For Russia, Change Comes SWIFTly

Authored by Tom Luongo,

During the ruble crisis of 2014/15 Russia announced in the wake of U.S. and European sanctions over reunifying with Crimea that it would begin building a domestic electronic financial transfer system, an alternative to SWIFT.

That system, System for Transfer of Financial Messages (SPFS), is not only now functioning in Russia, according to a report from RT it now handles the financial transfer data for more than half of Russia’s institutions.

According to Anatoly Aksakov, head of the Russian parliamentary committee on financial markets:

The number of users of our internal financial messages’ transfer system is now greater than that of those using SWIFT. We’re already holding talks with China, Iran and Turkey, along with several other countries, on linking our system with their systems,” Aksakov said.

“They need to be properly integrated with each other in order to avoid any problems with using the countries’ internal financial messaging systems.”

This is a follow up to last month’s boast by the Russians that their system was seeing a lot of international interest.  How much of this is boast and how much of it is reality remains to be seen, but the important point here is that the minute the U.S. weaponized SWIFT for use in its foreign policy, something like this was bound to occur.

China has its own internal system.  And other countries are building theirs as well.

The SWIFT Cost

A common theme on this blog is that control is an illusion.  Power is ephemeral.  The best way to exercise your power is to have it but never use it.  Because once you do use it you define for your enemies the costs of their lack of compliance to your edicts.

And if there is one thing humans are good at it is responding to known incentives.  Once we can calculate the cost of one behavior over another we can then decide which one is more important to us.

Once costs of staying in SWIFT rise above the benefits of building your own alternative, you build an alternative.

SWIFT is a market power similar to a CEO having billions in restricted stock in their company.  A lot of hay is made about the net worth of people like Jeff Bezos and Mark Zuckerberg.

Quoting their net worth by multiplying their known holdings times the current price of the stock is useless.  Because they can’t sell it.  It is market power or perceived wealth that evaporates the moment they signal to the market their intention to sell.

In reality, if they tried to sell their stock all at once the value of the stock would plummet as buyers would run for the hills and they would realize far less than their stated net worth before the selling began.

So, if anything they are a captive of their own success, needing to manage the creation carefully to avoid damaging its reputation, market position and, ultimately, its business.

SWIFT is a monopoly system, a monopoly born of convenience and inertia thanks to it being neutral to whims of international political spats.  Enter the late stage of imperial thinking in the U.S. where our control over world affairs is waning first in the hearts and minds of various people around the world and then in policy and you have the beginning of the end of SWIFT as the only international financial transfer system.

Back in 2010, I remember Jim Sinclair banging his shoe on the table about our threatening Switzerland over opening up its customer data looking for ‘tax cheats’ under FATCA.  He said then that the Obama administration was idiotic for doing this.

This is where I got the maxim, once you go nuclear you have no other option.  

And he was right.

Then Iran was cut out of SWIFT in 2012 to effect regime change which also failed.  And that woke the world up to the reality.  The U.S. and Europe will attempt to destroy your livelihood if you dare oppose its unilateral demands.

Our political and financial elites, The Davos Crowd, will stop at literally nothing to ensure your compliance.

Too bad that SWIFT is just code.  It’s just an encrypted messaging system.  And like the push to stifle alternative voices on social media – de-platforming Alex Jones and Gab for examples – the solution to authoritarian control is not fighting fire with fire, but technology.

And that’s exactly what Russia has done.  They applied themselves, spent the money and wrote their own code.  Code is, after all, hard to control.

De-coding SWIFT’s Power

It is also what is happening all over the Internet communications supply chain right now.  The infrastructure independent content producers need to resist corporate control is being built and will see their businesses rise as so many more people are now woke to the reality of the situation.

As Russian banks and businesses reap the benefits of no longer existing under SWIFT’s Sword of Damocles, others will see the same benefits.

I’ve been making this point all year, the more the Trump administration uses tariffs and sanctions to achieve its political goals the more it will ultimately weaken the U.S.’s position worldwide.  It won’t happen overnight.

It will build, gradually, steadily until one day the threat will no longer be there.

We may have already reached that moment as President Trump has ruled out pressuring SWIFT to cut Iran out of the system.  Too bad his evil Treasury Secretary Steve Mnuchin doesn’t agree with him.

But, Mnuchin is living in the past, he doesn’t respect the resistance that’s forming to U.S. financial hegemony.  He will though when it proves ineffectual.

Russia’s SPFS will gain clients across Iran, Turkey, China and the rest of its close trading partners.  This will accelerate the de-dollarization of Russia’s main trade, hydrocarbons, since many of these countries are major buyers of Russian oil.

When you hear the announcement from a German bank under sanctions from the U.S. for trading in Russian energy that it will use SPFS as its transfer system, that will be the real wake up call to the markets.

