Russia’s state banks are rotten | Business New Europe

Banks epitomise capitalism, but not in Russia. The financial industrial empires of men like JP Morgan, Rockefeller, Rothschild and Harriman are intimately tied up with creating the vibrant no-holds-barred capitalism in the US. In Russia the top five banks are all state-owned and their power comes largely from one man – Russian President Vladimir Putin.

The Russian economy is in recession and most of the important state-owned banks are under sanctions imposed by the US and Europe. Never particularly well run, the current environment means the tide has gone out for Putin’s “state capitalism“ system and it is apparent that several of these banks were not wearing swimming trunks. As the first quarter reporting season comes to an end, all Russia’s large state-owned banks admitted they are struggling.

What now?

With the banks in such a terrible state, the question is what happens now? The CBR’s emergency hike in interest rates to 17.5% in December made the cost of capital unaffordable to potential borrowers and while the central bank has reduced the rate several times since then into the low teens, it is still very expensive. Bank’s lending business, their main form of income, has collapsed as a result.

So far, the CBR has stepped in to provide funding and seen its share of liabilities rise to 11% of the banking sector’s total (in 2008 at the peak of the crisis the CBR accounted for only 3% of total funding). And the lucky few that have access to the state-directed loans are enjoying subsidised loans well below market rates. But the CBR can’t keep this up forever.

The Russian economy has been surprisingly robust in the face of Western sanctions and the ruble’s collapse, and it could even return to growth by the start of next year, so there is light at the end of the tunnel. If there is a “snap-back”, then many loans that were previously impaired could, once again, look profitable. On the other hand, if the outlook for the Russian economy remains bleak, then the situation in the financial sector could spin further out of control.

Russia’s state banks are rotten | Business New Europe

Primakov was Putinism’s ‘Godfather,’ Russian Analysts Say

“Already in 1996, when Primakov headed the foreign ministry, he laid the foundations for the anti-American shift in Russian foreign policy,” Milov says. Among other things, he pushed the Kremlin to provide support for Milosevich in the former Yugoslavia, Saddam Husein in Iraq, and the Iranian nuclear program at Bushehr.

Moreover, the Russian politician and analyst continues, under Primakov’s direction, “foreign ministry documents written in an anti-American tone began to circulate.” He first raised the issue of Russia’s “concern about NATO’s expansion to the east” rather than continuing to ask if and when Russia could join the alliance to meet common threats like Iran.

“Primakov set the tone in all of this,” Milov continues. Had Russia put pressure on Milosevich rather than backed him as Primakov wanted, “it would have been possible to save many lives in the former Yugoslavia.” Equivalent achievements would have been possible in the Middle East and Iran were it not for Primakov’s influence.

Domestically, Primakov’s retrograde positions became obvious when he was named prime minister. “Micromanagement was raised to such a level of absurdity,” Milov says, “that Primakov personally corrected by hand before signing our drafts of decisions on issues about which he could not understand anything.”

Window on Eurasia — New Series: Primakov was Putinism’s ‘Godfather,’ Russian Analysts Say

Prophecy Studies | The Christmas Star

Prophecy Sermons

by Pastor David Mattson,  Foothill Community Church  Angels Camp, CA

Below are two recent sermons given by Pastor David Mattson addressing God’s heavenly signs of the Blood Moon Tetrads and the Messiah’s Star, and one sermon on the meaning and significance of the 2015 Shemitah for America.  They give added importance to the 120 day period between the 30 June re-appearance of the Messiah’s Star and the 28 September appearance of the final lunar eclipse of the 2014-15 Tetrad and what they might mean for Israel and America in this Season of the Lord’s return. (Click on each link for the audio recording.)

1.        Significance of the 2014-15 Blood Moon Tetrad for Israel – 31 May 2015

2.        Significance of the Re-appearance of the Messiah’s Star for America – 7 June 2015

3.        Significance of the 2015 Shemitah for America – 14 June 2015


2014-15 PROPHETIC TIMELINE — God’s Heavenly Signs

Spanning the period of the 2014-15 Tetrad

  • 14-15 April 2014 — First Eclipse, Passover
  • 8 October 2014 — Second Eclipse, Tabernacles
  • 4 April 2015 — Third Eclipse, Passover
  • 17 June 2015 — Jesus Christ’s 2017th Birthday
  • 30 June 2015 — Reappearance of The Messiah’s Star
  • 11 Sept 2015 — Fourteenth Anniversary of 9-11
  • 13 Sept 2015 — 29 Elul (Hebrew calendar) Shemitah
  • 28 September 2015 — Fourth Eclipse, Tabernacles

Prophecy Studies | The Christmas Star

Who’s Afraid of Chinese Colonization? – Carnegie Moscow Center – Carnegie Endowment for International Peace

The news that Russia’s eastern Zabaikalsky region would grant 115,000 hectares of land to the Chinese company Huae Xinban under a 49-year lease stirred up a maelstrom of controversy and anxiety in Russia.  A survey conducted by Rosbalt shows that 50.5% of that news agency’s readers fear such a deal “provides fertile ground for China’s colonization and then annexation of Siberia, and for a major war.”  Another 40% believe that the deal will “deplete Russian agricultural land and bring about the kind of environmental disaster that China has already experienced.”

