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Wednesday 12th of April 2017
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Macro Thoughts |
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Japanese, U.S. navies plan joint show of force toward North Korea Law & Politics |
Japan's navy plans a joint show of force with the U.S. Navy's USS Carl
Vinson aircraft carrier strike group as it steams toward the Korean
peninsula aimed at deterring secretive North Korean regime from
further missile tests, two sources said.
With tension growing markedly, the Korean peninsula is the closest it
has been to a "military clash" since Pyongyang's first nuclear test in
2006, an influential state-run Chinese newspaper said on Wednesday
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What if the Actor is in fact completely irrational and that is the departure point ~ The "Mad Dog" is not pretending ~ he is in fact mad 2/2 Law & Politics |
The madman theory was a feature of Richard Nixon's foreign policy. He
and his administration tried to make the leaders of hostile Communist
Bloc nations think Nixon was irrational and volatile. According to the
theory, those leaders would then avoid provoking the United States,
fearing an unpredictable American response.
Nixon's Chief of Staff, H. R. Haldeman, wrote that Nixon had confided to him:
I call it the Madman Theory, Bob. I want the North Vietnamese to
believe I've reached the point where I might do anything to stop the
war. We'll just slip the word to them that, "for God's sake, you know
Nixon is obsessed about communism. We can't restrain him when he's
angry—and he has his hand on the nuclear button" and Ho Chi Minh
himself will be in Paris in two days begging for peace.[1]
In October 1969, the Nixon administration indicated to the Soviet
Union that "the madman was loose" when the United States military was
ordered to full global war readiness alert (unbeknownst to the
majority of the American population), and bombers armed with
thermonuclear weapons flew patterns near the Soviet border for three
consecutive days.[2]
The administration employed the "madman strategy" to force the North
Vietnamese government to negotiate an end to the Vietnam War.[3] Along
the same lines, American diplomats, especially Henry Kissinger,
portrayed the 1970 incursion into Cambodia as a symptom of Nixon's
supposed instability.[4]
In 1517, Machiavelli had argued that sometimes it is "a very wise
thing to simulate madness" (Discourses on Livy, book 3, chapter 2). In
Nixon's Vietnam War, Kimball argues that Nixon arrived at the strategy
independently, as a result of practical experience and observation of
Dwight D. Eisenhower's handling of the Korean War.[5]
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Growing risk of 'mass' starvation deaths in Africa: UN Law & Politics |
The United Nations warned Tuesday that "the risk of mass deaths from
starvation ... is growing" among people in conflict and drought-hit
areas of the Horn of Africa, Yemen and Nigeria.
Due to drought and a "severe" funding shortfall "an avoidable
humanitarian crisis ... is fast becoming an inevitability", said UN
refugee agency spokesman Adrian Edwards.
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Saudi Arabia Said Likely to Support OPEC Extending Output Cuts Bloomberg Commodities |
Saudi Arabia is likely to support extending OPEC output cuts into the
second half of 2017 in an effort to boost oil prices, according to a
person familiar with the kingdom’s internal discussions.
The Organization of Petroleum Exporting Countries is scheduled to
gather in Vienna on May 25 to discuss whether to roll over for another
six months the 1.2 million barrels a day in production cuts it
implemented in January. Several OPEC countries, including Kuwait, have
expressed public support for an extension.
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Oil in Biggest Rally Since December as Saudis Seen Backing Curbs Commodities |
Futures in New York were holding gains after rising 6.3 percent in the
previous six sessions.
West Texas Intermediate for May delivery was at $53.52 a barrel on the
New York Mercantile Exchange, up 12 cents, at 12:33 p.m. in Hong Kong.
Total volume traded was about 16 percent below the 100-day average.
Front-month prices rose 32 cents to $53.40 on Tuesday, the highest
close since March 1.
Brent for June settlement was 16 cents higher at $56.39 a barrel on
the London-based ICE Futures Europe exchange. Prices increased 25
cents, or 0.5 percent, to $56.23 on Tuesday. The global benchmark
crude traded at a premium of $2.48 to June WTI.
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S.Africa's top court to hear case for secret no-confidence ballot on Zuma Africa |
South Africa's top court said on Tuesday it will consider whether a
motion of no confidence against President Jacob Zuma should be taken
by secret ballot.
The rand extended its gains to 1 percent against the dollar after the
announcement, and opposition parties said there could be a better
chance that the motion, when taken, would succeed, if it was held by
secret ballot.
The ruling African National Congress party, which has a majority in
parliament, has said it will vote against the motion, which is due on
April 18. A secret ballot, however, would allow for anonymous dissent.
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Old Mutual Sticks With South Sudan Unit to Overcome War, Famine Africa |
London-listed Old Mutual, which runs insurance and property management
businesses in South Sudan, has just finished constructing the
oil-producing nation’s tallest building, a 15-floor tower in the
capital, Juba, at a cost of more than $20 million. It’s also spending
$6 million on high-end apartments in the city as it seeks to complete
work started shortly after the country gained independence in 2011 and
before a civil war two years later that has dimmed its prospects.
The country’s economy will probably contract 10.5 percent this year,
after shrinking as much as 6.9 percent in 2016, according to
International Monetary Fund estimates. The insurer’s gross premiums in
the country declined to $16.8 million in 2016, from $21 million a year
earlier, while earnings slumped to $4 million from $11 million in
2015, according to Waweru. Old Mutual has a 60 percent share of the
South Sudanese insurance market.
