ALEXEI MORDASHOV TRIES TO SELL HIS NORDGOLD SHARES OUTSIDE RUSSIA AGAIN, BUT HIS FAILURE ISN’T THE LESSON THE RUSSIA WARFIGHTERS WANT YOU TO BELIEVE

By John Helmer, Moscow 
  @bears_with

Last month the Russian metals and mining oligarch, Alexei Mordashov (lead image, left), took a spectacular  pratfall in front of the international money markets. Not even hand-holding by Citigroup, JP Morgan, Credit Suisse, and Bank of Montreal could save him from the public embarrassment.

On June 3, Mordashov and the banks announced his intention to sell shares in his goldmining company Nordgold (Nord  Gold PLC) on the London Stock Exchange, telling investors that future demand and the price of gold, and hence the profitability of Mordashov’s company, are bound to be  boosted because of “possible inflationary pressures in the medium term from an exceptionally low interest rate environment and the possibility of currency revaluations, including U.S. dollar depreciation”.

On June 22, Mordashov got a Nordgold executive to announce the share sale was cancelled for the foreseeable future. His reason was that “acceleration in expected interest rate rises have created significant uncertainty and volatility in the resources sector, in particular impacting gold and gold equities. Nordgold has determined that it would therefore not be sensible to pursue an IPO at this particular juncture.”

If inflation was good reason for buying shares in Mordashov’s business at the start of the month, and then in less than three weeks Mordashov’s reason for not selling the shares, then Mordashov has made a fool of the market and a liar of himself. “That has to be bullshit,” responded a leading London mining analyst, who believes Mordashov’s vanity is to blame for imagining his shares would fetch a higher value in the market than share-buyers are willing to pay; and also Citigroup, JP Morgan, Credit Suisse, Bank of Montreal and the other bankers and brokers involved who were “too afraid to give him good advice on pricing.”

There is one thing more laughable in this episode than that.  This is the effort which the Russia-warfighting media in London – for the first time combining Rupert Murdoch’s Times newspapers with Ian Hislop’s Private Eye —   to make the failure of the share sale attempt appear to be an act of “British policy towards Putin and Russia’s rich”, in the words of Private Eye — as symbolic as the voyage of HMS Defender across the Crimean red line on June 23,  the day after Mordashov and his bankers took their tumble.

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RUSSIAN PLATINUM IS MORE PRECIOUS THAN THE MARKET HAS BEEN CALCULATING UNTIL LAST WEEK

By John Helmer, Moscow
  @bears_with

Not everything that glisters is gold, Shakespeare wrote as a warning about the seeming value of precious metal. Nor plisters is platinum.

The shine has been off for years now because the price of platinum has fallen steadily, and because the risks of mining it in South Africa have accelerated even faster. South Africa, with more than 90% of global reserves and supplying almost 70% of mine production of the metal, remains the market leader. But  on account of the country’s political corruption, collapse of infrastructure, miner wage strikes,   and falling mineable metal grades, the country has become an unstable, high-risk, high-cost source. So the stock markets for listed South African-based miners have been slashing the share price and devaluing the metal the companies have yet to dig up and sell.

Russia, which is the world’s second largest source of platinum reserves and mine production, is much more attractive by comparison:  South Africa’s loss is Russia’s gain. And not just for Norilsk Nickel, the dominant Russian miner, but also for small platinum mining companies. Right now, they say they have the proven deposits; what they need is the cash to pay for the mining operations to dig it out, refine and sell it.

The problem for Russian platinum miners is that the supply of relatively low-cost alluvial –  river-dredged — sources of the metal are petering out. To make up for this, junior Russian miners must raise investment to finance costly underground excavation. If they succeed, their combined output of platinum will double. It’s on speculation of this that the share price of Eurasia Mining quadrupled in London last week. (more…)

THE BLUE SKY POTENTIAL OF CHUKOTKA — WHY IS STATE MONEY BEING WAGERED ON TIGERS REALM COAL?

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By John Helmer, Moscow

Tiger is an unlucky brand-name for Russian investment. The record of Mikhail Prokhorov and Maxim Finsky in trying, and failing three times over to sell shares in White Tiger Gold on the Toronto Stock Exchange explains. So why is the Russian Direct Investment Fund, a state development bank, betting on a small Australian-listed coking coal company in Chukotka called Tigers Realm Coal?

The feareasternmost province of Russia, Chukotka makes a good case for ample underground resources to be mined, so long as costs of digging and shipping to China stay low; and demand recovers. Perish the thought that Tigers Realm Coal is an insider manipulation with the aim of pumping the share price, then dumping the project by several names associated with such scheming in the past.
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WHOSE POCKETS FULL — SERGEI CHEMEZOV’S FRIENDS VITALY MASHITSKY AND ROBERT MUGABE ARE GOING TO SPEND AT LEAST $600 MILLION TO START, THEN $4.8 BILLION OF RUSSIAN STATE MONEY ON A PLATINUM MINE IN ZIMBABWE

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By John Helmer, Moscow

The world’s most mysterious, and expensive, hole in the ground has been ceremonially opened by the Russian Foreign and Trade Ministers, Sergei Lavrov and Denis Manturov. At least that’s what they say they did a month ago in Harare, the capital of Zimbabwe. The President of Zimbabwe, Robert Mugabe (lead image, centre), also presided.

