October 10, 2012 Leave a comment
September 7, 2012 Leave a comment
David Weidner wrote a piece for MarketWatch: “Fool’s Gold Standard.”
It was standard stuff, i.e., a combination of economic stupidity, attempted cleverness, and the rhetoric of contempt.
It deserves my special treatment, which I reserve for mainstream media journalists who hate the idea of a world not run by the Federal Reserve and who try to be clever. Weidner is not clever.
Let me explain. I quote him verbatim and in context.
He begins with this:
Every few decades the nation has a financial panic, and in doing so questions its mode of currency. Should we be on a gold standard, or not?
I ask: Why does the nation continue to experience these panics? Also, when? I recall no financial panic comparable to 2008 in the past 70 years. There was the S&L crisis of the mid-to-late 1980s. Government regulation of the industry caused this crisis.
Let us review chronology. Jesse Helms’ in 1980 called for a gold commission to study gold. A Democrat Congress passed it, and Jimmy Carter signed it. It was held in 1982, four years before the S&L crisis began. It was a dead issue by 1986.
Also, no one in Washington suggested a return to gold in 1982, other than Ron Paul. No one suggested it in 2008, other than Ron Paul.
So, the article begins with a false premise: a supposed relationship between financial panics and calls for a gold standard.
There was price inflation, 1971-1980, but no financial crisis. That decade of price inflation was the result of the policies of the Federal Reserve System under Arthur Burns and G. William Miller. Those policies resulted from Nixon’s unilateral killing of Bretton Woods on August 15, 1971. He killed the gold exchange standard, itself a Keynesian imitation of the post-World War I gold exchange standard (1922 Genoa Conference), itself a government-manipulated counterfeit of the pre-World War I gold coin standard, which had ended in 1914.
This post-financial crisis era is no exception. The Republicans have just put a plank in their party platform that called for the formation of a gold commission, a move that’s generating some buzz on Wall Street.
It is generating no buzz anywhere. The platform is taken seriously by no one, especially Speaker of the House John Boehner. It merely reflects that Ron Paul scared the Republican Establishment this time. He did not in 1982.
September 5, 2012 Leave a comment
Barack Obama cares about Barack Obama far more than he does about either Israel or Iran. And as far as Barack Obama is concerned, delaying the coming war between Israel and Iran until after the election is what is best for Barack Obama. Just think about it. If Israel attacked Iran right now, who would that please? It would mostly please hardcore Republicans, and they are not going to vote for Obama anyway. To independents and liberals, Obama would look like a guy that couldn’t stop war from happening in the Middle East. If the U.S. showed support for the Israeli attack, that would greatly discourage his anti-war supporters from going to the polls. If the U.S. did not show support for the Israeli attack, Obama would potentially lose many of the Jewish voters that he desperately needs in swing states such as Florida. A war between Israel and Iran is a no-win situation for Obama right now, and as I wrote about yesterday, the Obama administration has been trying to discourage Israel from attacking Iran for weeks. Well, now it is being reported in major international news sources that a deal has been reached between Obama and Israel. Obama is going to publicly declare what the “red lines” are that will cause the U.S. to strike Iran’s nuclear program, and the U.S. military is going to send some of their most advanced bunker busting bombs to Israel. Those bombs will come in very handy in getting at the Iranian nuclear facilities that are hidden underground. In return, Israel has apparently agreed to delay the attack on Iran until after the election. So would Barack Obama really play politics with war in the Middle East? Of course he would. Barack Obama is obsessed with winning a second term and he would make a deal with just about anyone if it will get him closer to his goal.
The Israelis really did not want to go ahead with an attack on Iran without U.S. support anyway. They feel like time is running out to stop Iran from becoming a nuclear power, but without the support of the United States it would have been hard to justify an attack to the rest of the world.
So in the end, it looks like both sides are going to get what they want. At some point there will be an attack on Iran’s nuclear program, and Obama gets it delayed until after the election.
According to Fox News, Israeli officials have admitted that they have been involved in talks with the Obama administration about Iran’s nuclear program….
Israeli officials said Tuesday they are in close discussions with the United States over how to deal with the Iranian nuclear program, seeking to ease tensions that have emerged between the two allies over a possible Israeli military strike against Iran.
The dialogue, in which Israel is looking for President Barack Obama to take a tough public position against Iran, suggests the odds of an Israeli attack in the near term have been reduced.
