Eagle, I don't want to form an alliance anymore.

July 4: The Caucasus Authority decided by a vote of 4 to 3 to transfer Karabakh to Armenia.

July 5: The decision was overturned overnight, and Karabakh remained within Azerbaijan, but the Nagorno-Karabakh Autonomous Region (NKAO) was established. At the same time, Nakhchivan also became an autonomous republic under Azerbaijan (although it does not border mainland Azerbaijan).

Some argue that the Turkish factor was decisive. In the Treaty of Moscow in March 1921 and the Treaty of Kars in October 1921, Soviet Russia and Mustafa Kemal Atatürk, the father of modern Turkey, reached a strategic cooperation agreement—Kemal needed Soviet weapons to fight against the Entente Powers, and Soviet Russia needed Turkey as an anti-imperialist ally.

Turkey has made it clear that it will guarantee the territorial integrity of its "Turkic brother" Azerbaijan, especially Nakhchivan (which borders Turkey). Giving Karabakh to Armenia would be tantamount to offending Turkey diplomatically.

Secondly, there was the economic weight of Baku oil. Azerbaijan was the energy lifeline of Soviet Russia at the time—the Baku oil fields were the only large-scale oil-producing region in the Soviet Union. In the early 1920s, the Soviet economy was extremely dependent on Baku. The economic weight that pleased Azerbaijan far outweighed that that that pleased Armenia.

Moreover, the Azerbaijani Communist Party held political weight in the Supreme Politburo from 1921 to 1989, and its leader at the time, Narimanov, had considerable connections in Moscow, even directly pressuring Lenin. The Armenian Communist Party, having just undergone Bolshevization in 1920, was unstable and lacked significant influence.

In such a mess, siding with either side would offend the other. The Soviet Union at the time had two traditional tools for handling ethnic conflicts:

The Party's machinery, through the Central Committee of the Republic, suppresses local demands; the violent machinery, using KGB and MI6 forces.

However, both of these tools malfunctioned in 1988. The Armenian Communist Party was hijacked by the national movement from the bottom up on the Karabakh issue—the party's grassroots organizations were themselves organizers of national demands, and the stability maintenance instructions issued by the central government through party channels could not be implemented at the local level at all!

The Communist Party of Azerbaijan is facing a different kind of paralysis – the party apparatus in Baku clearly coordinated with the perpetrators in the Sumgayit incident, which means that the party machine itself has been nationalized by local forces.

Worse still, Gorbachev's openness rendered the traditional model of information blockade and secret repression ineffective. The Novoch Cherkasy massacre of 1962 could be completely covered up until the day the Soviet Union collapsed, but the Sumgait massacre of 1988 spread throughout the Soviet Union within two days!

Gorbachev, as always, wavered and indecisive in his handling of this issue, at one point considering it a "normal growing pain in the democratization process" that should be resolved through political dialogue, and at another point considering it a "conspiracy of anti-Soviet forces" that must be suppressed with a hardline approach.

The result was policy inconsistency: sometimes sending troops, sometimes withdrawing them; sometimes negotiating, sometimes declaring a state of emergency.

The result was that Armenia and Azerbaijan clashed. Thanks to the border demarcation that resulted in each side having a portion of their respective ethnic groups within the other's territory, the two sides can now freely roam each other's borders.

Slava didn't have many options for dealing with this mess. He decided to temporarily remove Karabakh from Armenia and Azerbaijan and place it under the direct control of the Union Central Committee for a period of time, thus separating the two entangled entities.

If the fuse could be extinguished before it burned out, the disaster that dragged the Soviet Union into a quagmire could be temporarily averted.

Sigrún has taught at the Iceland University of the Arts as a part-time lecturer since and was Dean of the Department of Fine Art from -. In – she held a research position at Reykjavík Art Museum focusing on the role of women in Icelandic art. She studied fine art at the Icelandic College of Arts and Crafts and at Pratt Institute, New York, and holds BA and MA degrees in art history and philosophy from the University of Iceland. Sigrún lives and works in Iceland.

To make this whole machine of prevention, appeasement, and rehabilitation run smoothly, Slava had to go back and fix one thing—the KGB's terrible reporting system.

He was all too aware of the system's flaws. On another timeline, the KGB's reports on national issues severely underestimated the true potential of the national movement.

The reason lies in the paradigm in their minds—they always report that it's anti-Soviet elements plus Western subversion, so no matter where a national movement emerges, their first reaction is always that there must be a CIA behind it, and they insist on attributing something that grew out of the Soviet Union itself to a foreign conspiracy.