The hole to be dug is to cost the Russian state budget and banking system at least $600 million, rising to $3 billion in three years; and then $4.8 billion by 2024 when mine, ore-processing plant and refinery are fully operational. That’s according to the Zimbabwe press announcements. They have also disclosed the list of Russian and Zimbabwean partners in the deal. Calling themselves Afromet, the Russians are Vitaly Mashitsky (lead image, left), Sergei Chemezov (right), and Vnesheconombank (VEB) represented by Alexander Ivanov, son of the presidential chief of staff, Sergei Ivanov. The Zimbabweans are calling themselves Pen East Investments. Together, they have picked the name Great Dyke Investments.

There’s a catch: no Russian involved in what is billed as the Darwendale platinum project wants to admit what he is doing; what protection from loss has been installed by the Kremlin for the money; and why a new platinum mine in east Africa can be a profitable way of spending Russian state money when the country’s platinum miners, Norilsk Nickel and Russian Platinum, say they wouldn’t touch the project with a barge-pole.
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CONCERT-PARTY TAKEOVER OF POLYUS GOLD AND POLYMETAL – THE MORE SILENT ZELIMKHAN MUTSOEV AND GAVRIIL YUSHVAEV REMAIN ON THE PURCHASE PRICE, THE MORE OBVIOUS THEY ARE IN LEAGUE WITH SULEIMAN KERIMOV

By John Helmer, Moscow

Do snaps of businessmen playing cards, or dancing the lezginka together, prove they are in a concert-party relationship which is an unauthorized way of making money, according to Rule 9 of the Takeover Code for companies listed on the London Stock Exchange — if they keep it secret from other shareholders?

Zelimkhan Mutsoev (left and centre, upper and lower images), Gavriil Yushvaev (right, right) and Suleiman Kerimov (centre, left) were all born in the Caucasus within a decade of each other. As grown-ups they have taken different career paths, and they have made large sums of money independently. Two of them, Mutsoev and Kerimov, have also acted together to take over Russia’s second potash producer Silvinit, merge it with the leader Uralkali, and create a Russian potash monopoly. The Federal Antimonopoly Service found no infraction of Russian rules in that. But if they are now trying the same thing to acquire Mikhail Prokhorov’s 38% stake in Polyus Gold, Russia’s leading goldminer, and then merge it with Polymetal, the UK rules apply because both Polyus Gold and Polymetal are premium listings on the LSE.
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FIRST CAT’S PAW AWARD FOR 2012 – CATHERINE BELTON, THE FINANCIAL TIMES, AND SOLLY THE BENEFICENT DERVISH

By John Helmer, Moscow

The committee of administrators of the Personal Abasement Award (PAW), having sat on their hands for two years, have decided to nominate Catherine Belton (image left) and the Financial Times for a presentation of the affairs of Suleiman Kerimov (right) at the very moment he has been trying (failing) to cash out his stake in Polyus Gold with a merger into Polymetal.

The PAW award rules and procedures, along with the roll of past winners, can be found here. At this stage of the nominating process, the rules require that “each candidate will be advised of his nomination before publication, and given the opportunity to clarify meaning, and plead truth or justification.”
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THE CHAMBER OF SECRETS – HARRY POTTER IS THE ONLY FOREIGNER ALLOWED TO LOOK INSIDE (BUT THAT’S KIDSTUFF)

By John Helmer, Moscow

Deep inside the Russian government there is a chamber of secrets where officials have gathered just eight times since April 29, 2008, the day when then-President Vladimir Putin signed the law that created the chamber. The law was entitled “On Procedures for Foreign Investments in Business Entities of Strategic Importance for National Defence and State Security”; for short, Law № 57-FZ. The chamber is called the Government Commission for Control of Foreign Investment in the Russian Federation, the Control Commission for short (aka the Government Commission).
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HEADING INTO A WIDER WORLD OF GOLD

MOSCOW (Mineweb.com) – For at least a few hours on Monday, Harmony Gold’s Bernard Swanepoel knew more about Norilsk Nickel’s plan to spin off its gold assets in an offshore placement than Norilsk Nickel itself.

“Harmony wishes to advise”, a company announcement declared in Johannesburg, “that it has consented to the transfer by Norilsk Nickel of all its snares in the issued share capital of Gold Fields to an indirect wholly-owned subsidiary of Norilsk (“Subco”) and to cede all its rights and delegate all its obligations in terms of Norilsk’s irrevocable undertaking to Subco.”

In Moscow, the spokesman for Norilsk Nickel told Mineweb she didn’t know anything about Subco. Neither did the spokesman for Polyus,Norilsk Nickel’s principal gold-mining unit, although he admitted he had just seen Harmony’s announcement.

