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Friday 20th of September 2019
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The Spire is a 1964 novel by the English author William Golding. "A dark and powerful portrait of one man's will" Africa |
it deals with the construction of the 404-foot high spire loosely
based on Salisbury Cathedral; the vision of the fictional Dean
Jocelin. In this novel, William Golding utilises stream of
consciousness writing with an omniscient but increasingly fallible
narrator.
Dean Jocelin is the character through whom the novel is presented.
Golding utilises the stream of consciousness technique to show his,
Lear-like, descent into madness.
The novel charts the destruction of his self-confidence and ambition.
As the construction of the spire draws to an end, Jocelin is removed
from his position as Dean and his abandonment of his religious duties
is denounced by the church Council. Ultimately, he succumbs to his
illness which he had personified as his guardian angel.
Jocelin may have been named after Josceline de Bohon, Bishop of
Salisbury from 1142 to 1184, who is buried in Salisbury Cathedral.
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William Golding's The Spire @guardian Africa |
The Spire was published in 1964. The Dean of a cathedral, Jocelin,
wants to add a spire to the building, which has no foundations and is
therefore a kind of miracle already.
The novel is about the second, highly imperfect miracle, the erection
of the spire – and the cost, which is financial, physical and
spiritual.
And it is about creative realisation, bringing the impossible into
being. William Golding wrote the first draft of The Spire in 14 days –
itself a kind of miracle.
An anchor is "a chrysanthemum of phosphorescence"; a boat has "the
clumsy beauty of a double bass"; at war, he sees "a Christmas tree of
exploding ammunition". This is a huge spider on his pillow: "the dry
tap and scramble." He was afraid of spiders.
This is Golding describing dust. The cathedral of stone is being
dismantled and added to – creating a cathedral of dust, a phantom, a
twin.
Here is Golding's creation of not one pillar, but several:
"Everywhere, fine dust gave these rods and trunks of light the
importance of a dimension. He blinked at them again, seeing, near at
hand, how individual grains of dust turned over each other, or bounced
all together, like mayfly in a breath of wind. He saw how further away
they drifted cloudily, coiled, or hung in a moment of pause, becoming,
in the most distant rods and trunks, nothing but colour, honey-colour
slashed across the body of the cathedral … He shook his head in rueful
wonder at the solid sunlight."
So, as temporary as a mayfly and a serious rival and replacement.
Solid sunlight. Dust definitively described by a master.
Golding can scorch us by the immediate heat of his sentences. But
sometimes he chooses the slower narrative burn. The first chapter
begins with Jocelin holding the model of the spire and laughing:
"He was laughing, chin up, and shaking his head. God the father was
exploding in his face with a glory of sunlight through painted glass,
a glory that moved with his movements to consume and exalt Abraham and
Isaac and then God again. The tears of laughter in his eyes made
additional spokes and wheels and rainbows. // Chin up, hands holding
the model spire before him, eyes half closed; joy – "I've waited half
my life for this day!"'
It doesn't quite make sense, or it doesn't make immediate sense. It is
like Gerard Manley Hopkins's opening trump, "As kingfishers catch fire
…" Kingfishers don't catch fire. Hopkins is using a metaphor to
capture the burst of colours given off by the kingfisher. Ted Hughes
uses the same idea of combustion for bold colours in "Macaw and Little
Miss", a poem from his first book, The Hawk in the Rain: "the macaw
bristles in a staring / combustion …" The brilliant extra touch is
that adjective "staring" appended to "combustion". All the indignation
peculiar to the macaw is there.
In Golding's opening sentence we read "God the Father was exploding in
his face …" which is initially as enigmatic as it is dramatic – until
it is resolved as a metaphorical description of sunlight streaming
through a stained glass window. The delay is important. There is a
semantic lag, a slight, postponed understanding throughout The Spire.
"He was laughing, chin up, and shaking his head." It reads at first
like third-person impersonal, authorial prose, but as the paragraph
proceeds, we become aware that the narrative isn't impersonal: it is
focalised for Jocelin. It emanates from his point of view. It isn't
free indirect speech – a clearer indicator that we are privy to a
character's thoughts. An example from Jane Austen: "The comfort of
such a friend at that moment as Colonel Brandon – of such a companion
for her mother – how gratefully was it felt!" You can hear Elinor
Dashwood's voice, her emotion. Focalisation gives us not the
character's voice, but the timbre of their thought. And this is
crucial to The Spire because, for most of the narrative, the reader is
trapped in Jocelin's subjectivity, in Jocelin's solipsism. We find it
difficult to judge him – his motives, his purity, his corruption, his
ambition, his vanity – because the view of him is restricted. As in a
theatre, where the seats are cheaper because a pillar interferes with
the view of the stage.
In this case, not a pillar, exactly, but a nose: "He stood, smiling
round his nose, head up …", "so Jocelin felt a smile bend the seams of
his own face as he looked round his nose at him." The nose stands for
the obstacle of the self.
Golding knew exactly what he was doing. Later, he describes Jocelin's
fractured memories in terms of narrative: "they were like sentences
from a story, which though they left great gaps, still told enough."
Clearly self-referential. True, we are afforded glimpses, dispatches,
from the outside world.
Two young deacons are overheard by Jocelin, denigrating someone
unspecified: "Say what you like; he's proud." Second deacon: "And
ignorant." First deacon: "Do you know what? He thinks he is a saint! A
man like that!"
We can't be sure they are referring to Jocelin, except for the word
"but" which begins this sentence: "But when the two deacons saw the
dean looming over them, they fell to their knees."
However, the criticism of Jocelin is obliterated by Jocelin's
subjectivity, his joy at having held in his hand the model of the
spire that is to be built.
"He looked down, loving them in his joy." And he refuses to accept
explicitly that they are talking about him.
He says: "Who is this poor fellow? You should pray for him rather …"
He refuses to accept delivery of the insult he has overheard – and so
we cannot be completely sure what he knows and what he doesn't know.
The Spire confines us to Jocelin's consciousness – not absolutely, but
for most of the novel's length.