If the paradigm is wrong, everything reported will be biased, and when something really goes wrong, the central government will be completely in the dark.

In late August, Slava established a special department within the KGB to analyze ethnic relations, replacing the research teams with individuals from sociology and ethnology backgrounds. He gave this department strict orders:

Closely monitor the ethnic movements of each constituent republic and keep a close watch on areas where armed conflict or violent clashes may break out!

Once this mechanism was established, the central government's response speed to ethnic issues increased dramatically.

But after making this series of moves, Slava also ran into the hardest rock in his game.

Something bad is going to happen in Russia. Slava's series of low-key concessions to the various national republics—rehabilitating the Tatars, restoring the German Autonomous Regions, and giving Baltic scholars a voice—resonated increasingly with Russian conservatives, eventually being interpreted as:

Ivanov is betraying the interests of the Russian people!

Russian Federation President Vorotnikov, who harbored deep resentment towards Slava, directly voiced his discontent at a Politburo meeting:

"The General Secretary's actions are an unconditional concession! He's using Russia's dignity and resources to fill the bottomless pits of those national republics!"

Slava completely understood. “Vitali Ivanovich, it’s true that I’m backing down, but I want my comrades here to think about one thing clearly—these historical grievances passed down from decades ago are about to explode in our generation. In fact, we only have two paths in front of us.”

He held up one finger.

"The first thing to do is to send troops down and kill all the restless ethnic minorities until only one percent remain, so that Russians become the absolute majority on this land, a majority that no one can shake."

This road is the cleanest and most thoroughly clean.

The conference room was deathly silent.

Slava held up a second finger: "The second path is the one I'm taking now—gradually differentiating and resolving the contradictions bit by bit. First, we must appease and resolve these historical demands, and then turn around and use economic ties, political control, and ideological propaganda to firmly weld these ethnic groups onto the ship of the alliance."

He withdrew his hand and looked at Vorotnikov.

"I chose the second option not because I was soft-hearted, but because I knew that the first option would turn the country into a graveyard, and a tsar sitting in a graveyard cannot reign for long!"

My concession is so that I can stand firm and move forward in the future.

These words quelled some of the anger directed at him in the meeting room. Koslava also knew that reasoning alone wouldn't sway the Russians; he needed to offer concrete evidence.

So he made some concessions. In terms of propaganda, to cure Russian nationalism, he seized upon the "internationalist tradition of Leninism" and declared that the true interest of the Russian people was a stable alliance, not a fragmented ruin.

Slogans alone are not enough; he also needs to make Russians themselves taste the tangible benefits: special investments should be made in Russia's agricultural regions, and some of Russia's industries should be modernized.

He absolutely cannot allow the concessions to the national republic to leave the impression in the eyes of the Russian people that "Russians are being exploited instead."

Even if that's the truth.

Sigrún has taught at the Iceland University of the Arts as a part-time lecturer since and was Dean of the Department of Fine Art from -. In – she held a research position at Reykjavík Art Museum focusing on the role of women in Icelandic art. She studied fine art at the Icelandic College of Arts and Crafts and at Pratt Institute, New York, and holds BA and MA degrees in art history and philosophy from the University of Iceland. Sigrún lives and works in Iceland.

By mid-September, despite the inevitable political turmoil and public discontent, Slava's series of actions had managed to address the core demands of the separatist forces one by one on paper.

During the same period, Slava mobilized the KGB and the Ministry of Internal Affairs to de-radicalize ethnic separatist forces in various republics, purge those determined to cause trouble, and at the same time carefully cultivated a group of people loyal to Moscow in various places.

This move changed the views of conservatives within the party and hardliners in the military regarding Slava.

They initially viewed him with some skepticism, thinking, "This is just another Gorbachev," but now they understand: Ivanov is not Gorbachev!

He will not back down indefinitely. His concessions are merely paving the way for future advances, and when the time truly comes, this man will not hesitate to use violence and bloodshed to defend the core interests of the Soviet Union.

Offering candy in one hand and holding a knife in the other—that's the kind of rule these old-fashioned people believe in.

Sigrún has taught at the Iceland University of the Arts as a part-time lecturer since and was Dean of the Department of Fine Art from -. In – she held a research position at Reykjavík Art Museum focusing on the role of women in Icelandic art. She studied fine art at the Icelandic College of Arts and Crafts and at Pratt Institute, New York, and holds BA and MA degrees in art history and philosophy from the University of Iceland. Sigrún lives and works in Iceland.