According to Harmony’s version of the correspondence it has just received from Norilsk Nickel, “the transfer by Norilsk of its Gold Fields shares to Subco is in accordance with its strategy to consolidate all of its gold assets into one vehicle and does not have any impact on the obligators under the irrevocable undertaking.”

Exactly who has authority to speak for Norilsk Nickel n such binding terms, and to plan what to do next, has been unclear since January, when Vladimir Potanin and Mikhail Prokhorov, the co-owners of Norilsk Nickel, decided to fire Leonid Rozhetskin, their principal strategist for the C oldfields deal. Since then Rozhetskin has been unable or unwilling to return to Moscow, where awkward questions from state investigators probing other dea s await him. An associate told Mineweb that he believes Rozhetskin is comfolable abroad with a well-known Italian partner, and that currently, he is talking with Merrill Lynch about the future of what is now called Subco. According to documents that surfaced in a New York court late last year, the spin-off gold company was first codenamed I for “new international goldco” by RozHetskin and his advisors at HSBC. According to HSBC’s presentation of “Project Golf, if Harmony Gold and Norilsk Nickel succeeded in their takeover of Gold Fields, “I” was to be created out of the international gold assets of all thiiee companies, and “listed as a new ‘major’ in North America attracting premium valuation.”

Potanin and Prokhorov have refused all opportunities to speak, or requests to answer questions in public, about the Gold Fields acquisition, or their “1” plan. Notwithstanding, Potanin has told Gold Fields CEiO Ian Cockerill that Rozhetskin continues to have his authority to negotiate on the fate of the 20-percent shareholding, and the last stages of Swanepuel’s ill-fated bid. Gold Fields’s management, and other major stakeholders in Harmony, expect the bid to expire on May 20. In the meantime, is the disclosure of Subco by Swanepoel a last-ditch move to expose Potanin and Prokhorov ttji the commitment they once made to the takeover?

For one Moscow investment banker, who has been at different times close to all sides and a consistent backer of the “I” strategy, Subco was a surprise name for no surprise at all. “As far as I know,” he told Mineweb, Norilsk Nickel “can do what they like with their holding of gold asset.” If he were advising Norilsk Nickel at the moment, and he says he is no:, he would advise the company not to sell the Gold Fields stake, “There is ncl pressure to sell now. I know of no [government] pressure to sell.”

Late on Monday afternoon, Norilsk Nickel issued u press release citing Prokhorov for the announcement that it intends to create a new gold asset company, and then sell its shares abroad. “At its meeting on April 15th, 2005,” the fresh announcement reads, “the Board of Directors: of MMC Norilsk Nickel (“Company”) resolved to initiate steps which should leatjl to the demerger of the Company’s Russian gold assets consolidated under |ZAO “POLUS” and its subsidiaries (“Polyus”) and the Company’s 20% interest in Gold Fields Limited (the “Transaction”).

The contemplated Transaction, if implemented, shoLId create a new large independent gold major (Newco) with the potential for substantial organic growth and a window into one of the world’s most prospective gold regions: Russia. The Transaction, if implemented, would, in the (opinion of the directors, provide investors with direct exposure to this unique Investment, and should allow Newco to realize its inherent growth options, enhance gold business’s direct access to the financing opportunities and unlock substantial value for all Company’s shareholders.”

“The initial step in the Transaction will be to consolidate! all the Company’s gold assets (including its 20% interest in Gold Fields Limited) under Polyus.lt is the intention of the Board of MMC Norilsk Nickel that tsewco would seek both domestic and international listings as soon as practicable, following the Transaction.”

Prokhorov is cited in the announcement as saying “we.; see the demerger as a means to unlock substantial value for all Norilsk shareholders and to create a platform to build a new global gold major centred around existing gold assets.” Deutsche Bank is listed as financial advisor for the new scheme, and its legality assigned to Debevoise & Plimpton.

For investment bankers and lawyers, there can never be a political obstacle so high that it cannot be climbed to sustain their clients’ willingness to pay lucrative placement and arranging fees in the hope of seeing their cash safely out of Russia.

And so, when Brian Gilbertson, CEO of SUAL International, the Moscow-based resource company, announced last week that the Kremlin will not allow the large-scale sale of SUAL shares abroad, a Moscow resource banker claimed Gilbertson was talking his book, not telling the truth. SUAL is not ready for a placement, the banker told Mineweb. Gilbertson was passing the buck to the political leadership, he claimed.

The banker also claimed that his institution has three mandates from Russian resource companies on the go at present, and that none of them has been blocked by Kremlin fiat. Accordingly, he was emphatic that Norilsk Nickel’s owners are free to plan to move their gold assets offshore to “I” or Subco or Newco. Naturally, the banker didn’t concede that his firm’s access to know the Kremlin’s mind has been limited recently; especially since a share-buying scheme of a closed company the Kremlin is trying to eform was discovered to have been one of his bank’s inventions, and to have led to an investigation of its legality.

