One number to consider. Uniper probably is paying currently ~€30 million extra for the gas it’s buying in the spot market. Multiply that for 365 days: ~€11 billion. And that’s one single European utility. Now think about other big buyers of Russian gas. And start multiplying. https://t.co/6hKzinI7Pw— Javier Blas (@JavierBlas) June 30, 2022
… Deutsche Bank’s chief FX strategist George Saravelos penned a note in which he said that he was becoming increasingly concerned about the unfolding energy situation in Germany.
Here’s why: two weeks ago, Russia reduced Nordstream gas flows by 60% on the back of an alleged disruption over Siemens part supplies (chart 1). While the immediate availability of gas in Germany is not an issue, the energy market is starting to price a risk of a complete disruption to gas supplies for winter, and year-ahead natural gas prices are making fresh record highs (chart 2).
Most concerning however, is the skyrocketing price of electricity. Prices for 2023 delivery have also soared to all-time highs and have now tripled from the start of the year (chart 3). French and Italian electricity prices are similarly soaring. Which brings us tot he abovementioned collapse in the share price of Germany’s largest utility gas consumer, which just dropped to record lows amid speculation of an imminent bailout (chart 4).
As the DB strategist admits, his underlying assumption this year was that gas supplies to Europe would continue: even though the Nordstream pipeline is set to shut for ten days during July 11-21 for regular maintenance, press reports suggest that authorities are attempting to find a solution on sanctions restrictions to move gas turbine components back to Russia. Yet the German government is stating that disruptions are politically motivated and there are risks supply may be completely shut off.
So, as Saravelos warns, if the gas shutoff is not resolved in coming weeks this would lead to a broadening out of energy disruption with material upfront effects on economic growth, and of course much higher inflation, or as he puts it, “beyond the market’s worries about slower global growth in recent months, what is unfolding in Europe in recent days is a fresh big negative supply shock.”
If so, it would clearly make the ECB’s job more difficult and their reaction function ambivalent. But as far as the EUR/USD exchange rate goes, it would provide clear downside as not only would the energy import bill rise due to even higher prices, but it would raise the risk of an imminent German recession on the back of energy rationing. So while DB’s EUR/USD forecasts imply a range-bound euro over the summer months, the bank’s chjef FX strategist is worried that the energy situation is providing clear downside risks.
As for July 22, or a Friday three weeks from today, fellow DB strategist Jim Reid asks whether this could be the most important day of the year: “while we all spend most of our market time thinking about the Fed and a recession, I suspect what happens to Russian gas in H2 is potentially an even bigger story. Of course by July 22nd parts may have be found and the supply might start to normalise. Anyone who tells you they know what is going to happen here is guessing but as minimum it should be a huge focal point for everyone in markets.”
While I don’t fully agree with Sundance on this—nor with Tom Luongo (below)—that may not matter. At a certain point, if enough tripwires are set, things can go: Boom! These are the tripwires that Sundance and Luongo see:
BREAKING: @POTUS announces new US military deployments to Europe:
1. Create permanent HQ for US 5th Army Corps in Poland
2. Deploy additional rotational brigade to Romania
3. Deploy 2 additional F-35 squadrons to the UK
4. “Enhance” rotational deployments in Baltics
5. Deploy 2 additional Navy destroyers to Spain, bringing total from 4 to 6
6. Deploy “additional” air defense to Germany, Italy
So it seems like a good time to offer an explanation of what the Russian way of war actually is, to the extent that we can glean it second hand from what’s going on in Ukraine. I came across an interesting twitter thread today that sets this all out. Who is this guy? I don’t really know, but it seems sensible to me. If it seems otherwise to you, well, comments are enabled. So we’ll look at that first:
I’ve watched a LOT of drone footage from this war. I’ve seen, from a bird’s eye view, the construction and logic of the field fortifications Ukraine constructed, with US guidance, over the course of eight years.
The logic of these ubiquitous pre-prepared fortifications harkens back to the 1864-65 Battle of Petersburg (US Civil War), with many WW1 innovations – a logic where victory depends on:
– you not running out of men and ammo
– the enemy being comparatively stupid
Of course, when you think about it, the revealed logic of Ukraine’s long-prepared strategy for this war is, in many ways, a reflection of American military delusions and vanities, which multiplied and solidified over the course of the brief and fleeting “unipolar moment”.
Despite not having “won” a war since 1945 (and then only truly against the Japanese), the US military is consumed with the vanity that it has *always* dominated opposing forces in every conflict.
There is some measure of truth in this perspective.
But it is irrelevant. Because, since no later than the Korean War, the US has not faced a peer or near-peer adversary in a high-intensity conflict. The US military has not been, for almost three-quarters of century, truly tested “under-fire”.
This is an indisputable fact.
The US has measured its battlefield mettle, for decades, against brave sandal-shod men with AK-47s, RPGs, and a certain savoir faire for constructing IEDs.
But they have *never* faced anything like Russian artillery or missiles. Not even in Hollywood movies or video games.
Consequently, the Pentagon’s self-perception of unquestioned supremacy has served to disinform and corrupt its doctrinal and procurement decisions for multiple generations of its officer corps. For most US generals and admirals, all putative opponents are underestimated.
This morning I saw, somewhere, someone quoting Scott Ritter, who says that for many years the US has not trained for maneuver warfare. This is why Ritter and Doug Macgregor insist that the US military is emphatically not ready for a conventional war with Russia.
That said, I believe a great many have now been awakened from their intellectual slumber by the manner in which the Russian armed forces quickly assessed the Ukrainian order of battle, and then professionally adapted their strengths and tactics to decisively defeat it.
Here is a brief summation of the Russian tactical approach to the Battle of the Donbass:
Step #1: advance reconnaissance units (often in force, with dozens or hundreds of drones overhead) to assess the situation; draw fire; relay to commanders raw video and geo-coordinates
Step #2: with target-correcting drone swarms relaying real-time strike video, proceed to savage the fortifications with towed and mobile artillery, MLRS in gradations of strength and precision, and even horrific thermobaric munitions for particularly suitable targets.