On September 21, Slava convened a Politburo meeting.

At this meeting, he put his "final solution" to the ethnic issues on the table.

Of course, this "final solution" is completely different from the infamous solution concocted by the Nazis at the Wannsee Conference.

Hitler's "Final Solution" was to physically erase a nation, while Slava's approach was to gradually pull nations back from alienation into the Union family.

This plan is cloaked in Leninism—anti-Greater Russian chauvinism, national equality, and the socialist family; but the core beneath that cloak has a Stalinist flavor:

Use time to create space, use appeasement to create a buffer, and then use OGAS, economics, and cultural identity to bind the relationship.

Many committee members in the meeting hall changed their expressions as they listened. They had initially thought Slava was merely addressing the symptoms of a few ethnic unrests, but after hearing this comprehensive plan that had been meticulously crafted from 1987 until the late 1990s, many had to admit—

Ivanov's national solution, which stitched together Lenin's outward appearance with the strategic goals of the Soviet Union, was a good solution.

After the meeting, Director Nian followed Slava out of the conference room and said, half-jokingly and half-seriously:

"At least you didn't completely ruin the situation with your first step. But let me remind you, your whole gamble is on the next few years."

If the economy really takes off, if OGAS really starts spinning, and everyone has beef stew in their pot, then you've won the game.

But if any link in the chain breaks down, the lives of ordinary people will not improve—”

“I know,” Slava continued, without stopping. “By then, I’ll have to swallow all the boomerangs I have now.”

He paused, gazing at the window at the end of the corridor that let in natural light.

"But each generation can only do what its own generation can do. We can only rely on the wisdom of future generations to solve the problems that lie ahead. All I can do is get through this current challenge first."

The footsteps of two people in the corridor, one after the other, gradually faded into the distance.

Chapter 77 American Twilight

October 1987, New York

The bright autumn sun of Manhattan shone on the shop windows of Fifth Avenue, bathing the entire city in a golden glow, but Aldridge Ames was filled with melancholy.

He strolled leisurely through Manhattan's business district with his wife and son, carrying several shopping bags. To outsiders, it was a typical scene of a successful middle-aged entrepreneur enjoying a weekend with his family.

No one would have guessed that this amiable, slightly overweight man was the head of the counterintelligence department of the CIA's Soviet and Eastern European Bureau, and that he held a list of almost all of America's human intelligence sources within the Soviet Union.

He had personally handed this list to the KGB in 1985.

From that year on, he embarked on a path of no return. He wasn't recruited; he went to them of his own accord.

On the one hand, he was dissatisfied with the overbearing style of American foreign policy, and on the other hand, his chaotic and near-bankrupt personal finances pushed him step by step into the door of the Soviet embassy.

Now in 1987, he was in his first productive period, earning tens of thousands of dollars in cash for each batch of intelligence he delivered.

His wife thought the money he received last month came from his "entrepreneurial" status, but little did she know that he had sold another batch of CIA data to the Soviet Union.

But it doesn't matter. Since he's already a spy, morality and conscience are like clay in his hands, which he can mold into any shape at will.

Moreover, if those people in this line of work, who have access to so much smear material about the US, truly have a conscience and morality, then they must be hidden socialists. He still can't forget the previous syphilis experiments conducted in China, and the marine droplet experiments where anthrax bacteria were deliberately released indoors...

However, what was truly unsettling him at that moment was something else entirely.

A few days ago, Finance Minister Baker made a strong statement: "If West Germany dares to raise interest rates again, the United States will simply let the dollar fall!"

These words terrified those holding dollar assets in the international investment community the weekend before the collapse. Then, on October 14, rumors circulated in Congress that the tax credit for leveraged buyouts would be eliminated, and those who specialized in M&A arbitrage immediately became restless and began frantically dumping their assets.

From the 14th to the 16th, from Wednesday to Friday, the Dow Jones Industrial Average has fallen by nearly 10% in just three days, with a drop of 108 points on Friday alone!

Over the entire weekend, panic grew stronger and stronger, like a fire burning under a pot where no one could see it.

Ames sensed something was wrong much earlier than most Americans.

A few days earlier, the KGB had sent him, the most valuable Soviet agent in the United States, an unusual "suggestion" through a dead mail system.

Don't use your money to speculate on stocks, and don't buy government bonds!

After all, the KGB knew his financial skills; if he had good economic management abilities, he wouldn't have needed to approach the KGB.