Russian readers were also enraged by comments from retired Major General Wang Haiyun, a senior advisor at the China Institute of International Studies and a former military attache at the Chinese embassy in Moscow. The newspaper Huanqiu Siabao (The Global Times) cited Wang Haiyun as saying that the deal would spur a relaxation of Russian migration law and a large-scale influx of Chinese labor into the Zabaikalsky region.

Who’s Afraid of Chinese Colonization? – Carnegie Moscow Center – Carnegie Endowment for International Peace

Mass Protests in Armenia Trace Their Inspiration to…Kim Kardashian – The Daily Beast

The eight-day-long protest movement now called “Electric Yerevan” is full of symbols, underlying meanings, multiplying calls for change, and it even has a rather unexpected heroine: Kim Kardashian as Lady Liberty in her father’s family homeland.

The main demand is to stop the price of electricity from increasing by 17 percent. On Twitter, Electric Yerevan published the movement’s diary: it had nothing to do with Arab revolutions, Ukraine’s Maidan uprising, Washington’s or Moscow’s agendas, the activists insisted, smiling to newcomers knowingly, as if to say, wait for a moment and your heart will electrify and that will tell you what we are here for.

The darkness did not stop them; neither did the rain. Thousands of policemen surrounding the protest camp on Saturday did not manage to spoil the movement or the mood—this young generation has no fear, they are sure they will succeed. And some of the changes demanded already are raining down.

Mass Protests in Armenia Trace Their Inspiration to…Kim Kardashian – The Daily Beast

Kim Kardashian Can’t Fix Armenia’s Bleak Future – The Daily Beast

Sure, Kim Kardashian’s splashy visit this month demonstrated to the country that the world was watching, but the celebrity went away and problems stayed. Young Armenians are losing hope that life in their sad, poor country will ever improve: 80,000 citizens out of Armenia’s less than 3 million population have immigrated in the past year.

In one of the few houses still occupied in Sevaberd, Laura Khachaturian, 52, and her children live under a leaking roof with cracks in the walls big enough for a cat to climb through. Her teenage daughters go to a local school that educates a total of 42 children. Two of her nine kids have died because medical services in the area are nonexistent. “We live on 36,000 drams ($76) a month. Snakes crawl on our floor in summer, rain comes through the roof. There is no hope, authorities don’t want to help us,” she said.

The country is trapped in economic, geopolitical, and historical troubles. Its unemployment rate was almost 18 percent at the end of last year, according to official statistics. It has joined in a customs union led by Russia, Armenia’s only real political ally, but that has done nothing to improve the economy. On the contrary, “export to Russia has shrunk by about 20 percent due to the collapsing ruble,” says Parliamentary Deputy Alexander Arzumanian, a former minister of foreign affairs.

Kim Kardashian Can’t Fix Armenia’s Bleak Future – The Daily Beast

Putin Targets Pro-Western Bulgaria

Russia’s assault on Ukraine over the past year has made it clear that President Vladimir Putin is out to reassemble as much of the former Soviet Union as he can, having once called its collapse “the greatest geopolitical catastrophe of the century.” It should be of great concern in the West that Bulgaria, a member of NATO and the European Union, is one of his targets.

In a September address in Sofia to members of the America for Bulgaria Foundation, Bulgarian President Rosen Plevneliev compared Moscow’s stealthy undermining aggression toward Bulgaria to a “Trojan horse” attempt by Russia to penetrate NATO. Our foundation, perhaps Eastern Europe’s biggest, seeks to help Bulgarians preserve their hard-won independence.

Putin Targets Pro-Western Bulgaria – WSJ

U.S. officials see strong possibility of chemical attacks if rebels threaten Syrian regime strongholds

U.S. intelligence agencies believe there is a strong possibility the Assad regime will use chemical weapons on a large scale as part of a last-ditch effort to protect key Syrian government strongholds if Islamist fighters and other rebels try to overrun them, U.S. officials said.

