Wednesday, December 21, 2022

And So This Is Christmas

I have to admit I'm not a big fan of Christmas Season.  The overwhelming commercialism is bad enough.  We start with a guy who preached continually about the dangers of materialism and celebrate his birthday with an orgy of materialism that props up our entire capitalist system.  Unlike the list of things Alanis Morissette sings about, that actually is ironic.

For me, though, the real nightmare is the music.  Let's skip over the carols.  They're overwhelmingly schlock, and as Bob Rivers in American Comedy Network sang it, "I think I'd rather have you shove a chainsaw in my ear."  But at least they're short and have no pretensions.  I have to note, though, that one of the best of them, "Carol of the Bells", is actually the Ukrainian New Year song "Shchedryk", dating from back when New Year was in Spring.  Then New Year got moved back to January, and some Anglophone got hold of it, wrote new lyrics, and voila it was a Christmas carol.  Just another example of Christmas flopping its bloated carcass all the way across every stage it lands on.

Anyway.  The real disappointment is the classical side, where the worst is held up as the best.  Menotti's worst opera, Drivahl and the Nut Visitors, becomes his only work anyone knows.  I swear if I hear one more audience chuckle nostalgically when "This Is My Box" starts, I'm going to take a flame thrower to the place.  Crutnacker is Tchaikovsky's worst ballet.  I have to admit I have little use for dance, and ballet is definitely dance, but musically...come on.  An evening of Tchaikovsky will give you hyperglycemia, and the Second Act Endless Parade of Horribles is excruciating even by Tchaikovsky Second Act Endless Parade of Horribles standards.

And then there's Handel's worst oratorio, The Mess.  Thirty minutes of material crammed into two-and-a-half hours.  I've performed the thing more times than I care to think, both choir and orchestra.  I'll take orchestra.  At least hiding in there you can use all that down time to do something constructive, like re-reading Война и мир.  Up in the choir you have to just sit there with a pious, enraptured look on your face while you stare into the abyss.

As I do every year, I'll just be glad when it's over.

No, Old Friend, China Is Not Taking Over

I have an Old Friend (OF) who, like everyone else I went to law school with, is smarter than me.  That doesn't mean they're always right and I'm always wrong though.  This is one of those cases.

On 9 December China formally invited the Arab nations to trade oil and gas in yuan on the Shanghai Exchange.  There has been much pearl-clutching about this being the end of the dollar as the world's reserve currency and China taking over, and OF is one of the big clutchers.  "The oil-dollar link is gone, so Bretton Woods II is now gone, and the yuan is about to take the throne."  No.  Just no.

Admittedly OF knows more about the Gulf these days than I do, having been based there for several years recently.  Unfortunately OF also seems to now be "highly influenced" by certain entities in the Gulf.  I know OF was in a bit of a jam, OF went to the Gulf, and OF was no longer in a jam.  I believe there is something of a Professor Quirrell-Voldemort thing going on.  Besides that, I know more about China than OF.  And Russia.  And the general train wreck of 1973-74.

The collapse of Bretton Woods I in 1971 and the rise of Bretton Woods II in 1974 are convenient fairy tales economists like to tell, but that is what they are: fairy tales.  First, saying that Nixon killed Bretton Woods I when he pulled the plug on gold in 1971 (not 1972 OF) is about like saying Paul broke up the Beatles even though John, George, and Ringo had already called it quits.  Johnson recognized in 1967 that there wasn't enough gold to back enough currency to support the global economy (Oddly enough the same problem that pitched the US into a quarter-century of rolling recession from 1875 to the arrival of the first gold shipment from the Alaska-Yukon Rush, the blessed "one ton of gold", but then who says we can be taught.) and started acting on it.  By the time Nixon took office, the London Gold Pool was dead and De Gaulle was getting his petty revenge for not being treated like the Emperor of the World after WW II (As far as I'm concerned, France will owe us for time and eternity for red-baiting our brilliant leaders into taking over its failed recolonization efforts in Indochina.) by blocking domestic exchange of dollars for francs and hording gold at the dollar's expense, which proved once and for all that gold had to go.  All Nixon did in 1971 was code the patient.  Any resulting panic was due to the usual lack of preparation for the inevitable.