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New Law to Compel Zimbabwe Banks to Accept Cattle as Collateral Africa |
Commercial banks in Zimbabwe will soon be compelled to accept
livestock such as cattle, goats and sheep as collateral for cash loans
to informal businesses under a new law presented to Parliament
Tuesday.
Under the Movable Property Security Interests Bill tabled for debate
by Finance and Economic Development Minister Patrick Chinamasa in the
House of Assembly, the Reserve Bank of Zimbabwe will compile and
administer a collateral-security register in which small-business
operators and individuals can register their movable assets as
security for credit.
Vehicles, television sets, refrigerators, computers and other
household appliances will become acceptable as collateral once they
are evaluated and registered in the central bank’s register, according
to Chinamasa.
Kenya |
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Kenya Risks Election Violence With Mood Polarized, Group Says Africa |
The chances of unrest at the time of the Aug. 8 ballot have been
heightened by an “extremely polarized” political environment, the
Washington-based advocacy group said in a statement on its website
Monday. An NDI delegation traveled to the country last week to meet
political leaders, electoral and government officials, among others.
“Virtually everyone with whom the delegation met expressed serious
concern about the potentials for violence,” it said. “Numerous
stakeholders asserted to the delegation that the question is not
whether there will be violence, but how much and where.”
Increased interest in county-level positions of governor and
assemblies is likely to increase the potential for violence in those
areas, it said.
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10-APR-2017 :: Will Economics Prevail Against Politics in Africa? @Thestarkenya Africa |
Here in Kenya we are set to embark on an election. I have seen some
seriously credible research that puts the estimated cost of our
elections at anywhere between $2 billion-$4 billion(about Sh206.88
billion-Sh413.76 billion). That includes the presidential,
gubernatorial and all other elections put together. You have to ask if
Kenya Inc can afford to bear such a heavy burden.
In Greek mythology Sisyphus was the king of Ephyra. He was punished
for his self-aggrandising craftiness and deceitfulness by being forced
to roll an immense boulder up a hill, only to watch it come back to
hit him, repeating this action for eternity. The political economy is
like that boulder.
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World Bank Cuts Kenya Growth Forecast to 5.5% on Drought, Credit Bloomberg Africa |
The World Bank cut its economic growth forecast for Kenya due to a
slowdown in the expansion of loans to the private sector and a drought
that may hurt output.
Gross domestic product in East Africa’s largest economy will expand
5.5 percent this year, the Washington-based lender said in a report
released Wednesday. This compares with an earlier forecast of 6
percent and estimated growth of 5.9 percent in 2016, the World Bank
said.
“The drought will have knock-on effects on the rest of the economy
through higher electricity prices, as the shortfall in hydropower will
be made up with more expensive diesel-powered plants,” according to
the lender’s report. “Drought years in Kenya are generally associated
with a deceleration in GDP growth by about 0.6 percentage points. Our
estimates suggest that for every 100mm shortfall in rain, GDP declines
by some 0.3-0.5 percentage points.”
The low rainfall will also have fiscal and external-balance
implications given the need to import food staples, the lender said.
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07-MAR-2017 ::Where Meteorology intersects with Monetary Policy @Thestarkenya Africa |
What is clear now is that Meteorology intersects with Monetary Policy
and at times with considerable violence as we are witnessing now.
Kenya's inflation jumped to 9.04 percent year-on-year in February from
6.99 percent a month earlier, the statistics office said earlier this
week. On a month-on-month basis, inflation was at 1.72 percent
compared to 1.00 percent a month earlier. Thats a big asymmetric move
right there and this moment is reminiscent of 2011 when a weather
shock [coupled with elevated Crude Oil Prices] and a slow- motion
monetary policy response saw the Shilling tumble to an all time low of
107.00 against the Dollar in October 2011. Interestingly in 2011, we
had our noses pressed right up against an Election just as we do now.
There is also a political dynamic at work. Food Price increases have a
big outsize positive/negative well-being effect. Folks earning the
minimum wage spend a bigger percentage of their salary on Food [in
some cases as much as 50%] and therefore the Food price rise amplifies
at the lower salary point. I am not ignoring those who are at the
''bleeding edge'' of the drought, they are in extremis. In 2011, GDP
slowed over 1%. The economy is slowing and this was further confirmed
by higher frequency data; The Markit Stanbic Bank Kenya Purchasing
Managers' Index (PMI) dropped to 50.1, a record low since the survey
began in January 2014, down from 52.0 in January. A reading above 50.0
marks growth. Private sector credit growth stood at 4.3 percent in
December, the central bank said.
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Two Rivers seeks Sh2bn to fund real estate plans Africa |
Two Rivers Development Limited (TRDL), a company partly owned by
investment firm Centum #ticker:ICDC, is seeking to raise Sh2 billion
through short-term debt to fund its real estate projects.
TRDL, whose other shareholders are Aviation Industry Corp of China
(Avic), and the Industrial and Commercial Development Corporation, is
issuing a one-year note with an interest rate offer of 14.5 per cent.
This return is slightly higher than commercial banks’ maximum lending
rate of 14 per cent.
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