I told you Russia holds the key to the US economy. Were you paying attention?

I told readers before that Russia holds the key that can make or break the US economy. No one ever talks about this and the “news” from the msm, including the “financial news,” always seems to miss this point. After all, there is no such thing as real financial news in the Western world. 99% of what we are told is propraganda aimed at buoying up the markets, which have  already been in bubble mode and about to pop on news of a possible black swan event. The black swan is here and it is called COVID-19, the Chinese coronavirus.
 
But Russia just threw the world a hard ball and the possibility I pointed out back in June 2019 is now breathing down our necks. Did you expect this? What does your favourite news source say?
 
Here was the article in question:
 
HOW RUSSIA COULD BRING DOWN THE US ECONOMY (but probably won’t)
http://www.newsilkstrategies.com/economics-and-finance/how-russia-could-bring-down-the-us-economy-but-probably-wont
 
Allow me to quote myself from the above-linked article:
 
Theoretically, Russia could put the screws to Washington simply by controlling oil prices. If Russia started pumping oil as fast as it could, this would drive down the oil price to below the limit required by the US shale oil operators that Trump is counting on to make America great again for the zillionth time (I’ve lost count of all the times it was great again before). It could pretty much wreck the US economy.
 
Russian-language financial news outlets are finally talking about Russia’s potential impact on US shale oil. Notably, rueconomics.ru just today ran the headline (my translation): Russia’s position on OPEC+1 will be a serious blow to US shale oil (Позиция России по ОПЕК+ станет серьезным ударом для сланцевой нефти США). “Serious blow” is way understated. It could easily be a fatal blow. After all, it was the shale oi "miracle" that added new jobs that Trump touted as his chef d'oeuvre. Digging more deeply, note that Saudi crown prince MBS is launching a crackdown on a would-be palace coup, blaming royal family members of plotting with Americans to depose him. The Reuters report on this has everything to do with our story. In view of MBS’s suspicion of US involvement, I suspect that MBS, not Russia, is behind the opening of the floodgates. After all, it is entirely possible that the Saudis talked Putin into announcing his refusal to go along with the OPEC oil sale cutbacks. This would avenge MBS of the US for its supposed role in the coup attempt. But Russia would also certainly have a motive for slapping back at the US for its years-long ill treatment of Russia.
 
I also keep saying that the US made a terrible bet on shale energy because oil and gas from shale is very expensive to extract (requiring fracking) and requires a high sale price, making the price at the pump higher than you the consumer would like. BTW, msm and political-class propaganda to the contrary, the high consumer prices mandated by shale drillers are not a sign of a healthy economy, quite the opposite. With the dollar inflating, you want affordable prices to offset inflation (BTW, that was China’s role until recently). I also keep saying the proper time for the US to extract shale energy would be during a future worldwide oil shortage when a higher price would be sustainable and when the US would need this energy for security. But no, we are using up these reserves at a time when there is so little profit in shale that companies are going bankrupt on a regular basis! According to an analyst quoted by Reuters, US shale oil drillers need a WTI (West Texas Intermediate, the accepted benchmark) price of $50 minimum to stay in business. Keep this number in mind.
 
So now comes the really bad news and Russia is the fly in the ointment. CNBC announced just 2 days ago:
 
“International benchmark Brent crude traded at $45.46 a barrel Friday afternoon, down over 8%, while U.S. West Texas Intermediate sank to $41.93, also around 8% lower.”
 
Ok, so even more shale drillers will go bankrupt now and nothing can save them – partly because the epidemic (of suspicious origin) is disrupting Chinese manufacturing, making China use less oil, and partly because of this OPEC+1 refusal to continue the cuts – at exactly the worst possible time. So what does this have to do with Russia? The article goes on to say that OPEC is seriously weighing opening the floodgates and no longer abiding by the old iron-clad rule of making production cuts of between 1.5 million to 1.7 million barrels a day in order to keep the prices reasonably high, primarily for the sake of their shale drilling pals across the sea.
 
The reason for these tentative plans? Russia. We speak of OPEC+1, where the 1 is Russia, which never agreed formally to join OPEC but has agreed to various deals such as notably these cuts. But now that a black swan event has occurred, ie, the COVID-19 pandemic, Russia is balking and will not agree to any cuts at all -- which is why Saudi says it will no longer sustain the agreed production cuts. At least that is the story so far.
 
