The Ultimate Chess Game
Legendary chess player, Gary Kasparov, has a new opponent: Vladimir Putin. Kevin Kerr looks at Kasparov’s uphill battle against fascism through the eyes of the Russian press…
My wife Katrin is also sometimes my researcher, especially for stories from the Baltic, since she is Estonian and also speaks fluent Russian.
Most recently, there has been a lot of chatter about Gary Kasparov, the infamous chess player, and his fight against Vladimir Putin. Katrin helped me collect my research through several Russian news agencies, translating the stories for me. It’s invaluable to be able to read the stories from the perspective of the Russian press. Here’s what we found:
With new pipelines running through the region, key commodities and resources in demand and the need for more investment capital in Russia, the actions of the next year will be key for what happens for decades to come.
The Cold War may be over, but the sentiment in much of Russia is still suspicious of Americans and the West. Now, legendary chess player, Gary Kasparov may be getting involved in the ultimate chess match, and the stakes are high.
Garry Kasparov: Kasparov’s New Opponent
Kasparov has a new opponent: Russian leader Vladimir Putin. After over two decades of dominating the chess world, establishing a place in history as perhaps the greatest in the game, Kasparov has a very different opponent in his sights.
Kasparov was born in 1963 in the Azerbaijan capital, Baku. His father was of Jewish descent and his mother was Armenian. Since Kasparov’s 1985 victory over Anatoly Karpov to become the world champion of chess, he has been described as the outsider who, like the country of Azerbaijan, took on the Soviet establishment… and won!
Most recently, Kasparov helped to establish a group, Committee 2008, dedicated to suppressing Putin and halting the constitutional changes allowing the Russian president to run for a third term. As far as Kasparov is concerned, President Vladimir Putin’s regime is dealing in “fascism” and dismantling Russian democracy. Kasparov says the West is to blame for this, too, and that the West is primarily concerned with the stability in the East.
I believe that Kasparov does wish the best for Russia, but I question his biased tale of Russia’s political environment today. A lot of what Kasparov writes seems more like a Putin-bashing session, rather than sustentative ideas.
Recently, the BBC reported that Kasparov said that allowing Moscow to host the G-8 summit in 2006 is synonymous to allowing Nazi Germany host the 1936 Olympics:
“[It is vital] to make sure there is no G-7 meeting in Moscow in 2006. It will be like the Berlin Olympics in 1936, it will be the equivalent of Munich 1938, integrating Putin’s Russia.
“The democracies are conceding to a brutal dictator. He has abolished the nature of democratic institutions. He will go further. The West must stop its overt and tacit support for Putin.
“What is required from the West is a simple message: ‘Leave us alone.’ Don’t support Putin.
“It is not about giving support to us, but Putin’s main support comes from Western leaders. President Bush is not shy about calling this KGB colonel his friend.”
Garry Kasparov: Upholding Democracy? Fighting Corruption?
Kasparov goes on to say that the YUKOS sale was “the greatest robbery of the 21st century.” Needless to say, I don’t think he will be invited to dinner at the Kremlin anytime soon.
According to the articles Katrin showed me, most Russians don’t trust the West, even now. And many others simply think of Kasparov as a buffoon.
Putin himself has compared Russia’s democratic standards with any from the West. He states that he is upholding democracy and fighting corruption.
Where in the West? Cuba?
Even so, observers from the Organization for Security and Cooperation in Europe criticized the presidential election and earlier elections to the Duma and are keeping a close eye on the whole situation.
Recently, when speaking of the collapse of the Soviet Empire, Putin described the event as “the greatest geopolitical catastrophe of the century.” Putin had also fostered separatist movements inside Russia.
During his annual State of the Nation Address, Putin told parliament and the country’s top political leaders that the fall of the Soviet Union was “a genuine tragedy” for Russians.
But the real problem is that big business is like the queen in chess: vital. Unfortunately, nobody wants to rush in to invest after YUKOS.
Last month, Putin tried to reassure business leaders that the influx of back-tax investigations, ignited by the probe against the YUKOS oil company, would be managed using greater restraint.
