Tag Archives: Russia

Read these 2 books if you care about Democracy

Joe Biden this week carrying a copy of Democracy Awakening, via Threads.

While the Hub’s focus is primarily on investing, personal finance and Retirement, Findependence has given me sufficient leisure time to absorb a lot of content on politics and the ongoing battle to preserve democracy and in particular American democracy. What’s the point of achieving Financial Independence for oneself and one’s family, if you find yourself suddenly living in a fascist autocracy?

To that end, I have recently read two excellent books that summarize where we are, where we have come from and where we likely may be going. These books came to my attention from two relatively new social media sites I joined in the past year.

For those who care, I am still on Twitter (now X) but restrict most of my posts there to the financial matters on which this blog focuses. I post there as @JonChevreau, which is the same handle I have on Mastodon (since Nov 6, 2022) and Threads, which I joined a week after its early July launch this summer. Threads is now almost the polar opposite of X politically, a veritable Blue haven: just last week Joe & Jill Biden both signed on as @potus and @flotus respectively, as well as under their real names. So did vice president Kamala Harris (posting as @VP and @kamalaharris).

Amazon.ca

But back to the books. The first must read is Prequel, by the brilliant U.S. broadcaster Rachel Maddow [cover image shown on the left]. Tellingly, it’s subtitled An American Fight Against Fascism.

The second is Democracy Awakening, by Heather Cox Richardson [cover shown below]. Both are available as ebooks on the Libby app, through (hopefully) your local library. I couldn’t find either book on Scribd (now called Everand) but they do have ebook Summaries of both.

An American Hitler?

Given that the 2024 U.S. election is now about 12 months away, there is a certain urgency to these books. The Maddow book I’d read first since it’s a brilliant historical recap of the rise of German Fascism in the 1930s and — the shocking bit! — how close Germany came to installing fascists in America. It’s literally about Germany’s search for an American Hitler it hoped to install. It’s full of sinister characters you’ve probably not heard about before, like the assassinated Huey Long.

Maddow credits the reader with enough intelligence to extrapolate from that period into the current dangerous environment. One is left to infer how she feels about the parallels to the modern GOP and its fascist leader and would-be dictator: she never says their names although she is usually more explicit in her MSNBC and podcast commentaries.

Modern readers could easily substitute Putin’s Russia for Hitler’s Germany and draw their own conclusions about the parallels to collusion with foreign powers.  There are also similarities between protracted attempts by the U.S. government to try the perpetrators in court and the protracted Delay tactics of the Defence — including many U.S. senators of the 1930s and early 1940s. And as is currently the case, these tactics largely seemed to work, since the Allies won World War II before most of the collaborators were brought to justice. Frustrating indeed, as many of today’s Americans bristled at the ultimate futility of the Mueller Report around 2019 and other protracted legal proceedings that may not be resolved before the 2024 election.

Maddow of course hints at this right at the end, quoting one frustrated prosecutor (O. John Rogge) from the 1940s:

“The study of how one totalitarian government attempted to penetrate our country may help us with another totalitarian country attempting to do the same thing …the American people should be told about the fascist threat to democracy.”

Continue Reading…

The Ukraine war: a portfolio review

By Duane Ledgister, vice president, CC&L

(Special to the Financial Independence Hub)

The daily escalation of the war in Ukraine is tragic, and the range of potential outcomes is unsettling. We are seeing a devastating humanitarian crisis and the human toll is immeasurable. Below we speak to some questions we have received and provide insights into how to best manage a portfolio.

Emerging market risks

Russia is one of a group of countries investors call ‘emerging markets,’ which reflects the stage of maturity and development of their economies and financial systems. Collectively, companies in emerging markets are an attractive source of growth for investors, despite their heightened risks. Stock markets in the developed world have comparatively low return expectations resulting from developed markets’ lower economic growth and higher valuations. At CC&L, our emerging markets strategy had a 2% weight to Russian stocks coming into the crisis. When considering this in the context of clients’ overall portfolios, this equates to less than one-tenth of one percent. Client portfolios have no exposure to companies in Ukraine.

What impact has the war had on portfolios?