But I have not found a U.S. news source that is reporting on the details of the deal that has apparently been reached. The following is from an Israeli news source….
September 3, 2012 Leave a comment
Even as Greece desperately tries to avoid defaulting on its debt, U.S. companies are preparing for what was once unthinkable: that Greece will soon be forced to leave the eurozone.
Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency.
No one knows just how broad the shock waves from a Greek exit would be, but big U.S. banks and consulting firms have also been doing a brisk business advising their corporate clients on how to prepare for a splintering of the eurozone. That is a striking contrast to the assurances from European politicians that the crisis is manageable and that the currency union can be held together. On Thursday, the European Central Bank will consider measures that would ease pressure on Europe’s cash-starved countries.
September 2, 2012 Leave a comment
There is talk of a plank in the Republican Party’s platform calling for a gold commission. The commission will study the possibility of re-establishing a gold standard.
The likelihood of a positive recommendation coming out of such a commission is as likely as a positive report of another commission to study the feasibility of restoring the Articles of Confederation.
I did a Google search on these terms: “gold commission,” Republican, platform. I got 20,000 hits.
That’s not too bad. I always like to see public interest in the restoration of gold as the backing for the U.S. dollar.
But there is a lot of deja vu about this. We have been down this yellow brick road before. It is nothing but gold-painted bricks all the way to the Emerald City: Greenback heaven.
In 1980 Senator Jesse Helms persuaded a Democrat- controlled Congress and Jimmy Carter to sign into law a call for a gold commission. Under those circumstances, you can imagine how seriously the President took the bill. But Carter was trounced by Reagan later that year. This offered hope to the more naive gold bugs within the camp of the faithful.
Under Reagan’s Secretary of the Treasury, Donald Regan, plans went forward. In March 1982, the Gold Commission began meeting. The Secretary of the Treasury filled the commission with anti-gold Keynesians and monetarists – followers of Milton Friedman – who also favored the Federal Reserve. There were only two pro-gold standard members: Ron Paul and Lewis Lehrman. Out of the Gold Commission came a majority report, which opposed the gold standard, a minority report by Paul and Lerhman, and a detailed history of the legal foundations of the U.S. dollar by Austrian school legal scholar, Edwin Vieira. You can download all three documents here.
The Spanish Government allocates another 41,000 million of public money to help banks [elconfidencial]
August 28, 2012 Leave a comment
Translation by Google
Ministers De Guindos and Montoro, in an image file. (EFE)
As Americans spent July 4 celebrating the anniversary of the United States’ independence from Britain, German-born Kim Dotcom was reveling in a re-birth. According to the founder of Megaupload, his file storage site will rise again.
In a tweet to his followers this week, the man behind the world’s most famous file-locker site — and one of the FBI’s biggest foes — hinted that Megaupload will be brought back to life.
“SOPA is dead. PIPA is dead. ACTA is dead. MEGA will return. Bigger. Better. Faster. Free of charge & shielded from attacks. Evolution!” reads a tweet from the official @KimDotcom Twitter account. Dotcom— born Kim Schmitz — is currently being targeted by international authorities over his role with the website, which American official say was the centerpiece in a vast online piracy conspiracy.
By masterminding the operations of Megaupload, the Federal Bureau of Investigations insists that Dotcom caused the American entertainment industry to lose $500 million in revenue. Law enforcement agents raided his home this past January in a highly publicized sting that has since been condemned by not just Dotcom and his supporters but even justices in New Zealand.
Failed “neo-liberal” policies implemented over the past 20 years are responsible for Europe’s economic troubles, the leader of the country holding the rotating European Union presidency said Wednesday.
Members take six-months turns in presiding over the EU.
The role of EU presidencies has diminished since summit preparations and foreign policy has been entrusted to permanent officials – Herman Van Rompuy and Catherine Ashton – but they still chair ministerial meetings and broker deals between member states.
“There is no denying that the policies set up in recent years, neo-liberal policies based on an unbridled market – no social control, no supervision – have failed,” Cypriot President Demetris Christofias, a Communist, told the European Parliament.
“They have failed because the free-market economy is one thing, but impunity of the markets is something different,” he said in Strasbourg, France.
Speaking as the leader of a country on the verge of becoming the sixth eurozone members to need an international bailout, Christofias also attacked the German government’s focus on austerity to solve the debt crisis.
“The very harsh austerity policies that have been implemented to get us out of the crisis have failed to solve our problems; in fact, they have made them worse,” he said.
