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Satchu's Rich Wrap-Up
 
 
Thursday 07th of May 2020
 
Afternoon,
Africa

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Macro Thoughts

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Covid is a “fast forward” button pulling inevitable changes into the present. One month = one year. @Mazzeo.
Africa


If a trend was accelerating exponentially (eg ecom, gaming, remote)
the change is jarring. Like snapping two years off x axis.

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COVID19 has brought us all to an inevitable question. What is it all about? Can it ever return to what it was? #COVID19
Africa


As I try and peer through into the Future the one thing I do know is
that its not reverting to what it was.
We are turning the Page here and the uncertainty is because we all
know collectively that's what we are about to do.
The book is in front of us and the page might turn itself but turn it
will. The Question is what is on the next page and I cannot answer
that.

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2 yr yields slowly headed to zero and beyond. Real yields are about to go up during a recession for the first time since 1930...and they are about to go up a LOT. Rates HAVe to go negative to partially offset this. @RaoulGMI
Africa


2 yr yields slowly headed to zero and beyond. Real yields are about to
go up during a recession for the first time since 1930...and they are
about to go up a LOT. Rates HAVe to go negative to partially offset
this.

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The Way we live now #COVID19
Africa


It certainly is a new c21st that we find ourselves in. There is a
luminous and Fairy Tale feel to life in quarantine and as you know
most fairy tales have an oftentimes dark and dangerous and unspoken
undercurrent.

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How many elephants can you count? During this recent aerial patrol, one of our pilots spotted more than 600 elephants across the Tsavo Conservation Area. @SheldrickTrust
Africa


How many elephants can you count? In reality, there were too many to
fit in a single photo: During this recent aerial patrol, one of our
pilots spotted more than 600 elephants across the Tsavo Conservation
Area. Learn more about this vital project

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Zhang Li-Fan: China lacks the political wisdom to handle the growing international pressure @Medium @WilliamYang120
Law & Politics


Over the last few weeks, the US began an inquiry into China’s handling
of the coronavirus outbreak, hoping to hold Beijing responsible for
the pandemic that has now killed more than 250,000 people worldwide.
In response, China unleashed its “Wolf Warriors,” led by its
diplomats. As the relationship between China and the US becomes more
confrontational, Chinese historian Zhang Li-Fan thinks that the
current situation is the result of both Xi Jinping and Donald Trump’s
political needs.
Zhang Li-Fan: It’s been 101 years since the May Fourth Movement in
China, and the situation in the country now is very different. I think
it’s hard to make such comparison.
The May Fourth Movement happened due to the Beiyang Government’s need
to engage in political fights. They leaked information about the Paris
Peace Conference to student groups, which led to the May Fourth
Movement.
In a way, they used students’ patriotism for the country to engage in
the political fight.
However, China doesn’t really have the similar circumstances to
cultivate another May Fourth Movement. While there is a very radical
form of patriotism being promoted online, the patriotism mostly come
from China’s diplomats, who have been branded as the country’s “Wolf
Warriors.”
But even with their extreme version of patriotism, China doesn’t have
the right conditions to trigger another May Fourth Movement now.
I think the situation in China now is more similar to the Boxer
Uprising at the end of the Qing Dynasty.
But if the Chinese government wants to launch a similar movement now,
they might endanger the stability of their own administration.
Since the COVID19 outbreak, a lot of people who originally supported
the government have now become disillusioned. They no longer trust the
government.
I think the reason why the Chinese government is kicking off a
patriotic campaign similar to the Boxer Uprising is because there is a
political need to do so.
They want to use patriotism to strengthen people’s faith in the
government. However, they may not be able to achieve that goal
Sometimes, I think they might even intentionally act tough in front of
the US, because they want Washington to have the impression that “We
are not afraid of you and you can’t scare us. Ultimately, we still
have to sit down and negotiate.”
In order to maintain the stability of their administration, they can’t
afford to relax their control over society. To them, maintaining
stability means ensuring their survival. I think they will do whatever
it takes to maintain this.
In fact, I think they have been increasing their control over society
through big data and facial recognition technologies, as well as grid
management.
All these measures were launched in the name of combating the
pandemic. These advanced technologies have brought Beijing’s control
over civil society to a very sophisticated level. Essentially,
everyone in China is under their close surveillance now.

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The Coronavirus Pandemic and the Risks of America’s Fade-Out #COVID19 @WPReview @hofrench
Law & Politics