But is there a contradiction between what Gilbertson iiaid is impermissible, and what Potanin, Prokhorov, deutsche Bank and Debevoise & Plimpton would like to get away with?

In remarks to the Russian Economic Forum in London April 11, Gilbertson is reported to have said that Kremlin policy currently prohibits large-scale share listings or initial public offerings for Russian resource companies. He also acknowledged with apparent approval legislative and regulatory provisions in Chile, Brazil, and South Africa to assure state control of resource companies like his own, SUAL, Gilbertson assured, “accordingly will develop its strategic opportunities with its feet firmly rooted in the soils of Russia and the CIS.”

Yevgeny Ivanov, CEO of Polyus and the principal strategist of Norilsk Nickel’s gold strategy, followed Gilbertson at the same conference. But his remarks suggested that there are wings to his feet.

In response to questions about offshore listing plans, Ivanov said that he and his colleagues are considering listing in either Toronto or New York, or buying a company already listed there. Norilsk Nickel already owns the London-listed Norimet, and the New York-listed Stillwater Mining. But for the gold spinoff, Ivanov evidently has in mind something new. He was not asked directly about “I”, but acknowledged that a reverse takeover into Gold Fields was another “theoretical” possibility. At the time, noone had ever heard of Subco or Newco.

A few days earlier, Ivanov had told a Russian audience that these options could not be implemented for another two years. His spokesman told Mineweb that “all decisions could be made not earlier than in 2007.” What exactly must happen in the next two years is unclear. When asked if he favours Kremlin approval or disapprovasl of such an offshore listing plan, Vladimir Litvinenko, President Vladimir Putin’s advisor on resource policy, signaled that he is negative. Local bankers believe that the Newco will require at least a year of technical work to prepare. Two years may be required to overcome the Kremlin objections that are visible now.

Gilbertson’s acknowledgement of a Kremlin bar to IPO’s for major Russian resource companies is the first of its kind. Other Russian executives are sensitive to the requirement for Kremlin approval of their schemes, but they never discuss them openly. Once before, when Norilsk Nickel first announced, a year ago, that it had acquired the Gold Fields stake from Anglo American, it claimed publicly that no Russian government approval was required, and none had been sought. Central Bank action, and Kremlin advice, began to change that position several weeks later. However, it is still not clear what Kremlin officials have demanded, and what Potanin has promised in return.

I, Newco, or Subco are names that have a temporary ring to them. Why Norilsk Nickel’s board did not announce its plan immediately after deciding it last Friday, and waited until after Harmony Gold had disclosed it today, suggests that neither the board, nor the company owners have the confidence that their plan will be anything but temporary also.

WILL WORLD KEEP IN TUNE WHEN RUSSIA PLAYS SWING?

It’s not too early to see in this month’s clash between Saudi Arabia and Russia over oil supplies to the market the first real sign that the Kremlin sees a future for itself as the world’s alternative source of crude whenever the OPEC swing producer tries to make other producers dance to its tune.

Playing swing producer takes time, practice and nerve. Unbeknownst to the oil world, Russia has spent almost two years learning how to do it in another international commodity market – platinum-group metals.

In Soviet days, Moscow’s precious-metals traders disliked sharp upward price swings because they made it difficult to forecast the volume of sales required to meet revenue targets. The Soviet traders also understood that speculative price swings upward were always followed by sell-offs and sharp price declines. Soviet strategists preferred stability. (more…)

AFTERSHOCK OF NORD STREAM EXPLOSIONS RUMBLES WARSAW — POLISH POLITICIANS GO “NUTTERS”

By John Helmer, Moscow
  @bears_with

The Polish government in Warsaw, facing re-election in less than a year, wants all the credit from Washington for their joint operation to sabotage the Nord Stream gas pipelines on the Baltic seabed.

It also wants to intimidate the German chancellor in Berlin, and deter both American and German officials from plotting a takeover by the Polish opposition party, Civic Platform, next year.

Blaming the Russians for the attack is their cover story. Attacking anyone who doesn’t believe it, including Poles and Germans, Warsaw officials and their supporting media claim they are dupes or agents of Russian disinformation.

Their rivals, Civic Platform (PO) politicians trailing the PiS in the polls by seven percentage points,   want Polish voters to think that no credit for the Nord Stream attack should be earned by the ruling Law and Justice (PiS) party. They also want to divert  the Russian counter-attack from Warsaw to Washington.

“Thank you USA” was the first Polish political declaration tweeted hours after the blasts by Radoslaw Sikorski (lead image, left), the PO’s former defence and foreign minister, now a European Parliament deputy. In support and justification,  his old friend and PO ministerial colleague, Roman Giertych, warned Sikorski’s critics: “Would you nutters prefer that the Russians find us guilty?”

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THE BORNHOLM BLOW-UP REPEATS THE BORNHOLM BASH — POLAND ATTACKS GERMANY AND BLAMES RUSSIA

By John Helmer, Moscow
  @bears_with

The military operation on Monday night which fired munitions to blow holes in the Nord Stream I and Nord Stream II pipelines on the Baltic Sea floor, near Bornholm Island,  was executed by the Polish Navy and special forces.