Let smoke clear.
Repeat Step #1.
Still something moving there?
Repeat Step #2.
Repeat Step #1.
Dead bodies everywhere?
Step #3: Send in tanks and infantry to mop up.
Move to next series of fortifications.
And so on and so forth …
This is why Ukraine now suffers hundreds of KIAs every day.
And why, for months, the Russians have suffered very few casualties – at least a 1 to 10 ratio. Probably much lower.
The artillery (with occasional air and precision missile strikes) is doing all the fighting.
But back to Ukraine’s apparent strategy for this war, and the apparent US influence on that strategy.
I will preface my commentary on this issue by stating that I am now thoroughly convinced Ukraine’s fatal blunder was following NATO’s advice.
I’ll grant the remote possibility that the Pentagon/CIA had a cogent view, far in advance, of the relative unlikelihood that a half-million-strong, well-armed, and presumptively well-trained (by NATO) Ukraine military didn’t have much chance against Russia.
But watching drone video of Ukrainian fortifications has convinced me the NATO brain trust effectively disdained Russian military capability, and its commanders, in the course of their eight-year-long preparation of the eastern Ukrainian battlefield.
They clearly believed the Russians would be stupid enough to assault Ukrainian fortifications using “modern” tactics entirely ill-suited to the task at hand.
Their vanity persuaded them the Russians would beat themselves to pieces against an entrenched well-armed force.
Indeed, they were so confident of the genius of their plan that they persuasively encouraged many hundreds (if not thousands) of now-killed or captured NATO veterans to “share in the glory” of humiliating the Russians and bringing down the Putin regime once and for all.
They deluded themselves into believing the Russians lacked: strategic and logistical acumen, a sufficiently well-trained force, and – arguably the biggest miscalculation of all – sufficient stockpiles of ammo to conduct a protracted high-intensity conflict.
In short, I have come to believe the US/NATO actually persuaded themselves that this “Mother of All Proxy Armies” they built in Ukraine seriously had an excellent chance to soundly whip the Russians in a battle situated on their borders.
In other words, they not only grossly underestimated their enemy, but they ignored centuries of history that they somehow convinced themselves had no relevance to their 21st century aspirations to defeat Russia militarily and take a great spoil of its resources.
But, as is now readily apparent to all objective, knowledgeable military analysts around the globe, the US/NATO-trained Ukraine proxy army been savaged by a patient, methodical, and significantly outnumbered Russian force, using century-old doctrines and tactics.
Even more revealing is that once-vaunted and universally feared US/UK weaponry – almost all of it rather antiquated – has proven to be far less “game-changing” than the pea-brained strategists in Washington and Whitehall mistakenly believed.
Javelins, NLAWs, and Stingers have been exposed as effectively useless against their intended targets. M-777 howitzers break down after just a few fires. GPS-guided “precision” munitions are routinely jammed by Russian EW counter-measures.
Worse yet, the inculcation of NATO field doctrines in the minds of the AFU officer cadre has resulted in pervasively inflexible responses to battlefield events that developed contrary to expectations; discipline has disintegrated; improvisation has been paralyzed.
To be sure, if one were to go by the laughable assessments of western think-tank propagandists and their dutiful lackeys in the media, “Ukraine is winning” and “the inept Russian military has been humiliated”.
But more discerning observers around the world know better.
What sober military men in potential adversary countries across the globe see is that Russia has, with one hand tied behind its back, eviscerated the massive, relatively well-armed and well-trained Ukraine military. The US intimidation factor has been forever compromised.
What he means by “with one hand tied behind its back” is that Russia is doing this with only its standing professional army—it has not mobilized its reserves.
More geopolitically significant, at least in the near future, is that European NATO members can also read the scorecard of this war: they now understand as they never could previously that standing on the NATO side of the field is hardly a guarantee of security.
I am convinced NATO will not survive the results of this war in Ukraine. Sure, they’ll “keep up appearances” for the time being, but there can be no doubt that most now understand that siding with a rapidly declining empire is fraught with great risk and minimal gain.
More concerningly, the Chinese have been watching all of these developments with great interest. They are almost certain to be emboldened to act decisively to secure their sphere of influence in the emerging multipolar world.
Great dangers now await in east Asia …
The thing about all this is, is that US/NATO have still only seen a limited part of Russia’s capabilities—those capabilities are those geared toward the Ukrainian defensive strategy. How Russia would react to a US/NATO offensive is yet to be seen. For that reason I doubt US/NATO has sufficient information to counter the Russian military without severe damage. This is especially important to bear in mind because of the Russian hypersonic missile force. These weapons are not merely pinpoint but can also be used as area weapons—as in, take out, for example, an entire carrier group.
Now, Tom Luongo has a somewhat similar post—to that of Sundance—this afternoon. I highly recommend the entire post, but I’ll quote the concluding portion. I particularly like Luongo’s idea that the US’ federal system is still functioning well enough to pull us through this crisis—bloodied but still able to move forward within our limits. His reference to the SCOTUS is well taken in that regard, because the consistent theme of this term—quite a few cases, not just the high profile ones—has been the revival of federalism.
Luongo’s big picture view is pretty much the same as Sundance’s—Davos and its Neocon minions in DC are behind this war on Russia. Opposing Davos is the Fed and Jamie Dimon and the SCOTUS majority.
The vestiges of US Federalism still function at a high enough level to thwart all of their plans. c.f. the SCOTUS decisions last week and Ron DeSantis’ track record as Florida Governor.
Speaking of DeSantis, he’s rapidly emerging as the front-runner for the GOP nomination in 2024.
So, in conclusion this is what I see next:
Russia will not stop with their victory in Donbass
They will take Nikolaev, Kharkov and Odessa (Note Russian spelling, screw the BBC!).
Russia will not take the bait over Kaliningrad, but will cut off all gas to Germany.