But those words were quickly forgotten. The Anglo-Russian oil company, TNK-BP, was first victimized with a $1 billion back-tax bill weeks later. Then, Russian antitrust authorities deflected an investment made by Germany’s Siemens AG – so much for bringing things under control.
Regardless of some claims, according to several articles Katrin translated for me, Putin’s popularity during the last year has been blemished by the onslaught of street protests due to social reform and by the uprisings in the ex-Soviet republic of Ukraine.
Garry Kasparov: Business as Usual
The big question now is: What next? Putin cannot constitutionally seek a third term, but many Russians – and Katrin, too – assume that the Kremlin will befriend a Putin loyalist for the balloting in 2008.
Make no mistake – it’s business as usual in Moscow.
The stakes are high right now…and as Russia gets more and more tied in with China and as more pipelines are built, the shape of the Baltic is changing forever.
The role of the Trans-Siberian Railroad in the economy of the Asia-Pacific region is becoming more significant each year. The Grodekovo-Suifenhe Russian-Chinese railroad corridor has experienced the most rapid growth in freight traffic.
This Russian-Chinese railroad corridor transported 5.7 million metric tons of cargo in both directions in 2003- five times more than four years ago. In 2004, they expect to move 7 million metric tons of cargo.
In the past, most of the cargo transported was Russian. Today, China’s freight traffic is growing exponentially.
This summer, Russian petroleum products will begin exportation. In the first three months of 2004, greater than 1.5 million metric tons of foreign-trade cargo (10% more than in 2003) have been shipped via the Grodekovo-Suifenhe railroad corridor. And, the cargo volume that Russia imported from China grew more than 50% in comparison to the first quarter of 2003.
So the stakes are huge and likely to get even more intense as China and Russia grow closer.
In reality, Kasparov is doing the Kremlin a huge favor. If Kasparov really wants to get involved in politics, I think the Kremlin will be all too happy to give him the rope to hang himself. According to many of the articles from Russia, Kasparov won’t ever unite Russia’s liberals, but instead, only highlight their internal conflicts.
You just never know, though. Kasparov is a master strategist, so he better use those finely tuned skills to achieve his goal…and fast. There are only a few moves left on this shrinking chessboard.
for The Daily Reckoning
July 05, 2005
With 15 years of experience, Kevin Kerr is a true veteran of the commodities markets. A licensed commodities trader since 1989, he’s worked the trading pits in Chicago and New York with legends like Paul Tudor Jones, and he’s even traded commodity derivatives in London. Over Kevin Kerr’s career he’s dealt with everything from cotton to currencies to oil and natural gas.
Kevin Kerr’s unparalleled expertise in futures and commodities has made him a regular contributor to news outlets like CNN fn, CNBC and Marketwatch, where he’s been quoted in over 500 articles
One of the great mysteries of life is how people seem to come to believe what they need to believe just when they need to believe it. When stocks dip towards an epic low, people think they will go down forever, which is just what they must believe in order for stocks to reach their epic low!
Likewise, when a country sets out to destroy itself – as, say, Japan did in the 1930s – its people must believe that their course of action is not only advisable, but also inescapable – even if it means attacking the one nation with the power to crush them. If they were to stop and think clearly – ‘wait, why would we want to pick a fight with the world’s strongest economy?’- they could never fulfill their historical destiny.
Put another way, the phenomenon of “regression to the mean” wouldn’t exist unless there were a way to get beyond the mean in the first place. Without excess, there would be no moderation…and no mean to regress to. And unless people were prepared to believe preposterous and outrageous things, they would never get themselves in an excessive position.
Natural phenomena have their own exaggerations. But we leave droughts and heat waves to others. We’re interested in markets and politics – where exaggerations require a kind of collective insanity in which vast numbers of people come to believe remarkable things.
Actions give rise to words; situations breed thoughts. In America, until the late 19th century, people felt they needed to tend their own fields and mind their own affairs. There was no point thinking they needed to reform foreign governments, or dictate the terms of a distant peace. They had no means to do it. It was only after the United States became the world’s leading industrial power, around the turn of the century, that its thinking people began to think that they should mind the rest of the world’s business as well as their own. One hundred years later, in the early 2000s, hardly anyone questioned the U.S. imperial role; the only questions concerned how it should be played.
