Realtor Trump Faces End of Ukraine, Resurgence of Hamas/Hezbollah.

No Beach Parties for Donald Snr & Jnr.

New readers should know that my Substack posts are dedicated to surveillance of matters related to a central premise, and that premise, put at its simplest, is that the collective West, made ever more desperate and ruthless because of its unsustainable debt load, is attempting to beat back the multiple forces of multipolarity. It is currently doing this on three main fronts: against Russia over the proxy excuse of defending Ukraine; against Iran over the proxy excuse of defending Israel; against China over the proxy excuse of defending Taiwan. But there is no limit to the number of fronts that the West will entertain.

Four Happy Young Israeli Women

Just as Donald Trump goes full sociopath and in his casually repugnant manner places a beach view and billionaire property investment opportunities above the deaths of up to 200,000 or more Palestinians, and as the 1.5 million to 2 million living survivors of Biden-Trump genocide policies, their broad, resilient columns marching homewards, and in hope, to the devastation of northern Gaza, Hamas releases four young female Israeli hostages.

They look well, these girls, praising Hamas’ al-Qassam brigades, grateful for being kept humanely alive, and healthy. They are released to Israel amidst the serried ranks of disciplined, immaculately uniformed Hamas military who confidently exert their authority over the fateful strip.

And all of the sudden Israelis understand that Netanyahu and his extremist aparatchiks have sold them a bill of goods. Hamas is not defeated, nor, further north in Lebanon, is Hezbollah, whose members now journey southwards to confront Israeli forces who should have left yesterday.

In the face of this realization, Israelis are poised to see the peace process through to its end. They yearn to receive - smiling and happy - all the other hostages, notwithstanding the putrid hate of the likes of Smotrich, and Givir (already on their way out) who think the only good peace process is one they can routinely violate and destroy. And as Netanyahu appears, humbled, in a court of law, to be tried on charges of bribery and corruption they may begin to pick up the smell of corruption beneath the manufactured Israeli narrative of October 7th. This is far from being a strong administration and if it risks playing games with the ceasefire, which is of course the Netanyahu standard operating procedure, who can tell the consequences for Israel. Netanyahu has recently suffered ill-health; his wife and son are in Florida and will likely stay there. Relations between father and son are reportedly not good, with rumors of a recent physical altercation between them. His personal decline may prefigure the nation’s.

This is beginning to look a whole lot less than a glorious new Zion and more a multi-frontal catastrophe, its putryfying bloody intestines spilled out across at least three nations of West Asia, offering nothing good for the future of Israel if it has one. In Lebanon, Hezbollah has further exposed the mendacity of Israel and the treacherous weakness of the Lebanese political system, of the Lebanese army and of their Western would-be sponsors.

Six More Months for Ukraine

Early today, January 27th (California time), there were multiple reports that Kyrylo Budanov, Ukraine’s head of State Intelligence had told a closed meeting in the Verkhovna Rada in Kiev that if Ukraine had not achieved a peaceful settlement or at least if it was not by that time engaged in serious negotiation by the summer of this year “then very dangerous processes for the very existence of Ukraine can begin.”

If these reports are true (and some later sources are suggesting that they may not be true or that Budanov has been misquoted or that his comments have been misunderstood), then they coincide with two other significant developments. (I would note, before I proceed, that there have been signs recently either of Budanov’s disaffection with the Zelenskiy mob, or their disaffection with him).

The first companion development is that the Rada is only two days away from giving its consent to a bill to reduce the age of mobilization to 18. The measure follows the urging of politicians across the collective West - the same ones, pretty much, who are absolutely fine with the genocide of Palestinians, the seizure of beachfront for New York property developers and with profit for the West and Israel from maritime gas deposits, and who, as though in paen to box office takings for Nosfaratu, display vampiric lust for young blood, and comic self-delusion by their claim that Ukraine is a “democracy,” or that their own plutocratic corporatocracies could be similarly described.

