If you watch old movies there was a one time a gentleman’s code about war. The gentleman’s code tended to apply to the leaders because they were part of the 1% of their day and they did not want to die. Part of the code was they could be held for ransom or something and because they were part of the 1% in their country including being leaders, the country generally paid the ransom. There was always intrigue behind the scenes because when the person had gone fighting, another person became their caretaker of power and who wants to give up power? What do we in modern times?

In a book called Punishing Putin by Stephanie Baker published by Scribner, New York, 2024, we try to impose sanctions on the government and/or the leaders of the country the western countries do not like. For the past 50 years we are living in a global society which means every year countries are more connected to each other. In the past, it used to be a war was used to gain territory or resources or something along those lines for the dominate country. In the1800’s every European country took the resources of a country somewhere in the world, and it was the accepted course of events.

In the book, Putin decides to invade Ukraine and the western countries because they fear what could happen next do not like it. European and the US decide that even though Russia was in the capitalist orbit with other 1500 foreign companies in Russia generating $300 billion in revenue in 2021 or 17% of Russia’s GDP.

McDonald’s was one of the first American companies to open in 1990. In 1976, a senior executive of McDonald’s brought the Soviet delegation in Montreal to a McDonald’s and realized they all loved the food. McDonald’s provides meat, bread, potatoes and milk at high quality and affordable prices. It took 14 years before McDonald’s not only was approved to operate in Russia but to ensure the food quality or logistics would work. The first McDonald’s advertised for 630 people and received 27,000 applications. The first McDonald’s had 30,000 customers the opening day, before the war with Ukraine McDonald’s had 850 restaurants. Russia accounted for 7% of the McDonald’s global revenue or about $1.6 billion. Corporate McDonald’s owned 85% of the restaurants with the other 15% franchised, as well as the companies which supplied the restaurants.

Pepsi signed an agreement with Russia in 1973, Coke did not operate till McDonald’s came in. By 2021, Coca-Cola sold more than 2 billion liters of branded soft drinks in Russia.

The above show over the years, Russia similar to many countries around the world developed a consumer society and there are good financial reasons why companies did not just leave Russia. One could argue that with any war who knows when it is over, to leave is to write off assets and profits, what if the war is short?

The result is by the end of 2023. more than half remained in Russia, according to the Kyiv School of Economics and paid roughly $5 billion in corporate taxes in 2022. It took companies a long time to leave Russia. However, for the average Russian inflation increased and they were worse off. For the wealthy, they have choices.

In the book, ideally sanctions are made to disrupt the lives of the 1% and those in power, if the regime changes the sanctions could come off. If the 1% are hurt, they might say something to those in power.

Russian money has a long history of leaving Russia to Paris and London. Some of the people buying the very expensive real estate in those cities are Russian. For a time, one of the places, Russians used to hide money was Cyprus. When the banking sector had a downturn, they turned to Dubai and the UAE. There are always countries which accept money from other countries to boost their economies.

In the world of banking, being able to move money from one account to another is paramount. It is widely believed that once into the system, it is legit and there are massive infrastructure networks to do that. For the first time, western governments targeted the infrastructure of Russia and then had a problem what do you do with the assets? If you do not allow access, what would happen next time if a country invaded another and you supported it?

The unintended consequence of sanctions is most Central Bankers kept a great deal of assets in the US dollar, with the use of sanctions as a weapon, Central Bankers have moved assets to gold. This has helped push up the price.

Linking to dividend paying stocks, we live in a more connected world, which means very quickly everything is much more related to other events. If a crisis happens, it takes time to come back to what was normal and for diversified countries that means the time is shorter than the time for countries dependent on other one resource or another. If a country is dependent on commodity prices, they have a habit of rising and falling, when they are rising the money flows into the treasury. When prices fall, everyone looks for alternatives and eventually they are found and used, till the up cycle and normalcy comes back.

There are more questions than answers, till the next time – to raising questions.

All business runs on credit and access to credit is the one of the most important aspects to a good functioning economy. The controllers of credit tend to be banks, and when they give loans to small businesses, the economy grows. When they slow down the use of credit, the economy slows down. It is important to know how the bankers see the economy, and one of the best methods is look at the results of the biggest banks in the country.