What an awful thing for Russia to do to its US partner, right?
 
Well consider how nice the US has been to Russia all along.
 
– US ambassador to the UN Nikki Haley famously said “We don't trust Russia; we don't trust Putin; we never will. They're never going to be our friend. That's just a fact.” And “we'll slap them when needed.” Now these words were uttered in public by the highest ranking ambassador in the US serving at an international body. No other US diplomat had ever said anything this crude about any other country at any time in history, not even about Mussolini, Hitler, Stalin or Mao during the terms of these men in office. And yet there is a good reason for restraint by diplomats. Because quite often, what goes around comes around. Diplomats – who usually have some training in diplomacy or at least some degree of common sense – are expected to use diplomatic language even when they are angry or dislike the country they are dealing with because leaders of nations have ways of hitting back at the US. But Nikki turns on her mouth before her brain. And the most telling thing about Nikki’s inappropriate remarks was that hardly any US official called her on this grotesque breach of protocol. They acted as if they agreed with these racist statements (ok, Russians are not a race, but they are an ethnicity and she was saying the US will never trust an entire ethnicity. Suppose she’d said that about Jews? And Putin was listening. He is slow to anger but never forgets).
 
– The US ambassador to Germany, Richard Grenell, has repeatedly and insistently tried to strong-arm that country to refrain from buying Russian natural gas, even though it had bought this gas since Soviet times and has always relied on this cheap energy source. Russia had never applied palpable political pressure on Germany using this commercial relationship as a lever, since Russia needed the income as much as Germany needed the energy. Thus Grenell’s argument that consuming Russian gas would threaten Germany’s “energy security” was just part of a naked attempt to use political pressure to force Germany to buy US LNG at premium prices that would really threaten Germany’s energy security. In fact, in the unlikely event that Russia had sought to use the gas prices to blackmail Germany, the country could have easily set up a hub for LNG, including US LNG – although realistically, thanks to this US bullying and to the high US prices, the US would probably not be its supplier of choice. It is noteworthy that fairness in business and trade is a cardinal principle of the German business culture. Once a trading partner is identified as cheating or, especially, extortion – which is exactly how the Germans interpret the US actions – they will normally discontinue relations with that partner.
 
 – Making good Grenell’s threats, the US slapped third-party sanctions on the companies involved in the Russian Nord Stream 2 gas pipeline project intended to deliver Russian gas to Germany, ultimately bringing the project to a halt. Fortunately for Russia, it possesses one ship capable of laying submerged pipe, with which to replace the two ships of the sanctioned Swiss-Dutch Allseas company. The completion will be delayed by several months inflicting losses of billions of dollars for Russia.
 
– The US has been busy for years interfering in the affairs of states of the former Soviet Union in order to weaken the economic and political relations between Russia and its traditional partners. Ukraine was the prime target. Because Russia refused to go quietly into the night on these issues, and has allegedly supported the self-defence of 2 renegade republics in Donbass (which was subjected to genocidal attacks on its citizens), the US heaped sanctions on Russia, and has done so since 2014. Recently, the US has imposed sanctions on Russia, Iran and Syria for alleged “war crimes,” though this is a case of a war criminal that slaughtered civilians in Nagasaki, Hiroshima, Dresden, Korea, Vietnam, Iraq, Afghanistan, Libya, Syria and others, introduced terrorists into the Middle East and supported them for over a decade, trying to assert a moral authority that it clearly does not possess over states that have never been proven – only alleged by this war criminal – to have perpetrated crimes – without proof.
 
Putin now has the chance for retaliation. What will he do? Will the US start to treat Russia as a respected peer or will it continue the anti-Russian harassment as it sinks into economic oblivion? It’s all up to Washington.
 
Relevant:
 
News from Isreali newspaper Haaretz on the COVID-19 epidemic.
 
Analysis Israel vs. U.S.: Coronavirus Crisis Shows Importance of Public Healthcare System
“The idea that people suspected of having the coronavirus must pay for testing and any treatment is nearly inconceivable to Israelis, but that’s what Americans face”