For most of the past three years, many close observers of American
politics shuddered at the thought of what would happen to the United
States if it faced a genuine crisis during Donald Trump’s presidency.
Even many of his elite supporters in the Republican Party, in the
media and in business cannot have failed to wonder how a man who
struggles to organize his thoughts into clear and linear sentences
would be able to marshal the full resources and unified will of the
United States to deal with a national emergency.
It is no longer speculation after the initial months of the
coronavirus pandemic, which has afflicted the United States more than
any other country. Everyone, it seems, but Trump’s inner circle
recognizes that Washington largely squandered February and March, when
the spread of the virus might have been contained and the ultimate
death toll kept within far lower limits. And by now it is obvious that
strong and active leadership by the federal government would have been
far more effective than the approach chosen—or perhaps adopted by
default—of allowing each state to go its own way in applying and
easing social restrictions. A headline in The Wall Street Journal this
week captured a sense of the ongoing American folly: “Even Hard-Hit
Areas Ease Limits.”
By encouraging protests against state lockdowns by his gun-toting
supporters, Trump has taken the embrace of confusion and mismanagement
several steps further, approaching levels of deliberate,
government-fostered disorder not seen since late in the rule of the
Chinese dictator Mao Zedong, when he incited youth during the Cultural
Revolution to attack his own Communist Party elite. “Everything under
heaven is in utter chaos, the situation is excellent,” Mao is said to
have uttered.
But as unflattering the picture is of American leadership under Trump,
these past few months raise far broader questions, beyond the
president’s incompetence and penchant for division. Taking a long view
of things, it is hard to avoid the conclusion that this is, in part,
about something much bigger: a decline in America’s comprehensive
power that has been in the works at least since the George W. Bush
administration.
During those eight years, the United States launched itself into
ruinous and unending wars in Iraq and Afghanistan after 9/11, and
fought against ill-chosen enemies in environments that could only defy
conventional military success. Under Barack Obama, the United States
sought to but never fully succeeded in ending American adventurism,
and could notably never extract itself from Bush’s geopolitical
follies. China’s stirring rise was the most important global
phenomenon during both presidencies, but neither Bush nor Obama
managed much of a strategy in response to it. Obama at least spoke of
using both economic and military statecraft, vowing to shift the focus
of America’s military to Asia from its perennial but outdated
concentration on Europe and the Middle East. He also cobbled together
a promising economic coalition of countries throughout the Pacific
Rim, catalyzing them to form the world’s largest trade deal, the
Trans-Pacific Partnership. But Obama never sold it to his own
Democratic Party, and Trump jettisoned the TPP as one of his first
acts in office.
Without offering an exhaustive review of the broad trail of
destruction left by Trump, suffice to say that abandoning the TPP was
the first of many ways in which he led a retreat from America’s
traditional multilateralism. Just this week came the news that
Washington had declined to join a multilateral consortium of countries
aimed at developing a vaccine against COVID-19 and guaranteeing its
availability for countries around the world. For decades, this sort of
thing was the United States’ bread and butter; one could count on it
to step up, not just as a leader in financial and scientific efforts
to resolve big global problems, but as a convener, too. The shirking
of that role of helping to coordinate a global response to the
coronavirus pandemic essentially ensures that the world will manage
this crisis in America’s catastrophic image under Trump: every state
for itself.
It goes hand in hand with other forms of Trumpian abandonment of
values that until recently were pillars of American influence. Even if
the United States was often in frequent and even serious breach of its
ideals—democracy, human rights, freedom of the press, equal
opportunity for women, a clean environment, international
cooperation—the fact that it promoted and was associated with them was
one of the country’s most important sources of strength. Much of that
is gone now, and it is hard to imagine any of those ideals surviving
if Trump is reelected.
Taking a long view, the current disorder is about something much
bigger: a decline in American power that has been in the works at
least since the George W. Bush administration.
As hard as it is in the midst of the present crisis, though, try to
think beyond Trump. For all of its vaunted military strength, who
today believes that the United States could respond as it has in the
past to a military conflict of the first order, given how it has
confronted the coronavirus pandemic with such shabbiness and
dissipated purpose? Especially if that armed crisis actually required
not just a quick flash of power, but a sustained military mission, a
comprehensive industrial mobilization and serious personal sacrifice?
Consider America’s inability to amass and maintain strategic stocks of
obvious necessities like ventilators and masks; its inability to
quickly produce adequate supplies of reagents for coronavirus tests;
its failure to standardize the immunological tests that it does run,
and test them for quality. Perhaps worst of all, consider its
incapacity to churn out something as basic as cotton swabs. Add to
this the recent, scandalous mishandling of the coronavirus outbreak on
the USS Theodore Roosevelt, in which most of the aircraft carrier’s
crew was infected, and its captain reprimanded and removed by Navy
leadership for speaking out. Defense Secretary Mark Esper eventually
offered his much belated realization that the disease could be
transmitted by those without symptoms.
Failures like this paint a grave picture of American competence and
capacity. For sure, some of this is down to Trump’s malign hand and
spirit. But then again, much of it is not.
Whatever blame one wishes to ascribe to him, the problems of the
United States going forward are about far more than just Trump. Much
has been made, I believe wrongly, of the supposed advantages of
authoritarian systems, like China’s, in responding to major challenges
like this pandemic. Authoritarianism shaped the nature of China’s
domestic response to its COVID-19 outbreak to a certain extent, but
the Chinese Communist Party didn’t invent obvious and time-tested
ideas like disease containment, widespread testing and contact
tracing. And it wasn’t an aversion to authoritarianism or an
unyielding love of privacy or of civil liberties that has prevented
the United States from adopting those very steps.
Yes, there has been failed leadership at the top. But there has also
been a certain decadence and self-indulgence in America’s culture
during the pandemic. Leave it to Ireland to close its pubs until
mid-August in order to quell the contagion, while much of America is
reopening bars and restaurants now and “letting it rip,” as Trump put
it. This isn’t all on Trump. It is also about state governors
pandering to a public enamored of consumption, entertainment and easy
payoffs—promises of big benefits at almost no cost. The irony here is
that polls show that many Americans clearly oppose a hasty and
dangerous reopening.
Americans will have to decide what kind of country they want to be
once Trump is gone, whatever is left of it. It is perfectly fine as an
option to consider that global leadership isn’t all that it was
cracked up to be, or that there was no reason that this should be a
perpetual national goal. I, for one, would prefer excellence and much
more equality in living standards across America, starting with things
like great education and health care for all.
Whatever one’s preference, though, it is probably best to reach a
decision as important as a nation’s shifting purpose after clear-eyed
and extensive discussion. But that looks unlikely. The country seems,
instead, to be at risk of an oblivious fade-out without ever having
seriously contemplated what it once was, both good and bad, and what
it should become.