Then there is the myth of how the US brutally strong-armed everyone into Bretton Woods II.  It's a popular story in the Middle East now, understandably so in light of the Afghanistan and Iraq wars and US clandestine operations everywhere else in the region, but let's take a look at July 1974, shall we?  We'd just pulled out of Vietnam with our tails between our legs.  We were in our worst recession since the Depression.  The political scene was a mess; Nixon would be gone in a month.  We honestly felt like we'd had our stuffings kicked out.  Granted, we now had a military with nothing to, and we had lots of unemployed people to feed into that machine.  Granted, we were all really pissed off at OPEC because it was now really expensive to drive our 8 mpg Detroit land battleships in a society built around getting in your car just to visit the neighbors.  But we just weren't up for it.  Sure we could have sent in our professional hitters for some wet work, but putting the requisite boots on the ground to occupy and operate the oil fields?  Wasn't gonna happen, and everybody knew it.  Aside from everything else, it would have put "paid" to Kissinger's efforts in China and the Soviet Union.  So no.

OK, so speaking of China, there's something you really need to know: Everything China does that is outward-facing is theater.  Whether it's the economy, the military, the space program, or whatever, it's propaganda with questionable substance behind it.  And China likes using Westerners to shill for it and has gotten really good at recruiting them.  If you want details, here is a good site to go to, run by someone who has been there.  I'll just share a personal anecdote.  Once upon a time, I was on a multi-discipline team China had brought in to advise it on an environmental issue.  In its drive to industrialize, China had turned a number of its rivers into things that made the lower Cuyahoga look like a bubbling, mountain brook.  Yet people were still living by and using the water from these rivers.  China had been receiving heat from international watchdogs and investors, and so they brought in international experts to help it solve the problem.  Over three years we presented several solutions.  All were declared unfeasible by the Chinese authorities.  In reality they were not interested in solving the problem; they were interested only in presenting an outward-facing appearance of trying to solve the problem.  That's the way it works there.  And that's what the latest dog-and-pony show in Riyadh is all about.

For a currency to be used for exchange or as a reserve, it needs a couple of things.  First, it needs to be issued by a sovereign.  The yuan meets that.  (The euro, BTW, doesn't.  Think the EU is sovereign?  When the US wanted to enforce school desegregation, it sent the US Marshals and the 101st Airborne into the Cracker States to do it.  Ask the EU what it would do if Germany or France told it to pound sand.)  Second, it can't be pegged to another currency, because then any exchange would actually be in the peg.  The yuan doesn't meet this.  "But," you say, "Didn't China remove its dollar peg in 2005?"  Yeah, that's what they said they did.  But since then they've held the yuan in such a tight band around the dollar it might as well be pegged to it.  Again, appearance vs. reality.  Again, image.  China can say it is trading in yuan all it wants, but so long as the yuan's value depends on the dollar, the trades are really in dollars.

One last note.  OF remarks the US can do little to intervene in China's plans because Biden has drained the Strategic Petroleum Reserve to reduce domestic prices.  I'm not a fan of Biden, but I think he's actually done a creditably crafty job here.  He has used the Reserve exactly for its stated purpose, cushioning against supply shocks such as the one created by Bad Vlad.  The Reserve has been drawn down significantly, but it certainly hasn't been drained.  And Biden sold at the top of the market and is now resupplying at the current, much lower price.  If Biden were a Republican, I suspect OF would be calling this a genius business move.  At any rate, the current level of the Reserve does not hamper any steps the US may need to take concerning China's plans.  Should any substantive consequences actually materialize from those plans.

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