“It is our moral and political responsibility to share out the burden of this crisis, we must protect the most vulnerable among us,” Christofias insisted, while urging “sanctions” for “those whose behaviour has been reprehensible.”
His remarks echoed those of European Commission President Jose Manuel Barroso, who on Tuesday denounced “reckless trading and market manipulation” a few hours after Barclays chief executive Bob Diamond resigned over a rate-rigging scandal.
The European Commission – as well as Germany, France and a selected group of eurozone nations – favours a financial transaction tax as a way of making the financial sector pay its dues.
Cyprus – which has a low tax regime – opposes the measure, but may be forced to steer discussions on the issue in its role as EU president.
On Wednesday, Barroso suggested that the main task for the Cypriot presidency will be forging a compromise on the EU’s budget for 2014-2020, a controversial issue which should be decided by December.
“Reaching a deal by the end of the year, not any deal, I mean a good or even, why not, a very good deal, would mean a great service for the European Union as a whole, and it would mean a success for the Cyprus presidency,” he said.
BUENOS AIRES, Argentina (AP) — Facing clear signs of a looming recession, Argentina’s president is ordering the country’s biggest banks to lend $3.3 billion of their clients’ savings at rates below what many believe to be the inflation rate.
The requirements taking effect Thursday limit interest on the loans to 15 percent a year. The government says inflation is below 10 percent, but many analysts estimate it at around 25 percent, one of the world’s highest rates.
President Cristina Fernandez says the government saved the private banks when they were in trouble, and now it’s the banks turn to do their part to fan Argentina’s decelerating economy by lending 5 percent of their deposits to small and medium-sized businesses.
Argentina, one of the world’s leading grains suppliers, saw its economy expand by almost 9 percent last year on the back of high commodity prices and industrial output led by car sales to Brazil. But blistering growth has been reined in by less demand from its neighbor and leading trade partner Europe’s economic woes and surging inflation.
Fernandez has said that Argentina’s top 20 banks will lend more at a maximum interest rate of about 12 percent for a minimum three-year period. Economic analysts say the move is a quasi-subsidy imposed on the leading bankers that does not get to the core of what discourages investors: one of the world’s highest inflation rates and one of the most volatile business environments.
“This is a negative development inasmuch as requiring banks to lend at negative real rates erodes the capital base of banks and by distorting the cost of capital will lead to a misallocation of credit,” senior Goldman Sachs economist Alberto Ramos wrote in a research note.
June 30, 2012 Leave a comment
Over the past couple years China has been making strides to expand the use of the renminbi for international trade as apposed to using the US dollar as an intermediary. With a growing Chinese economy and a weakening USD, increased use of the renminbi protects global trade from the desperate moves made by the US Federal Reserve. The Financial Times reports on this big economic development:
China plans to create a special zone to experiment with currency convertibility in Shenzhen, the city where it introduced key economic reforms three decades ago.
The measure will enable Hong Kong banks to lend renminbi directly to companies in Qianhai Bay – a new economic zone on a peninsula across the water from Hong Kong – according to Chinese state media.
Analysts say the experiment could prove as critical to eventually dismantling capital controls as Deng Xiaoping’s reforms were to opening China to the world.
Foreign institutions have also been given a limited but growing array of investment options for their renminbi holdings, such as Hong Kong’s dim sumbond market and a programme for buying Chinese equities.
Liu Ligang, an economist at ANZ, said the risks of the latest measure were greater than those attached to the 1980s opening.
June 28, 2012 Leave a comment
If no bank will lend your kid $100,000 to get a degree in sociology without the feds promising to assume all risk, there’s a reason: In 4 years, your kid will have the same job prospects he does now but will have $100,000 in debt and no way to pay it off. And colleges keep on jacking up prices because the federal gravy train keeps rolling. Subprime loans: When will we learn?
June 27, 2012 Leave a comment
If you have seen the stage version of Peter Pan, you know the scene in which the audience is asked to clap if they want Tinker Bell to live. It’s time.
Janet Daley wrote a provocative essay in London’s The Telegraph on the day before the Greek election (June 16). She did her best to explain why the eurozone is in crisis. Europe’s leaders are living in an illusion of their own making.
She began with what should be obvious to the financial markets by now. By entering into the eurozone, the politicians surrendered control over the money supply.
The problem is not that politicians surrendered control over the money supply. It is that they surrendered it to the European Central Bank. They should have surrendered it to the free market.