In an article from Reuters, Bank of America’s profit rose in the first quarter in the global markets as volatility in the global markets lifted trading activity and a rebound in mergers and acquisitions boosted investment banking fees.

Volatile markets tend to benefit investment banks, as trading desks generate higher revenues from increased client activity. BofA ‘s sales and trading revenue rose 13% to $6.4 billion in the first quarter.

Big transactions – specifically big technology M&A – dominated with 22 deals worth more than $10 billion each signed in the 3 months ending March 31, data complied by LSEG showed.

BofA Securities secured advisory roles included McCormick’s $42.7 billion acquisition of Unilever’s food business and Boston Scientific’s $14.9 billion purchase of medical device maker Penumbra. The bank advised on Devon Energy’s $26 billion takeover of Coterra Energy.

BofA’s total corporation investment banking fees rose 21% to $1.8 billion in the first quarter, they were expecting a 10% rise.

In a recent MSNBC video clip, Steve Liesman used BofA information which showed aggregate numbers that the bankers could see how the average American is doing with their banking for the US economy has moved into a K economy. Some are doing very well, others are suffering and BofA numbers reflect the trend.

Linking to dividend paying stocks, the trends you see in the news and reflected help some companies more than others. More M&A’s those fees help investment banking, because there are fees for the actual transaction and then there are fees for selling off assets or right sizing the company. When you examine the M&A do not see it from the consumer but the investor point of view, can you make money on the trends or if you own investments in the sector will they benefit from the trends? There are always trends in the economy, ideally they happen consistently which is why companies make money depending where the season and the cycle is. For example, more construction happens in the spring, summer and fall than the winter. Is it happening?

There are more questions than answers, till the next time – to raising questions.

You are where you are located for a reason and in reality, there are other choices. In every industry, there are alternatives and you always must consider them. This is more true in the services business because as COVID lock downs showed with a laptop, you can do business from anywhere. That being said, it is good to have a home base and do all the things that people do at the place they consider home.

In an article by James Griffiths of Reuters, one of the fallouts from the war between the US and Iran was that Iran has shot missiles and drones to other countries around it, even though technically they were not part of the aggression. The countries had various views about Iran, but their military infrastructure was not part of the US and Israel bombing, however Iran shot missiles because all the countries had close ties with the US. One of the little-known facts is since the 1970’s the US dollar has been the currency of choice for OPEC to receive and invest in. The oil economies of the Middle East prop up the US dollar, so the effect of bigger deficits is lessened, relative to other countries in the world. Iran was trying to hurt the US dollar which would have the effect, investors would have to pay attention to the US deficits and is it going down?

With low taxes, sunny weather and a seemingly endless supply of luxury properties, Dubai has long presented itself as a haven for the global elite. The UAE city has seen its population of millionaires grow 102% in the past decade, according to research by Henley & Partners to 81,200.

Jim Krane, a fellow at Rice University’s Baker Institute, told CNBC Dubai’s economic model is based on expatriate residents providing the brains, brawn and investment capital. You need stability and security to bring in smart foreigners. To keep them, you need the infrastructure and Dubai has evolved to the playground of the Middle East which is the reason why their airline Emirates had more flights into Dubai making it the busiest airport in the world. With all the oil money, Dubai had reasons for tourists to come to the city. The infrastructure improvements brought in people from all the world to do the construction. All of the activity is based on being a safe and secure location, at the moment according to the Financial Times 10 to 15% of British nationals have left Dubai.

Hong Kong used to offer the same choices as Dubai, Hong Kong offered easy access to China and other Asian markets without the risks, legal and otherwise of doing business in them directly.

Drew Bernstein, a managing partner at tax and accounting firm MBP Global, said capital is moving from Dubai to Hong Kong and Singapore. Hong Kong’s challenge is that it is firmly part of the China geopolitical sphere, so its prosperity remains closely tied to broader geopolitical stability in the APAC region and the tenor of US-China relations.

Middle Eastern money tends to be very cautious about these US-China dynamics, given the region’s deep commercial and security ties to the US.

