It was the Unfortunate Mrs O’Leary’s predecessor, Lord Stockton who famously remarked, “Events, Dear Boy. Events!”
This morning, the Unfortunate Right Honourable Kwasi Kwarteng, PC, Chancellor of the Exchequer and the Member for Spelthorne delivered his not so “mini” budget.
It has been said that Unfortunate Mrs O’Leary’s administration are like gamblers in the last chance casino. The two sat side by side like two gamblers at the roulette table placing all their chips on one square and then to watch as the wheel was spun with their fate placed in the three forces of aerodynamics, friction and gravity!
In the Unfortunate Mrs O’Leary’s case the three forces that will decide her fate are the currency markets, the gas markets and Mr Putin!
To quote from Doctor North’s blog-post of 21st September, 2022:
“The Ukrainian gas storage facilities comprise twelve facilities with a total design capacity of 31 billion cubic metres (bcm). This gives Ukraine the largest underground storage system in Europe, substantially more than the 23 bcm operated by Germany, which ranks fourth among the world’s largest storage countries. Of these there exists the giant Bilche-Volytsko-Uherske complex, with a capacity of 17.05 bcm, more than half Ukraine’s total capacity, centred on the village of Bilche, conveniently located in the west of the country, south of Lviv and close to the Polish border. As part of the European gas pool, directly connected into the European pipeline gas transmission system, this forms part of Europe’s strategic reserves which will help keep the lights on over winter. Targeting the highly vulnerable gas injection and recovery sites would require only a small number of low-yield [battlefield nuclear] weapons and, at some distance from Russian territories, fallout impact could be confined to Ukrainian territory, while having a significant strategic effect in damaging European gas supplies.”
Today, Mr Putin’s minions are holding referendums in the four provinces Mr Putin wishes to annex into the Russian Federation. Voting is to take place over the next five days! Anybody who believes that this will constitute a free and fair poll believes in the tooth fairy!
When the Russian Federation formally annexes the disputed territories into itself any continuation of hostilities within these territories will it seems be viewed as an attack on Russia itself.
Mr Putin has repeatedly made thinly veiled threats to use nuclear weapons. He has accused “the West” of nuclear blackmail.
Were Mr Putin to deploy a battlefield nuclear weapon to destroy the Bilche-Volytsko-Uherske complex the political, economic and military consequences are hard to overstate.
Suffice it to say that gas prices would reach levels where the protection afforded by Mrs O’Leary’s measures would become completely unaffordable! The loss of capacity would make power cuts unavoidable. The economic effects would plunge the UK (and other European economies) into a slump. The value of Sterling would plummet as would the Euro. The US Dollar being the world’s reserve currency would be the one safe haven and would soar in value as would the price of gold. This will send inflation up to the levels reached in the 1970s.
The foregoing is based on one premise: That the USA does NOT respond by using nuclear weapons! IF the USA responds with nuclear weapons the likelihood will lead to a global nuclear exchange at which point, the question of the UK’s economy will be moot as we will all be dead – or dying!
The alternative – of not initiating Armageddon – is to force Ukraine into a humiliating negotiated peace. The terms are obvious:
#1: Recognise the validity of the phoney referendums and recognise the Russian annexation of the disputed territories and recognise Crimea as being part of Russia.
#2: Accept that all damage and loss incurred during hostilities be the responsibility of the powers occupying their respective sovereign territory.
#3: Agree to open the Nordstream II pipeline and to purchase Russian gas via this.
In return, Russia will accept Ukraine’s right to join NATO – if that organisation still exists and also Ukraine’s right to join the EU – if that organisation still exists.
This of course will have a catastrophic effect on the chances of success by the Democrats in the US Mid Term elections. It guarantees the resignation of President Biden following these elections.
Here in the UK, we might see Mrs O’Leary’s resignation and the formation of a National Government that would constitute a grand coalition under the leadership of Sir Ed Davey and the Liberal Democrats for the remainder of the duration of the parliament. This because the measures taken would be so severe no party politicians wants to take full responsibility for them!
The big geopolitical problem after this will be nuclear proliferation as nearly every nation state will want “nukes”!