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Coronavirus: France's first known case 'was in December' BBC #COVID19
Law & Politics


A patient treated in a hospital near Paris on 27 December for
suspected pneumonia actually had the coronavirus, his doctor has said.
This means the virus may have arrived in Europe almost a month earlier
than previously thought.
Dr Yves Cohen said a swab taken at the time was recently tested, and
came back positive for Covid-19.
The patient, who has since recovered, said he had no idea where he
caught the virus as he had not travelled abroad.
The patient, Amirouche Hammar was admitted to hospital on 27 December
exhibiting a dry cough, a fever and trouble breathing - symptoms which
would later become known as main indications of coronavirus.
This was four days before the WHO's China country office was informed
of cases of pneumonia of unknown cause being detected in the Chinese
city of Wuhan.
Mr Hammar told French broadcaster BFMTV that he had not left France
before falling sick.
Dr Cohen said while two of the patient's children had also fallen ill,
his wife had not shown any symptoms.
But Dr Cohen pointed out that the patient's wife worked at a
supermarket near Charles de Gaulle airport and could have come into
contact with people who had recently arrived from China.
The patient's wife said that "often customers would come directly from
the airport, still carrying their suitcases".
"We're wondering whether she was asymptomatic," Dr Cohen said.
Could coronavirus have been circulating in Europe in late 2019, many
weeks before it was officially recognised and declared a threat there?
That is the suggestion being made after a French doctor has revealed
that he treated a patient in Paris with all of the symptoms of
coronavirus just after Christmas.
How does this change what we know about the pandemic? It might be that
the test result is an error and so does not change a thing.
But it if is correct, it could mean spread of the disease was going
unchecked in Europe while all eyes were on the East in Wuhan.
Certainly, any laboratories in Europe with samples from patients sick
with similar symptoms around that time might want to run a test for
coronavirus to see what it reveals so that we can learn more about
this new disease.
Until now, what were thought to have been the France's first three
cases of coronavirus were confirmed on 24 January.
Of those, two had been to Wuhan - where the outbreak was first
detected - and the third was a close family member.
Mr Hammar's positive test result suggests the virus was present in
France much earlier.
The first human-to-human transmission within Europe had until now
thought to have been a German man who was infected by a Chinese
colleague who visited Germany between 19 and 22 January.
Rowland Kao, a professor of veterinary epidemiology and data science
at the University of Edinburgh, said that if confirmed, Mr Hammar's
case highlighted the speed at which an infection starting in a
seemingly remote part of the world could quickly seed infections
elsewhere.
"It means that the lead time we have for assessment and
decision-making can be very short," Prof Kao said.

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Can We Trust the WHO? By F. William Engdahl
Law & Politics