Ultimately, Hong Kong is for players who want China access, while Singapore is for a China-neutral position.

Other countries seeing inquiries is Zug in Switzerland.

Linking to dividend paying stocks, within every industry are alternatives. At times, it may not seem to be alternatives and when monopoly like positions are to found, but come a crisis, alternatives are found. The issue is what happens when the crisis is over? Will the monopoly like positions rebound to where they were or will the alternatives or competition take market share? It is a never ending question, but if there is no crisis, it tends to be a decades answer.

There are more questions than answers, till the next time – to raising questions.

In April 2, 2025, President Trump announced Liberation Day or tariffs on every country in the world. President Trump believes in tariffs and wanted more economic activity in the US. The tariffs were signed in by executive order using the International Emergency Economic Powers Act (IEEPA)which put its path in the court system. The US Constitution says only Congress can pass taxes, but the President said he does not believe in higher taxes, he wanted more revenue, this was different. The court cases came and the lower courts said no, tariffs are a tax. The case went to the Supreme Court and the court agreed tariffs are a tax and only Congress can increase taxes. If President Trump wanted to, he could go through Congress and try to have them pass the tariff tax. Unfortunately for him, he does not have the votes.

US Customs and Border Protection went to work and designed a program called CAPE. The system will consolidate refunds so importers will receive one electronic payment, with interest where applicable, rather than processing refunds on an entry-by-entry basis. At the Supreme Court, one of the arguments to keep the system in place was that it was going to be complicated to get back the refunds. The agency figured it out.

The Agency noted there was $166 billion collected from tariffs and the first phase is for money to go out starting April 20, 2026.

In court cases, some 56,497 importers had completed the process to receive electronic refunds affected by the court’s ruling or $127 billion.

A different issue is prices went up because tariffs are a cost, when the importers receive the bulk of their money, will they lower prices, because the cost of the tariff is gone?

Linking to dividend paying stocks, ideally all the companies follow the law or the regulations decided by the government. They can try to change the rules, sometimes by courts and sometimes by regulatory bodies, but they should follow the rules or the rule of law. It has taken a year, which is why the process takes time but in the end the court delivers the correct judgement. Sometimes the law helps your investments, sometimes they take a hit, but often they will bounce back and in the long run you will be rewarded.

There are more questions than answers, till the next time – to raising questions,

If you think about satellites one of the companies that will come to mind is Starlink. There are many companies in the sphere but because Elon Musk owns Starlink, it is the one that comes up in the media and likely to your thoughts. Mr. Musk is a very good marketer of his brands. Another company that needs to be in this space is Amazon.

In an article from Reuters, Amazon is acquiring Globalstar Inc for $11.57 billion for its satellite business. If you think about the world of drones and ensuring internet access wherever you are or want to be, one of the methods is satellites. Amazon is experimenting with drones for its last mile deliveries, so it needs access to the internet or its own satellites.

Starlink has a 10,000 unit strong network, Amazon has 200 and Globalstar 2 dozen. However, Amazon has ambitions to have 3.200 satellites in Earth’s low orbit by 2029. It is preparing to roll out its satellite internet services later this year.

Globalstar’s satellite network is designed for reliable low-data connections directly to the mobile devices or Direct-to-Device (D2D). The advantage is no need for devices to connect to ground-based cellular towers. (there is a company which offers investors monthly dividends and owns cellular towers, if you own it there will be more competition).

Starlink serves 9 million users globally and is also developing D2D services through partnerships with T-Mobile.

Starlink’s parent is SpaceX and it is moving forward with an IPO, Starlink contributes between 50 and 80% of revenue generated by SpaceX.

Linking to dividend paying stocks, technology changes many things and it changes how the landscape of how companies make money. For a long time, cell phone companies used cell towers, at some point do the newer cell phones use cell towers or satellites. If they use satellite companies, it changes the revenue model for cell tower companies. In every industry there is competition, how the landscape changes is what you need to focus on as an investor.

There are more questions than answers, till the next time – to raising questions.

If you remember the Olympics in China, you might remember the opening and closing ceremonies at the Evergrande Stadium. At the time of the Olympics, Evergrande was the biggest property developer in China and its founder at the time the founder was one of the richest people in the world. Times have changed.

