Russia to US: We're Not Going Anywhere

Russia will build a permanent naval base in Syria at Tartus

Turkey and Russia sign a new pipeline deal

Russia already has a permanent air base in Syria

US Diplomacy Has Reached its Level of Ineffectiveness in the Middle East

Yesterday, we posted a story on why Russia is so intransigent on its Syrian position. in it, Vince Lanci shared his opinion on Russia's continued presence in Syria, and the potential dificulties itraised for Middle East diplomacy.

In his intro, Vince says that he learned of the importance of Syria to Russia by accident. He confesses it was his patriotic ignorance and naivete that led him to ask a military officer the question that opened his eyes to the inevitable outcome of US involvement there. The focus of the post was on the importance of Russia's need for a port to access the Mediteranean.

John Kerry: Add one on the stern side to balance it out

What he also noted was the limitations of the US style of keeping the Middle East's balance of power see-saw. The US keeps ME balance largely by adding to whatever side of the fulcrum demanded it. And never removing things from the see-saw. Removing implies error. And ego prohibits admission of errors. So politicians, regulators, diplomats only add to fix things. This meant they had to fine tune it constantly, as the slightest imbalance could create entropy that destroyed everything. And it is not just in the Middle East. It is the preferred way leaders solve problems in everything.

2008 TBTF Crisis: result, concentrating risk even more in banks and on exchanges

result, concentrating risk even more in banks and on exchanges The Tax Code: the document speaks for itself.

the document speaks for itself. The Middle East: arm our enemies to take out our bigger enemies. Then deal with the people we armed later

That is the US way. Solving event risk by compounding systemic risk.

Meanwhile Russia believes it is protecting itself from an aggressor. Russian's actions are related to domestic issues, not international. It can't effectively defend itself without quick access to the Atlantic. Putin has also been a fine student of using false pretense to get his way. Putin: “We are providing energy for the EU for the past 50 years. We are now working on a second project with Turkey".. to help even more. Hillary would be proud!

Russia: It's About the Port Stupid

Reuters: Russia to build permanent Syrian naval base, eyes other outposts. (10/10/2016) 11:20 AM

“In Syria, we will have a permanent naval base in Tartus. The corresponding documents have been drafted,” Deputy Defense Minister Nikolai Pankov said at a Federation Council meeting on Monday. “We hope that we will soon ask you to ratify these documents.” Reuters described the move as “further evidence Russia is building up its capabilities in Syria” and “another sign it is digging in for the long haul to help prop up President Bashar al-Assad.” Reuters

MarketSlant: Russia isn't Bluffing, Hillary Won't Help- Military Source (10/10/2016) 10:59 AM

"Russia will not back down on Syria, Putin will not walk away from Assad as his ally.... Syria offers Russia the ONLY real water access on the Mediterranean side and therefore the Atlantic. They will not give up this port, It is a line in the sand for their defenses. Russia will (also) likely seek to expand its Atlantic footprint to hedge themselves"- full post here

MarketSlant: Russia Won't Back Down on Syria, Ever (10/08/16)

"The USA is underestimating how important this port is to them.The warasw pact was created out of fear, not aggression.Russia will make good on its cuba threat because if Syria is lost as a water acess point they will need a port in the atlantic. Isreal is not watching just becasue it is muslim on muslim war. It does not want to piss off Russia." full post here

The US is Out of Tricks

More color from Vince: (emphasis ours)

"I walked away from the meeting with a better understanding of the Russian position in context of history. It was clear to me that the US was either ignorant or worse, had finally faced the systemic risks it had created and was powerless to pick sides without pissing off half the globe. That see-saw has so many items on each side creating the balance, that the tiniest miscalculation could tip it. The US style of solving problems is to add complexity (not unlike Fed, IRS, and regulatory methods- Soren) which results in a trade off of immediate event risk for increased systemic risk.

So here we are. Russia wont back down for reasons it feels are self-preservation. The US hasn't yet figured out how to add to either side of the equation without tipping the whole thing. And if nothing is done, the system will surely break. How then has the US simplified its unnecessarily complex creations in the past? It hits the RESET button, military conflict. War, preferably one that can be blamed on the other guy. (in Finance: currency wars>trade wars>military wars- Soren) A diplomatic solution may yet happen, but it wont be through simplifying things. And that will make the "reset" even worse when it comes. War is nature's way of simplifying things I guess."