It was aided by the Danish and Swedish military; planned and coordinated with US intelligence and technical support; and approved by the Polish Prime Minister Mateusz Morawiecki.

The operation is a repeat of the Bornholm Bash operation of April 2021, which attempted to sabotage Russian vessels laying the gas pipes, but ended in ignominious retreat by the Polish forces. That was a direct attack on Russia. This time the attack is targeting the Germans, especially the business and union lobby and the East German voters, with a scheme to blame Moscow for the troubles they already have — and their troubles to come with winter.

Morawiecki is bluffing. “It is a very strange coincidence,” he has announced, “that on the same day that the Baltic Gas Pipeline  opens, someone is most likely committing an act of sabotage. This shows what means the Russians can resort to in order to destabilize Europe. They are to blame for the very high gas prices”.   The truth bubbling up from the seabed at Bornholm is the opposite of what Morawiecki says.

But the political value to Morawiecki, already running for the Polish election in eleven months’ time, is his government’s claim to have solved all of Poland’s needs for gas and electricity through the winter — when he knows that won’t come true.  

Inaugurating the 21-year old Baltic Pipe project from the Norwegian and Danish gas networks, Morawiecki announced: “This gas pipeline is the end of the era of dependence on Russian gas. It is also a gas pipeline of security, sovereignty and freedom not only for Polish, but in the future, also for others…[Opposition Civic Platform leader Donald] Tusk’s government preferred Russian gas. They wanted to conclude a deal with the Russians even by 2045…thanks to the Baltic Pipe, extraction from Polish deposits,  LNG supply from the USA and Qatar, as well as interconnection with its neighbours, Poland is now secured in terms of gas supplies.”

Civic Platform’s former defence and foreign minister Radek Sikorski also celebrated the Bornholm Blow-up. “As we say in Polish, a small thing, but so much joy”.  “Thank you USA,” Sikorski added,   diverting the credit for the operation, away from domestic rival Morawiecki to President Joseph Biden; he had publicly threatened to sabotage the line in February.  Biden’s ambassador in Warsaw is also backing Sikorski’s Civic Platform party to replace  Morawiecki next year.  

The attack not only escalates the Polish election campaign. It also continues the Morawiecki government’s plan to attack Germany, first by reviving the reparations claim for the invasion and occupation of 1939-45;  and second, by targeting alleged German complicity, corruption,  and appeasement in the Russian scheme to rule Europe at Poland’s expense. .

“The appeasement policy towards Putin”, announced PISM, the official government think tank in Warsaw in June,  “is part of an American attempt to free itself from its obligations of maintaining peace in Europe. The bargain is that Americans will allow Putin to finish building the Nord Stream 2 pipeline in exchange for Putin’s commitment not use it to blackmail Eastern Europe. Sounds convincing? Sounds like something you heard before? It’s not without reason that Winston Churchill commented on the American decision-making process: ‘Americans can always be trusted to do the right thing, once all other possibilities have been exhausted.’ However, by pursuing such a policy now, the Biden administration takes even more responsibility for the security of Europe, including Ukraine, which is the stake for subsequent American mistakes.”

“Where does this place Poland? Almost 18 years ago the Federal Republic of Germany, our European ally, decided to prioritize its own business interests with Putin’s Russia over solidarity and cooperation with allies in Central Europe. It was a wrong decision to make and all Polish governments – regardless of political differences – communicated this clearly and forcefully to Berlin. But since Putin succeeded in corrupting the German elite and already decided to pay the price of infamy, ignoring the Polish objections was the only strategy Germany was left with.”

The explosions at Bornholm are the new Polish strike for war in Europe against Chancellor Olaf Scholz. So far the Chancellery in Berlin is silent, tellingly.

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LEMONS, MIMOSAS, AND STALIN’S SHOVEL

By John Helmer, Moscow
  @bears_with

The only Russian leader in a thousand years who was a genuine gardener and who allowed himself to be recorded with a shovel in his hand was Joseph Stalin (lead image, mid-1930s). Compared to Stalin, the honouring of the new British king Charles III as a gardener pales into imitativeness and pretension.   

Stalin cultivated lemon trees and flowering mimosas at his Gagra dacha  by the Black Sea in Abkhazia.  Growing mimosas (acacias) is tricky. No plantsman serving the monarchs in London or at Versailles has made a go of it in four hundred years. Even in the most favourable climates, mimosas – there are almost six hundred varieties of them — are short-lived. They can revive after bushfires; they can go into sudden death for no apparent reason. Russians know nothing of this – they love them for their blossom and scent, and give bouquets of them to celebrate the arrival of spring.