Change then will comes, forgive the obvious pun, swiftly.

*  *  *

Join my Patreon if you want to understand how swiftly things change.

The U.S. “Cannot Win Militarily” In Afghanistan, Says Top Commander In Shocking Interview

Historians of the now seventeen-year old U.S. war in Afghanistan will take note of this past week when the newly-appointed American general in charge of US and NATO operations in the country made a bombshell, historic admission. He conceded that the United States cannot win in Afghanistan.

Speaking to NBC News last week, Gen. Austin Scott Miller made his first public statements after taking charge of American operations, and shocked with his frank assessment that that the Afghan war cannot be won militarily and peace will only be achieved through direct engagement and negotiations with the Taliban — the very terror group which US forces sought to defeat when it first invaded in 2001. 

“This is not going to be won militarily,” Gen. Miller said. “This is going to a political solution.”

Gen. Austin Scott Miller, the U.S. commander of resolute support, via EPA/NBC

Miller explained to NBC

My assessment is the Taliban also realizes they cannot win militarily. So if you realize you can’t win militarily at some point, fighting is just, people start asking why. So you do not necessarily wait us out, but I think now is the time to start working through the political piece of this conflict.

He gave the interview from the Resolute Support headquarters building in Kabul. “We are more in an offensive mindset and don’t wait for the Taliban to come and hit [us],” he said. “So that was an adjustment that we made early on. We needed to because of the amount of casualties that were being absorbed.”

Starting last summer it was revealed that US State Department officials began meeting with Taliban leaders in Qatar to discuss local and regional ceasefires and an end to the war. It was reported at the time that the request of the Taliban, the US-backed Afghan government was not invited; however, there doesn’t appear to have been any significant fruit out of the talks as the Taliban now controls more territory than ever before in recent years

Such controversial and shaky negotiations come as in total the United States has spent well over $840 billion fighting the Taliban insurgency while also paying for relief and reconstruction in a seventeen-year long war that has become more expensive, in current dollars, than the Marshall Plan, which was the reconstruction effort to rebuild Europe after World War II.

Even the New York Times recently chronicled the flat out deception of official Pentagon statements vs. the reality in terms of the massive spending that has gone into the now-approaching two decade long “endless war” which began in the immediate aftermath of 9/11.

Via NYT report

As of September of this year the situation was as bleak as it’s ever been after over a decade-and-a-half of America’s longest running war, per the NYT’s numbers:

But since 2017, the Taliban have held more Afghan territory than at any time since the American invasion. In just one week last month, the insurgents killed 200 Afghan police officers and soldiers, overrunning two major Afghan bases and the city of Ghazni.

The American military says the Afghan government effectively “controls or influences” 56 percent of the country. But that assessment relies on statistical sleight of hand. In many districts, the Afghan government controls only the district headquarters and military barracks, while the Taliban control the rest.

For this reason Gen. Miller spoke to NBC of an optimal “political outcome” instead of “winning” — the latter being a term rarely if ever used by Pentagon and officials and congressional leaders over the past years. 

Miller told NBC: “I naturally feel compelled to try to set the conditions for a political outcome. So, pressure from that standpoint, yes. I don’t want everyone to think this is forever.”

And ending on a bleak note in terms of the “save face” and “cut and run” nature of the U.S. future engagement in Afghanistan, Gen. Miller concluded, “This is my last assignment as a soldier in Afghanistan. I don’t think they’ll send me back here in another grade. When I leave this time I’d like to see peace and some level of unity as we go forward.” 

Interestingly, the top US and NATO commander can now only speak in remotely hopeful terms of “some level of unity” — perhaps just enough to make a swift exit at least. 

33 Trillion Reasons Why The New York Times Is Wrong About Russiagate

Authored by Gareth Porter via ConsortiumNews.com,

New research shows The New York Times was even further off the mark in blaming Russian social media for Trump’s win…

Even more damning evidence has come to light undermining The New York Times‘ assertion in September that Russia used social media to steal the 2016 election for Donald Trump.

New research shows that a relatively paltry 80,000 posts from the private Russian company Internet Research Agency (IRA) were engulfed in literally trillions of posts on Facebook over a two-year period before and after the 2016 vote.

That was supposed to have thrown the election, according to the paper of record. In a 10,000-word article on Sept. 20, the Times reported that 126 million out of 137 million American voters were exposed to social media posts on Facebook from IRA that somehow had a hand in delivering Trump the presidency.

The newspaper said:

“Even by the vertiginous standards of social media, the reach of their effort was impressive: 2,700 fake Facebook accounts, 80,000 posts, many of them elaborate images with catchy slogans, and an eventual audience of 126 million Americans on Facebook alone.”