In theory, mobilization of the 18-24 year old male population, might raise an additional army of 300,000. Russia currently fields 450,000 active soldiers in Ukraine; Ukraine’s army now numbers around 250,000. However, Ukraine’s most recent, previous mobilization fell well short of its target. The newly proposed mobilization, even in the face of cruel measures to stop it, will provoke another mass flight from Ukraine. Those who are mobilized, by definition, will be very young and militarily inexperienced. The thought that the mobilization, meaningful professional training and deployment can be funded and executed by the summer of 2025 invites ridicule.

The second companion development is the publication in a dissident online Ukrainian publication (based outside of Ukraine for obvious reasons), Strana (Strana), of a document that purports to be an outline of a peace agreement, one that the publication claims to have been sent by sources close to the Trump administration to interlocuters in Europe.

Alexander Mercouris, in his broadcast today, suspects it is actually a “float” that originates from Ukraine’s Budanov himself. Mercouris, I should say, runs an excellent and generally insightful daily YouTube commentary, well attuned to multiple Russian publications and other sources. It is sister to a show which Mercouris jointly runs with Alexander Christoforu under “The Duran” brand, and one that can certainly be described as “pro-Russian,” given its prevailing sympathy (which, overall, I happen to share) for the Russian position on NATO’s proxy war with Russia over Ukraine. I note he is actually cited in an article today in the Russian publication Izvestia.

The key points in the document indicate a preparedness by whoever penned it to negotiate on the basis of a commitment to Ukrainian neutrality; a change in the constitution of Ukraine to divest Ukraine from its commitment to joining NATO; ratification by NATO of Ukrainian neutrality; Russia to hold on to the territories that it currently occupies but without Ukraine being obliged to officially recognize these territories as Russian; the lifting by Ukraine of restrictions on the use of Russian language, Russian culture and media, the Russian Orthodox Church; new presidential and, I presume, RADA elections; Ukraine to proceed in its bid to join the European Union (with the expectation that it would join by 2030); Ukraine retaining the right to as large a military as it chooses and for the US to support this military as it wishes.

Such a negotiating position makes no mention of US guarantees for Ukraine, nor of US involvement in the reconstruction of Ukraine. It leaves to a separate negotiation considerations of a “peace-keeping” force.

If this is indeed an indication of an initial negotiating position on the part either of the Trump administration or of Ukraine, or both, I do not believe it deserves to get outside the door.

There is absolutely no good reason why Russia should trust Ukraine, or Trump or European leaders, who can sign a piece of paper one day (like the Minsk accords, like the Istanbul agreement of 2022) and walk away from it the next. NATO is absolutely commited to its victory over Russia on Ukraine and there is no reason to think it will simply abandon this; but, at the same time, there is no reason, either, to expect that all NATO members would agree to the terms of the proposed negotiation (bearing in mind, for example, that the UK has just laughably signed a 100-year agreement to support Ukraine).

I do not believe that Ukraine should be allowed to join the European Union. Just as in the case of NATO, Ukrainian membership will likely increase rather than reduce the fractures within both institutions. The EU is increasingly indistinguishable from NATO, and I do not see EU membership for Ukraine as compatible with the idea of Ukrainian neutrality. Of course, in the event of US abandonment of NATO, there is a big question mark over the survivability of NATO (the US provides 60% or more of its budget), and while the US economy continues to grow on the back of crushing the European, the future of the EU itself is somewhat bleak.

Russia would be ill advised to agree to retain control only of the territories that it today occupies without securing, at the very least, a recognition that the full territories of Donetsk, Luhansk, Zapporizhzhia and Kherson are Russian. I further believe that Russian security - in the light of the war, of Ukraine’s unwillingness so far to compromise, and the continuing hostility of Western Ukraine and of Europe towards Russia - requires that Russia secures control of Kharkiv (it is well on its way to doing this), Kherson, and, I would argue, Odessa and, perhaps, Kiev itself.

Allowing Ukraine the right to mobilize any size of army, with any degree of support from the US, I am certain, will be totally unacceptable to Russia. Likewise, the absence of meaningful action to suppress Ukrainian Banderite movements is merely an invitation to Ukraine to reactivate these at any time.

In short this document might appear to many, and is perhaps intended by Budanov, as a trap to Russia (though Moscow is far too intelligent to fall into it) and which, were it to be implemented, would, like the Minsk accords, be exploited by NATO and Ukraine as a way of buying time for the rearmament of Ukraine and preparation for a new phase to the war.

