University of California, Berkeley, dubbed China’s data-enhanced governance “a digital totalitarian state.”In the last two years thousands of checkpoints have been set up at which passersby must present both their face and their national ID card to proceed on a highway, enter a mosque, or visit a shopping mall.
Uighurs are required to install government-designed tracking apps on their smartphones, which monitor their online contacts and the web pages they’ve visited. Kashmir, Gaza and Xinjiang are being managed in precisely the same way and it is precisely because they all reside at the Periphery and can be cut off from the World.
Interestingly, The Wall Street Journal reported last week that China's Huawei had exported this same model to many parts of Africa.
While many of the projects are rudimentary, Huawei has sold advanced video-surveillance and facial-recognition systems in more than two dozen developing countries, according to data gathered by Steven Feldstein, an expert in digital surveillance at Boise State University and a former Africa specialist at the State Department. Huawei lists foreign firms among its partners in its safe-city products, including U.S. smart-sensor manufacturer and systems integrator Johnson Controls International PLC and iOmniscient Pty. Ltd, an Australian producer of A.I. systems that analyze video, sound and smell.
Hong Kong is presenting a serious challenge to the Chinese authorities. It is not possible to Xinjiang Hong Kong, I think. The Citizens in Hong Kong have been Virilian.
“Whoever controls the territory possesses it. Possession of territory is not primarily about laws and contracts, but first and foremost a matter of movement and circulation.”
The amophorous leaders of the Hong Kong Protests on Friday called on Hong Kong citizens to take out all bank deposits. primary goal is Chinese banks, but he said other banks should also be targeted, otherwise Chinese banks can borrow money from other banks to solve problems."
This is a sophisticated response and speaks to the sophistication of the Protestors in Hong Kong. China will surely flood the zone.
The Frontier from Xinjiang to Kashmir, from Gaza to Crimea from Hong Kong to Taiwan [Trump has Approved $8BN Sale Of F-16 Jets To Taiwan; Congress Urged To "Move Quickly"] are c21st flash points. Of course, there are many other Frontiers, the Mediterranean Sea, the Sahara desert, Islands because of the EEZ's they control.
Emerging and Frontier Markets have been encountering a bout of serious turbulence. The rand [which can be viewed as a proxy for the global appetite for risk] is back as the world’s most volatile major currency, and options pricing suggests it’s not going to lose that status any time soon. The premium of options to sell the rand over those to buy it, known as the 25 Delta risk reversal, widened 23 basis points to 338.
South Africa’s currency has depreciated 6.5% versus the dollar in August, the worst performance among emerging-market currencies after Argentina’s peso. Argentina'a MerVal Index fell 37% in a single day the largest 1-day decline in its history.
This was a 17-sigma event which means that it should not have happened even once in the history of the universe (assuming a normal distribution which markets do not follow). Stock Markets from Lagos to Nairobi to Johannesburg are in reverse. There is a big negative spillover happening in front of our eyes.
Meanwhile far from the volatile frontier, we are witnessing whiplash inducing moves at the centre. There has been a Major Flight to ''quality'' in 2019. Treasuries, gold and the Japanese yen are clocking “the largest number of outsized rallies” combined since at least 1990, according to Bank of America Corp. The latest milestone in the haven frenzy arrived this week, when the yield on 30-year U.S. Treasuries slipped below 2% for the first time.
“Investors have not been so worried about the future in the past thirty years,” BofA strategists led by Stefano Pascale wrote in an Aug. 13 note.
The charge into havens this month has been spurred by flashing recession indicators, trade-war tit-for-tat and data disappointments -- all amid thin liquidity. Gold is up about 18% this year, while the yen is the top performer against the dollar across G-10 currencies [Bloomberg]
Safe Havens are priced for Armageddon now.
Now the last time G7 Economies went full on ''zombie'' the liquidity surge washed up just about everywhere in every corner of the World. It was characterised as the Global Hunt for Yield. Now when safe Haven Demand turns parabolic, Investors are signalling they are not interested in the return but only in getting their Principal back. Emerging and Frontier Markets look in big trouble this time around.
Iqbal: “In the bitter chill of winter shivers his naked body / Whose skill wraps the rich in royal shawls''