Stalin didn’t attempt the near-impossible, to grow lemons and other fruit in the Moscow climate. That was the sort of thing which the Kremlin noblemen did to impress the tsar and compete in conspicuous affluence with each other. At Kuskovo, now in the eastern district of Moscow, Count Pyotr Sheremetyev built a heated orangerie between 1761 and 1762, where he protected his lemons, pomegranates, peaches, olives, and almonds, baskets of which he would present in mid-winter to the Empress Catherine the Great and many others. The spade work was done by serfs. Sheremetyev beat the French king Louis XIV to the punch – his first orangerie at Versailles wasn’t built until 1763.

Stalin also had a dacha at Kuskovo But he cultivated his lemons and mimosas seventeen hundred  kilometres to the south where they reminded him of home in Georgia. Doing his own spade work wasn’t Stalin showing off, as Charles III does in his gardens, like Louis XIV before him. Stalin’s spade work was what he had done in his youth. It also illustrated his message – “I’m showing you how to work”, he would tell visitors surprised to see him with the shovel.  As to his mimosas, Stalin’s Abkhazian confidante, Akaki Mgeladze, claimed in his memoirs that Stalin intended them as another lesson. “How Muscovites love mimosas, they stand in queues for them” he reportedly told him.  “Think how to grow more to make the Muscovites happy!”

In the new war with the US and its allies in Europe, Stalin’s lessons of the shovel and the mimosas are being re-learned in conditions which Stalin never knew – how to fight the war for survival and at the same time keep everyone happy with flowers on the dining table.

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AND THEN THERE WERE NONE

By John Helmer, Moscow
  @bears_with

Agatha Christie’s whodunit entitled And Then There Were None – the concluding words of the children’s counting rhyme — is reputed to be the world’s best-selling mystery story.    

There’s no mystery now about the war of Europe and North America against Russia; it is the continuation of Germany’s war of 1939-45 and the war aims of the General Staff in Washington since 1943. Defense Minister Sergei Shoigu (left) and President Vladimir Putin (right) both said it plainly enough this week.

There is also no mystery in the decision-making in Moscow of the President and the Defense Minister, the General Staff, and the others; it is the continuation of the Stavka of 1941-45.  

Just because there is no mystery about this, it doesn’t follow that it should be reported publicly, debated in the State Duma, speculated and advertised by bloggers, podcasters, and twitterers.  In war what should not be said cannot be said. When the war ends, then there will be none.  

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RUSSIANS RAISE THEIR GLASSES – THE TOAST IS TO BEATING THE BLOCKADE OF MOSCOW



By John Helmer, Moscow
  @bears_with

Alas and alack for the Berlin Blockade of 1948-49 (Berliner Luftbrücke): those were the days when the Germans waved their salutes against the unification of Germany demilitarised and denazified; and cheered instead for their alliance with the US and British armies to fight another seventy years of war in order to achieve what they and Adolf Hitler hadn’t managed, but which they now hope to achieve under  Olaf Scholtz — the defeat of the Russian Army and the destruction of Russia.

How little the Germans have changed.

But alas and alack — the Blockade now is the one they and the NATO armies aim to enforce against Russia. “We are drawing up a new National Security Strategy,” according to Foreign Minister Annalena Baerbock. “We are taking even the most severe scenarios seriously.”  By severe Baerbock means nuclear. The new German generation — she has also declared “now these grandparents, mothers, fathers and their children sit at the kitchen table and discuss rearmament.”  

So, for Russia to survive the continuation of this war, the Germans and their army must be fought and defeated again. That’s the toast of Russian people as they salute the intrepid flyers who are beating the Moscow Blockade.  

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THE INTERNATIONAL ATOMIC ENERGY AGENCY GOES TO WAR — GORILLA RADIO GOES NUCLEAR

By John Helmer, Moscow
  @bears_with

Last week the International Atomic Energy Agency’s (IAEA) board of governors voted to go to war with Russia by a vote of 26 member countries against 9.

China, Vietnam, India, Pakistan, Egypt, Senegal and South Africa voted against war with Russia.  

The IAEA Secretary-General Rafael Grossi (lead image, left) has refused to tell the press whether a simple majority of votes (18) or a super-majority of two-thirds (23) was required by the agency charter for the vote; he also wouldn’t say which countries voted for or against. The United Nations Secretary-General Antonio Guterres then covered up for what had happened by telling the press: “I believe that [IAEA’s] independence that exists and must be preserved is essential. The IAEA cannot be the instrument of parties against other parties.” The IAEA vote for war made a liar of Guterres.

In the IAEA’s 65-year history, Resolution Number 58, the war vote of September 15, 2022,  is the first time the agency has taken one side in a war between member countries when nuclear reactors have either been attacked or threatened with attack. It is also the first time the IAEA has attacked one of its member states, Russia, when its military were attempting to protect and secure a nuclear reactor from attack by another member state, the Ukraine, and its war allies, the US, NATO and the European Union states. The vote followed the first-ever IAEA inspection of a nuclear reactor while it was under active artillery fire and troop assault.