The most influential organization in the world with nominal
responsibility for global health and epidemic issues is the United
Nations’ World Health Organization, WHO, based in Geneva.
What few know is the actual mechanisms of its political control, the
shocking conflicts of interest, corruption and lack of transparency
that permeate the agency that is supposed to be the impartial guide
for getting through the current COVID-19 pandemic.
The following is only part of what has come to public light .
Pandemic declaration?
On January 30 Tedros Adhanom, Director-General of the UN World Health
Organization declared a Public Health Emergency of International
Concern or PHIEC.
This came two days after Tedros met with China President Xi Jinping in
Beijing to discuss the dramatic rise in severe cases of a novel
coronavirus in Wuhan and surrounding areas that had reached dramatic
proportions.
Announcing his emergency PHIEC declaration, Tedros praised the Chinese
quarantine measures, measures highly controversial in public health
and never before in modern times attempted with entire cities, let
alone countries.
At the same time Tedros, curiously, criticized other countries who
were moving to block flights to China to contain the strange new
disease, leading to charges he was unduly defending China.
The first three cases in Wuhan were reported, officially, on December
27, 2019, a full month earlier. The cases were all diagnosed with
pneumonia from a “novel” or new form of SARS Coronavirus.
Important to note is that the largest movement of people in the year,
China’s Lunar New Year and Spring Festival, during which some 400
million citizens move throughout the land to join families went from
January 17 through February 8.
On January 23, at 2am two days before start of actual New Year
festivities, Wuhan authorities declared an unprecedented lockdown of
the entire city of 11 million as of 10am that day.
By then, hundreds of thousands if not several million residents had
fled in panic to avoid the quarantine.
By the time the WHO declared its Public Health Emergency of
International Concern on 30 January, precious weeks had been lost to
contain the disease.
Yet Tedros effusively praised the “unprecedented” Chinese measures and
criticized other countries for placing “stigma” on Chinese by cutting
travel.
In reference to the Wuhan COVID-19 spread and why WHO did not call it
a pandemic, the WHO spokesman, Tarik Jasarevic, stated “There is no
official category (for a pandemic)…WHO does not use the old system of
6 phases — that ranged from phase 1 (no reports of animal influenza
causing human infections) to phase 6 (a pandemic) — that some people
may be familiar with from H1N1 in 2009.”
Then, in an about-face, on March 11, Tedros Adhanom announced for the
first time that WHO was calling the novel coronavirus illness, now
renamed COVID-19, a “global pandemic.”
At that point WHO said there were more than 118,000 cases of COVID-19
in 114 countries, with 4,291 deaths.
2009 WHO Fake Pandemic
Since an earlier WHO fiasco and scandal in 2009 over its declaration
of a global pandemic around the “swine flu” or H1N1 as it was termed,
the WHO decided to drop using the term pandemic. The reason is
indicative of the corruption endemic to the WHO institution.
Just weeks before first reports in 2009 of a young Mexican child being
infected with a novel H1N1 “swine flu” virus in Veracruz, the WHO had
quietly changed the traditional definition of pandemic.
No longer was it necessary a reported disease be extremely widespread
in many countries and extremely deadly or debilitating. It need only
be widespread, like seasonal flu, should WHO “experts” want to declare
pandemic. WHO H1N1 symptoms were the same as a bad cold.
When then-WHO Director-General Dr Margaret Chan officially declared a
Phase 6 global Pandemic emergency, that triggered national emergency
programs including billions of dollars of government purchases of
alleged H1N1 vaccines.
At the end of the 2009 flu season it turned out the deaths due to H1N1
were tiny relative to the normal seasonal flu.
Dr Wolfgang Wodarg, a German physician specialising in Pulmonology,
was then chairman of the Parliamentary Assembly of the Council of
Europe.
In 2009 he called for an inquiry into alleged conflicts of interest
surrounding the EU response to the Swine Flu pandemic.
The Netherlands Parliament as well discovered that Professor Albert
Osterhaus of the Erasmus University in Rotterdam, the person at the
center of the worldwide Swine Flu H1N1 Influenza A 2009 pandemic as
the key advisor to WHO on influenza, was intimately positioned to
personally profit from the billions of euros in vaccines allegedly
aimed at H1N1.
Many of the other WHO scientific experts who advised Dr Chan to
declare pandemic were receiving money directly or indirectly from Big
Pharma including GlaxoSmithKline, Novartis and other major
vaccine-makers.
The WHO Swine Flu Pandemic declaration was a fake. 2009-10 saw the
mildest influenza worldwide since medicine began tracking it. The
pharma giants took in billions in the process.
It was after the 2009 pandemic scandal that the WHO stopped using the
6 phase pandemic declaration and went to the totally vague and
confusing “Public Health Emergency of International Concern.”
But now, Tedros and WHO arbitrarily decided to reintroduce the term
pandemic, admitting though that they are still in the midst of
creating yet a new definition of the term.
“Pandemic” triggers more fear than “Public Health Emergency of
International Concern.”
WHO’s SAGE Still Conflicted
Despite the huge 2009-10 conflict-of-interest scandals linking Big
Pharma to WHO, today the WHO under Tedros has done little to clean out
corruption and conflicts of interest.
The current WHO Scientific Advisory Group of Experts (SAGE) is riddled
with members who receive “financially significant” funds from either
major vaccine makers, or the Bill and Melinda Gates Foundation (BGMF)
or Wellcome Trust.
In the latest posting by WHO of the 15 scientific members of SAGE, no
fewer than 8 had declared interest, by law, of potential conflicts.
In almost every case the significant financial funder of these 8 SAGE
members included the Bill and Melinda Gates Foundation, Merck & Co.
(MSD), Gavi, the Vaccine Alliance (a Gates-funded vaccine group), BMGF
Global Health Scientific Advisory Committee, Pfizer, Novovax, GSK,
Novartis, Gilead, and other leading pharma vaccine players.
So much for independent scientific objectivity at WHO.
Gates and WHO
The fact that many of the members of WHO’s SAGE have financial ties to
the Gates Foundation is highly revealing, even if not surprising.
Today the WHO is primarily financed not by UN member governments, but
by what is called a “public-private partnership” in which private
vaccine companies and the group of Bill Gates-sponsored entities
dominate.
In the latest available financial report of WHO, for December 31,
2017, slightly more than half of the $2+ billion General Fund Budget
of WHO was from private donors or external agencies such as World Bank
or EU.
Far the largest private or non-government funders of WHO are the Bill
and Melinda Gates Foundation together with Gates-funded GAVI Vaccine
Alliance, the Gates-initiated Global Fund to Fight AIDS, Tuberculosis
and Malaria (GFATM). Those three provided more than $474 million to
WHO.
The Bill and Melinda Gates Foundation alone gave a whopping
$324,654,317 to WHO.
By comparison, the largest state donor to WHO, the US Government, gave
$401 million to WHO.
Among other private donors we find the world’s leading vaccine and
drug makers including Gilead Science (currently pressing to have its
drug as treatment for COVID-19), GlaxoSmithKline, Hoffmann-LaRoche,
Sanofi Pasteur, Merck Sharp and Dohme Chibret and Bayer AG.
The drug makers gave tens of millions of dollars to WHO in 2017. This
private pro-vaccine industry support for the WHO agenda from the Gates
Foundation and Big Pharma is more than a simple conflict of interest.
It is a de facto high-jacking of the UN agency responsible for
coordinating worldwide responses to epidemics and disease.
Further, the Gates Foundation, the world’s largest at some $50
billion, invests its tax-exempt dollars in those same vaccine makers
including Merck, Novartis, Pfizer, GlaxoSmithKline.
Against this background it should come as no surprise that Ethiopian
politician, Tedros Adhanom, became head of WHO in 2017. Tedros is the
first WHO director not a medical doctor despite his insistence on
using Dr. as title.
His is a doctor of philosophy in community health for “research
investigating the effects of dams on the transmission of malaria in
the Tigray region of Ethiopia.”
Tedros, who was also Ethiopia Minister of Foreign Affairs until 2016,
met Bill Gates when he was Ethiopian Health Minister and became Board
Chair of the Gates-linked Global Fund Against HIV/AIDS, TB and
Malaria.
Under Tedros, the notorious corruption and conflicts of interest at
WHO have continued, even grown.
According to a recent report by the Australian Broadcasting
Corporation, in 2018 and 2019 under Tedros, the WHO Health Emergencies
Program, the section responsible for the COVID-19 global response, was
cited with the highest risk rating noting the “failure to adequately
finance the program and emergency operations [risks] inadequate
delivery of results at country level.”
The ABC report further found that there has also been a “surge in
internal corruption allegations across the whole of the organisation,
with the detection of multiple schemes aimed at defrauding large sums
of money from the international body.” Not very reassuring.
In early March Oxford University stopped using WHO data on COVID-19
because of repeated errors and inconsistencies the WHO refused to
correct.
The WHO test protocols for coronavirus tests have repeatedly been
cited by various countries including Finland for flaws and false
positives and other defects.
This is the WHO which we now trust to guide us through the worst
health crisis of the past century.