Analysts and policy makers have been poring over all available intelligence hoping to determine what types of chemical weapons the regime might be able to deploy and what event or events might trigger their use, according to officials briefed on the matter.

Last year, Syrian President Bashar al-Assad let international inspectors oversee the removal of what President Barack Obama called the regime’s most deadly chemical weapons. The deal averted U.S. airstrikes that would have come in retaliation for an Aug. 21, 2013, sarin-gas attack that killed more than 1,400 people.

Assad Chemical Threat Mounts – WSJ

Russia braces for ‘Euromaidan’ in Armenia | Asia Times

The influential Moscow politician, Konstantin Kosachyov, who heads the Federation Council’s (Duma) International Relations Committee has warned that the crisis is following the script of “color revolutions” in Georgia and Ukraine.

The well-known Russian pundit Sergei Markov wired to the Russian establishment has alleged that the protests in Yerevan are “being directed from an external headquarters” (read Washington). Of course, such allegations are difficult to prove in real time and the US media organs have been plainly dismissive, claiming that the “civil society” in Armenia is spearheading the mass protests and there is no “foreign hand” involved.

If the protests gather momentum, Moscow will be caught on the horns of a dilemma. With hindsight, Moscow has estimated that the deposed Ukrainian president Viktor Yanukovich’s refusal to heed Russian advice to use force to quell the ‘Euromaidan’ protests in a critical period in February last year proved to be his undoing and resulted in his overthrow.

By the same logic, the pro-Russian leadership in Armenia is walking a fine line.

On a broader plane, Armenia becomes a test case of the impact of the Ukraine crisis on the collective psyche of the people in the former Soviet republics in the Caucasus and Central Asia. Are the ‘masses’ in these regions drawing inspiration from the regime change in Ukraine and are they ready for their own ‘Euromaidan’? That is the question.

Russia braces for ‘Euromaidan’ in Armenia | Asia Times

Map of Armenia:

Japan Unleashed: The Good, the Bad and the Ugly | The National Interest

A fight between Japan and China remains the ugliest possible outcome of Japan’s newly-implemented national security policies. Japan’s invasion of China in WWII engendered an inextricable historical feud between the two nations. While Japan may never offer a formal apology for the atrocity, China feels that no compensation from Japan can mitigate the crime. China–Japan relations have been hampered by this incessant problem. Now that Japan and China are pitted against each other in a putative contest for supremacy in Asia, an unleashed Japan may stage a tough match with a rising China. Provocative moves on either side could trigger a showdown. The increased Chinese and Japanese militarization around the Senkaku Islands portends the possibility of such a conflict. Though no shots have been fired (yet) in the region, it is not difficult to imagine how this regional powder keg could be set off by a small miscalculation between the two nations. For example, conflict could be sparked by the sailing of a Chinese vessel within the Senkaku Islands’ twelve mile territorial waters or an unsavory interaction between Chinese and Japanese fighter jets in the two nations’ overlapping air defense identification zones. Given each nation’s military capacity and economic power, a war between the world’s number two and three economic powers would be long and costly. Adding fervent Chinese and Japanese nationalism to the mix creates an extremely potent brand of international conflict.

Japan Unleashed: The Good, the Bad and the Ugly | The National Interest

The Worst Is Yet to Come: Greece and Europe’s Economic Woes Aren’t Over | The National Interest

More frightening, this weakness in the system of official support leaves a potential for considerable harm should Italian, Spanish or other depositors in Europe’s periphery follow the Greek example. Even with great faith in their government’s commitment to the euro, Italians, Spaniards and others still might take their money out of local banks just to play it safe. There is, after all, little cost to such a move. Should such outflows gain momentum, little could be done to save these countries from a shortage of liquidity, with all the associated economic and financial harms that would go with it. These nations would then have still more trouble making good on their debt obligations, and the ECB would have to struggle still harder to support their finances.

Such trends could, in the extreme, precipitate a full-blown financial crisis. Widespread concern over bank illiquidity would cause doubt about the ability of banks to fulfill their obligations. People and other institutions would then shy away from transacting any business with them. And since no one could know which firms had liquidity problems, that wariness could extend to just about all. Financial flows could then freeze up, shutting down the great amount of economic activity that depends on them. This is exactly what happened in the United States in 2007-08, when a similar wariness developed around each firm’s exposure to subprime loans. If the cause this time in Europe has different roots, the result could well be the same. And because all financial institutions in the world deal with each other, the situation would quickly spread around the globe, as America’s financial problems did seven years ago.

The Worst Is Yet to Come: Greece and Europe’s Economic Woes Aren’t Over | The National Interest

Monitoring emerging risks.