The German government will fall, but it won’t matter b/c the Greens, who set policy, control the Bundesrat.
Russia will continue to not give Davos the excuse to start WWIII, even with Finland and Sweden entering the alliance.
They will keep upping the stakes while further exposing the emptiness of their threats.
The Biden Admin. will keep trying to start a war over Taiwan
Eventually China will oblige them, even though they don’t want to.
Bulgaria’s collapse is just the start of the end of the EU in Eastern Europe.
NATO will either collapse or nukes will fly…. I’m still betting on the former.
Erdogan caving over NATO expansion means Putin will oppose him in Syria.
The Fed will continue raising rates while the ECB hangs on for dear life.
In desperation I expect a false flag provocation to force the Russians into a move or simply justify the Davos pulling us into their next war, i.e. another virus or chemical weapons attack this time blamed on Putin.
The goal of this project is an independent Europe, a broken US and vassalage for Asia.
They will achieve, at best, one of those three things. An independent, but broken Europe under the vassalage of Russia and China, the the US retreats and licks its wounds. That’s the future I see now, if the nukes don’t fly.
Before I get into the main topic, I’d like to quickly draw attention to an Epoch Times article that Zerohedge republished. It has to do with the campaign of fire bombings directed against churches and pro-life clinics across the country. Of course, we know that Antifa isn’t behind this firebombing campaign because Antifa isn’t a thing, as such—if you don’t believe me, just ask Chris Wray at the FBI. However, one thing should be clear—criminal campaigns of this sort require money and coordination. You’d need to be hopelessly naive to think that this isn’t a well organized and well funded campaign:
This intro will give you the idea. What would be the purpose of an interactive map of this sort?
Radical pro-abortion activists are reportedly using an interactive map developed by two University of Georgia professors to plan their violent attacks on pregnancy resource centers.
These centers, which typically offer pregnancy tests and counseling services from a pro-life perspective, have been vandalized, smashed, and set on fire in growing numbers across the country in the weeks leading up to the U.S. Supreme Court’s overturning of Roe v. Wade.
While these centers’ locations are public knowledge, perpetrators have been using online tools that collect and organize this information in a way that makes it easier for them to find the next target.
One of such tools is the Crisis Pregnancy Center Map, a project led by Andrea Swartzendruber and Danielle Lambert, both professors at the Epidemiology and Biostatistics Department at the University of Georgia. The interactive map identifies the exact street addresses of over 2,500 pro-life clinics.
The stated purpose of the map is “to provide location information about all of the crisis pregnancy centers operating in the U.S.” The website also refers to these centers as “fake women’s health centers” primarily aimed to “prevent people from having abortions.”
The main topic is one that should be near and dear to Sundance’s heart. Red State has run an investigative article by The Heartland Institute that draws attention to the secretive—and, by normal standards, conflicted—dealings of BlackRock with the Zhou regime:
For anyone not in the know, here’s the short version of what BlackRock is—with the proviso (unmentioned in the article) that BlackRock is tightly integrated with the World Economic Forum (WEF)—the globalist Davos crowd who are heart and soul behind the war on Russia. You need to keep that integration in mind and the focus on Russia as you read:
BlackRock controls more assets than any other investment management firm on Wall Street, with about $10 trillion now under management. (Yes, that’s “trillion” with a “t.”)
BlackRock has used much of this wealth to seize control of sizeable minority stakes in numerous publicly traded companies, making BlackRock and its CEO, Larry Fink, the most powerful forces in corporate America. When BlackRock and Fink speak, Wall Street listens.
Environmental, social, and corporate governance (ESG) is an approach to evaluating the extent to which a corporation works on behalf of social goals that go beyond the role of a corporation to maximize profits on behalf of the corporation’s shareholders. Typically, the social goals advocated within an ESG perspective include working to achieve a certain set of environmental goals, as well as a set of goals having to do with supporting certain social movements, and a third set of goals having to do with whether the corporation is governed in a way that is consistent with the goals of the diversity, equity, and inclusion movement.
Ever wonder why June is the biggest month of the year for corporations, most of which can be strongarmed through BlackRock by the WEF and George Soros’ Open Society outfit? Right. BlackRock uses its stakeholder status to get its own people on corporate boards.
Of course, all of this means that BlackRock has a major interest not only in economic matters in the US but globally. When you’re talking about trillions of dollars in assets you’re likely looking for more than just an occasional heads up—ideally you’d like not only a heads up but also a voice in policy formulation. That’s the “governance” part, and that’s what the Heartland Institute piece explains, simply by laying out the personal interconnections between Tom Donilon and the Zhou regime. I shouldn’t have to explain who Tom Donilon is to any Sundance readers. However, I’ve excerpted a good chunk to make it basically clear. Do yourself a favor and read it all, at the link. One final caveat—I’m not pretending that this setup is somehow unique to probably the most corrupt administration in US history. This is about how the US is run. It’s not run by We the People. Maybe we’re more sensitive about these matters, and less naive:
According to an investigation of White House visitors logs, Thomas E. Donilon — chairman of the BlackRock Investment Institute (BII), BlackRock’s personal think tank dedicated to assessing geopolitical investment risk — met with Biden administration officials at least eight times from March 2021 to November 2021, and perhaps on other occasions as well. …
Donilon has been an important figure in U.S. foreign policy for many years. Most recently, he served under President Barack Obama as his national security advisor. He also worked for Hillary Clinton’s 2016 presidential campaign and was reportedly on Biden’s short list of nominees to become the next CIA director.
In large part because of his extensive experience in government, and likely because of his connections to establishment Democrats, BlackRock hired Donilon to be its chairman of BII, which, according to BlackRock’s website, “leverages the firm’s expertise and generates proprietary research to provide insights on the global economy, markets, geopolitics and long-term asset allocation – all to help our clients and portfolio managers navigate financial markets.”