Were Russia even to consider such a document as a starting point, who would it negotiate with? In October 2022, Zelenskiy issued an edict prohibiting negotiations with Putin. He now claims, falsely, that it was always intended that the edict would not apply to himself. In any case, Russia up until now has taken the position, very wisely in my view, that it cannot negotiate with a President whose hold on power is no longer legal under the terms of Ukraine’s own constitution.

Furthermore, there is no good reason whatsoever why Russia would trust that Zelenskiy is capable of negotiating in good faith. Far better, some commentators conclude, that any negotiations to end the war take place between the US, Russia and possibly China, and exclude both Ukraine and Europe, parties who only know how to act as “spoilers” - in part because Zelenskiy is notoriously obdurate (and may fear for his life at the hands of the Banderites), and because Europe is desperate to keep the US in Europe.

In the hands of the US and Russia, particularly, there is a better chance of pitching negotiations at the “Yalta 2” level, a degree of altitude which would permit discussion of new security architectures for Europe, and for the world. Having been reacquainted with Trump over the past few days, I do not believe that either Trump himself, or his administration have either the intellectual capacity, or sufficient material interest in any such ambition. Poor Europe, poor World.

Negotiations

Glenn Diesen, in his Substack column has provided a useful history of the (unlikely) prospects for any such negotiation. He notes that the foundation for a pan-European security architecture to mitigate security competition was born with the Helsinki Accords in 1975. This established common rules of the game for the capitalist West and the communist East in Europe, and inspired Gorbachev’s “new thinking,” leading to the Soviet reduction of tis military strength and withdrawal from the territory of Warsaw Pact allies.

The 1990 Charter of Paris for a New Europe laid the foundation for a new inclusive pan-European security that recognised the principle of “the ending of the division of Europe” and pursuit of indivisible security (security for all or security for none). This was concretized by the foundation of the Organisation for Security and Cooperation in Europe (OSCE) in 1994. Signatories agreed that they would not strengthen their security at the expense of the security of other States. But this principal was quickly tossed to one side by NATO which, as Charles de Gaulle once noted, was an instrument for US primacy from across the Atlantic.

The decision to expand NATO cancelled the pan-European security agreements at the expense of Russia’s security. In response, Russian leaders Yeltsin and Putin attempted to enter NATO and to create a larger Europe, but were rebuffed. In 2008, Moscow proposed constructing a new pan-European security architecture. This was opposed by Western states as it would weaken the primacy of NATO. In 2010, Moscow proposed an EU-Russia Free Trade Zone, but all such proposals for a Helsinki-II agreement were ignored or criticised.

“It was evident that redividing the continent would recreate the logic of the Cold War, and it was equally evident that a divided Europe would be less prosperous, less secure, less stable, and less relevant in the world. Yet, arguing for not dividing the continent is consistently demonised as taking Russia’s side in a divided Europe. Any deviation from NATO’s narratives comes with a high social cost as dissidents are smeared, censored and cancelled. The combination of ignorance and dishonesty by the Western political-media elites has thus prevented any course correction”.

Russian Casualties and Russian Economy

In recent weeks, guests on Judge Napolitano’s daily YouTube show, in particular the former CIA analysts Larry Johnson and Ray McGovern, have persistently returned to the theme of the manipulation of the Presidential “informational environment” (my term) by bad actors at the top of the intelligence agencies, in particular the CIA (think Brennon and Russiagate) and FBI (think Comey and Russiagate).

Today Larry Johnson charges that the CIA is providing the President with inaccurate, false intelligence about Russia’s casualties and the condition of its economy. On Russian casualties, Johnson notes that the best dependable source is Mediazona, founded by Maria Alyokhina and Nadezhda Tolokonnikova, who are also co-founders of the protest group and band Pussy Riot. The outlet is ideologically opposed to Vladimir Putin and employs a multi-faceted eight-fold methodology to track Russian casualties in the Ukraine war.

“According to Mediazona’s latest data, there are 88,726 confirmed Russian combat deaths since February 2022. Mediazona estimates, using probate registry data, that the number may be as high as 120,000.”