In an article by Clare Jim of Reuters, the founder of China Evergrande Group, the world’s most indebted property developer, pleaded guilty to 8 charges, including misuse of funds, fundraising fraud and illegally taking public deposits.

The indictment of the billionaire founder of the once China’s number one property developer would mark an end to his rags to riches story. Evergrande has defaulted on most of its $300 billionaire in liabilities.

The liquidators of Evergrande declined to comment on the case. Evergrande’s Hong Kong court-mandated liquidation has moved at a glacier pace over the past 2 years, according to liquidators, with $255 million of assets sold as of August compared to creditors’ claim of $45 billion.

Evergrande specialized in building low-cost homes, aggressively running on debt and ensuring having ventures which are passions of Chinese President Xi Jinping. In building homes, Evergrande and others helped make the property and the rise of prices a significant part of the economy, as China went through an infrastructure building boom. The fall of house prices led the company threatened the social stability of the country as many ordinary investors saw their holdings wiped out. The mortgages were greater than value of the home or they were underwater. It was easier to walk away.

Linking to dividend paying stocks, when Evergrande was in its headway and growing it was the darling of the press, but it was built on debt and rising prices. Once the music stopped or the waves receded, only debt was left. It is a story about too much debt, which is why for your investments you are concerned what their debt levels are?

There are more questions than answers, till the next time – to raising questions.

Every country and industry has at least one great asset to fend off the competition and when you understand what the asset is, you can understand how it can handle competition. In the case of Iran, the biggest asset is oil.

In an article written by Patricia Cohen and Robert Gebeloff of the New York Times News Service, how does Iran which as one of the world’s largest reserves of oil, but is on the sanction list of many developed countries continue to function as a country.

Iran has traded with 190 countries since 2019, when the international restrictions were imposed. Overall trade is down, but the country has imported much needed food, electronics and auto parts while it sells oil, gas, construction materials, specialty foods and thousands of other products.

The expectations is that sanctions have isolated Iran from global trade but that is not entirely the case. Iran’s trade has grown more complex over time in response to sanctions.

Trade date over the past 30 years may offer clues about the Iranian economy. Its ability to adapt under the strain of sanctions and disruptions could signal how it would operate going forward.

Precise trade figures are difficult to obtain, however China has stepped up as Iran’s biggest trading partner. During the pandemic, China invested $400 billion in exchange for a steady supply of oil. In 2024, China purchased 90% of Iran’s oil exports.

China also accounted for 25% of Iran’s non-oil exports from 2019 to 2024. Payments are made in renminbi, China’s currency avoiding the use of dollars and the need to involve US banks. China appears to provide nearly 30% of the commodities Iran imports selling everything from furniture to sunflower seeds.

Both countries use a barter system whereby China receives oil from Iran and in return Chinese state-backed companies build Iran’s infrastructure from airports to roads.

Iran’s economy has been diversifying from oil, although heavily dependent on oil, to exporting $120 billion in non-petroleum commodities, according to data from Harvard university’s Atlas of Economic Complexity.

Iran is helped by its geographical location to several trade corridors, as it borders 7 countries including Pakistan, Afghanistaon, Iraq and Turkey. Iran was access to the Caspian Sea as well as the Persian Gul and Strait of Hormuz.

Iran’s 3 biggest trading customers are China, Turkey and Iraq accounting for over 50% of Iran’s non-oil export trade since 2019.

Kuwait is a major buyer of cement and sheep. Bulgaria, Kazakhstan and Uzbekistan import large quantities of packaging materials. Most of saffron in Spain comes from Iran.

Since the sanctions, internally Iran has developed an extensive manufacturing sector that produces automobiles, steel, iron, electronics and pharmaceuticals as well as food products.

In the mid-1990’s European countries accounted for 50% of Iranian exports, now it is less than 20%.

Linking to dividend paying stocks, every country or industry has some assets, when sanctions happen there will be an adjustment and it takes time to accomplish. For Iran, it can sell oil and received goods to keep its economy for the average person in the country functioning. Any country that is isolated will start to do more things internally, sometimes it is better, sometimes not so good. For every problem there are solutions, sometimes there is an easy way, sometimes there is a harder way, but a solution can be found.