There is in the opening pages a dumb mason who is sculpting Jocelin's
head for a gargoyle to be built into the spire. He carves while
Jocelin loses himself in prayer. It is an objective record.
Yet Jocelin disputes it: "Oh no, no, no! I'm not as beaky as that! Not
half as beaky!" Then he contemplates the gaunt stone portrait head and
reinterprets its bony features as the portrait of spirituality.
The dumb man makes a gesture that Jocelin interprets to mean bird
flight. And from that supposition it is only a step to identifying
with angels:
"Rushing on with the angels, the infinite speed that is stillness,
hair blown, torn back, straightened with the wind of the spirit, mouth
open, not for uttering rain-water, but hosannas and hallelujahs."
The function of the gargoyle is over-ridden. By Jocelin, primarily,
though he is conscious of his hubris. A hubris he attributes to the
sculptor.
"Don't you think you might strain my humility, by making an angel of me?"
And what is the answer to this question? The sculptor shakes his head.
"Humming in the throat, headshake, doglike, eager eyes."
Is the dumb sculptor denying that Jocelin's humility is vulnerable?
Or is he denying that he ever thought of portraying Jocelin as an
angel in the first place? Jocelin's extrapolation is, after all, based
on a gesture.
What is the dumb sculptor doing in the novel? He represents the muted
objective narrative voice. Which we hear only as William James's
description of consciousness: "one great blooming buzzing confusion".
It is Golding's task as a novelist to keep this ambiguity alive for
the length of his novel.
Let me return to the very beginning of The Spire and ask why Jocelin
is laughing? The obvious reason is that he is laughing because he is
happy. He has the model of the spire in his hands. But is that all? In
the stained glass there are two images. God the father exploding in
his face – a phrase that suggests a disaster brought on the self by
the self. It blew up in his face.
The other image in the stained glass is Abraham and Isaac. In Hebrew,
the name "Isaac" means "she laughed". She is Sarah, the wife of
Abraham. When Abraham was over 100 and Sarah well beyond child-bearing
age, Sarah was promised a son – and she laughed. But the promise comes
to pass. Miracles are possible. The spire might also come to pass –
and does, at an extraordinary cost.
After extraordinary sacrifices. Sacrifices: again we think of Abraham
agreeing to sacrifice the boy Isaac and thus demonstrate obedience to
a relentless deity.
"Consumed and exalted." And those rainbows created by Jocelin's tears
of laughter are brilliantly naturalistic, but they also nod to the
rainbow of the covenant between God and man after the flood, giving
man dominion over the earth and its animals. Power. Like the imperfect
power Jocelin wields.
And there is another reason why Jocelin is laughing. He is laughing
because The Spire is a divine comedy. In Dante, the word commedia
doesn't mean the Comedy Store. It means a happy ending – paradiso,
after the inferno and purgatory.
In Golding's novel, comedy means something dark, and bitterly ironic.
Is Jocelin's angel an angel? Or is the angel a hallucination caused by
Jocelin's tubercular spine? There are two explanations. It is not
until the final pages that we know for a certainty that we can never
know.
There are two explanations just as there are two cathedrals – one of
stone, one of dust – in the first chapter. At the end of The Spire,
Golding returns to the idea of dust.
The dying Jocelin examines a patch by a mounting block. "But for all
the feet that had trodden it, it remained ordinary dust." Not a
cathedral of individual motes shot through by the sunlight of genius.
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"Twin Buddhas, twin towers, interesting coincidence, so what." - Thomas Pynchon, Bleeding Edge Africa |
“You remember those twin statues of the Buddha that I told you about?
Carved out of a mountain in Afghanistan, that got dynamited by the
Taliban back in the spring? Notice anything familiar?"
"Twin Buddhas, twin towers, interesting coincidence, so what."
"The Trade Center towers were religious too. They stood for what this
country worships above everything else, the market, always the holy
fucking market."
"A religious beef, you're saying?"
"It's not a religion? These are people who believe the Invisible Hand
of the Market runs everything. They fight holy wars against competing
religions like Marxism. Against all evidence that the world is finite,
this blind faith that resources will never run out, profits will go on
increasing forever, just like the world's populations--more cheap
labor, more addicted consumers.”
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Houthi Rebels Overturned the Middle East Geopolitical Chessboard @asiatimesonline @GRTVnews Pepe Escobar Law & Politics |
We are the Houthis and we’re coming to town. With the spectacular
attack on Abqaiq, Yemen’s Houthis have overturned the geopolitical
chessboard in Southwest Asia – going as far as introducing a whole new
dimension: the distinct possibility of investing in a push to drive
the House of Saud out of power.
Blowback is a bitch. Houthis – Zaidi Shiites from northern Yemen – and
Wahhabis have been at each other’s throats for ages. This book is
absolutely essential to understand the mind-boggling complexity of
Houthi tribes; as a bonus, it places the turmoil in southern Arabian
lands way beyond a mere Iran-Saudi proxy war.
Still, it’s always important to consider that Arab Shiites in the
Eastern province – working in Saudi oil installations – have got to be
natural allies of the Houthis fighting against Riyadh.
Houthi striking capability – from drone swarms to ballistic missile
attacks – has been improving remarkably for the past year or so.
It’s not by accident that the UAE saw which way the geopolitical and
geoeconomic winds were blowing: Abu Dhabi withdrew from Crown Prince
Mohammad bin Salman’s vicious war against Yemen and now is engaged in
what it describes as a “peace-first” strategy.
Even before Abqaiq, the Houthis had already engineered quite a few
attacks against Saudi oil installations as well as Dubai and Abu Dhabi
airports.
In early July, Yemen’s Operations Command Center staged an exhibition
in full regalia in Sana’a featuring their whole range of ballistic and
winged missiles and drones.
The situation has now reached a point where there’s plenty of chatter
across the Persian Gulf about a spectacular scenario: the Houthis
investing in a mad dash across the Arabian desert to capture Mecca and
Medina in conjunction with a mass Shiite uprising in the Eastern oil
belt. That’s not far-fetched anymore.
Stranger things have happened in the Middle East. After all, the
Saudis can’t even win a bar brawl – that’s why they rely on
mercenaries.