See Saw System Risk

Staying with the see saw analogy: On one side of 1000 objects weighing 2 tons. On the opposite side are 600 objects weighing 2 tons. This makes it very difficult to add or subtract and maintain the balance. And an imbalance destroys a combined 1600 objects.The balancing act eventually reaches its level of scale. A butterfly lands on one side, and boom it is over. So the balancer seeks more control of the see saw. No wind, no bugs, a completely controlled environment. And lets say he is successful. There is still systemic risk. And that can be described as the board or fulcrum breaking.

Government Should Know its Place

Based on our history, the system breaks. It breaks because government is reactive to crises, not proactive. In business, laws change to follow the lead of business innovations, and that is not a bad thing. But when the government thinks it knows more than the market and tries to change the course of nature we get problems. And that proactivity is based on " We know more than you do". It is based on a belief that people cannot take care of themselves. It is elitist in its origins.

Hockey's 3rd Man Rule is Good Government

Government should stick to facilitating market-clearing events in global as well as business affairs in an orderly manner. Not trying to eliminate them. The 3rd man rule in hockey is a good example of proper government. The fight is going to happen. May as well let it take its course. But let's help the market clear itself without destroying the system.

Here's the full story

Russia Just Defied the US by Doubling Down in the Middle East

James Holbrooks and theAntiMedia.org | If there was ever any question, Russia signaled Monday it intends to be involved in Middle Eastern affairs for a very long time, as Russian officials announced plans to build a permanent naval base in Syria right as Vladimir Putin and Turkish President Recep Erdogan sealed the deal on a new oil pipeline in Turkey.

“In Syria, we will have a permanent naval base in Tartus. The corresponding documents have been drafted,” Deputy Defense Minister Nikolai Pankov said at a Federation Council meeting on Monday. “We hope that we will soon ask you to ratify these documents.”

Reuters described the move as “further evidence Russia is building up its capabilities in Syria” and “another sign it is digging in for the long haul to help prop up President Bashar al-Assad.”

Russia already has a permanent air base in Syria, from which it conducts joint strikes with the pro-Assad Syrian military against U.S.-backed rebels.

As the deputy defense minister was making his comments in Moscow, Russian President Vladimir Putin and his Turkish counterpart Erdogan attended a gathering of the World Energy Congress in Istanbul, where each expressed a desire to move forward with the long-proposed Turkish Stream pipeline.

“We are providing energy for the EU for the past 50 years. We are now working on a second project,” Putin said at the meeting. “We are discussing the Turkish Stream with Erdogan and our other partners and we want to bring this about.”

As a separate meeting, Erdogan said, “We look positively at the Turkish Stream project. Our efforts are continuing.”

The pipeline, which was first proposed in 2014, will carry natural gas through Turkey and on to the European Union. It marks a further strengthening of ties between Turkey and Russia that began back in August.

As Underground Reporter highlighted earlier this year, Putin and Erdogan reportedly “buried the hatchet” regarding the shootdown of a Russian jet by Turkish forces at a meeting between the two men in St. Petersburg. Talks about proceeding with the Turkish Stream pipeline began immediately after.

Friendly cooperation between Russia and Turkey presents something of a problem for the United States, with Turkey, a supposed American ally, and Russia supporting the Assad regime the U.S. has worked so hard to eliminate. The situation was further complicated when Turkish tanks rolled across the border into northern Syria in late August.

Since then, the violence has intensified. The latest attempt by the U.S. and Russia at achieving a Syrian ceasefire was a disaster, and diplomacy officially cratered last week when the U.S. suspended talks with Russia and Putin reneged on a nuclear pact with Washington.

Now, with Russia announcing plans to establish a permanent naval base in Syria and Putin locking the pipeline deal with Erdogan, one thing is being made abundantly clear — Russia, despite the wishes of those in Washington, D.C., has no intention of backing out of the Middle East anytime soon.

Read more by Soren K.Group