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Currency Markets at a Glance WSJ
World Currencies


Euro 1.0789
Dollar Index 100.197
Japan Yen 106.304
Swiss Franc 0.9755
Pound 1.2329
Aussie 0.6422
India Rupee 76.065
South Korea Won 1226.38
Brazil Real 5.7155
Egypt Pound 15.7595
South Africa Rand 18.6889

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19-APR-2020 :: The End of Vanity China Africa Win Win
World Currencies


And the entire China Africa relationship has been an extraordinary
exercise in Narrative Framing and linguistic control, accompanied by a
chorus of Party Hacks chirruping Hosannas at every turn amplifying
largely meaningless feel good Phrases artfully placed in the mouths of
our Politicians and our Newspapers. It is remarkable.
4/12 Curiosamente, esse período marcou uma das piores décadas para
esse mercado na história. É incontestável a contradição entre esses
números, presumivelmente mais apurados, e os números “criados” pelo
próprio governo comunista Chinês.
4/12 Interestingly, this period marked one of the worst decades for
this market in history. The contradiction between these numbers,
presumably more accurate, and the numbers “created” by the Chinese
communist government is undeniable.

Commodities

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24-FEB-2020 :: The Viral Moment has Arrived #COVID19
Commodities


At this point I would venture Gold is correlated to the #Coronavirus
which is set to turn parabolic and is already non linear and
exponential ~

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02-MAR-2020 :: The #COVID19 and SSA and the R Word
Africa


We Know that the #Coronavirus is exponential, non linear and multiplicative.
what exponential disease propagation looks like in the real world.
Real world exponential growth looks like nothing, nothing, nothing ...
then cluster, cluster, cluster ... then BOOM!

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there is something Karmic in this #COVID19
Africa


The COVID19 is invisible but it has already defeated the most
expensive Aircraft carriers, it lurks everywhere and in silence

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Nigeria Stares Into the Abyss of a Life Without Oil Cash @business
Africa