The US intel refrain that the Houthis are incapable of such a
sophisticated attack betrays the worst strands of orientalism and
white man’s burden/superiority complex.
The only missile parts shown by the Saudis so far come from a Yemeni
Quds 1 cruise missile. According to Brigadier General Yahya Saree,
spokesman for the Sana’a-based Yemeni Armed Forces,
“the Quds system proved its great ability to hit its targets and to
bypass enemy interceptor systems.”
Houthi armed forces duly claimed responsibility for Abqaiq:
“This operation is one of the largest operations carried out by our
forces in the depth of Saudi Arabia, and came after an accurate
intelligence operation and advance monitoring and cooperation of
honorable and free men within the Kingdom.”
Notice the key concept: “cooperation” from inside Saudi Arabia – which
could include the whole spectrum from Yemenis to that Eastern province
Shiites.
Even more relevant is the fact that massive American hardware deployed
in Saudi Arabia inside out and outside in – satellites, AWACS, Patriot
missiles, drones, battleships, jet fighters – didn’t see a thing, or
certainly not in time.
The sighting of three “loitering” drones by a Kuwaiti bird hunter
arguably heading towards Saudi Arabia is being invoked as “evidence”.
Cue to the embarrassing picture of a drone swarm – wherever it came
from – flying undisturbed for hours over Saudi territory.
UN officials openly admit that now everything that matters is within
the 1,500 km range of the Houthis’ new UAV-X drone: oil fields in
Saudi Arabia, a still-under-construction nuclear power plant in the
Emirates and Dubai’s mega-airport.
My conversations with sources in Tehran over the past two years have
ascertained that the Houthis’ new drones and missiles are essentially
copies of Iranian designs assembled in Yemen itself with crucial help
from Hezbollah engineers.
US intel insists that 17 drones and cruise missiles were launched in
combination from southern Iran. In theory, Patriot radar would have
picked that up and knocked the drones/missiles from the sky.
So far, absolutely no record of this trajectory has been revealed.
Military experts generally agree that the radar on the Patriot missile
is good, but its success rate is “disputed” – to say the least.
What’s important, once again, is that the Houthis do have advanced
offensive missiles. And their pinpoint accuracy at Abqaiq was uncanny.
For now, it appears that the winner of the US/UK-supported House of
One Saudi war on the civilian Yemeni population, which started in
March 2015 and generated a humanitarian crisis the UN regards as
having been of biblical proportions, is certainly not the crown
prince, widely known as MBS.
Crude oil stabilization towers – several of them – at Abqaiq were
specifically targeted, along with natural gas storage tanks. Persian
Gulf energy sources have been telling me repairs and/or rebuilding
could last months. Even Riyadh admitted as much.
Blindly blaming Iran, with no evidence, does not cut it. Tehran can
count on swarms of top strategic thinkers. They do not need or want to
blow up Southwest Asia, which is something they could do, by the way:
Revolutionary Guards generals have already said many times on the
record that they are ready for war.
Professor Mohammad Marandi from the University of Tehran, who has very
close relations with the Foreign Ministry, is adamant: “It didn’t come
from Iran. If it did, it would be very embarrassing for the Americans,
showing they are unable to detect a large number of Iranian drones and
missiles. That doesn’t make sense.”
Marandi additionally stresses, “Saudi air defenses are not equipped to
defend the country from Yemen but from Iran. The Yemenis have been
striking against the Saudis, they are getting better and better,
developing drone and missile technology for four and a half years, and
this was a very soft target.”
A soft – and unprotected – target: the US PAC-2 and PAC-3 systems in
place are all oriented towards the east, in the direction of Iran.
Neither Washington nor Riyadh knows for sure where the drone
swarm/missiles really came from.
Readers should pay close attention to this groundbreaking interview
with General Amir Ali Hajizadeh, the commander of the Islamic
Revolutionary Guard Corps Aerospace Force.
The interview, in Farsi (with English subtitles), was conducted by
US-sanctioned Iranian intellectual Nader Talebzadeh and includes
questions forwarded by my US analyst friends Phil Giraldi and Michael
Maloof and myself.
Explaining Iranian self-sufficiency in its defense capabilities,
Hajizadeh sounds like a very rational actor.
The bottom line: “Our view is that neither American politicians nor
our officials want a war. If an incident like the one with the drone
[the RQ-4N shot down by Iran in June] happens or a misunderstanding
happens, and that develops into a larger war, that’s a different
matter. Therefore we are always ready for a big war.”
In response to one of my questions, on what message the Revolutionary
Guards want to convey, especially to the US, Hajizadeh does not mince
his words:
“In addition to the US bases in various regions like Afghanistan,
Iraq, Kuwait, Emirates and Qatar, we have targeted all naval vessels
up to a distance of 2,000 kilometers and we are constantly monitoring
them. They think that if they go to a distance of 400 km, they are out
of our firing range. Wherever they are, it only takes one spark, we
hit their vessels, their airbases, their troops.”
On the energy front, Tehran has been playing a very precise game under
pressure – selling loads of oil by turning off the transponders of
their tankers as they leave Iran and transferring the oil at sea,
tanker to tanker, at night, and relabeling their cargo as originating
at other producers for a price.
I have been checking this for weeks with my trusted Persian Gulf
traders – and they all confirm it. Iran could go on doing it forever.
Of course, the Trump administration knows it. But the fact is they are
looking the other way. To state it as concisely as possible: they are
caught in a trap by the absolute folly of ditching the JCPOA, and they
are looking for a face-saving way out.
German Chancellor Angela Merkel has warned the administration in so
many words: the US should return to the agreement it reneged on before
it’s too late.
And now for the really hair-raising part.
The strike at Abqaiq shows that the entire Middle East production of
over 18 million barrels of oil a day – including Kuwait, Qatar, United
Arab Emirates and Saudi Arabia – can be easily knocked out. There is
zero adequate defense against these drones and missiles.
Well, there’s always Russia.
Here’s what happened at the press conference after the Ankara summit
this week on Syria, uniting Presidents Putin, Rouhani and Erdogan.
Question: Will Russia provide Saudi Arabia with any help or support in
restoring its infrastructure?
