09 SEP 16 – Executive Intelligence Summary 🔒

EXECUTIVE INTELLIGENCE SUMMARY – 09 September 16

[wcm_nonmember]In this EXSUM (2195 words)…

• Russia continues campaign of meddling and harassment against Obama admin
• Obama warns of “cyber arms race” with Russia
• Syrian and Hezbollah forces stage operation along Israeli border
• Investment continues to flow into Black Lives Matter, associated funds
• Another round of federal bailouts becoming more likely
• And more…

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Bottom Line Up Front:  Here are the  SHTF trends we’re seeing…

• Putin continually harassing Obama and US foreign policy to diminish US influence and power
• Russian and Chinese cooperation to elevate their global status and become superpowers
• Russian, Chinese, Syrian, and Iranian cooperation to destruct a unipolar world
• The race to automate warfare with machines on a global scale is down to the US and China
• Iran pursuing permanent build-up of forces in Syria to threaten Israel
• Global economic leaders continue path of globalization
• Small but growing push to end the cash economy, shift to digital currency and monetary plutocracy
• Significant threats, including a looming recession, likely to catch up with the US economy
• US legalization of marijuana and targeting of senior leaders is causing substantial pain to Mexican cartels
• Continued investment and high-level advising of Black Lives Matter as a national movement
• Militarization of police continues, setting up federalized domestic security force
• Increasing likelihood of attacks on critical infrastructure, or failing infrastructure

Priority Intelligence Requirements:

PIR1: What are the current indicators of systems disruption that could lead to a SHTF event?

PIR2: What are the current indicators of an outbreak of global conflict? (Russia, China, Middle East)

PIR3: What are the current indicators of military, government, political, or social-related instability or violence that leads to widespread domestic conflict?

PIR4: What are the current indicators of economic, financial, or monetary instability that leads to civil unrest?

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PIR1: What are the current indicators of systems disruption that could lead to a SHTF event?

Russia continues campaign of meddling and harassment

The FBI, CIA, NSA, and DHS are currently investigating the near certainty that Russian intelligence agencies are involved in influencing and manipulating public opinion in America.  Just like the military actions in Georgia, Ukraine, and Syria, Russian influence targeted towards the American public can be attributed to Putin’s effort to supplant US leadership and influence at home and around the globe.  The more destabilized the US becomes, the easier it will be for Russia, China, and the anti-West cabal to fill the vacuum and increase their own influence.  That means that we’re likely to see Putin continue to exploit these “gray areas” where the US finds difficulty in responding and skirts the edge of an actual conflict.  This week, a Russian jet flew within 10 feet of a US spy plane in the Black Sea, and Russian aircraft have harassed the US border for years.  This will absolutely continue until Putin has a reason to stop.  And as previously reported, Russian intelligence activity is likely at an all-time high in America.

From the 24 June 2016 EXSUM:

In all likelihood, Russia’s influence activities in Europe — and in the U.S. for that matter — certainly run much deeper than state-owned Russian television broadcasting propaganda to English-speaking audiences.  And it’s for that reason that Congress included a provision in the 2017 Intelligence Authorization Bill for bringing back the presidentially-appointed Active Measures Working Group, a remnant of the Cold War that was tasked with identifying Russian operatives in America.  Last week, we reported that U.S. officials say there are hundreds of Russian intelligence operatives currently in the U.S.

I put this trend under PIR1 because it’s part of a plan to disrupt the system.  Putin is not altruistic in his approach to toppling the US.  He’s not doing out of the goodness of his heart or to make the world a better place, but to punish America for humiliating the Soviet Union during their collapse.  And if Putin wants to make his mark on history, then there’s no better path for him than to diminish US power and influence, which represents his greatest impediment to providing levity to the Eastern world.  Given that Putin is a determined adversary with substantial capabilities to accomplish his goals, I think we have to prepare for the very real possibility that we experience systems disruption, particularly in the government sector.  A domestic emergency could sideline the election and/or provide the necessary distraction for Putin to achieve his regional goals, which includes pushing back the territory under NATO influence.  Additional information on the Russia-NATO conflict can be found under PIR2.

 

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PIR2: What are the current indicators of an outbreak of global conflict? (Russia, China, Middle East)

The prospects of global conflict continue to revolve around the usual players: Russia, China, and the Middle East. The ways in which global conflict could cause or contribute to a SHTF scenario in America are myriad and they largely depend on which conflict is initiated. We’re certainly at risk of cyber attack in the event of conflict in any of the three regions. Systems disruption, like the price and availability of fuel, is also a top concern that could cause a SHTF event.

Obama warns of cyber “arms race” with Russia

In remarks this week, President Obama warned that we risk a “cyber arms race” with Russia and other nations.  Attempting to prevent what’s already happening, Obama said that he wanted to apply rules and norms to cyber capabilities.  Good luck, Mr. President…

It’s difficult to gauge just how the US matches up with Russia in terms of cyber capabilities.  For one, we don’t understand the full extent of US cyber power.  Unlike Russian attacks against the US and NATO members, we don’t often hear about US cyber attacks/exploitation against Russia or China, or if they’re even being carried out.  Some experts are warning that the US has fallen behind Russia’s cyber arsenal, and that’s problematic given that the next world war, which may involve Russia, will rely heavily on information and cyber warfare.  Should a hot war break out with Russia, I still think that US critical infrastructure is going to be a likely target as Russia attempts to make the war as short and painful as possible.

US continues to warn Russia about intervention

U.S. Defense Secretary Ash Carter this week publicly warned Russian leaders about their intervention against the West.   “We don’t seek an enemy in Russia. But make no mistake – we will defend our allies, the principled international order, and the positive future it affords all of us.  We will counter attempts to undermine our collective security. And we will not ignore attempts to interfere with our democratic processes.”

