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Daily Archives: March 28, 2022

Chart: How Long Can the Commodities Rally Last?

Source : BofA Global Investment Strategy

In Pictures: Food of Hiša Franko in Kobarid, Slovenia

Fine Dining Cuisine Based on Local Seasonal Produce

No.21 of the World’s 50 Best Restaurant 2021

Is Ukraine’s Partition Zelenskyy’s Fate?

Patrick J. Buchanan wrote . . . . . . . . .

“It’s time to meet, time to talk … time to restore territorial integrity … for Ukraine,” said President Volodymyr Zelenskyy on Saturday.

Zelenskyy added that the need to negotiate was even greater for Moscow. “Otherwise, Russia’s losses will be so huge that several generations will not be enough to rebound.”

According to the Pentagon, Russia has lost 7,000 soldiers; Kyiv puts the figure at 14,000 dead.

Still, Russian President Vladimir Putin appears less pressured to meet and talk. What does this tell us?

Zelenskyy does not believe further fighting will benefit Ukraine as much as it will cost his country. And he wants the war over.

As for Putin, as Secretary of Defense Lloyd Austin said Sunday, “He’s not been able to achieve the goals that he wants to achieve as rapidly as he wants to achieve them.” Putin wants more time.

The Russian president began the invasion of Ukraine with Crimea already annexed and the enclaves of Luhansk and Donetsk having already declared their independence of Kyiv.

Since the invasion began, however, Putin’s forces have besieged but not taken Ukraine’s capital, Kyiv, or second largest city, Kharkiv.

Yet, Russian troops are now in Mariupol on the Sea of Azov, having completed a land bridge from Russia through the Donbas to Crimea and, from there, halfway to Odessa, the last major Ukrainian port on the Black Sea.

While the Ukrainian army and citizens have put up fiercer resistance than was anticipated in Moscow, Russia is not losing this war.

Measured by territorial gains, Putin is winning

He has not captured Kyiv or Kharkiv, but he has expanded the Russian-controlled territories of Donetsk, Luhansk and Crimea that he had at the start of his invasion.

While Russia’s costs and casualties have been far greater than was anticipated, Putin has added to the Ukrainian lands he held when the war began. And Mother Russia has not lost an inch of land in this war.

“How does this thing end?” Gen. David Petraeus famously asked on the road to Baghdad.

No political solution appears more likely than a new partition of Ukraine, with lands east of the Dnieper River and along the coasts of the Sea of Azov and the Black Sea being ceded to Moscow, and the west of Ukraine being declared a neutral nation like Austria or Finland in the Cold War.

The problem with this probable outcome is that Zelenskyy has ruled out any territorial concessions or land transfers from Ukraine to Russia. And he seeks to “restore,” not to make permanent, the 2014 amputations of Crimea and the Donbas.

The dilemma: Zelenskyy probably cannot survive ceding control of any Ukrainian land to Russia. And Putin probably cannot survive a failure in peace talks to expand the Ukrainian holdings with which he began the war.

The “territorial integrity” of Ukraine is the crucial issue in ending this war.

And it is precisely here where it appears impossible for both sides to come to terms.

The one issue on which both parties will likely agree in any peace settlement is the issue that should have been agreed to — to prevent the war: a formal declaration by Kyiv that it will never join a NATO alliance created to contain Russia and, if necessary, defeat Russia in a war.

A frustrated and enraged President Joe Biden has taken to calling Putin a “killer,” a “murderous dictator” and a “war criminal” who has launched an “immoral war” — comments the Kremlin calls “unforgivable”

Such rhetoric would seem to rule out any role for U.S. diplomacy in negotiating the end to this war. Other nations — Israel, Turkey, France, Germany — have maintained regular relations and constant contact with Putin, who sits and broods atop the world’s largest nuclear arsenal.

Consider the moral dilemma the U.S. has put itself in.

Our president says Russia is led by “a war criminal,” conducting an “immoral” war in which deliberate atrocities are committed at hospitals, schools, kindergartens and art theaters.

Yet, the U.S. and NATO will not provide weapons to Ukraine, including secondhand MiGs, that might cause Russia to retaliate against us or NATO or risk World War III or risk Russia’s use of tactical atomic weapons.

Because, pillaged and persecuted though Ukraine may be, it is not a member of NATO.

If Latvia, however, with 5% of Ukraine’s population, is encroached upon, we will engage Russia militarily, and to hell with the risk of World War III or Russia’s possible retaliation with atomic weapons.

In war, the moral is to the material as three is to one, said Napoleon. Unfortunately, what George Bernard Shaw said cynically also appears to be true: In war, God is on the side of the big battalions.