President Putin: As for assisting Saudi Arabia, it is also written in
the Quran that violence of any kind is illegitimate except when
protecting one’s people.
In order to protect them and the country, we are ready to provide the
necessary assistance to Saudi Arabia.
All the political leaders of Saudi Arabia have to do is take a wise
decision, as Iran did by buying the S-300 missile system, and as
President Recep Tayyip Erdogan did when he bought Russia’s latest
S-400 Triumph anti-aircraft system. They would offer reliable
protection for any Saudi infrastructure facilities.
President Hassan Rouhani: So do they need to buy the S-300 or the S-400?
President Vladimir Putin: It is up to them to decide [laughs].
In The Transformation of War, Martin van Creveld actually predicted
that the whole industrial-military-security complex would come
crumbling down when it was exposed that most of its weapons are
useless against fourth-generation asymmetrical opponents.
There’s no question the whole Global South is watching – and will have
gotten the message.
Now we are entering a whole new dimension in asymmetric hybrid war.
In the – horrendous – event that Washington would decide to attack
Iran, egged on by the usual neocon suspects, the Pentagon could never
hope to hit and disable all the Iranian and/or Yemeni drones.
The US could expect, for sure, all-out war. And then no ships would
sail through the Strait of Hormuz. We all know the consequences of
that.
Which brings us to The Big Surprise. The real reason there would be no
ships traversing the Strait of Hormuz is that there would be no oil in
the Gulf left to pump. The oil fields, having been bombed, would be
burning.
So we’re back to the realistic bottom line, which has been stressed by
not only Moscow and Beijing but also Paris and Berlin: US President
Donald Trump gambled big time, and he lost. Now he must find a
face-saving way out. If the War Party allows it.
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16-SEP-2019: Drones Strikes Deep Inside the Kingdom Law & Politics |
Last week was the Anniversary of 9/11 and it is increasingly apparent
that More Americans are questioning the Official 9/11 Story As New
Evidence contradicts the Official Narrative [MintPress News]
The overwhelming evidence presented now demonstrates beyond any doubt
that pre-planted explosives and/or incendiaries — not just airplanes
and the ensuing fires — caused the destruction of the three World
Trade Center buildings, killing the vast majority of the victims who
perished that day. The Official Narrative around the assassination of
JFK has been similarly debunked. Two great American Writers have
touched on this
Don DeLillo in his book Libra "There is a world inside the world."
"There's always more to it. This is what history consists of. It is
the sum total of the things they aren't telling us."
Thomas Pynchon in Bleeding Edge “No matter how the official narrative
of this turns out," it seemed to Heidi, "these are the places we
should be looking, not in newspapers or television but at the margins,
graffiti, uncontrolled utterances, bad dreamers who sleep in public
and scream in their sleep.”
Events in Saudi Arabia this weekend has been interpreted every which
way and allow me to try and interpret the events outside the Echo
Chamber that is the Saudi paid PR machine and the reflexive Pompeo
''Iranians under the bed'' standard response.
It has been reported that a swarm of ten armed and explosive Drones
struck at the heart of the Kingdom's Oil industry. The strikes were on
Saudi Arabia's 7 million barrel per day Abqaiq processing complex and
its second-biggest oil field, Khurais, Saudi Aramco describes its
Abqaiq oil processing facility there as “the largest crude oil
stabilization plant in the world.” Abqaiq is perhaps the world’s most
important oil installation. According to the @EIAgov the plant has a
capacity of more than 7 million b/d or about 8% of the world's total
oil production [Energy Intelligence]. Most of the oil produced in the
country [Saudi Arabia] is processed at Abqaiq before export or
delivery to refineries. Saudi Aramco is assuring the World it can
restore output quickly but has admitted that the production shutdown
amounts to a loss of about five million barrels a day, the people
said, roughly 5% of the world’s daily production of crude oil. The
kingdom produces 9.8 million barrels a day. I cannot recall an attack
of this severity in the Kingdom ever.
The Houthis took responsibility for this attack. U.N. investigators
have previously pronounced that the Houthis’ new UAV-X drone, likely
has a range of up to 1,500 kilometres (930 miles). Secretary Pompeo
immediately dismissed the possibility that these drones originated
from Yemen and blamed Iran. More worryingly for the Kingdom are
reports of cooperation by people in Saudi Arabia. It may well be that
drones were launched from inside Saudi Arabia and that their launch
point was far nearer to the targets than publicly assumed. Neither
option is a good one. If the Houthis did launch the attack from the
Yemen, it speaks to the fact that nowhere in the Kingdom is safe and
the Houthis have achieved an asymmetric balance, which is quite
extraordinary. In November 2017, I wrote of how the then 30-year-old
Crown prince of Saudi Arabia Mohamed bin Salman MBS had arrived on the
scene and immediately launched an unwinnable war in the Yemen. It will
be a cake walk MBS said over in a week he said and they will be
throwing rose petals at our feet. Abu Dhabi's MBZ saw the writing on
the Wall and stop lossed his Yemeni Adventure. It is clear now that
the ''Yemen War has become Saudi Arabia’s Vietnam (or Soviet Union’s
Afghanistan or indeed U.S. version of Afghanistan)'' @JKempEnergy and
that the ''The kingdom has thrown everything into conflict but failed
to achieve a decisive military advantage and favourable political
endgame'' More worrying for the Kingdom is the second scenario were
these Drones might have been launched within the Kingdom which would
be signalling that the Houthis might well have teamed up with the
Saudi Shia who represent up to 25% of the Population and have been
ground down viciously by the House of Saud, characterised as Apostates
and whose Leaders have been beheaded and crucified.