On the question of the economy, Johnson cites the latest IMF projections to the effect that Russia’s economy is expected to grow by 1.4% in 2025, a slight increase from their previous forecast of 1.3%. This represents a slowdown from the estimated 3.8% growth in 2024. The IMF attributes this slowdown to Russia’s transition from a “war economy,” inflation in Russia at 8.3% in 2024, and monetary tightening, which is how the Central Bank of Russia responds to inflation leading it to raise interest rates to 21% and in that way to weigh down economic activity.

Reasons for optimism over the Russian economy are GDP growth, low unemployment (2.6% in 2024), rising global economic status (Russia has overtaken Germany and Japan to become the fourth-largest economy in the world when measured by purchasing power parity), increased investment and trade surplus (Russia enjoyed a surplus of $50.2 billion in 2023 and $40.6 billion in the first half of 2024).

Starmer in Ukraine

The Russian Ambassador to London, Endrei Kelin, has said that the reason for British Prime Minister Keir Starmer's trip to Kiev on 16 January was to promote the inadmissibility of a peaceful settlement of the conflict in Ukraine. Kelin noted betrayal in the document of "the colonial thinking characteristic of the British ruling class of the XIX century,” which he says has not been eradicated to this day. London is driven, he says, by the idea of enslaving Ukraine".

Going After Mexico

The Economist (Economist) today reports on Trump’s order that Mexico’s criminal gangs be designated as foreign terrorist organisations (FTOs). Additionally, he has:

“Declared an emergency at the southern border, reinstated policies that leave migrants languishing on Mexican soil and ordered federal institutions to call the Gulf of Mexico the “Gulf of America”. He broke his promise to impose a 25% tariff on goods imported from Mexico and Canada on “day one”, but ordered an investigation of trade imbalances and rambled about a new date for imposing tariffs, February 1st”.

Republican officials argue that by trafficking fentanyl into the United States, the gangs have killed more Americans than groups like Islamic State and Hamas (and, like one commentator I read today, one should note that Israel has killed more Americans than Iran). The designation paves the way for the United States to take unilateral military action in Mexico. The idea of unilateral military action is no longer fringe.

Thousands of migrants hoping to enter the United States legally are now stuck there after Mr Trump closed all pathways to do so. Mr Trump reinstated Remain in Mexico, a policy from his first term which requires asylum-seekers to wait in Mexico for their hearings. His declaration of an emergency helps him to seal the border, including by deploying the army. Trump is following through on his threat to deport “millions” of people who entered the United States illegally; some 5m of them are Mexican.

The next two weeks are likely to see a flurry of activity to try to ward off the tariffs that Mr Trump has said will come on February 1st.

More Chips for China and the DeepSeek Shock

Following my recent posts on Chinese advances in fusion energy, Belt and Road, AI and electrical vehicles comes the news that China’s AI firm DeepSeek has revealed the technical recipe for its cutting-edge model, (FT).

DeepSeek, founded by hedge fund manager Liang Wenfeng, has shown how to build a large language model on a bootstrapped budget that can automatically learn and improve itself without human supervision. In doing so it has thrown stock markets into chaos and sparked a frenzied debate in Silicon Valley. Chinese start-ups such as DeepSeek are challenging global AI giants. After Washington banned Nvidia from exporting its most powerful chips to China, local AI companies have been forced to find innovative ways to maximise the computing power of a limited number of onshore chipsunderstand how to get the best use of computing resources to train and run models more cheaply.

In the meantime, Chinese news agency Xinhua reports that at least five Chinese provinces or municipalities, including Shanghai, Guangdong, Zhejiang and Liaoning, have proposed blueprints to boost the semiconductor industry, considered a critical "bottleneck" sector in China.

Beijing is set to accelerate production capacity for major integrated circuit projects while supporting relevant firms to withstand external pressures. These impact the new energy vehicle (NEV) manufacturing field, smart and connected vehicle technologies, building pilot cities for the national "vehicle-road-cloud integration" initiative.