In other words, Donilon’s job is to help BlackRock clients make money and protect their assets by having access to important information about foreign affairs, geopolitics, etc. Of course, such insights would be greatly enhanced by insider knowledge provided by White House staff. …
Beginning in March 2021, just two months after Biden entered the White House, Donilon started to meet with Biden administration officials. He met multiple times with special assistants to the White House Office of Cabinet Affairs Thomas Isen and Sanam Rastegar, and he also met once with Sezaneh Seymour, the deputy national security advisor for cyber and emerging technology at the National Security Council.
Donilon has also conducted at least four one-on-one meetings with Kimberly Lang, a figure we know very little about. Lang is strangely absent from the official Annual Report to Congress on White House Office Personnel dated July 1, 2021, despite having held meetings since Biden’s first week in office. However, federal payroll records suggest that Lang worked alongside Biden and Donilon in the Obama administration’s National Security Council.
Despite her relative anonymity, White House visitor logs show Lang regularly holds meetings, often privately, with top foreign policy and national security elites, including experts on geopolitical affairs, nuclear threats, terrorism, and economic sanctions. Some of her notable visitors have included William Burns, director of the Central Intelligence Agency; James Stavridis, former NATO Supreme Allied Commander Europe and current managing director of the Carlyle Group; and Colin Kahl, U.S. undersecretary of defense.
This evidence appears to show that Donilon, an expert in foreign policy, is secretly meeting with well-connected national security staff in the Biden White House while also working for BlackRock in a position where he is responsible for using geopolitical and foreign policy information to help investors get a good financial return.
Incredibly, as bad as these connections seem to be, Donilon’s links to the Biden administration run even deeper. Mike Donilon, a senior advisor to the president, is Thomas Donilon’s brother. Mike has been a longtime supporter of Biden’s, even serving as his chief strategist throughout the 2020 presidential campaign.
Until earlier this year, Thomas Donilon’s wife, Cathy Russell, was the director of the Presidential Personnel Office, which vested her with the important task of hiring and vetting administration employees.
Perhaps not so coincidentally, the Donilon duo’s daughter, Sarah, also works in the Biden administration, as a staffer for the National Security Council, giving Thomas Donilon yet another important contact in the White House.
BlackRock has other connections within the Biden administration as well. …
Speaking of Fink, he, too, appears to have met secretly at the White House. Visitor logs show that on February 8, 2022, just two weeks before Russia’s invasion of Ukraine, Fink met with Steve Ricchetti, the counselor to the president. Ricchetti served as chairman of Biden’s 2020 presidential campaign, and has been described as the “yin to the yang” of Biden’s other highly trusted advisor — Mike Donilon.
What’s the connection between the two topics above? Money.
The growth rate of real gross domestic product (GDP) is a key indicator of economic activity, but the official estimate is released with a delay. Our GDPNow forecasting model provides a “nowcast” of the official estimate prior to its release by estimating GDP growth using a methodology similar to the one used by the U.S. Bureau of Economic Analysis.
GDPNow is not an official forecast of the Atlanta Fed. Rather, it is best viewed as a running estimate of real GDP growth based on available economic data for the current measured quarter. There are no subjective adjustments made to GDPNow—the estimate is based solely on the mathematical results of the model. In particular, it does not capture the impact of COVID-19 and social mobility beyond their impact on GDP source data and relevant economic reports that have already been released. It does not anticipate their impact on forthcoming economic reports beyond the standard internal dynamics of the model.
Please note that we no longer support the GDPNow app. Download our EconomyNow app or go to our website to continue to get the latest GDP nowcast and more economic data.
Latest estimate: 0.3 percent — June 27, 2022
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2022 is 0.3 percent on June 27, up from 0.0 percent on June 16. After recent releases from the Federal Reserve Board of Governors, the National Association of Realtors, and the US Census Bureau, the nowcast of second-quarter real gross private domestic investment growth increased from -9.0 percent to -8.1 percent.
The next GDPNow update is is Thursday, June 30. Please see the “Release Dates” tab below for a list of upcoming releases.
Here are some take-aways, per MishTalk
Real Final Sales (RFS) is the true bottom line forecast of the economy.
The difference between GDP and RFS is inventory adjustment that nets to zero over time.
RFS is 1.7 percent, unchanged since June 26.
Base GDP is up to 0.3 percent from June 26, a meaningless rise in size but more importantly because RFS is the number to watch.
Since June 16 the most important data releases were existing and new home sales.
According to the First Deputy Minister of Information of the DPR Daniil Bessonov, more than 50 thousand Ukrainian soldiers have died since the beginning of the Russian special operation in Ukraine.
The deputy minister aided that most of the combat-ready units of Ukraine were destroyed or captured.
“According to my observations, from what gets into the network, if you add all this into the overall picture, they have more than 50 thousand dead – this is if you take the entire front line. Counting the wounded is usually one to three, one to four, that is, roughly speaking, more than 150 thousand may be wounded,” Bezsonov said in his interview.
The report of the DPR official are confirmed by the claims of Ukrainian servicemen. Sky News agency has recently published an interview with an Ukrainian officer who was deployed in the Severodonetsk area.
The commander of an elite unit of the Ukrainian Marine Corps, who gave his name as Olexander, said that most of his most trained soldiers were wounded or killed. The losses amounted to about 80% of the well-trained and battle-hardened fighters with whom he had been fighting side by side since 2018. According to him, heavy losses have a strong emotional and psychological impact on both other units and relatives of servicemen. Olexander admitted that he does not know how long the AFU would be able to bear such losses.
The Armed Forces of Ukraine are suffering heavy losses in manpower and military equipment during the battles with Russian, LPR and DPR troops. Russian military media are publishing more and more interviews with Ukrainian prisoners of war who served in the rear units, which confirms that the military command of the Armed Forces of Ukraine is experiencing a shortage of manpower and uses untrained servicemen as cannon fodder on the front line.
Russia’s Ministry of Defense is currently reporting AFU KIAs in the range of 500-1000/day. With wounded and MIA at 4:1 KIA (or 2000-4000/day), that brings estimated AFU losses in the range of 2500-5000 day.