There are more questions than answers, till the next time – to raising questions.

If you think of the big 3 car companies you likely think of the North American based companies of GM, Ford and Chrysler. However, if you think about electric cars, you have to look at Chinese car companies. The Chinse companies are expanding outside of China.

In an article by Gilles Guillaume of Reuters, Chery is looking to expand car production in Europe through partnerships with other automakers allowing it to use existing factories, top executives said and an event in Paris, France.

All over the world, various automakers have built factories, some are successful and some are not, but they might be reused for another company given the assets and logistics are in place. If a new company takes over a former existing factory, the municipality will likely make it easier to open the facility again.

Lionel French Keogh, chief commercial officer for Chery Automotive said the company is looking for production capacities in Europe, The company recently launched its brands of Omoda and Jaecoo in Paris,

Similar to Chinese rival BYD, Chery is seeing rapid growth since launching sales in Europe in 2023. Last year sales grew to 120,147 units from 17,035 in 2024, according to data from auto consultancy Dataforce.

Last year, Chery’s global sales grew almost 7% to 2.8 million vehicles with overseas markets outside of China accounting for 47% of sales.

Chery has invested in a joint venture with Ebro in a former Nissan assembly plant in Barcelona and aims to reach production of 200,000 units annually by 2029. The company expects to need to open a new plant to meet demand requirements and the company is expecting to add a small electric SUV in France.

Linking to dividend paying stocks, we often invest in things we know, because if you made a rational decision on what to buy, others would likely make the same decision, and it will turn out to be correct. When we make our decisions, we look and who are the competitors and sometimes do not think about other countries because government regulations make it hard for those companies to compete in the US. Sometimes laws change and companies have various pricing methods for the consumer to buy their item or increase demand elsewhere until consumers demand the regulations to be changed.

There are more questions than answers, till the next time – to raising questions.

In the world of economics, eventually everything is related although some events are easier to see than others. The clearest example is the war in Iran, sent up oil prices.

In an article by Christopher Rugaber of the Associated Press, the largest monthly jump in gas prices in 6 decades caused a sharp spike in inflation challenging for the inflation fighters at the US Federal Reserve and heightening already substantial political hurdles for the White House.

Consumer prices rose 3.3% in March from a year earlier, the Labor Department from 2.4% in February and biggest increase since May 2024. On a monthly basis, prices rose 0.9% in March from February, the biggest increase in 4 years.

The surge in gas prices will stretch the budgets of lower-and middle-income households as it erodes their incomes, making it harder other necessities such as food and rent.

A big question for now is how the oil and gas price shock lasts and whether it will lead to a broader, long-lasting inflation boost, similar to what occurred in the spring of 2022 after Russia invaded Ukraine.

Still how the war and its impact on inflation will play out in the coming months remains highly uncertain.

Industries that depend on oil and gas are paying more, particularly airlines, which have passed on those higher cots to travelers. Fares jumped 2.7% just last month and are 14.9% higher than a year ago. Many delivery services, including UPS and FedEx, have already announced fuel surcharges that have raised shipping costs for businesses and households.

Andy Harig, a VP at the grocery trade group FMI- The Food Industry Association, noted as energy prices increase, the costs associated with producing and delivering food also rise.

If America cut back on spending elsewhere in response to more expensive gas, the economy could slow and unemployment may rise.

According to AAA, gas prices nationwide averaged $4.15 a gallon up from $2.98 a gallon from the day before the war or an increase of 40%.

The last time inflation jumped 9.1%, there were stimulus checks to push up consumer demand, this time around there are no large government stimulus checks expected to spur demand.

Linking to dividend paying stocks, the term everything is interconnected is often used and sometimes it takes time to see everything is connected, however given the prominence of oil and gas in the economy, higher prices to offset the costs quickly show up. In your portfolio, there is an opportunity to benefit from higher oil and gas prices with stocks in the oil and gas business, some of them have been paying dividends for generations, which offset any personal costs.

There are more questions than answers, till the next time – to raising questions.