Multiple provinces have introduced "AI plus" plans, with Beijing targeting the construction of two 10,000-card intelligent computing clusters. Guangdong is focusing on enhancing the application of general and industry-specific large language models (LLMs). Shanghai and Sichuan have identified brain-computer interfaces as a key technological frontier, while Anhui targets building a fusion reactor research facility. The eastern province of Anhui is advancing an international lunar research station project, while Shanghai, home to the C919 aircraft manufacturing, is pushing to grow its large aircraft industry. Hainan, China's southern island province, has prioritized marine-related industries, accelerating offshore wind farm construction while pioneering a landmark offshore wind-to-hydrogen demonstration project.

Agitating Venezuela

Along with all the others sources of Trumpian agitation in foreign affairs (including Greenland, Canada, Mexico, Panama, Iran and Taiwan) a recent piece in the New York Times is advocating “military intervention” to promote “democracy” by overturning the democratically elected government of Venezuela ( write Francisco Dominguez and Roger D. Harris for Popular Resistance).

The piece by neocon journalist Bret Stephens argues a moral basis for deposing the current president on the grounds of claims that he stole the election, terrorizes his opponents, and brutalizes his people with no sign of letting up, much less letting go. Every other option for political change, it contends, has been attempted. Not only that, but Venezuela maintains friendly relations with “our enemies” such as China, Russia, and Iran.

The authors deconstruct this argument. Like the paper itself they note that Venezuelans for 25 years have been successful in defending their sovereignty and self-determination against violent regime-change efforts by the US and its allies. Even though punishing sanctions initially devastated the economy, Venezuela is experiencing among the highest GDP increases in the hemisphere.

The article appeared four days after Maduro was inaugurated for a third term. It worries that the US has “failed to bring the regime down.” But it has led to 100,000 mortalities, none the less. The US unilaterally proclaims that Edmundo González Urrutia is Venezuela’s “rightful president.” Urrutia in turn is the surrogate for María Corina Machado, the US-designated “leader” of the far-right insurrectionary opposition.

The authors find that González’s electoral victory claims are not backed up by data in his campaign’s possession. Machado rejected the results on the evening of election day itself but failed to submit evidence to the election authority about her claim. González refused to hand over these data to the investigation carried out by Venezuela’s supreme court, but built a website which posted dubious election data.

The authors address a number of other falsehoods. While it is true that millions of Venezuelans have left the country, they say Stephens omits that worsening conditions were deliberately created by the US with over 900 illegal unilateral coercive measures. What they describe as asphyxiating sanctions were imposed by the US precisely to cause pain, in a policy which the Trump administration labelled “maximum pressure.” The Times piece charactgerizes Venezuela as a narcotic regime, simply on the basis of cocaine, traffic most of which comes from Colombia and almost all of which is consumed in the US, traffic in which about the only thing that the US has apparently been unable to block, despite 10 military bases in the region, is cocaine.

Hudson on Trump Tariffs

Michael Hudson warns that Trump’s protectionist policies threaten to radically unbalance the balance of payments and exchange rates throughout the world (Hudson). They are preventing debtor countries from earning the dollars needed to pay their foreign debts. This makes a financial rupture inevitable. Germany and Europe, amongst others, will become sacrificial offerings in desperate but futile effort to save the US.

“Imposing a 20% tariff or other trade barriers on Mexico and other countries would be a fatal blow to their exchange rates by reducing the export trade that U.S. policy promoted starting under President Carter to promote an outsourcing of U.S. employment by using Mexican labor to keep down U.S. wage rates”.

“The creation of NAFTA under Bill Clinton led to a long line of maquiladora assembly plants just south of the U.S.-Mexico border, employing low-wage Mexican labor on assembly lines set up by U.S. companies to save labor costs. Tariffs would abruptly deprive Mexico of the dollars received to pay pesos to this labor force, and also would raise costs for their U.S. parent companies.

“The result of these two Trump policies would be a plunge in Mexico’s source of dollars. This will force Mexico to make a choice: If it passively accepts these terms, the peso’s currency exchange rate will depreciate. This will make imports (priced in dollars on a worldwide level) more expensive in peso terms, leading to a substantial jump in domestic inflation.