Moon of Alabama discusses the accelerating losses below.
The distance between the red fronts above and below has shrunk to 8 kilometer (~5 miles). According to Russian source there are some 8,000 soldiers and militia left in Lysichansk.
The area between the Russian fronts is under full Russian artillery control with drones flying above seeing anyone who moves to escape from Lysichansk to Siversk on the left side of the map. A Washington Post report describes what happens to those who try:
The Ukrainian Airborne unit was relieved to be pulling back from the front Sunday morning, riding a column of armored personnel carriers away from the embattled city of Severodonetsk, which had already fallen to the Russians, and Lysychansk, which was on the brink.
“Nothing happened to us to when we were at the front,” the unit commander said. “It was while we were retreating that we got hit.”
They were hit, and hit badly.
As the convoy moved into the farm village of Verkhniokamianske, with many of the soldiers riding on the outside of the vehicles, the first blast struck right by them. It was a cluster bomb, they would later surmise, something that tore through the contingent of men clinging to that side of one truck.
Several men were wounded, with blood pouring from limbs and, in one case, a soldier’s head. But there was no time to treat them while the convoy remained in the crosshairs of Russian artillery. The uninjured applied tourniquets where they could, dragged the hurt back onto the vehicles and raced out of the village, across rutted farm lanes to a line of trees across a golden wheat field about a kilometer away.
(The claim of a cluster bomb is likely wrong. An exploding 152mm high explosive artillery round spreads many fragments of deadly metal around.)
There were at least eight wounded in the attack. The bodyguard of the WaPo reporter helped to apply first aid to them. They were ‘evacuated’ back to Lysichansk.
Whoever commands the 8,000 soldiers there should tell them to give up and to surrender to the Russian led forces.—
On Saturday Russian bomber flying over the Caspian Sea fired four cruise missiles into the Artem missile factory in Kiev. The ‘western’ reporting claimed that some hit a civilian building:
Russian missiles hit a multistory residential building and a kindergarten in Kyiv early on Sunday, killing at least one person and injuring six others in what the city’s mayor called an attempt to “intimidate Ukrainians” on the eve of summits in Europe focused strongly on the war. … The casualties occurred in the nine-story apartment block in central Kyiv, badly damaged by what the Ukrainian air force said were Russian Kh-101 cruise missiles launched from long-range strategic bombers over the Caspian Sea, roughly 1,000 miles away.
A picture in the report shows damage to the upper two floors. bigger
The Kh-101 cruise missile has a warhead with 450 kilogram of high explosives. If one had hit that high-rise the building would be completely gone.
Modern Russian cruise missiles are extremely precise as last week’s damage of the Dnieper bridge in the Cherkasy region of Ukraine shows. The railway part that was used to transport heavy weapons is gone. The road bridge right next to it has little damage. bigger
It is way more likely that the building in Kiev was hit by an Ukrainian air defense missile that missed its target but eventually fell back to earth.—
Any army fighting a war will hold some trained units in reserve. Such a reserve will be used to block a strategic breakthrough by the enemy or when there is a good chance to launch a significant counterattack. As Kiev was throwing untrained Territorial Defense Forces into the slaughter of the Donbas front I began to doubt that there was still a significant reserve. On Friday or Saturday the Ukrainian president Zelensky ordered all Territorial Forces that were left in areas that are currently not fought in to move to the Donetsk front. This included some units from Odessa which is still in danger of being attacked. That nearly sealed it for me. If they pull troops from Odessa the Ukrainian reserve must have gone.
But on Sunday the daily report by the Russian Defense Ministry told me that I was wrong:
High-precision attacks of Russian Aerospace Forces and Kalibr missiles were launched at 169th Army Training Centre near Desna (Chernigov region), 199th Air Assault Troops Training Centre near Teterevka (Zhitomir region), as well as at 184th Training Centre of the Armed Forces of Ukraine (AFU) near Starichi (Lvov region).
Attacks have resulted in neutralising 65th, 66th mechanised brigades and 46th Airmobile Brigade from AFU strategic reserves that were finishing their preparation at those training grounds. The planned redeployment of the above mentioned units to operations area has been frustrated.
Three full brigades, likely at full strength and equipped with weapons the ‘west’ has delivered, are a significant force of probably 12,000 men. They could have launched a decent counterattack on Kherson or some other area the Russian forces have captured but where their defense lines are currently quite thin.—
Another day, another false claim of civilian casualties?
The video show a burning shopping center which does not seem to have an urban surrounding. Some 20 civilians are hanging around and watch as the firefighters do their job. They show no panic or grief. The shopping center’s rather large parking space is empty except for some five cars which all seem to be undamaged. I see no bicycles.
If there were 1,000 people in the shopping center how did they get there? How did they plan to get home?
Another video from a different perspective also shows a large empty parking space with two soldiers strolling by in full battledress. They have helmets on, wear body armor and carry their weapons. They have large military backpacks. Some other soldiers who are hanging around in olive green clothing great them. bigger
Kremenchuk is on the Dnieper, far from the front lines. Why were the soldiers at the burning shopping center. Was there something in there that was of military interest?
Satellite pictures show that the shopping center is right next to the large Kredmash machine plant. Was that the real target of the attack with the shopping center being an unintended casualty?—
About $100 million in dollar- and euro-denominated interest payments failed to reach investors within a 30-day grace period following a missed May 27 deadline. The grace period expired Sunday night.
A formal declaration of default would need to come from bondholders because ratings agencies, which normally declare when borrowers have defaulted, have been barred by sanctions from reporting on Russia. The Credit Derivatives Determinations Committee, a panel of investors that rules on whether to pay out securities linked to defaults, hasn’t been asked to make a decision on these bond payments yet.
MOSCOW. June 24 (Interfax) – National Settlement Depository (NSD), the paying agent for Russian sovereign Eurobonds, has received 8.5 billion rubles or $159.4 million equivalent in order payment of coupon interest on the country’s 2028 Eurobonds, the Finance Ministry said.