There is a first time for everything but this is the end of the IAEA. On to the scrap heap of good intentions and international treaties, the IAEA is following the Organisation for the Prohibition of Chemical Weapons (OPCW), and the UN Secretary-General himself.  Listen to this discussion of the past history when the IAEA responded quite differently following the Iranian and Israeli air-bombing attacks on the Iraqi nuclear reactor known as Osirak, and later, the attacks on Pakistan’s nuclear weapons sites.

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INTERNATIONAL ATOMIC ENERGY AGENCY TAKES UKRAINE SIDE IN WAR IN SEPTEMBER 15 VOTE, MAKING UN SECRETARY-GENERAL GUTERRES EITHER A LIAR OR A FOOL

By John Helmer, Moscow
  @bears_with

The International Atomic Energy Agency (IAEA) decided this week to take the side of Ukraine in the current war; blame Russia for the shelling of the Zaporozhye Nuclear Power Plant (ZNPP); and issue a demand for Russia to surrender the plant to the Kiev regime “to regain full control over all nuclear facilities within Ukraine’s internationally recognized borders, including the Zaporizhzhya Nuclear Power Plant.”      

This is the most dramatic shift by the United Nations (UN) nuclear power regulator in the 65-year history of the organisation based in Vienna.

The terms of the IAEA Resolution Number 58, which were proposed early this week by the Polish and Canadian governors on the agency board, were known in advance by UN Secretary-General Antonio Guterres when he spoke by telephone with President Vladimir Putin in the late afternoon of September 14, before the vote was taken. Guterres did not reveal what he already knew would be the IAEA action the next day.  

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THE RUSSIAN SITUATION COMEDY IS NO LYING MATTER – THE JOKE IS ON THE OFFICE OF FOREIGN ASSETS CONTROL

By John Helmer, Moscow
  @bears_with

Never mind that King Solomon said proverbially three thousand years ago, “a merry heart doeth good like a medicine.”  

With seven hundred wives and three hundred concubines, Solomon realized he was the inventor of the situation comedy. If not for the sitcom as his medicine, the bodily and psychological stress Old Solly had to endure in the bedroom would have killed him long before he made it to his death bed at eighty years of age,  after ruling his kingdom for forty of them.

After the British sitcom died in the 1990s, the subsequent stress has not only killed very large numbers of ordinary people. It has culminated today in a system of rule according to which a comic king in Buckingham Palace must now manage the first prime minister in Westminster  history to be her own joke.

Even the Norwegians, the unfunniest people in Europe, have acknowledged that the only way to attract the British as tourists, was to pay John Cleese of Monty Python and Fawlty Towers to make them laugh at Norway itself.   This has been a bigger success for the locals than for the visitors, boosting the fjord boatman’s life expectancy several years ahead of the British tourist’s.  

In fact, Norwegian scientists studying a sample of 54,000 of their countrymen have proved that spending the state budget on public health and social welfare will only work effectively if the population is laughing all the way to the grave. “The cognitive component of the sense of humour is positively associated with survival from mortality related to CVD [cardio-vascular disease] and infections in women and with infection-related mortality in men” – Norwegian doctors reported in 2016. Never mind the Viking English:  the Norwegian point is the same as Solomon’s that “a sense of humour is a health-protecting cognitive coping resource” – especially if you’ve got cancer.  

The Russians understand this better than the Norwegians or the British.  Laughter is an antidote to the war propaganda coming from abroad, as Lexus and Vovan have been demonstrating.   The Russian sitcom is also surviving in its classic form to match the best of the British sitcoms, all now dead – Fawlty Towers (d. 1975), Black Adder (d. 1989), You Rang M’Lord? (d. 1988), Jeeves and Wooster (d. 1990), Oh Dr Beeching! (d.1995), and Thin Blue Line (d. 1996).

The Russian situation comedies, alive and well on TV screens and internet streaming devices across the country, are also increasingly profitable business for their production and broadcast companies – not despite the war but because of it. This has transformed the Russian media industry’s calculation of profitability by removing US and European-made films and television series, as well as advertising revenues from Nestlé, PepsiCo, Mars, and Bayer. In their place powerful  Russian video-on-demand (VOD) streaming platform companies like Yandex (KinoPoisk), MTS (Kion),  Mail.ru (VK), and Ivi (Leonid Boguslavsky, ProfMedia, Baring Vostok)  are now intensifying the competition for audience with traditional television channels and film studios for domestic audiences.  The revenue base of the VOD platforms is less vulnerable to advertisers, more dependent on telecommunications subscriptions.

Russian script writers, cameramen, actors, designers, and directors are now in shorter supply than ever before, and earning more money.  “It’s the Russian New Wave,” claims Olga Filipuk, head of media content for Yandex, the powerful leader of the new film production platforms; its  controlling shareholder and chief executive were sanctioned last year.  

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RUSSIAN AVIATION INDUSTRY CORRECTS YELTSIN YAW – BOEING, AIRBUS DITCHED



By Olga Samofalova, translated and introduced by John Helmer, Moscow
  @bears_with

It was the American humourist Mark Twain who didn’t die in 1897 when it was reported that he had. Twain had thirteen more lively years to go.

