Spoke to @hendry_hugh and @writes_sweeney on Thursday about how the convexity of war has shifted from the urban arena to the fields favouring the Ukranian defenders. (1/7)

Crucially for markets, the convexity of economic strategy (sanctions) is shifting economic power away from current account surplus countries towards those with current account deficits and countries with open asset markets. (2/7)

US sanctions on the Russian central bank and on Russian oligarchs show that if you don't control it then you don't own it. The rent seeking economic strategy of selling commodities without spending on a functioning state is broken. There is nowhere to hoard the proceeds. (3/7)

Paradoxically this means that in a commodity bull market economic power resides with those who have assets to invest in rather than those producing the goods. (4/7)

The Chinese Yuan is no substitute for the US dollar which will remain king for all those who retain access to it. Attempts to create a replacement via the Yuan or any other closed currency will fail as no non US aligned power has managed to create anything other than (5/7)

a closed mercantilist economy. Gold and systems of barter are the only alternative. They likely will be hugely inefficient but will be tried nonetheless. (6/7)

Buy gold, buy dollar (7/7) @hendry_hugh @BraxResearch @Bardamu_31 @RaoulGMI @SantiagoAuFund @michaelxpettis @profplum99 @SrivatsPrakash