The ministry said it had honored obligations to service the sovereign bonds in full.
The ministry said on June 23 that it had has transferred rubles to the NSD in payment of coupons on the country’s 2027 and 2047 Eurobonds as part of the new arrangement for servicing sovereign external debt, as approved by a presidential decree of June 22.
The new form of payment came after the ‘west’ rejected to receive the money in Euros. As the NYT writes:
Russia is rejecting the default declaration, on the grounds that it has made efforts to pay. Dmitri S. Peskov, the Kremlin’s spokesman, told reporters on Monday that the statements about default were “absolutely illegal.”
“The fact that Euroclear withheld this money, did not transfer it to the recipients, it is not our problem,” Mr. Peskov said. “In other words, there are no grounds to call this situation a default.”
The bond investors can easily get their money in the currency they want. They will have to open two accounts with Gazprombank in Zurich, one in rubles and one in euros. They then can ask Russia’s National Settlement Depository to send their rubles to their rubles account at Gazprombank which will happily buy those rubles and move the corresponding euro value into the investor’s euro account.
That is simply the reverse of the process European buyers use to pay for Russian gas in rubles.
Russia Combined Arms doctrine is anchored in the concept of creating and reducing “cauldrons”.
Wiki defines the term as follows: Cauldron or kettle (Russian: котёл, romanized: kotyol or kotyel): a very large, strategic-level concentration of trapped enemy forces. Sack (Russian: мешок, romanized: meshok): an operational-level trapped enemy force.
Two battles during World War II (or, The Great Patriot War) characterize the “Cauldron” concept: Stalingrad and Courland.
The Battle of Stalingrad (23 August 1942 – 2 February 1943) was a major battle on the Eastern Front of World War II where Nazi Germany and its allies unsuccessfully fought the Soviet Union for control of the city of Stalingrad (later renamed to Volgograd) in Southern Russia. The battle was marked by fierce close-quarters combat and direct assaults on civilians in air raids, with the battle being the epitome of urban warfare. The Battle of Stalingrad was the deadliest battle to take place during the Second World War and is one of the bloodiest battles in the history of warfare, with an estimated 2 million total casualties. Today, the Battle of Stalingrad is universally regarded as the turning point in the European Theatre of war, as it forced the Oberkommando der Wehrmacht (German High Command) to withdraw considerable military forces from other areas in occupied Europe to replace German losses on the Eastern Front. The victory at Stalingrad energized the Red Army and shifted the balance of power in the favour of the Soviets.
Russia suffered more casualties at Stalingrad alone than the US in the entire war against all the Axis powers combined.
The Ukrainian leadership is still sending new units into the Lysichansk cauldron in the east. The Russians do not mind that. Their job is to “demilitarize” Ukraine. To enclose more troops in one swoop makes that easier.
The distance between the red Russian held area at the the top to the one at the bottom at the most narrow gap is a mere 15 kilometer or some 9 miles. There is only one open road running through it from west to east which is used for pushing resupplies to the Ukrainian troops in Lysichansk.
Then a battalion of Ukrainian troops that was supposed to hold the villages in the upper area of the pocket retreated. Some say they were ordered to leave, others claim they mutinied. The later is more likely as these were amateur infantry from the Territorial Defense Forces who, without sufficient support, had been send to replace better troops that were ordered back.
In today’s report the Russian Defense Ministry claims:
Successful offensive of Russian units towards Lugansk within 5 days has resulted in the liberation of Loskutovka, Podlesnoye, Mirnaya Dolina, Shchebkaryer, Vrubovka, Nyrkovo, Nikiolayevka, Novoivanovka, Ustinovka and Ray-Aleksandrovka.
Group of Ukrainian units has been completely isolated near Gorskoye and Zolotoye.
This pocket has encircled four battalions: 3rd Mechanised Battalion of 24th Mechanised Brigade, 15th Mountain Assault Battalion of 128th Mountain Assault Brigade, 42nd Mechanised Infantry Battalion of 57th Mechanised Infantry Brigade, 70th Battalion of 101st Territorial Defence Brigade, as well as an artillery group of 57th Mechanised Infantry Brigade, a group of Nazis from Right Sector organisation and a detachment of foreign mercenaries.
In total, the Gorskoye pocket has isolated up to 2 thousand people: about 1,800 servicemen, 120 Nazis from Right Sector, up to 80 foreign mercenaries, as well as over 40 armoured combat vehicles and about 80 guns and mortars.
41 servicemen abandoned their resistance and surrendered voluntarily just over the past 24 hours.
According to the prisoners, the encircled Ukrainian units are exhausted. The units are currently manned by less than 40%. Higher Ukrainian command has lost control over these units. Armament, munitions, fuel and other logistic supply is completely stopped.
Russian troops are straitening the Gorskoye encirclement by launching uninterrupted attacks at the enemy. Half of Zolotoye had been taken under control over yesterday.
Since this morning some 600 have additionally surrendered. The others will likely follow later today or tomorrow.
Also this morning the Ukrainian deputy commander for Luhansk province announced that the soldiers and foreign mercenaries who held out in the industrial area of Sevierodonetzk east of Lysichansk were told to retreat to Lysichansk. In fact a full retreat from Lysichansk further west seemed to be likely.
But that was no longer really possible for the 10-15,000 soldiers in and around the city as a bridge on the single road that leads to the west has been dropped overnight onto the railway tracks below.
Correction (19:00 utc) This sections was wrong and has been corrected. A bridge was bombed to cut the escape route from Lysichansk but it was a different one than I first wrote. That does not change the conclusion-
A Russian helicopter performed that mission and it now seems that there was a bigger landing of airborne troops west of the refinery.
Here is how the bridge is now said to be looking. Correction (17:30 utc): The picture does not show the bridge on the map.
Correction (19:00 utc) The picture is of the destroyed bridge but it was geo-located wrongly. But that the bridge on the map is now damaged was reported by a source that is usually correct. I still assume that it is in fact so. Again the map was wrong, not the picture of the bridge.