Zerohedge is speculating that this is a false Flag attack designed to
ramp up the Price of Oil in order to grease the way for the Saudi
Aramco IPO. If this is true and I put the probability at zero then the
Crown Prince is I am afraid insane for who would buy a share of a
company when its major installations are not secure but under severe
attacks? The Saudi Aramco IPO is now dead in the Water. The Surge in
the Oil Price [which I will get to momentarily] will have zero effect
on the IPO because now the overwhelming geopolitical question is
around the longevity of the House of Saud and its Crown Prince who is
of course the Proud Owner of Leonardo Da Vinci's Salvatori Mundi which
means Saviour of the World and according to Robert Baer has so. many
enemies that he sleeps on his $500m yacht the Serene off Jeddah. The
much commented on Orb is of no help now. If the Houthis have tapped
into the Saudi Shia, the House of Saud in my opinion is on its last
legs. This is a Big Call and needs to be understood for that. No
amount of paid PR or kind words from Trump can finesse this. Over the
Weekend, so many of the Oil Watchers I follow were saying we must wait
for the Official Saudi comment. Let me tell you this for free. Saudi
comment is worthless, irrelevant and paid for.
The Oil Markets open on Sunday evening.
On June 17th this year I wrote [quite presciently I must admit]
''All global markets have become liquidity Traps. The Oil Markets
trade 24 hours but in the early hours is when Gremlin Wizards and
Djinns [The Quran says that the Djinn are made of a smokeless and
"scorching fire", They are usually invisible to humans, but humans do
appear clearly to Djinn, as they can possess them. DJinn have the
power to travel large distances at extreme speeds and are thought to
live in remote areas - so now You Know] stalk the Exchanges like the
FX Markets. Therefore, we could very well see a Price Spike. One Touch
is the Way to go''
I reckon we could jump as high as $80.00 which would be a +45.00% leap
versus Fridays closing price before we trade back to about +10% with
would be about $60.00+ as Trump unloads Crude from the Reserve. So Big
Price Spike then retracement but then if we do get within 10% of
Fridays closing Price of $54.83, then you need to get long. The
production shutdown amounts to a loss of about five million barrels a
day and is a big deal.
In May I wrote about Iran and I quoted Hunter S. Thompson who
described The Edge [and I was describing Iran as being at the Edge]
thus
“There is no honest way to explain it because the only people who
really know where it is are the ones who have gone over''
My Mistake was to think Iran was at the Thompsonian Edge whereas it is
clear now that it is the Kingdom.
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@netflix: how will the story end? @FinancialTimes World Currencies |
On a sunny midsummer weekend in Los Angeles, Netflix turned the Santa
Monica Pier — one of the city’s busiest tourist destinations — into a
three-dimensional marketing blitz, transforming it into the fictional
1980s Indiana town where its hit show Stranger Things is set.
The 110-year-old structures were dressed up to mimic the show’s
location; the Ferris wheel was flashing eerie red lights over the
Pacific Ocean. The night before, there had been a full marching band
for a lavish premiere party.
The marketing push illustrated how critical the show is to the
subscription-reliant digital streaming service.
The July 4 arrival of the third series of Stranger Things was the
“biggest content drop” of 2019 for Netflix, says Bernstein analyst
Todd Juenger.
“If any one piece of content would make a difference on [subscriber
additions], that should be the one,” he adds.
He was right. Global subscriber numbers spiked in the first two weeks
of July. Unfortunately for Netflix it was two weeks too late.
In the quarter to the end of June the company lost subscribers in the
US — 126,000 of them — for the first time since 2011.
Equally worrying, outside the US the company signed up only 2.8m
subscribers — about half of what Netflix had predicted.
The market wiped $17bn off Netflix’s stock value overnight,
emphasising the brutal correlation between new subscribers and stock
market value.
The company is predicting 7m new subscribers in the third quarter.
But the dramatic fall in the second quarter — even before the arrival
of greater competition from Apple and others later this year — has
cast doubt over whether the company, that successfully took on the
Hollywood hierarchy is as invincible as it previously seemed.
“The next best thing to success in Hollywood is schadenfreude,” says a
senior executive at an independent film studio who has worked with
Netflix on TV projects. “There is no better sport. It might even
eclipse your own success.”
Wall Street is now seeking evidence as to whether this miss was a blip
or a trend. The stock market has become “addicted” to Netflix’s
subscriber growth, says Aswath Damodaran, a finance professor at New
York university's Stern School of Business who closely follows the
company.
“For a decade, [Netflix has] spent more and more money on content to
get users and increase market capitalisation, and it worked,” he says.
“But the question is: how do you get off this treadmill? At some point
spending 75 per cent of every dollar on content won’t be sustainable.
The next year is going to be the big challenge.”
Netflix spearheaded a streaming revolution that changed the way we
watch TV and films. As cable TV lost subscribers, Netflix gained them,
putting it in a category with Facebook, Amazon and Google as one of
the adored US tech stocks that led a historic bull market.
The company spends more than 70 per cent of revenues on content.
Analysts estimate that would give it a budget of more than $15bn this
year — more than any other media company.
Yet Netflix projects it will spend $3.5bn more than it will generate
in cash in 2019, while promising that this mismatch will narrow over
time.
This rate of cash burn means the company has to repeatedly tap debt
markets to pay for its content and make other debt repayments.
It relies on the faith of investors to fuel the machine, studiously
raising more junk-rated debt roughly every six months to help finance
its splurge on content.
Netflix has taken on the vast majority of its $12bn in long-term debt
in the past three years as it almost doubled its global subscriber
base to 150m.
In an environment of historic low interest rates, investors searching
for yield have happily gobbled up Netflix bonds.
Many of the big legacy media companies initially surrendered their
catalogues to Netflix in return for royalty payments.
But the streaming service, anticipating that its rivals would fight
back, began building its own catalogue before these shows disappeared
from its platform.
“People wondered why they were paying so much, but in hindsight it now
looks smart,” says a senior film and television banker. “They were
building a following [ahead of] an arms race.”
Today Netflix faces an onslaught of competition in the market it
invented. After years of false starts, Apple is planning to launch a
streaming service in November, as is Disney — with AT&T’s WarnerMedia
and Comcast’s NBCUniversal to follow early next year.
Apart from Apple, they all have extensive back catalogues. After
raising prices in the US earlier this year, a standard Netflix
subscription now costs $13 a month. Apple will charge $5 a month and
Disney $7 a month for their subscription services.
Traditionally Netflix’s strategy has been to outspend rivals, but it
may have met its match in Apple, the second-richest company in the
world.