Zelenskyy probably cannot survive signing away the title to any Ukrainian land, be it Crimea or the Donbas. And Putin likely cannot survive not bringing home new territory from a Russian “victory.”

Again, perhaps the one issue on which almost all now agree is that Ukraine renounce its right to join the NATO alliance.

Source : Patrick J. Buchanan

Infographic: EU’s Energy Dependency

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Source : Visual Capitalist

COVID-19 Mixed with Flu Increases Risk of Severe Illness and Death

Adults in hospital who have Covid-19 and the flu at the same time are at much greater risk of severe disease and death compared with patients who have Covid-19 alone or with other viruses, research shows.

Patients with co-infection of SARS-CoV-2, which causes Covid-19, and influenza viruses were over four times more likely to require ventilation support and 2.4 times more likely to die than if they only had Covid-19, experts found.

Researchers say the findings show the need for greater flu testing of Covid-19 patients in hospital and highlight the importance of full vaccination against both Covid-19 and the flu.

The team from the University of Edinburgh, University of Liverpool, Leiden University and Imperial College London, made the findings in a study of more than 305,000 hospitalised patients with Covid-19.

The research — delivered as part of the International Severe Acute Respiratory and emerging Infection Consortium’s (ISARIC) Coronavirus Clinical Characterisation Consortium — is the largest ever study of people with Covid-19 and other endemic respiratory viruses.

ISARIC’s study was set up in 2013 in readiness for a pandemic such as this.

The team looked at the data of adults who had been hospitalised with Covid-19 in the UK between 6 February 2020 and 8 December 2021.

Test results for respiratory viral co-infections were recorded for 6965 patients with Covid-19. Some 227 of these also had the influenza virus, and they experienced significantly more severe outcomes.

Dr Maaike Swets, PhD student at the University of Edinburgh and Leiden University, said: “In the last two years we have frequently witnessed patients with Covid-19 become severely ill, at times leading to an ICU admission and the employment of an artificial ventilator to help with breathing. That an influenza infection could give rise to a similar situation was already known, but less was understood about the outcomes of a double infection of SARS-CoV-2 and other respiratory viruses.”

Professor Kenneth Baillie, Professor of Experimental Medicine at the University of Edinburgh, said: “We found that the combination of Covid-19 and flu viruses is particularly dangerous. This will be important as many countries decrease the use of social distancing and containment measures. We expect that Covid-19 will circulate with flu, increasing the chance of co-infections. That is why we should change our testing strategy for Covid-19 patients in hospital and test for flu much more widely.”

Professor Calum Semple, Professor of Outbreak Medicine and Child Health at the University of Liverpool, said: “We are seeing a rise in the usual seasonal respiratory viruses as people return to normal mixing. So, we can expect flu to be circulating alongside Covid-19 this winter. We were surprised that the risk of death more than doubled when people were infected by both flu and Covid-19 viruses. It is now very important that people get fully vaccinated and boosted against both viruses, and not leave it until it is too late.”

Dr Geert Groeneveld, doctor at Leiden University Medical Center’s infectious diseases department, said: “Understanding the consequences of double infections of SARS-CoV-2 and other respiratory viruses is crucial as they have implications for patients, hospitals and ICU capacity during seasons that SARS-CoV-2 and influenza circulate together.”

Professor Peter Openshaw, Professor of Experimental Medicine at Imperial College London, said: “Being infected with more than one virus is not very common but it’s important to be aware that co-infections do happen. The vaccines that protect against Covid-19 and flu are different, and people need both. The way that these two infections are treated is also different so it’s important to test for other viruses even when you have a diagnosis in someone who is hospitalised with a respiratory infection. This latest discovery by the ISARIC consortium again adds significantly to improving the way we manage patients.”

The findings have been published in The Lancet.

Source: The University of Edinburgh

The 2021 Economic Scorecard: How China Stacks Up with the U.S. and Its Allies

Josh Lipsky wrote . . . . . . . . .

nce upon a time, the dominant narrative about China’s rise went something like this: What used to be a country stuck in a state-run economic morass had, thanks to its embrace of open-market reforms, broken out from the pack—putting it on track to eventually converge with the world’s largest economies. China might become a geopolitical challenger of the United States and its allies, the narrative went, but commercially both powers would increasingly play the same game. The story we in the capitalist world told ourselves was perhaps even comforting: On the economic front, at least, what China really wanted was to be more like us.

But then China seemingly changed course. In recent years, an increasingly powerful Xi Jinping reasserted the role of the state in the economy. Beijing’s new direction was no longer so clear—or comforting. Amid this uncertainty, a counternarrative was born: China’s purported economic liberalization had been an illusion all along, designed to get a naive United States to give Beijing a free pass as it gathered strength to become a superpower.