While headline Brent-crude futures have rallied sharply in the past
few weeks -- rising above $30 a barrel on Tuesday -- a glut of
Nigerian oil is fetching about $10 less than that.
It’s a level that means fiscal revenue for the continent’s biggest
economy has cratered.
“It’s now dawned on everyone across the country how severe this threat
is,” said Andrew Nevin, a partner and chief economist for Nigeria at
PricewaterhouseCoopers LLP.
“There is a possibility that at least for three to five years, there’s
going to be no revenue flowing to the government from oil.”
Nigeria’s plight is playing out across the world: from Venezuela to
Iraq and Iran, petrostates are grappling with the same bleak future --
one where their prized commodity is worth a much less than it was, and
where private companies often still want their cut.
Nigeria is faced with the twin challenge of dealing with the Covid-19
pandemic itself, and a slump in the price of crude, Finance Minister
Zainab Ahmed said in a webinar on Tuesday.
“It’s a double whammy,” she said. “This has set us back significantly.”
Global efforts to fight the spread of coronavirus have driven oil
prices so low that they no longer cover the cost of pumping barrels
for many companies in Nigeria -- let alone providing the government
with crucial cash.
Nevin of PwC said at a webinar on April 30 that when oil prices are at
around $20 a barrel, Nigeria gets very little for its oil. The
commodity normally contributes about half of fiscal revenue.
The rout has been so severe that, having resisted borrowing from the
International Monetary Fund for many years, Nigeria has secured its
first ever loan -- $3.4 billion -- from the Washington-based
organization to help plug some of the holes that appeared in the
country’s 2020 spending plan.
It’s also asked to borrow a further $3.5 billion from other
development institutions, including the World Bank.
As of late April, the IMF was predicting Nigeria’s economy would
shrink by 3.4% this year. Previously, it was anticipating 2% growth.
“It is no longer a secret that government revenues have collapsed,”
said Clement Agba, minister of state for budget and national planning
at the webinar on Tuesday.
Even before the coronavirus halted mass-transportation systems and
trashed oil demand, the rise of U.S. shale oil was already proving
uniquely challenging for Nigeria.
Booming production from shale drastically cut Nigerian exports to the
U.S. -- once the destination for about 40% to 50% of the country’s
cargoes.
Despite near rock-bottom prices, traders said on Tuesday that about a
quarter of Nigeria’s crude oil cargoes for loading this month have yet
to find buyers. They should normally have been sold out by now.
At least six tankers carrying about 4.5 million barrels of the
country’s crude have been floating off Gibraltar and nearby Ceuta --
just inside the entrance to the Mediterranean Sea from the Atlantic --
since as long ago as the end of March, according to tanker tracking
data monitored by Bloomberg.
A seventh vessel is about to join them. In normal markets, those
barrels would go straight to oil refineries for processing into
gasoline, jet fuel and other products.
Nigeria started this year projecting it would sell oil at $57 a
barrel, then it revised that down to $30 a barrel, and then $20.
Oil revenues will decline by $26.5 billion this year, down from $54.5
billion in 2019, according to the IMF.
“This is a period of crisis,” said Fortune Obi, who works for Shell
Nigeria and is a spokesman of the country’s oil union for senior
workers.
“Job losses are imminent across the petroleum industry. The impact of
this will start reflecting from June and July. The reality is that
some members will certainly be impacted. What matters most to us is
how to manage the process of any of such expected exit.”
Another concern in Nigeria is that a period of economic distress could
lead to a return of social unrest that dogged the country as recently
as 2016.
The Niger River Delta, at the heart of Nigeria’s crude production, has
suffered bouts of militancy and violence for years, with oil
facilities targeted by people claiming they were unfairly treated by
the government and big oil companies.
Nigeria’s worst outcome would be that its prices stay low and
production is reduced by renewed unrest.
“A concern is social stability in oil-producing areas as weaker
government support and rising unemployment lead to social discontent,”
said Jeremy Parker, head of business development for West Africa at
Citac Ltd.
“There is a risk that this could lead to spikes in incidences of
politically-motivated vandalism or theft, leading to production
disruption.”
Although oil makes up just 9% of the Nigerian economy, crude exports
bring in more than 90% of foreign exchange earnings.
Non-oil revenues remain one of the lowest in the world, with 65% of
GDP largely dependent on “recycling of petrodollars,” according to the
IMF.
For years, banks have preferred lending to the lucrative oil sector.
With 26% of their loans to firms producing crude, they risk collapsing
if the low prices persist.
Pressure from the government and banks will keep oil wells producing
to sustain dollar inflows even if it’s not economic to do so on paper,
said Cees Uijlenhoed, chief financial officer First Exploration &
Petroleum Plc, an independent producer.
His view, which is more optimistic than many, is that prices will
reach around $50 a barrel by year end, and that Nigeria will be aided
by the destruction of the U.S. shale industry.
The government’s focus will probably be on maximizing its revenue by
curtailing output from high-cost producers, with deep offshore
operators likely to be the hardest hit from such an approach,
Uijlenhoed said, adding that shutting production “leads to zero
cash-flow through the bank accounts and adds to the risk profile.”
The real question is how much Nigeria can afford to lose as a nation,
and how much longer it can withstand those losses, said Kola Karim,
CEO of Shoreline Energy, a big independent producer in the country.
His view is that there should be mandatory oil-production cuts in the
country so that barrels aren’t produced at loss-making levels and
revenue is deferred instead.
“It’s going to get worse,” Karim said. “The problem is a serious one
and it’s not something that’s going to go away easily. I’m not sure
what Nigeria is doing but for me this is an emergency that government
should be attacking like Covid-19.”