Two years ago Netflix got into a bidding war with the iPhone maker for
The Morning Show, a comedy-drama television series with a star-studded
cast led by Jennifer Aniston and Reese Witherspoon.
“The deal kept going back and forth between Netflix and Apple,” says
one person involved in the talks. Ultimately the producers decided to
sell it to Apple for more than $300m, in part because they felt the
iPhone maker would give it a bigger marketing push.
“On Netflix it would be one of their many great shows. But on Apple it
would be the first big marquee show on its new service,” says the
person.
Despite this, several former Netflix employees say there is little
concern internally about the looming competition.
“There was never any fear that we’re in trouble,” says one former
marketing executive, who left the company in the spring.
“Every quarter felt like a year in which Disney and Fox weren’t in the
game. The feeling was that we are leap years ahead. And it’s kind of
true.”
Netflix first invaded US living rooms with its video streaming in
2007. But it would take another six years before it made a big splash
with its own shows.
The company paid $100m for two seasons of the political thriller House
of Cards, which debuted in 2013 to widespread acclaim, putting Netflix
on the map with both audiences and Hollywood.
House of Cards was instructive for how Netflix would approach deals
for years to come. The strategy was to spend big to outbid rivals,
usually committing to full global rights for series without asking for
a pilot.
The deal “changed the whole landscape for how TV was created”, says
one veteran Hollywood banker. “For the next year, Netflix was gobbling
up everything . . .[it became] ‘the only game in town’.”
On occasions the streaming service offered between 30 and 50 per cent
higher prices than competitors such as HBO, Showtime and Starz,
according to people familiar with these deals.
The structure of them also stood out. While traditional networks
typically paid on delivery of the show, Netflix sometimes stretched
payments out over time, which was accepted because it was paying such
a premium, according to people familiar with the deals.
This turned out to be an effective liquidity strategy because
Netflix’s debt and liabilities are spread out over years, and much of
it is not on the balance sheet but rather listed as “contractual
obligations”.
In addition to its $10.4bn in long-term debt, at the end of last year
Netflix also owed another $19bn in obligations and an additional $2bn
to $5bn in “unknown” spending — money committed over the next five
years to pay for new shows, and to license the rights to existing TV
and movies over multi-year contracts.
in the meantime rival streaming services such as Hulu, Amazon and
Apple have become more aggressive in acquiring content, giving
producers options beyond Netflix.
And bankers are beginning to question whether Netflix will need to
change its funding model to continue winning projects because Apple,
Amazon and Hulu pay on delivery.
A Netflix spokesman, responding after publication, said the service
was already competitive on payment terms, and already paid for some
projects on delivery.
The streaming wars have spawned a phenomenon known as “Peak TV”, with
bankers saying there has not been as much capital in Hollywood since
the mid-2000s, when private equity firms were jumping to finance
feature films.
But some observers believe this is not sustainable. “Five years from
now, there will not be as many TV series being made, I promise you,”
says Jonathan Taplin, an Oscar-nominated film producer.
“We have [doubled the number of series] from seven years ago, and we
haven’t grown the audience at all. Any idiot in Economics 101 can tell
you that’s not a good proposition,” he says, adding that there is “no
real precedent for this . . . it’s kind of weirdly new”.
Most of that growth in TV series has come from the streaming services,
predominantly Netflix. Some of Hollywood’s most talented executives
and creatives have in recent years been lured by the company from
other studios, with the promise of eye-popping pay cheques.
But at the start of this year, whispers spread of budget cuts.
Marketing spending was trimmed to make more space for Netflix’s
content budget.
“You would hear it a lot in conversations and in meetings. Money
needed to be shifted into tent pole [or blockbuster] films,” says one
former executive who left this summer.
Netflix has also sliced its budget for direct digital advertising of films.
Netflix declined to comment, but someone close to it says the company
is experimenting with its promotional strategy and plans are likely to
change with the imminent arrival of a new chief marketing officer,
Jackie Lee-Joe, who joined from BBC Studios.
When it comes to content, however, there is little evidence that
Netflix is tightening its purse strings. The week before the
announcement that it had lost subscribers in the US, Netflix agreed to
spend about $200m to make Red Notice, a Dwayne Johnson action film.
A few weeks later, it signed a $200m deal with the Game of Thrones
creators for future productions.
Netflix thrived during a period of easy money and a stock market
rally. But recessionary fears have roiled markets recently, and
critics believe that a credit crunch would dent its debt-driven model.
The company admitted as much in its annual statement, warning that
“our streaming obligations include large multiyear commitments”, and
that “as a result, we may be unable to react to any downturn in the
economy . . . by reducing our obligations in the near term”.
However, analysts and investors still believe firmly in the Netflix
model. More than 80 per cent of stock analysts rate the company as a
buy.
Even after the loss of subscribers in the second quarter, Ben
Swinburne, head of media research at Morgan Stanley, says Netflix is
still on course for a record year of subscriber additions.
Analysts, on average, project that cash flow will break even in 2023
as subscribers and margins improve.
“They’re balancing growth versus investment and we understand that.
It’s quite expensive to create so much content,” says S&P analyst
Jawad Hussain.
However, he warns: “In 2020, if we don’t see a material improvement in
cash flow deficit, that would be a worrying sign.”
Mr Hussain expects Netflix to issue at least $3bn in debt next year to
comfortably cover its costs.
It does have levers that it can pull. More than 70 per cent of its
long-term debt is not due for at least five years, which in theory
would give it time to adjust its spending if there were to be a
downturn.
However, a pullback on content also runs the risk of losing
subscribers — Netflix blamed its second quarter numbers on a weak
content slate.
Optimists point to the group’s global reach. It is betting its future
on an expansion outside the US, where it has already attracted 60m
subscribers.
The company is investing heavily in content in places like India and
Malaysia, with a focus on local-language programming.
However, the economic prospects in these territories are weaker.
Netflix subscriptions in India start at the equivalent of $3 a month,
compared with its cheapest plan in the US which is three times that,
resulting in thinner margins compared with its US business.