Sorry for this ‘fog of war’ confusion. The tactical effects of the incident mentioned below stays the same. [end of both corrections]
There are still side roads and dirt tracks that can be used but the whole area west of Luhansk is under Russian fire control. The long convoy that would be needed for a retreat can not pass without being severely molested.
The big Lysichansk cauldron has thereby also been closed. Despite the still necessary cleanup of the city and two or three small villages one can state that the former Ukrainian province Luhansk, now the Luhansk People’s Republic, has been liberated from Ukraine.
On the Russian side some 30-40 Battalion Tactical Groups (BTG) have been involved in the whole operation. Most of them can now resupply and rest to later be used elsewhere.
Ukraine Forces Retreat From Encircled Severodonetsk As Russia Achieves Hold Over Luhansk Province
BY TYLER DURDEN
FRIDAY, JUN 24, 2022 – 08:30 AM
Ukraine’s government on Friday announced for the first time that its remaining forces defending the key eastern city of Severodonetsk have been ordered to withdraw, after having lost control of most of the city to Russian forces for weeks, amid relentless shelling and persistent Ukrainian army complaints of being low on ammo and men.
“Remaining in positions that have been relentlessly shelled for months just doesn’t make sense,” Luhansk regional governor Serhiy Haidai said, after Severodonetsk had been nearly completely encircled over the past days. “Ukrainian armed forces will have to retreat from Severodonetsk. They have received an order to do so.”
Like in prior instances of defeat in the Donbas region, the government is emphasizing the new action as a ‘strategic retreat’: “They have received orders to retreat to new positions… and from there continue their operations,” Haidai told Ukrainian television.
It remained unclear how quicky the withdrawal and evacuation from the city will take place. Haidai in the Friday morning statements described a city infrastructure entirely destroyed, estimating that over 90% of houses had been shelled. It had a pre-war population of over 100,000 and it’s believed there could be 10,000 or more civilians still there. Haidai stressed that Severodonetsk has been “nearly turned to rubble”.
The announced Ukrainian retreat marks a significant point of momentum for Russian forces in the four month long war, given the fall of Severodonetsk means Russia’s military now effectively holds the entirety of Luhansk province.
Ukrainian officials have also acknowledged that nearby Lysychansk is also being overtaken by Russian forces. Starting Thursday Ukrainian troops began withdrawing from parts of the frontline city to “avoid being encircled” – as Reuters wrote – amid what’s looking like may be complete rout from the region.
Besieged Lysychansk is likely to suffer a similar fate as Severodonetsk, also with an estimated 7,000 to 8,000 civilians still trapped there, reportedly with nowhere to go. With both cities, Russian forces systematically destroyed key bridges in the area while issuing ultimatums to holdout Ukrainian fighters:
“You have two options,” a commander of the pro-Russian separatists battling to take the city warned Ukraine’s defenders. “Surrender or die.”
Still, each major Ukrainian army exit is dubbed by its leadership a withdraw to more fortified positions, and not as defeat.
At the same time, the battle for the city has highlighted a glaring discrepancy between Russian artillery capabilities and superior supply compared to a lack of the same on the Ukrainian side. One British military veteran who is currently assisting Ukrainian forces as a foreign trainer told CBS of a “sheer unevenness” of the battlefield due to the Russian military’s “overwhelming hardware” advantage.
American and Western policy towards Russia is founded on two serious errors. (A considerable understatement, of course – the past thirty years show that conventional Western ideas of Russia are almost completely wrong.)
But these two are endlessly repeated and, no matter how many times they are proven wrong, they remain the foundational assumptions of the West’s attempts to change or control Russia.
First is the idea that the Russian economy is feeble, unbalanced and dependent on income from the West. The second is that Putin is the chief of a band of thieves who, who if made to feel pain, will get rid of him. Sanctions will collapse the first and bring the pain to cause the second. (Another delusion is that once Putin goes, everything will be to the West’s liking – but I did say there was a multitude of misconceptions.)
First let’s consider Russia’s economy. Op-eds that say that the Russian economy is the size of Texas or Belgium or Luxembourg or whatever simply translate rubles into dollars and gallop to their preassigned conclusion. They never ask how big the space program of the country Russia is compared to is, or how many nuclear submarines it makes, or new subway stations, airports or bridges it opens, or whether that country makes all kinds of airplanes and trucks, or how much food it grows and exports or anything else that actually measures a real economy.
They persist in the face of all experience to the contrary. The EU cut food exports to Russia to, I suppose, bring people out into the streets protesting the disappearance of exotic cheese (remember Masha Gessen’s heartbreak about my little cheese?) Russia responded intelligently and is now self-sufficient in food and Europe has lost that market. Biden was going to reduce the ruble to rubble but Moscow effortlessly countered him and the ruble is now tied to energy – one of the strongest foundations a currency can have.
And still the sanctions pile on. But it’s educational – now we know a lot more about what potash is used for and where it comes from. And neon – who knew that was important? Rare earths! Beer bottles! Moscow is only just now starting to counter-sanction and the world is discovering that Russia is a major producer of a lot of important things and if you sanction them, you will find yourself running short of lots of things you’d never heard of. (You’d think anyone who owned an atlas would be able to figure out that a country as large as Russia must be a big producer of most resources).
Biden can blame Putin all he likes, but sanctioning energy and potash is a certain way to drive up prices all round. Biden used to think that Russia had “nuclear weapons and oil wells and nothing else“. Maybe the people running Russia are better at thinking things out and seeing reality than we thought they were. (Yet another mistaken Western assumption – what is there in the last twenty years that suggests we’re smarter than they are?)
The idea that Russia is a big criminal conspiracy and Putin is the Boss of Bosses is the foundation of the personal sanctions strategy. So-and-so is deemed “close to Putin”, whatever that means, and he’s prevented from going to Paris to buy cheese and his yacht is stolen confiscated. Angry, he sits down with the other capos and decides it’s time the Boss was found face down in a bowl of kasha and blood. The think tankers tell us that Putin is the Chief Thief holding onto power by spreading the loot around, fake elections and making critics disappear. (By the way, wasn’t he supposed to have tried to kill Navalny, where’s the oped savant explaining why he’s still alive?)