While direct exposure to Russian and Ukrainian assets may be minimal, portfolios have not been immune to the volatility of the recent weeks caused by the war. Russia and Ukraine are important countries in the supply of commodities. Russia supplied approximately 12% of world oil and about 38% of Europe’s natural gas until the start of the war. Additionally, Russia and Ukraine — known as the breadbasket of Europe — provided roughly 25% of the world’s grain. Since the war began, commodity prices, particularly oil and gas, have shot up, acting like a tax on the global economy. This will put downward pressure on economic growth in many regions.

Context is key

It is important to understand the global economic landscape that was in place before the onset of aggression. The world was experiencing inflation levels not seen in decades, exacerbated by commodity underinvestment and global supply disruptions caused by the COVID-19 pandemic. Economic growth was riding high, boosted by the massive fiscal stimulus to offset COVID-19-related demand weakness. Continue Reading…

How Investors can respond to Ukraine Invasion

By Sa’ad Rana, Senior Associate – ETF Online Distribution, BMO ETFs

(Sponsor Blog)

It has been almost two months since Russia invaded Ukraine. During this time, we have been witnessing the dramatic impact the war has had on global markets and economies. There is also concern with how these events will impact our portfolios and investments. 

Economic Impact

Inflation numbers are expected to continue rising higher and this war will put more upward pressure on inflation. Russia is a large global oil exporter. Increased sanctions on Russia will undoubtedly cause a supply squeeze in the oil market, which will lead to higher oil prices. In addition, Russia and Ukraine both account for about 25% of total wheat exports, which will now be limited. This can drive up food costs on a global scale. The war will also continue to restrict supply chains. For example, planes are being diverted because Russian air space is closed to more than 35 countries. Having to go around Russia leads to longer travel, resulting in increased fuel consumption and trip costs.  Continue Reading…

The most under-owned Asset Class

Pretty much every serious investor has a favourite investment thesis or theme that they employ.  Many of these are mainstream, which, by, definition, means that a number of people do something similar.  One such theme is to invest disproportionately in either dividend paying stocks or stocks that have a history of raising dividends.  Some people like to invest in the so-called FAANG stocks.  Some people like to speculate and call it ‘investing’ by putting large percentages of their assets into new ideas like cannabis stocks.  The point is that there are different strokes for different folks and that virtually everyone can justify their own peculiarities.  People seldom resist their own ideas.

I’m like most people.  For a generation now, I have been pounding my fist on the table about the need to address what I see as a chronic under-investment in emerging market equities.  To me, this asset class makes sense from virtually every meaningful perspective: historical risk, expected return, co-variance, current valuation, prognosis for growth… you name it.

In a world where overall GDP growth is anemic and not likely to improve materially in our lifetimes, emerging economies are the only ones where economic (specifically, GDP) growth remains strong.  These are rapidly industrializing countries which are mostly stable politically, young and full of ambitious strivers who want access to a more western way of life.  Many people are of the viewpoint that the key to a growing economy is a growing middle class. There are far more people entering middle class status in emerging economies than anywhere else. Continue Reading…

Three views of Putin’s Russia: one fiction, two reality

9780374533106_day-of-the-oprichnikBy Jonathan Chevreau

Day of the Oprichnik is a futuristic Russian novel has little to do with Financial Independence but with that disclosed, let me add that I think investors need to keep a close eye on what remains the United States’ biggest nuclear rival.

This week’s issue of The Economist is a good place to start, with a cover story on Vladimir Putin:  Putin’s War on the West, as well as this in-depth feature on What Russia Wants.

As we noted in an earlier Hub review of a trio of books on Putin’s Russia, when you add in the geopolitics of plunging oil prices and the perpetual skirmishes with the Chetchens  and the escalating brinkmanship in the Ukraine, it might be useful for investors to keep tabs on this rogue Capitalist state.

As so often is the case, art sometimes imitates life and sometimes anticipates it. Day of the Oprichnik was published nine years ago and is looking more and more prescient. Vladimir Sorokin, born in 1955, is a prize-winning novelist based in Moscow and also wrote The Ice Trilogy. Day of the Oprichnik was published in Russia in 2006 and the first American translation was only in 2012.

Below, we also look at two more recent non-fiction books on Putin’s Russia: 2013’s Fragile Kingdom and the just-published (2015) Red Notice.

Destined for Silver Screen?

But first, back to the novel. To sum it up in a sentence, I’d say Day of the Oprichnik is a combination of A Clockwork Orange and Fahrenheit 401, Continue Reading…