He hesitated at first because the interest rate on government bonds had soared to over 10% at that time. Who wouldn't be tempted by such a large sum of money?

However, the series of signs from the 14th to the 16th made him believe the KGB's seemingly nonsensical "suggestion" to some extent.

Having dealt with Soviets for many years, he has gained a much deeper understanding of the current economic reforms in the Soviet Union and of Marxism than before.

Meanwhile, the newly appointed Federal Reserve Chairman who replaced Greenspan, Sprinkler—a die-hard monetarist of the Chicago School, who spouted dogmas like "the market will clear itself" and "central banks should not intervene"—made him doubt the American system he was in.

His wife, arm in arm with him, gazed at the dresses in the shop window and casually remarked, "Do you think the Dow Jones has been falling so sharply these past few days? Could it really be a second Great Depression?"

Ames paused for a moment.

"I don't know, darling, but I think it's possible."

He was born in 1941. His father was someone who had experienced the Great Depression of 1929. When he was a child, his father often talked about those days at the dinner table—about those respectable people who became penniless overnight, about the long lines of people outside the bank, about the dizziness of "the whole world suddenly not recognizing you".

Ames heard these words but only half-believed them, leaving them in a corner of his memory.

"I think it's just the market's self-regulation; there are winners and losers, and that's a normal phenomenon."

His wife, however, looked optimistic. She waved her hand, her tone carrying a confident disdain.

"So what if a few go bankrupt overnight? Are we going to change the entire financial system because of that? No, that's absurd."

The 1929 incident was purely due to the immaturity of the financial system's regulation. Things are different now; this is at most a minor fluctuation! If it really comes to that, only those who have lost money will whine and bark like stray dogs that have been kicked.

To put it bluntly, their own understanding is insufficient to justify the amount of money they have—they deserve to lose; it's their own lack of expertise as investors.

Ames didn't reply, but his expression became more complicated. He thought about where the money from last month came from, and then about his wife's confident words, and his face began to tense up.

Their ten-year-old son listened intently. Under the influence of his mother and the anti-communist propaganda permeating society, the child had long since become a core member of the Republican Party, an untested and wavering capitalist fighter.

"The Great Depression?" The son curled his lip, looking disdainful. "Dad, that's impossible."

Communism is just a bunch of poor bastards making up nonsense to comfort each other. The history of communism is long gone. From now on, this world belongs to America.

Ames looked at his son's face, which was filled with confidence and bewilderment, opened his mouth, but ultimately said nothing.

He just had a vague feeling that something was about to happen.

Sigrún has taught at the Iceland University of the Arts as a part-time lecturer since and was Dean of the Department of Fine Art from -. In – she held a research position at Reykjavík Art Museum focusing on the role of women in Icelandic art. She studied fine art at the Icelandic College of Arts and Crafts and at Pratt Institute, New York, and holds BA and MA degrees in art history and philosophy from the University of Iceland. Sigrún lives and works in Iceland.

Meanwhile, in the downtown financial district, the fuse of disaster had burned to its last flame.

On this morning, just before the New York Stock Exchange rang its opening bell, the deepest link in the financial system that held everything together snapped.

The options clearing company and the Chicago Mercantile Exchange clearinghouse discovered early that morning that the on-time margin call had not yet arrived.

The market maker "First Options"—whose parent company was the Continental Illinois Bank, which had just been rescued from the brink of bankruptcy by the federal government in 1984 and was on the verge of collapse!

If it collapses, the Chicago Mercantile Exchange's clearinghouse will default.

According to the script on another timeline, two people were supposed to step in and save the day that morning.

Federal Reserve Chairman Alan Greenspan would deliver a statement at 8:41 a.m. that would later be considered a classic central bank statement—the Fed affirmed its readiness to provide liquidity at any time;

Meanwhile, the president of the New York Federal Reserve would pick up the phone and call the chairmen of giants like Morgan Stanley, Citigroup, and Chemical Bank one by one, telling them:

"Continue lending to your brokerage clients, don't withdraw loans, the New York Fed will bail them out!"

Legally, the Federal Reserve was not authorized to make such a commitment, but everyone accepted it, so the chain that was about to break was forcibly stretched back.

Without the Federal Reserve's guarantee, the futures clearing chain would have broken on the morning of October 20th. In that case, it wouldn't have been a single-day drop of 22.6%, but a chain reaction of defaults throughout the derivatives market, the collapse of major securities firms, and then the transmission to the banking system!