“Alternatively, Mexico can put its economy first and say that the trade and payments disruption caused by Trump’s tariff action prevents it from paying its dollar debts to bondholders…

“Canada faces a similar balance-of-payments squeeze. Its counterpart to Mexico’s maquiladora plants are its auto-parts plants in Windsor, across the river from Detroit. In the 1970s the two countries agreed on the Auto Pact, allocating what assembly plants would work on in their joint production of U.S. autos and trucks...

“There is a basic illusory moral principle of reciprocity at work in Trump’s tariff and trade threats, and it underlies the broad narrative by which the United States has sought to rationalize its unipolar domination of the world economy. But the United States did not permit foreign imports to compete with its own producers. And for debtors, the price of monetary austerity was not more competitive export production but economic disruption and chaos.

“Circumstances thus are forcing the world to break away from the U.S.-centered financial order. The U.S. dollar’s exchange rate is going to soar in the short term, as a result of Trump blocking imports with tariffs and trade sanctions…

“Trump is telling the rest of the world that they must be losers – and accept the fact graciously in payment for the military protection that it provides the world, in case Russia might invade Europe or China might send its army into Taiwan, Japan, or elsewhere.

“Trump bases his attempt to tear up the existing linkages and reciprocity of international trade and finance on the assumption that, in a chaotic grab-bag, America will come out on top. That confidence underlies his willingness to pull out today’s geopolitical interconnections.

In a not entirely dissimilar vein Financial Times, Ruchir Sharma writes that the world is moving on to trade without the US (FT)

“Retaliation is not the only or even the most likely response to Trump, no matter how broadly he finally delivers on his threats. The US has wielded tariffs as a weapon for eight years now. Those imposed by Trump in his first term were mostly continued or — in the case of China — expanded by Joe Biden. Some nations retaliated; others offered concessions or challenged them before global trade arbiters. But most just quietly moved on, seeking trade with countries other than the US. Since 2017, Trump’s first year in office, trade has held more or less steady at just under 60 per cent of global GDP.

“But there’s been a decline in the US share of trade flows offset by an increase in other regions, particularly the nations of Asia, Europe and the Middle East. Trump 2.0 seems likely to bring more of the same: trade without America. Over the past eight years, more than four of every five nations — developed and developing — have seen trade rise as a share of their national GDP. Gains of more than 10 percentage points have been chalked up in more than a dozen major nations, from Japan, Italy and Sweden to Vietnam, Greece and Turkey. The big exception is the US, where it has dipped to around 25 per cent of GDP.

“The US has been growing faster than most of its peers — but with no boost from trade. America may be increasingly dominant as a financial and economic superpower but not so much as a trading power. Its share of global equity indices has exploded to almost 70 per cent. Its share of global GDP has inched up to more than 25 per cent. Yet its share of global trade is under 15 per cent, and has declined significantly in the last eight years.

(Following the financial crisis of 2008), “the number of bilateral and regional agreements rose steadily, with fresh impetus after Trump first took office, and soon styled himself “tariff man”. The US became an outlier, looking on as others cultivated the art of the trade deal. Since 2017, the US has abandoned talks on partnerships with the EU and Asia, and cut not a single new trade deal. Meanwhile, the EU has negotiated eight agreements and China has concluded nine, including a landmark 15-nation partnership in Asia. By late last year, dealmaking picked up anew as the start of Trump’s second presidency approached. The EU rushed to finish the outline of a difficult agreement — 25 years in the making — with members of the Mercosur alliance in South America, followed by one with Mexico.

“Now, Mexico is hurrying to widen trade ties with fellow nations in Latin America, in part as insurance against what Trump might do next. The result: over the past eight years, as the locus of global trade shifted away from the US and towards the Middle East, Europe and Asia, nations registering big share gains included the United Arab Emirates, Poland and, above all, China.

“Of the 10 fastest-growing trade corridors, five have one terminus in China; only two have a terminus in the US. Trump says tariffs will command respect, and help restore US power. But there’s another risk worth considering. The new president’s brand of populism vows to free the US from heavy government intervention through taxes and regulations, but tariffs are another form — and equally subject to the laws of unintended consequences. To date, the “America first” tariff regime has done less to damage its prime target, China, than to compel US allies to look elsewhere for trade. So the risk of even broader tariffs may be less about triggering trade wars than undermining US relevance as a trading power, and eventually sapping its economic prowess”.