As we’ve previously reported, Hillary Clinton has a sizeable history of neo-conservative and interventionist foreign policy.  She’s already compared Putin to Hitler, and accused Russia of trying to sway the election in Trump’s favor.  Putin is probably setting himself up for revenge if Clinton is elected, so a conflict with Russia is more likely under a Clinton administration.

Syrian, Hezbollah troops planning operations near Israeli border

One of the more significant developments from the Syrian Civil War is the possibility that Iran leaves a significant and permanent presence behind in Syria.  More specifically, my concern is that Iran uses this opportunity to further expand their foothold in the Middle East and threaten Israel on their doorstep with Syria.  This week, Iran got one step closer with the announcement of an upcoming Hezbollah operation with Syrian forces along the Israeli border.  Should Iranian forces, including the Iranian Revolutionary Guard Corps, become a permanent fixture in Syria, then I think we’ll see an increase in the prospect of war between Iran/Hezbollah and Israel, and that could initiate World War III.

Risk of collapse of Saudi Arabia increasing

For the past year, watchers in the Middle East have been warning that Saudi Arabia is headed for its own financial collapse.  Low oil prices, which have been artificially suppressed in order to put competitive oil companies out of business, have hurt Saudi revenues.  In April, Saudi Arabia took out a $10bn loan to float its required spending, but the kingdom continues to suffer from financial woes.  This week, 31,000 workers filed a complaint over not being paid their wages, some of them for the past seven months.  Additionally, construction companies in the kingdom have not been paid for some of their projects.  Saudi Arabia’s financial problems may not matter to us in the short term, but if civil unrest or violence seen in neighboring countries finds its way to the Sauds, then we’re going to see a new level instability that could spin out of control and require an international effort, to include another conflict.  Additionally, given the somewhat dire circumstances the royal family is facing, we should expect a huge hike in oil prices when OPEC finally decides to ensure that they can sell their oil at the price of their choosing.  Once other oil companies are bankrupt or severely scale back production due to continued low oil prices, I think we’ll easily face six to 12 months of abnormally high costs.

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PIR3: What are the current indicators of military, government, political, or social-related instability or violence that leads to widespread domestic conflict?

Black Lives Matter Roll-Up

Black Lives Matter (#BLM) is professionalizing its outreach and finance strategies.  A group known as International Development Exchange, or IDEX, is a charity organization that can receive grants and tax-deductible donations that are then funneled into the #BLM groups.  There are an estimated 40 chapters in the US.  (Analyst Comment: I am making it a priority to begin mapping out each chapter.)  And that doesn’t include other related groups pushing in the same direction: Black Youth Project 100, Southerners on New Ground and the Million Hoodies Movement for Justice.

In another report, a #BLM founder said that the group was very interested in learning from other “social progress” movements around the globe.  I presume that to include the African National Congress (ANC) movement, a Marxist terrorist organization in South Africa.  I’m not implying that #BLM would pursue the same terror tactics as the ANC, but would study Nelson Mandela and how the ANC organized and politicized their social base and came to political power.  Poor urban school districts in Buffalo and Utica, New York both have chronically absent rates around fifty percent.

Indicator: School absentee rates

According to data from the Education Department’s Office of Civil Rights, about thirteen percent of American students have missed 15 or more days of school.  Those students are disproportionately from minority groups, and half of those numbers come from just four school districts.  Poor urban in like Detroit, Philadelphia, Baltimore, Milwaukee, and Cleveland each have about a third of their students chronically absent, and is a large driver behind those cities’ problems with crime.  I did a bit of searching and was able to find school attendance rates by state (http://nces.ed.gov/programs/coe/indicator_cga.asp), however, many of the individual states have their own data (just search “school attendance rates by district” and “your state”).  Checking school attendance rates may give you a better idea of how your area is doing, or how crime might be affected by rising absentee rates.

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PIR4: What are the current indicators of economic, financial, or monetary instability that leads to civil unrest?

California in the red by $127 billion

One of my top economic concerns revolves around the financial health of states like California and Illinois.  Between unfunded liabilities like pensions and massive budget deficits, I think we run the risk of, eventually, another round of federal bailouts; but this time for states.  That’s obviously unfair for taxpayers in places like Texas who contribute more in federal taxes than the state receives in benefits.  But even if we don’t have a stock market crash or some epic financial default or meltdown, there are still significant pressures on individual states.  According to the Mercatus Institute, which ranks the financial health of states each year, pensions and healthcare costs continue to weigh heavily on state finances.  In several states, pensions are severely underfunded and healthcare costs continue to rise. That’s a trend that will continue.  (Be sure to check your state’s health in the Mercatus report here: http://mercatus.org/statefiscalrankings)

 

JP Morgan’s outlook on national debt default

JP Morgan recently published their take on the five “myths” of national debt.  (You can read it here: https://am.jpmorgan.com/us/en/asset-management/gim/adv/insights/market-insights/5-myths-about-u-s-government-debt)  I found the first three to be most applicable to an economic SHTF situation, and they make the case that the likelihood of an overnight collapse in the near term is still small.  My takeaway is that this report has a lot of financial speak about how the debt is being and can still be managed, however, the underlying factors still spell a longer term trend of very slow growth and stagnation, which may lead to a more rapid collapse in the future.  I think there’s a greater risk right now of very poor and worsening economic conditions that create a host of other problems (like crime and political instability), than there is a risk of an overnight “collapse”.

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Appendix:

ANC: African National Congress

BLM: Black Lives Matter

EXSUM: Executive Intelligence Summary

NATO: North Atlantic Treaty Organization

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