Tag Archives: markets

Finally

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Great Britain, early in this latest stage, might finally have a Prime Minister who’s serious about Brexit because he’s committed to it in his soul, unlike the Remainer Theresa May (whom I think made a good faith effort, but because her heart wasn’t in it, she couldn’t perform).

British Prime Minister Boris Johnson laid out a hard-line negotiating stance with the European Union, setting the stage for fraught Brexit talks before the UK’s scheduled departure from the bloc on Oct 31.

Among other things,

In a combative first speech to Parliament, Mr Johnson reiterated Thursday that the plan in place to avoid a border on the island of Ireland after Brexit—one of the central planks of the divorce deal—was “unacceptable” and would have to be abolished.

Of course it’s unacceptable, and it should have been all along—it is nothing but Brussels’ attempt to disassemble Great Britain in punishment for its effrontery in deciding to leave the EU and as a warning to other uppity member nations.

Which is sort of what Johnson said:

No country that values its independence and indeed its self-respect could agree to a treaty, which signed away our economic independence and self-government as this backstop does[.]
I do not accept the argument that says that these issues can only be solved by all or part of the UK remaining in the customs union or in the single market

Nor does this poor, dumb colonial from Texas accept such sewage.

One More Reason

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…to be clear and overt in our support for the Republic of China.

We sailed a guided missile cruiser through the international waters of the Taiwan Strait last Wednesday, and the People’s Republic of China objected.  Then it threatened.

China said it would take all necessary military measures to defeat “separatists” in Taiwan.

This comes, also, after the PRC threatened military action against the people of Hong Kong because they’ve been uppity enough to insist that the PRC honor its commitment to Hong Kong’s (semi-)autonomy IAW its handover agreement with Great Britain.

All this adds to the necessity of selling the RoC anti-missile and anti-aircraft systems, modern combat aircraft and ground combat equipment, and brokering deals between the RoC and Israel for the latter’s Iron Dome and Arrow systems.  And systems designed specifically to defeat amphibious and airborne invasion attempts.

We’re already in the processing of selling them $2.2 billion worth of arms, but that should be only a start.

Sanctions on Turkey?

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That’s the question being asked regarding Turkey’s decision to buy—and subsequently to take delivery on—Russia’s AS-400 anti-aircraft missile system and the impact that has, or should have, on our alliance with Turkey.

The question, though, assumes we have an alliance. Formally, one exists, but it’s in name only outside of NATO (and with Turkey cozying up to Russia, that one is in flux, too); Turkey has chosen functionally to walk away from any bilateral arrangement.

I think, though, the decision to cancel Turkey’s F-35 buy is sufficient. We don’t need to apply sanctions; we don’t need to have much of anything to do with Turkey, good or bad, outside our NATO obligations.

Turkey just isn’t that important to us.  It’s a convenient path into the Middle East, but even that is questionable.  Turkey, after all, refused to let us operate from there during the second invasion of Iraq, in contrast with Saudi Arabia’s and Kuwait’s active support.  That refusal complicated military matters and led to a longer fight than necessary, with higher casualties all around.

Much Ado

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…is being made about the People’s Republic of China’s slowing economic growth rate.

The Chinese economy has suffered a loss of momentum in the second quarter, with the GDP falling to 6.2% from a 6.4% expansion in the first three months of the year, figures released by the National Bureau of Statistics showed on Monday.

This is the slowest growth rate in 27 years, goes the alarm.  That’s supposed to apply pressure to the PRC to start negotiating seriously with the US on trade.  In truth, it does add some pressure, but it’s necessary to keep in mind a couple of other things, too.

One is that slowing growth is, still, growth, and a 6.2% growth rate still is one of the highest economic growth rates in the world, albeit that rate comes against one of the lowest baselines in the world.

Another is that the PRC’s government, led by President Xi Jinping and his Communist Party of China henchmen, is willing to inflict more pain and economic (read: standard of living) damage on its people than are most Western governments on theirs.

The tariff pressure being applied to the PRC is both necessary and having serious effects. Producers are moving their sourcing from the PRC and shifting it to other nations around the Pacific, some to the US, others to Vietnam, Philippines, Japan, Indonesia, Malaysia, and so on.  And that slowdown in growth rate is real and a continuing trend.

It’s just that the struggle to get the PRC to deal honestly with the rest of us in trade, intellectual property, and technology will not be over quickly, nor will any of us enjoy it.  But we must stay the course.

A Thought on Huawei

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John Hemmings made some interesting and critical points about the “security” (my metaphoric quotes) of Huawei equipment.  In doing so, he cited a study by Finite State, a cyber-security organization that looks deeply into the Internet of Things and resulting vulnerabilities—an IoT of which Huawei is aiming to be a central part (as well as a central part of national communications and defense systems and of governments).  Finite State’s analysis investigated “more than 1.5 million files embedded in 9,936 firmware images supporting 558 different products within [Huawei’s] enterprise networking product lines.”

Hemmings’ points center on these:

  • In virtually all categories we studied, we found Huawei devices to be less secure than comparable devices from other vendors.
  • On average, Huawei devices had 102 known vulnerabilities inside their firmware, primarily due to the use of vulnerable open-source and third-party components.
  • Out of all the firmware images analyzed, 55% had at least one potential backdoor.
  • On dozens of occasions, Huawei engineers disguised known unsafe functions (such as memcpy) as the “safe” version (memcpy_s) by creating wrapper functions with the “safe” name but none of the safety checks.
  • Across 356 firmware images, there are several million calls into unsafe functions. Huawei engineers choose the “safe” option of these functions less than 17% of the time, despite the fact that these functions improve security and have existed for over a decade.
  • Huawei devices had…2-8x more potential 0-day vulnerabilities than the other devices.
  • Vulnerabilities in both the routers and the fixed access network remained beyond 2012 and were also present in Vodafone’s businesses in the U.K., Germany, Spain and Portugal.

Those vulnerabilities? Given how enthusiastically Huawei’s representatives tout the superiority of their equipment, and given that fourth bullet, I suggest that those vulnerabilities also are known to Huawei’s men and put there deliberately.

And that last bullet: Vodafone had identified those “vulnerabilities” to Huawei in 2011 and received assurances from Huawei that they’d be removed.  Those security holes remained far past 2012.  And still remain as far as I can tell.

This is why Huawei has no legitimate place in any organization outside of the People’s Republic of China, nor should it have access to any technology of any nation or business outside of the PRC.

But Huawei’s CEO, Ren Zhengfei, and CFO, Meng Wanzhou, and men of the PRC’s government, like President Xi Jinping, deny all of this. And Ren is an honorable man; So are they all, all honorable men.