But Consortium News, on Oct. 10, debunked that story, pointing out that reporters Scott Shane and Mark Mazzetti failed to report several significant caveats and disclaimers from Facebook officers themselves, whose statements make the Times’ claim that Russian election propaganda “reached” 126 million Americans an exercise in misinformation.

What Facebook general counsel Colin Stretch testified before the Senate Judiciary Committee on October 31, 2017 is a far cry from what the Timesclaims.

“Our best estimate is that approximately 126,000 million people may have been served one of these [IRA-generated] stories at some time during the two year period,” Stretch said.

Stretch was expressing a theoretical possibility rather than an established fact. He said an estimated 126 million Facebook members might have gotten at least one story from the IRA –- not over the ten week election period, but over 194 weeks during the two years 2015 through 2017—including a full year after the election.

That means only an estimated 29 million FB users may have gotten at least one story in their feed in two years. The 126 million figure is based only on an assumption that they shared it with others, according to Stretch.

Facebook didn’t even claim most of those 80,000 IRA posts were election–related. It offered no data on what proportion of the feeds to those 29 million people were.

In addition, Facebook’s Vice President for News Feed, Adam Moseri, acknowledged in 2016 that FB subscribers actually read only about 10 percent of the stories Facebook puts in their News Feed every day. The means that very few of the IRA stories that actually make it into a subscriber’s news feed on any given day are actually read.

And now, according to further research, the odds that Americans saw any of these IRA ads—let alone were influenced by them—are even more astronomical. In his Oct. 2017 testimony, Stretch said that from 2015 to 2017, “Americans using Facebook were exposed to, or ‘served,’ a total of over 33 trillion stories in their News Feeds.”

That 33 trillion figure is 412.5 million times larger than the total of 80,000 IRA posts in that two year period. To put that in perspective, the Russian-origin Facebook posts represented just .0000000024 of total Facebook content in that time.

Shane and Mazzetti did not report the 33 trillion number even though The New York Times’ own coverage of that 2017 Stretch testimony explicitly stated, “Facebook cautioned that the Russia-linked posts represented a minuscule amount of content compared with the billions of posts that flow through users’ News Feeds everyday.”

The Times‘ touting of the bogus 126 million out 137 million voters, while not reporting the 33 trillion figure, should vie in the annals of journalism as one of the most spectacularly misleading uses of statistics of all time.

A Gun Capable Of Fitting Into A Wallet Is Being Sold By An American Arms Company

The National Interest recently profiled the latest firearm which is pushing the limits in terms of size and technology — except this isn’t a “big gun” but quite the opposite. A North Carolina company has produced and is currently selling a single-shot “credit card gun” which fits into a wallet, and which can be neatly tucked away in a person’s back pocket

A military analyst writing for The National Interest describes the gun, called the “LifeCard,” as “a single-shot, single-action .22 designed to resemble an innocuous credit card.”

The credit-card sized pistol was “fashioned from lightweight anodized aluminum with a steel trigger and tilt-up barrel” which enables “the 7 oz. pistol folds up into a 3.375 inch by 2.215 inch card that, despite its half-inch thickness, can fit with relative ease inside your back pocket or average wallet.”

It was developed by a North Carolina-based company Trailblazer Firearm, and has enough ammo storage for four rounds.

The company has billed it as a weapon of “last resort” in dangerous, unexpected situations, but it’s also sure to draw controversy given the extreme ease of concealment and potential for passing through security screenings, similar to the controversy evoked by 3-D printed guns.

Via Trailblazer Firearms

“Trailblazer Firearms fully intends to spearhead innovative new firearms products starting with the LifeCard, available later this month,” Trailblazer president Aaron Voight said in a statement. “New designs and true innovation have been the exception and our goal is to be the pioneer laying new trails for gun enthusiasts, designers, and manufacturers.”  

But Jared Keller, writing for the military website Task & Purpose, poses the following question regarding the weapon’s ultimate effectiveness in a life and death situation

But how effective would this $400, uber-hyped firearm actually be in a situation that calls for a stealthily concealed weapon, or a quick draw? The product is so new that reports from the urban battlefield have barely been released.

Though the tiny weapon, which is being compared to the turn-of-the-century Chicago palm pistol, was first unveiled in 2017, it is only recently picking up visibility in the media as the popularity of the weapon grows. 

It’s already angering some pundits and journalists on social media after an Israeli arms company recently took note of it

According to the National Interest the gun has been deemed in compliance with the American National Firearms Act given that it’s incapable of firing when folded

Below is a short video produced by the manufacturer showing just how quickly the “LifeCard” can be deployed. It definitely appears something straight out of James Bond’s collection.

* * *