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09-DEC-2019 Time to Big Up the Dosage of Quaaludes
Africa


This week Moody’s Investor Services downgraded Nigeria to negative and
we learnt that Foreign Investors are propping up the Naira to the tune
of NGN5.8 trillion ($16 billion) via short-term certificates. Everyone
knows how this story ends. When the music stops, everyone will dash
for the Exit and the currency will collapse just like its collapsing
in Lusaka as we speak.

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06-APR-2020 : The Way we live now
Africa


What I do know is this. Regime implosion is coming to the Oil
Producers and Trump can game the price a little more sure but its a
pointless exercise.
Demand has cratered and a return to a hyper connected 100m barrels per
day world is not going to happen for the foreseeable future.
Putin will survive because he prepared for this moment. Others are as
good as terminated.

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22-MAR-2020 :: COVID-19 and a Rolling Sudden Stop #COVID19
Africa


We are moving from a World of Hyper Connectedness to a World of
Quarantine. A complete Quarantine is the only way to vaccine this
c21st World of ours
#Coronavirus "has started behaving a lot like the once-in-a-century
pathogen we've been worried about." - @BillGates
The Price of Crude Oil is perfectly correlated to the #COVID19 Sudden Stop

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@EdgarCLungu’s largesse Zambia was already a case study in how not to run an economy Then came covid-19 @TheEconomist
Africa


“I feel your pain,” said Edgar Lungu in a televised address on April 24th.
The president of Zambia claimed that covid-19 had “thrown into
disarray” the country’s finances.
He mused about whether the government could afford to pay for
pensions, civil-service salaries and medicine. “Where will the money
come from?”
It is a good question. Zambia is arguably the developing country
facing the biggest debt crisis in the era of covid-19 (see article).
Nearly half of its tax revenues go towards debt service; add the
public wage bill and there is little left.
In 2019 its budget deficit was 10.9% of gdp. Investors are now pricing
its sovereign bonds for default.
Though the pandemic has worsened these problems, it did not cause
them. Rather, it is Mr Lungu’s profligate politics that have weakened
Zambia.
Before his party, the Patriotic Front (pf), took power in 2011,
Zambia’s economy was doing rather well. Over the previous two decades
the Movement for Multi-party Democracy (mmd) had unpicked the
one-party socialism of Kenneth Kaunda, Zambia’s founding president.
Copper mines, which generate 75% of the country’s exports, were
privatised before the commodity boom of the 2000s.
After Zambia was forgiven some loans, its debt as a share of gdp fell
from 104% in 2005 to 25% a year later. Economic growth averaged 7.4% a
year from 2001 to 2010.
The pf has borrowed heavily, splurging on infrastructure and
civil-service pay. In 2015, when Mr Lungu became president, these
trends accelerated.
Debt in foreign currencies or owed to foreigners tripled between 2014
and 2018 relative to gdp.
Compared with the mid-2000s, today’s creditors are more diverse and
interest rates are higher.
Of the roughly $12bn (51% of gdp) of external debt on Zambia’s books
at the end of 2018, about 30% was owed to China, 25% to bondholders
and 19% to foreign banks.
The World Bank, the imf and Western governments hold a relatively small share.
Financial management has been calamitous. Often individual departments
take out loans and the finance ministry only finds out later, notes
Trevor Simumba, a consultant who has written extensively on Zambian
debt.
This has encouraged, for example, the purchase of a presidential
Gulfstream jet and other planes.
Then there are loans that have been authorised but do not yet show up
in official figures. These added up to about $10bn in April 2019,
according to analysis by the imf and the World Bank. Most are owed to
China for infrastructure.
Since these loans may include the underlying asset as collateral, they
have led to speculation that any restructuring of Zambian debt to
China could involve the handing over of roads, airports or perhaps
even mines. (Zambia denies this.)
A short-sighted search for revenue is one reason why Zambia has taken
a hostile approach to its mining sector. Taxes on mining are among the
highest in the world, says ey, a consultancy.
Miners say they are owed more than $1bn in vat refunds. In May 2019
the government went to court to, in effect, grab Konkola Copper Mines,
which is mostly owned by Vedanta, an Indian company. The case rumbles
on.
Zambia has picked a strange time for a spasm of resource nationalism.
Mining firms, and thus taxes and royalties, have been hit by the
collapse in global demand.
The price of copper has fallen by 16% this year. Zambia produced more
than 800,000 tonnes in 2019; one miner says he would be “astonished”
if the country produced more than 700,000 in 2020.
The effects of covid-19 were cited by Glencore when it said on April
7th that it would stop operations at its Mopani mine. Eight days later
the firm’s local boss, Nathan Bullock, was stopped from leaving the
country and temporarily detained (he has now left).
The government is in talks with Glencore over reopening the mine.
On April 20th Bwalya Ngandu, the finance minister, said that Zambia
had asked multilateral lenders, including the imf, for help.
Yet the Fund will lend only to countries it believes are getting their
borrowing under control.
To that end, the finance minister has suspended some projects,
advertised for debt advisers to try to renegotiate its commercial
loans, and is in talks with Chinese lenders.
Is it enough? Mr Ngandu is a trusted technocrat. But that still leaves
Mr Lungu. Under his presidency Zambia has become more corrupt by some
international yardsticks.
Dodgy procurement deals, from 42 fire engines bought for $1m each to
inflated contracts to build roads, have been alleged.
The Financial Intelligence Centre, a watchdog, reckoned the value of
money-laundering and shady transactions had leapt to $520m in 2018
from $382m in 2017.
Mr Lungu is also becoming more authoritarian. In 2017 Hakainde
Hichilema, an opposition politician, was detained for four months on
charges of endangering the president after not making way for his
motorcade.
In March Prime tv, an independent channel, had its licence suspended.
Most worrying is a bill before parliament that would give sweeping
powers to the presidency. Muna Ndulo, a Zambian law professor at
Cornell University, calls it a recipe for a “constitutional
dictatorship”.
The president is eyeing re-election in August 2021. He may struggle in
a fair fight against Mr Hichilema; previous votes have been marred by
allegations of rigging.
His stance on mines is partly to shore up support in the copper belt,
a former pf stronghold where it lost a by-election in 2019.
His reluctance to put a stop to borrowing for pet projects reflects
his concern that he may not win his party’s nomination in July. Mr
Lungu was a compromise candidate after the death of Michael Sata in
office in 2014.
But members of the large Bemba ethnic group, who were pre-eminent
under Sata, have become frustrated with the president. Mr Lungu, who
is from the smaller Nsenga group, is accused of favouring other
ethnicities. Some Bemba want Mr Ngandu to take over.
Mr Lungu has been somewhat unlucky. Disease and drought have both hurt
the economy. Being a landlocked country at a time of closed borders is
difficult. But it is not the virus that has got Zambia into this mess.
It is the president. ■