All elections in Russia are fake, all opinion polls are fake, all media is controlled by the Kremlin, the underbosses are hurting so why is Putin still there? It surely couldn’t be that he is the very popular and respected elected head of state – to suggest that would be to call into question three decades of US and EU think tankery. Therefore he must be just one more sanction away from being whacked out. And so more names – all “close to Putin” – are added to more lists. But nothing changes.
These two errors run on and on. Russia is now the most sanctioned country ever and Western politicians still think another round of “tough sanctions” will do the job. But the more sanctions it survives, the more sanction-proof Russia becomes.
Wars are irruptions of brutal reality into fantasy and the Ukraine war is laying bare the empty complacency at the root of the West’s view of Russia. It’s going to be a cold hungry winter in Europe and in parts of America. Can’t blame Putin forever.
But the depressing truth is that minds are rarely changed, you have to change the man. How much longer will the West’s leaders outlast their repeated failures?
Russia’s barbaric war on Ukraine—and before that on Syria, Libya, Georgia, and Chechnya—has exposed the Russian Federation’s viciously imperial character to the entire world. Its aggression also is catalyzing a long-overdue conversation about Russia’s interior empire, given Moscow’s dominion over many indigenous non-Russian nations, and the brutal extent to which the Kremlin has taken to suppress their national self-expression and self-determination.
Serious and controversial discussions are now underway about reckoning with Russia’s fundamental imperialism and the need to “decolonize” Russia for it to become a viable stakeholder in European security and stability. As the successor to the Soviet Union, which cloaked its colonial agenda in anti-imperial and anti-capitalist nomenclature, Russia has yet to attract appropriate scrutiny for its consistent and oftentimes brutal imperial tendencies.
Now, “decolonizing”, taken in the total context of this statement, can only mean: partition. To “decolonize” Russia, based providing for the “national self-expression and self-determination” of “non-Russian nations” currently a part of the Russian Federation can only mean: dismembering the Russian Federation as it currently exists.
Also, please note two additional takeaways. First, the announcement doesn’t speak of a need for Russia to decolonize itself—rather, the implication is that others will decolonize Russia. Second, the further implication is the purpose decolonization is to make Russia “a viable stakeholder in European security and stability.” This means that Russia will be incorporated into the Rules-Based Order of the New World Order. Decolonization of Russia actually means the colonization of Russia by the West, to be mined for its natural resources. The colonization can only proceed if Russia is first decolonized—partitioned, dismembered, defanged, rendered subservient.
To provide a concrete example of what they’re talking about …
Who, you might ask, are these people, this Commission on Security and Cooperation in Europe? Is there any reason why Russia should take them seriously? Well:
You can learn more at the link above, but here’s what the site says about the Commissioners (as opposed to the Staff)—follow the link for the names:
The Helsinki Commission consists of 21 Commissioners, 18 of whom come from the U.S. Congress. Nine Senators and nine Representatives – five from the majority and four from the minority in each chamber – are selected by the President of the Senate and the Speaker of the House, respectively. The remaining three Commissioners are appointed by the President of the United States from the Departments of State, Defense and Commerce, usually at the Assistant Secretary level.
Is it any wonder that Russia regards the current conflict as an existential conflict against the West, led by the US? And with tensions at just under a boil, why would the US conduct such an “online briefing”?
The operative reality, of course, is that Russia is not going to be decolonized—although the very fact of such an online briefing taking place surely speaks volumes about the madmen who make policy in DC. However, just to make this mentality perfectly clear, we hear from a national security reporter at the WaPo:
NEW: Even if Western arms don’t change the battlefield equation, US officials describe the stakes of ensuring Russia doesn’t win in Ukraine as so high that they are willing to countenance even a global recession & mounting hunger. From @DanLamothe & me washingtonpost.com/national-secur…
Do we get a vote on this?
The operative reality is that all signals are that Russia has shifted from somewhat minimalist goals in Ukraine to a much more maximalist strategy. From everything I’ve been reading and hearing the following tweet (which precisely reflects my early and often expressed view) represents official Russian thinking. Note that Pomorenko describes this map as representing the minimal outcome that Russia is seeking:
FWIW, I was listening to Alex Mercouris earlier. He compared the Donbass to the Ruhr, in terms of productivity. He stated point blank that the the areas of Ukraine that Russia currently occupies account for 80% of Ukrainian GDP. Without being able to vouch for the exact numbers, I do believe that Mercouris’ comparison is a fair one and that the numbers are probably pretty accurate.
Mercouris was also speaking about the Lithuania situation. He suggested that it’s high time that Lithuanians understood that the US is not about to risk its existence just for the sake of Lithuania—no matter what Article 5 of the NATO treaty says. As it happens, Russia addressed those fantasies today:
MOSCOW, June 22 (Reuters) – A top Russian official warned the West on Wednesday to stop talking about triggering NATO’s “Article 5” mutual defence clause in a standoff between Lithuania and Russia.
Moscow has promised practical retaliation that will affect Lithuania’s population after the Baltic state blocked the transit of goods subject to EU sanctions from Russia to its Baltic exclave.
“I would like to warn Europeans against dangerous rhetorical games on the topic of conflict,” the Interfax news agency quoted Russian Deputy Foreign Minister Sergei Ryabkov as saying on Wednesday.
The U.S. State Department said on Tuesday its commitment to Article 5 of NATO’s founding treaty – which states that an attack on one member of the alliance is an attack on all – was “ironclad”.
The US commitment to Article 5 is “ironclad”. However, it reserves the right to its own interpretation of Article 5 within its overall understanding of the Rules-Based Order, in which the US makes the rules. #1, We make the rules. #2, the rules don’t apply to us.