Both of these narratives are wrong. With China, the story is never so simple. The truth is that China still hasn’t decided which direction its economy is ultimately headed. And we need a credible way to track its trajectory.

Seeking clarity on China’s economic course, the Atlantic Council’s GeoEconomics Center, which I direct, joined with the China experts at Rhodium Group to launch an innovative, data-driven investigation. What we found tells a nuanced and often surprising story about China and its economic model—a primary source of tension between Beijing and the rest of the world.

Here’s the key takeaway: China is, in fact, conflicted—slowly opening up its economy in some areas while swiftly retrenching in others. In key sectors, Chinese leaders are backtracking. In others, they simply can’t figure out how to successfully reform. And while this zigzag worked in the 2010s, it could become a self-inflicted wound in the 2020s. That’s because China’s economy is now on shaky ground. Its growth over the last decade was largely built on credit-fueled spending that the country can’t afford to replicate in the decade ahead. This means officials in Beijing will need to get serious about the liberalizing reforms they’ve been promising since China’s accession to the World Trade Organization twenty years ago. Otherwise they may face a severe economic slowdown, which would upend the march to prosperity that has been so central to the Chinese Communist Party’s success.

China is, in fact, conflicted—slowly opening up its economy in some areas while swiftly retrenching in others.
Our project started with a foundational question: Is China’s economy becoming more or less like those of the United States and other open-market countries? The answer couldn’t be more important. Mutual trust between the two powers has eroded dramatically—with the United States convinced that it has been taken advantage of through unfair Chinese economic practices, and China insisting that it is in fact reforming and just needs more time to do so like any developing nation.

If China is converging with open-market systems, it would mean that its leaders still see benefit in economic liberalization. Policymakers in the United States and other open-market economies could assume Xi will eventually be compelled—by his desire for continued growth—to make more concessions to international norms such as reducing industrial subsidies and opening up to foreign capital. The United States could slowly reduce tariffs and step away from the mutually destructive trade wars that began in 2018. US and European businesses could count on predictability and continue to invest in China with confidence.

But if China is diverging from open-market systems, it would signal that Beijing believes the country can sustain sufficient growth even as the government clamps down on its private market. Policymakers in the West would then be justified in reassessing the way their countries engage with China and thinking more strategically about protecting their own supply chains and companies (even if those companies haven’t yet fully realized the risk).

To find the answer, we’re launching the inaugural report of our China Pathfinder Project—an exploration of China’s economy in six areas that economists consider critical for open markets. We used this data to create a new scoring system that compares both China’s record of liberalization and its economic performance with those of the United States and nine other leading open-market economies. We then tracked how China has progressed on these metrics over the last decade.

[ . . . . . . ]

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The big picture

This study confounds the narrative that China has never wanted to play by international economic rules. The data demonstrates that under Xi, China has tried to implement some liberalizing reforms. Much of its post-2010 convergence with open-market economies, after all, was under his direction. But, in large part because Xi and other Chinese leaders have been unable to reconcile those efforts with their desire for more control, the reforms have failed to deliver.

That’s a significant distinction. If you’re a US strategist dealing with a Chinese economy that is on its way to becoming more interoperable with your own economy, you’ll play your cards differently than if you believe that Beijing is truly trying to move away from your economic model. For years, policymakers in Washington assumed that Chinese leaders wanted their economy to be more like America’s. Then many of those same people decided that China never wanted to emulate open-market economies at all. US policies have swung like a pendulum because of these assumptions, but both miss the mark.

For US policymakers, the key message from the study is this: China shouldn’t be treated as if it’s attempting to completely diverge from the international economic system. Chinese leaders might yet decide that liberalization is the answer after all. An effort to decouple the US and Chinese economies would thus be not only an implausible and costly economic strategy, but one that treats China like something it isn’t. Washington—and Wall Street—should instead respond to the China that actually exists and focus on areas where there’s real potential to make a difference. If you want to address an emerging problem rather than an old one, place less scrutiny on trade and more on China’s restrictive financial system and Chinese companies that are seeking to list on US exchanges.

The study also discredits the narrative that Chinese leaders have cracked the code coveted by so many authoritarians—that they have figured out a way to have a dynamic economy and illiberal political controls all at once. In category after category, China is inflicting costs on itself through its decisions to not be more like open-market economies. China’s own projections for its GDP growth in 2022 and beyond underscore the risk of this approach. Beijing has reached the limits of what it can achieve with the strategy it’s been pursuing for the past twenty years of attempting to have it both ways.

That means the 2020s could take the country in dramatically different directions. Pathfinder is designed to track the journey ahead. China could either jump to the middle of our dashboard and deliver strong economic growth, or stay mired in its current system and stagnate. Despite what you read about Xi and his intentions, neither outcome is predestined.

Source : Atlantic Council