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14-OCT-2019 :: Ozymandias The Canary in the Coal Mine is Zambia.
Africa


“Investors have lost faith in government promises to get spending
under control and the government has fallen out with the IMF as well,”
he said.
It seems to me that we are at a pivot moment and we can keep
regurgitating the same old Mantras like a stuck record and if we do
that this turns Ozymandias
''My name is Ozymandias, King of Kings;
Look on my Works, ye Mighty, and despair!
Nothing beside remains. Round the decay
Of that colossal Wreck, boundless and bare. The lone and level sands
stretch far away.”

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THE WORLD THROUGH A LENS Madagascar: A Cornucopia of Beauty @nytimes
Africa


Situated some 250 miles off the coast of southeast Africa, Madagascar
— the fourth largest island on Earth — is a world of its own.
Sometimes referred to as the eighth continent, Madagascar split from
the Indian subcontinent 88 million years ago and the African mainland
some 47 million years before that, so it is perhaps not surprising
that about 90 percent of its fauna and flora is found nowhere else on
earth.
Much of the island’s megafauna (including nearly 10-foot-tall elephant
birds and lemurs the size of gorillas) has been driven to extinction.
And some 90 percent of the original forest habitat here has been lost
since humans first arrived some 2,000 years ago — first from the Malay
Archipelago and, much later, from mainland Africa, Arabia, India and
Europe.
I spent several days slowly traveling by boat down the Tsiribihina
River. I learned about razana (ancestor spirits) and fady (taboos,
hundreds of which dictate much of local life) from the crew around the
campfire in the evenings. We slept under the stars and finally arrived
at the spectacular limestone mazes of Tsingy de Bemaraha — which aptly
means “where one cannot walk barefoot.”

Kenya

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@IMFNews Executive Board Approves a US$739 Million Disbursement to Kenya to Address the Impact of the COVID-19 Pandemic
Africa


The IMF approved the disbursement of US$739 million to be drawn under
the Rapid Credit Facility to support the authorities’ response to the
COVID-19 pandemic.
The impact of COVID-19 on the Kenyan economy will be severe. It will
act through both global and domestic channels, and downside risks
remain large.
While the authorities have taken decisive action to respond to the
pandemic’s health and economic impacts, the sudden shock has left
Kenya with significant fiscal and external financing needs.
Authorities have committed to resume their fiscal consolidation plans
once the crisis abates to reduce debt vulnerabilities.
“To ensure that COVID-19 related resources are used for their intended
purpose, the authorities plan to conduct independent post-crisis
auditing of COVID-19 related expenditures and publish the results.”

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Tourism has been the hardest hit sector - it is operating at zero capacity and with a longer perception risk. Also horticulture - freight costs are 50-60% higher than 3 months ago - @jibz555 @StanbicKE @bankelele
Africa


Tourism has been the hardest hit sector - it is operating at zero
capacity and with a longer perception risk. Also horticulture - and
while some cargo flights have resumed, freight costs are 50-60% higher
than 3 months ago - @jibz555 @StanbicKE

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@jibz555 I like you see Tourism stopped out but increasingly see it as a seminal moment.
Africa


A vaccine in my opinion is unlikely for 18 months if that and I feel
behavior and consumption of Tourism is set to change more permanently.

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by Aly Khan Satchu (www.rich.co.ke)
 
 
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May 2020
 
 
 
 
 
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