Netflix most recently raised debt in April to a rapturous reception,
selling $2.2bn in 10-year notes in an auction that was three times
oversubscribed. Based on its previous schedules, it would next be
expected to tap investors in October.
For now the stock market appears to be siding with the critics.
Netflix’s shares have sunk further since its July slide, touching an
eight-month low that values the company at $127bn.
“They have to reframe the story,” says NYU’s Mr Damodaran. “If they
have a couple more bad quarters, the market will tell the story for
them.”
Commodities
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Angola gov making reform progress but still much to do if debt risks to be contained. Some necessary reforms unpopular & risk of pushing too hard as economy recovery fragile @gregorylbsmith Africa |
Need time to shift economy from oil & to jobs but time not on Angola’s
side. Recent trip thread 1/10
2. Key areas reform for investors to watch 1/ FX. 2/ Balancing budget
& stabilising debt. 3/ Privatisation program. Each important to gov &
for keeping $3.7bn IMF program on-track (crucial for eurobond
investors & China’s exposure). S&P has #Angola on a B- rating with neg
outlook
3. FX big hurdle to non-oil business. Depreciation since devaluation.
More market-based allocation but hard to get letter of credit needed
to access FX (most firms import inputs). Official & parallel rate gap
had narrowed but recently widened. Now official AOA364/$,
parallel=~535
4. Until easier FX allocation, will be drag on non-oil investment.
Also parallel rate premium means those with official FX access could
make easy money. Creates perverse incentives. Wheeling & dealing
replaces entrepreneurship & job creation. FX reform important to IMF
5. FX risks also with large public external debt to service =~$51bn
(inc $5bn eurobonds, China ~$23bn). Pressure visible in net FX
reserves at BNA, down to ~$9bn vs mid-2019 target of $10bn. Gov also
has $2bn cash recovered from sovereign wealth fund, plans to spend it
for 2020
6. Balancing budget. Adjustment delayed 2014-17 when oil fell from
$100. Gov & Sonangol borrowed lots. 2014 debt-GDP 40%, ~90% 2019.
Large consol happened: spend ~40% GDP per year 2010-14, down to ~20%
GDP 2018-19. Gov working to meet targets but still odd ideas like new
gov HQ
7. Next steps: VAT intro 1st Oct (delayed July). Fuel subsidy
reduction, pump prices not increased as AOA dep'd. Today diesel
K160/43 US cents (at official rate) costing gov (most refined products
imported). Both important to IMF agreement but unpopular & local
elections in 2020
8. Privatisation plan listed 91 state company. Pressure to act quickly
as huge drain on state finances. But better strategy needed. Should
decide where state needed & not & rebrand it beyond privatisation:
some reform, some closing, only few might be successful in private
hands
9. In sum. Action needed to stop debt rising far above 90% GDP. IMF
program essential to avoid debt crisis. Risk reform fatigue &
reversal. No easy path for gov. Oil only served elite now pressure for
inclusion. Need time to redirect economy but time not on Angola’s side
10. PS if visiting well worth taking a copy of the @BradtAngola
guidebook. Recommends good places to explore. Lots to do in Luanda,
particular fondness for central bank museum, sea front running, &
grilled fresh fish on the beach
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Robert Gabriel Mugabe (1924-2019) Africa |
Most of Zimbabwe’s citizens are ‘’born free’’ the fight for
independence was real but is no longer relevant is it?
We are grateful to all those iconic leaders who liberated our
continent of which Mugabe is one but at what price? Fighting for
independence is not the same as building an economy which provides
opportunity for all its citizens.
As some African leaders laud Mugabe today, @PastorEvanLive argues:
“There can be no mixed feelings, misconceptions or complications about
Robert Mugabe’s legacy. He presided over the destruction of millions
of people’s lives over a span of 37 years.”
Emmerson Mnangagwa who was eulogising Mugabe as a Revolutionary Icon
has failed and is frankly as untenable as his erstwhile Mentor.
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JAN-2019 :: "money is the most universal and most efficient system of mutual trust ever devised." Africa |
“Money is accordingly a system of mutual trust, and not just any
system of mutual trust: money is the most universal and most efficient
system of mutual trust ever devised.”
“Cowry shells and dollars have value only in our common imagination.
Their worth is not inherent in the chemical structure of the shells
and paper, or their colour, or their shape. In other words, money
isn’t a material reality – it is a psychological construct. It works
by converting matter into mind.”
The Point I am seeking to make is that There is a correlation between
high Inflation and revolutionary conditions, Zimbabwe is a classic
example where there are $9.3 billion of Zollars in banks compared to
$200 million in reserves, official data showed.
The Mind Game that ZANU-PF played on its citizens has evaporated in a
puff of smoke.
‘’The choice of that moment is the greatest riddle of history’’ and
also said “If the crowd disperses, goes home, does not reassemble, we
say the revolution is over.”
What is clear to me is that Zimbabwe is at a Tipping Point moment.
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25-FEB-2019 :: Zimbabwe finally overhauled its dysfunctional,''whack'' and even Voodoo FX regime. Africa |
Zimbabwe finally overhauled its dysfunctional,''whack'' and even
Voodoo FX regime. Zimbabwe’s government dropped its insistence that a
quasi-currency known as bond notes are at par with the dollar as it
overhauled foreign-exchange trading and effectively devalued the
securities. While the government has previously insisted that bond
notes and RTGS dollars are worth the same as U.S. dollars, the units
currently trade at between 3.66 and 3.8 to the dollar respectively on
the black market [Bloomberg] “The introduction of a Zim dollar will be
just in name, but the RTGS$ is essentially the Zim dollar.” Tendai
Biti is predicting a 6-8 range whilst the Government is looking for it
to appreciate to 2.5 which is best characterised as ''Hail-Mary''
economics. This is the right move but I would definitely be short at
2.5, if it ever gets there which is entirely unlikely.
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EDITION 8 - QUARTER 1, 2019 AFRICA'S PROSPECTS MACRO, BUSINESS, CONSUMER AND RETAIL INDICATORS @nielsen Africa |
Amidst times of ongoing and relentless change the Nielsen Africa
Prospects Indicator shows country prospects stabilising in Quarter
1’2019, with only two markets changing position on the latest ranking
update. Kenya remains in top position, followed by Cote d’Ivoire and
Tanzania.