But in June of 2005, the empire suffered a shock to its amour propre; China entered the homeland markets with a bid for one of its oldest oil companies, Unocal, following an earlier offer for one of its oldest and most famous manufacturers, Maytag. We have been watching the response with great interest. Thoughts are arising; words are coming up. As you might imagine, they are just the thoughts and words the times require – those that make it possible for a great empire to fall on its face.
The challenge for all the late, imperial institutions – the Bush administration, Congress, the media, economists and Wall Street – is to spin the facts in such a way that people keep spending…investing…and voting as they are told.
They already spend too much. Their investments are already overpriced. And the characters for whom they vote are the worst sort. But that is the point…the historical hand the U.S. has been dealt must be played out. People need to believe absurd things; otherwise they would never go along.
The problem for the spinmeisters currently, is that a fact as big as an asteroid has come along; they are having a hard time finding a lie big enough to spin it. The fact is China is making a bid for resources that Americans thought were theirs. Asians have been recycling their profits back into the United States for a long time. As long as they were buying T-bonds everyone was happy. Americans thought they could stiff their lenders; they never expected to have to pay up. But now the Asians are coming into the U.S. and competing directly for resources – both natural and man-made.
The politicians and media want to tell the public that protectionist measures are needed. But the trouble is that this lie contradicts the lie they have been telling up to now, that the U.S. economy is the world’s most dynamic and most flexible form of capitalism. If it were really so dynamic and flexible, you wouldn’t think it would need to be shielded from competition from a third world nation run by communists.
More news, from our team at The Rude Awakening:
Eric Fry, reporting from New York…
“It is hard to find and produce gold, easy to print money. We [gold] bulls take comfort in the geological scarcity of our precious and beloved metal.”
Bill Bonner, back in London:
*** Oil prices stay close to $60 a barrel…and Kevin Kerr recently told Marketwatch.com how to play both sides of this volatile market…
“To rush in at this point and try to get in on the bull run can be sheer trading suicide for many investors. The inevitable pullback is bound to happen, and when it does, you want to be a buyer ready to snatch up bargains. It’s vital to be working on some other plays right now that the average trader is not even considering. It’s imperative to approach the sector this way during these extremely volatile times.
“How do we hedge ourselves during the inevitable oil profit-taking and retracement? Simple: put options on crude oil.
“‘Oh no!’ you’re saying. ‘I don’t like futures. Commodities and options are too dangerous.’
Nonsense. Put options simply give you the right – but not the obligation – to own crude oil within a certain time frame. Your risk is completely limited, but your profit potential is unlimited. It’s one of the most simple and easy to use types of trading.
*** People do not really want to have wealth. Instead, what they really want is the opportunity to fritter it away. We say that after many years of observation and a comment by a salesman this past weekend. “We increased the price,” he said, “and were surprised when sales went up.”
Vacation season has begun in Europe. The roads are clogged with people in mobile homes or tugging little plastic cabins behind their cars. The trains are crowded too. This morning, we couldn’t even get a seat on the Eurostar to London. Everyone is trying to figure out how to waste his two more important assets – time and money.
It is amazing what lengths to which people will go. Some will put on strange outfits and travel great distances in order to reenact the bloodiest and most pointless battles in history. That the fight wasn’t worth having in the first place hardly troubles them; they do it again and again. Or, they will collect things – old watches, pottery, paintings, automobiles, keys, light bulbs. A sensible person might not want to own a single one; still, people will spend a fortune in order to get many of them. Many men love chasing balls – tennis balls, golf balls, and baseballs. Other men prefer chasing women or butterflies. Some stand for hours in train stations in order to record the arrival of engine number 3371 at 11:59 from Bristol; that they would do it for employment is mystery enough, but they do it for fun!
We only bring this up to demonstrate how relative money really is. Getting rid of it is as big of a chore for most people, as obtaining it.
That is why, we think, collective hallucinations play such a big role in human life. A man is happy to pay taxes for a “war against terror,” even if he has not much reason to think terror poses a threat to him, because it helps him get rid of time and money. Even more important, when he is on vacation, it spares him from thinking too much about the pathetic wastes of time and money with which he fills up his deathward-going days.