The death of the Russian aerospace and aviation industry in the present war is proving to be an even greater exaggeration – and the life to come will be much longer. From the Russian point of view, the death which the sanctions have inflicted is that of the US, European and British offensive against the Soviet-era industry which President Boris Yeltsin (lead image, left) and his advisers encouraged from 1991.

Since 2014, when the sanctions war began, the question of what Moscow would do when the supply of original aircraft components was first threatened, then prohibited, has been answered. The answer began at the Federal Aviation Administration (FAA) in 1947 when the first  Supplemental Type Certificate (STC) or Parts Manufacturing Approval (PMA) was issued by Washington officials for aircraft parts or components meeting the airworthiness standards but manufactured by sources which were not the original suppliers.   

China has been quicker to implement this practice; Chinese state and commercial enterprises have been producing PMA components for Boeing and Airbus aircraft in the Chinese airline fleets for many years.  The Russian Transport Ministry has followed suit; in its certification process and airworthiness regulations it has used the abbreviation RMA, Cyrillic for PMA. This process has been accelerating as the sanctions war has escalated.

So has the Russian process of replacing foreign imports entirely.

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FOR WANT OF A NAIL THE KINGDOM WAS LOST – ENGLISH PATHOLOGIST GUY RUTTY FACES CHALLENGE TO THE RELIABILITY OF HIS NOVICHOK EVIDENCE



By John Helmer, Moscow
  @bears_with

The weakest link in the British government’s four-year long story of Russian Novichok assassination operations in the UK – prelude to the current war – is an English medical expert by the name of Guy Rutty (lead image, standing).

A government-appointed pathologist advising the Home Office, police, and county coroners, Rutty is the head of the East Midlands Forensic Pathology Unit in Leicester,  he is the author of a post-mortem report, dated November 29, 2018,  claiming that the only fatality in the history of the Novichok nerve agent (lead image, document), Dawn Sturgess, had died of Novichok poisoning on July 8, 2018. Rutty’s finding was added four months after initial post-mortem results and a coroner’s cremation certificate stopped short of confirming that Novichok had been the cause of her death.

Rutty’s Novichok finding was a state secret for more than two years. It was revealed publicly   by the second government coroner to investigate Sturgess’s death, Dame Heather Hallett, at a public hearing in London on March 30, 2021. In written evidence it was reported that “on 17th July 2018, Professor Guy Rutty MBE, a Home Office Registered Forensic Pathologist conducted an independent post-mortem examination. He was accompanied by Dr Phillip Lumb, also an independent Home Office Registered Forensic Pathologist. Professor Rutty’s Post-Mortem Report of 29th November 2018 records the cause of death as Ia Post cardiac arrest hypoxic brain injury and intracerebral haemorrhage; Ib Novichok toxicity.”  

Hallett, Rutty, Lumb, and others engaged by the government to work on the Novichok case have refused to answer questions about the post-mortem investigations which followed immediately after Sturgess’s death was reported at Salisbury District Hospital; and a cause of death report signed by the Wiltshire Country coroner David Ridley, when Sturgess’s body was released to her family for funeral and cremation on July 30, 2018.  

After another three years, Ridley was replaced as coroner in the case by Hallett in March 2021. Hallett was replaced by Lord Anthony Hughes (lead image, sitting) in March 2022.

The cause-of-death documents remain state secrets. “As you have no formal role in the inquest proceedings,” Hallett’s and Rutty’s spokesman Martin Smith said on May 17, 2021, “it would not be appropriate to provide you with the information that you have requested.” 

Since then official leaks have revealed that Rutty had been despatched by the Home Office in London to take charge of the Sturgess post-mortem, and Lumb ordered not to undertake an autopsy or draw conclusions on the cause of Sturgess’s death until Rutty arrived. Why? The sources are not saying whether the two forensic professors differed in their interpretation of the evidence; and if so, whether the published excerpt of Rutty’s report of Novichok poisoning is the full story.   

New developments in the official investigation of Sturgess’s death, now directed by Hughes, have removed the state secrecy cover for Rutty, Lumb, and other medical specialists who attended the post-mortem on July 17, 2018. The appointment by Hughes of a London lawyer, Adam Chapman, to represent Sergei and Yulia Skripal, opens these post-mortem documents to the Skripals, along with the cremation certificate, and related hospital, ambulance and laboratory records. Chapman’s role is “appropriate” – Smith’s term – for the Skripals to cross-examine Rutty and Lumb and add independent expert evidence.

Hughes’s appointment of another lawyer, Emilie Pottle (lead image, top left), to act on behalf of the three Russian military officers accused of the Novichok attack exposes this evidence to testing at the same forensic standard. According to Hughes,  it is Pottle’s “responsibility for ensuring that the inquiry takes all reasonable steps to test the  evidence connecting those Russian nationals to Ms Sturgess’s death.” Pottle’s responsibility is to  cross-examine Rutty and Lumb.

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