Ghana and Nigeria hold on to their stronger fourth and fifth places,
respectively, while Uganda slips to sixth place, South Africa weakens
to seventh and Cameroon remains in eighth place.
Despite remaining as Africa’s lead prospect, Kenya’s business and
retail prospects have weakened relative to other markets. Business
sentiment for country and own business growth prospects is less
positive than before, but is offset by a stronger macro-economic
position, however, GDP growth rates are lower and indications are that
the economy lost steam in Quarter 1’2019.
Kenyan consumer sentiment is also softer with only 41% of consumers
feeling that their outlook for job prospects is good/excellent over
the next 12 months, and one third of Kenyans of the opinion that their
personal finances are in a “not so good/bad” state, up 11 points from
a year ago
Only 17% of Ivorian retailers feel that consumer spend is increasing
and just 15% are of the view that consumers are increasingly willing
to try new things. Purchase decisions are firmly entrenched in
familiarity and trust, with 84% of consumers choosing products with
this in mind.
The next most influential factors are availability followed by
pricing. For manufacturers to disrupt this trust-bound market is
extremely challenging.
For this reason, new brands and propositions need not be primarily
based on the usual affordability aspects, but must establish
awareness, consideration and confidence to gain new users. Media and
marketing outreach, as well as retail ambassadors, are essential to
reach and resonate with Ivoirians.
Tanzania remains in third place, however, improved retail prospects
are countered by weaker business prospects. Tanzanian retailers are
positive about their growth outlook as the country’s economic
development remains resilient.
However, business sentiment regarding country growth opportunities has
weakened due to unpredictable policy making and protectionist rules
that limit foreign investment.
Tanzania is one of the poorest nations in the world, with almost 90%
of the population living on less than US$2 per day. Poverty reduction
that improves consumers ability to spend, is therefore a pre-requisite
for companies to realise any significant investment opportunity.
Ghana and Nigeria maintain their healthier positions following
turbulent times. According to the IMF, Ghana is expected to be one of
the fastest growing economies in the world, and companies share this
positive outlook, rating Ghana as Africa’s second best business
prospect with improved country and own business growth expectations.
In addition, Ghanaian consumer prospects have improved significantly
with 36% of retailers of the opinion that consumer spend is increasing
compared to only 11% a year ago. Thirty two percent of retailers also
believe that consumers are more willing to try new products, compared
to only 15% a year ago.
Consumer confidence levels regarding job prospects and personal
finances are stronger than in Kenya, the current top ranked prospect,
which bodes well for Ghana as a long-term market expansion
opportunity.
Nigeria retains its improved fifth place, its best level in three
years. With economic recovery set to gain momentum in 2019 business
prospects have improved in parallel.
Nigerian consumers are also the most positive and open to spending,
but the major obstacle resides in the retail environment. The ease of
doing business sentiment is low as the strain of ongoing double digit
inflation takes its toll.
Uganda has traded between sixth and eighth place on the overall
ranking for the past four years. In Q1’2019 Uganda replaced South
Africa in sixth place, with stable economic prospects and
strengthening business and consumer prospects.
In South Africa, the initial enthusiasm and confidence resulting from
Cyril Ramaphosa’s leadership is waning. Businesses’ view on country
growth outlook has weakened substantially and close to 80% of South
African consumers think the country is in a recession.
The major concerns for consumers are the state of the economy followed
by job security, debt, crime and political stability.
Cameroon struggles with poorer prospects relative to other markets,
driven by political tensions, job struggles, constrained finances and
unrest in parts of the country, which have impacted economic, business
and consumer prospects.
Economic growth remains below population growth for the fourth consecutive year.
Nigeria, South Africa and Angola contribute 60% of SSA’s GDP and face
ongoing challenges constraining the overall outlook.
Nigerian consumers are most adventurous when it comes to trying new products.
SSA retailer growth outlook is the most favourable in 3 years (%
good/excellent) Tanzania, Cote d’Ivoire, South Africa and Uganda are
ahead of the average.
65% of FMCG trade takes place in close- proximity/neighborhood
channels (Table Tops, Kiosks, Grocers), with consumers favouring these
channels for convenience, ease of access and flexible offerings.
3X FASTER Smaller players are formidable opposition in informal channels.
Large multinational FMCG leaders need to find ways to be agile,
flexible and relevant to consumers where they shop.
The top 10 manufacturers, on average, account for approximately 55% of
sales* but are growing at less than 5% per annum, while the smaller
manufacturers are growing ahead of 15%.
Kenya
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Kenya starts tightening its belt after debt binge criticism @ReutersAfrica Africa |
President Uhuru Kenyatta’s government has been criticised for ramping
up borrowing since coming to power in 2013. Total public debt stands
at 55% of GDP, up from 42% when he took over.
The critics accuse the government of saddling future generations with
too much debt. The government has defended the higher borrowing,
saying it is required to fund infrastructure.
The finance ministry said it will cut the government’s spending for
the 2019/20 (July-June) fiscal year by 2.1%, equivalent to 46.2
billion shillings ($445 million), the budget review showed.
The cuts to the budget for this fiscal year were mainly caused by
revenue collection shortfalls, the ministry said in its budget review,
citing a 123.5 billion shillings gap in the government’s financial
year to the end of June.
The cuts were attained through “trade-offs and reallocations of the
existing budgetary provisions,” it said.
The overall budget deficit target, however, remained unchanged at 5.9%
of GDP, while projected local and external borrowing also remained
broadly within the initial budget unveiled in June, disappointing
analysts.
“Given the scale of the fiscal deficit, a meaningful fiscal
consolidation exercise might require substantive spending cuts
alongside big revenue measures,” said Razia Khan, head of research for
Africa at Standard Chartered in London.
Patrick Njoroge, the governor of the central bank, said on Wednesday
that a tightening of the government’s fiscal policy, would give room
for some form of monetary easing to attain a balance.
The government aims to cut the fiscal deficit to about 3.5% of
economic output by the 2022/23 financial year, Yatani said last week.
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