The politicians of Europe asserted control over the international money market in 1914, when they abandoned the international gold standard. They set the precedent. Everything that has followed has been one fiat money crisis after another. But only Austrian School economists teach this. In Europe, bureaucratic control over money has run the show ever since 1999.
The economy is now beyond the control of national governments, and therefore outside the remit of democratic politics. It has become truly global, and thus a law unto itself; nation states have gone broke in their attempt to feed its gargantuan appetites for consumption and debt.
It is not the “world economy” that has a gargantuan appetite for debt. It is each nation’s politicians, who want something (increased spending) for almost nothing (borrowed money at low rates). That was what northern commercial bankers gave the PIIGS’s governments at German rates of interest until the spring of 2010, when the Greek socialist government announced that its predecessor had cooked the books.
The losses must now be parceled out. The losses are in the past. They cannot be avoided. They can only be postponed by covering them up. In short, the eurozone must do what the Greek government did before 2010: cook the books. Thus, the bailouts continue.
The remedies for this began in panic and are now ending in delusion: first the banks went bust and were bailed out by governments; then the governments went bust and needed to be bailed out by – whom? International funding agencies which get their cash from – where? From central banks which will have to print gigantic amounts of money to replace all the money that simply disappeared in the bad debt that bankrupted the banks in the first place. And if we all agree to accept the illusion that this newly printed cash has actual value – if we all clap really hard and say that we believe in fairies – then the whole show can get back on the road and we will be rich again.
It was exactly a century ago that Ludwig von Mises’ book, The Theory of Money and Credit laid out the case against central bank wealth fairies, but few listened then, and fewer listen now. The message is unpleasant to politicians, who want to spend more than the government takes in through taxes. They do not want rising interest rates that will result if the government is to cover its deficit.
Sometime in the early ’70s we came back from summer recess to find that the sisters at St. John Villa Academy on Staten Island, like nuns across the United States in those years, had been liberated from their head-to-toe black wraps, suddenly donning skirts and short little veils. Exciting times! For a boy like me, who knew I was gay for as long as I could remember, there was something hopeful about the nuns finally being able to kick that oppressive habit. Maybe this church was actually making a change for a more enlightened, modern direction on a whole host of issues.
But things didn’t exactly go that way. And recent events have underscored what we’ve known for a long time about the Vatican. Men in the church who act out are protected and even rewarded, and lying is acceptable if it’s in the service of covering for the church. Women, however, are slammed for espousing compassion and truth if it deviates evenly slightly from what the men in charge have decided. And homosexuals are blamed for everything.
The Vatican’s doctrinal office, the Congregation for the Doctrine of the Faith, spent more than two years reviewing Sister Margaret Farley’s book Just Love. She advocates a healthy sex life, including women pleasuring themselves, and makes an argument for accepting same-sex marriage. It’s not a shocker that the office’s Cardinal William Levada recently rebuked Sister Farley harshly, slamming the book and its positions as “not acceptable.”
But what should be shocking is how this contrasts with the Vatican’s response to the recent revelation that Cardinal Dolan of New York lied about having paid off pedophile priests. He called the charges “false and preposterous” years ago when they were first made, but tax documents obtained by The New York Times reveal that he paid $20,000 to hush up one priest and make him go quietly. Dolan refused to respond to the facts of the story, saying it was “useless and counterproductive” to do so because The New York Times is supposedly biased against the church. And there’s been no official response from the Vatican, which seems perfectly fine with lying if it’s in the service of protecting the church’s own horrendous actions and abdication of responsibility in the face of the child-abuse scandal. Let’s not forget that only a few months ago New York’s prior archbishop, Cardinal Egan, rescinded the church’s apology for the child-abuse scandal.
The rebuke of Sister Farley came weeks after the rebuke of the largest order of nuns for spending too much time helping the poor and not enough time speaking out against same-sex marriage and abortion. The church claimed the nuns espouse a radical feminist point of view, and clearly it is their deviation on the issue of homosexuality, which the church has been obsessed over, that has the Vatican infuriated. Sister Farley was reminded that the church calls homosexuality “intrinsically disordered” and that same-sex relationships thus can never be condoned. It was none other than Pope Benedict himself who used that phrase to describe homosexuality back in the 1980s, when he, as Cardinal Ratzinger, ran the Congregation for the Doctrine of the Faith.
Everyone knows that the term fascist is a pejorative, often used to describe any political position a speaker doesn’t like. There isn’t anyone around who is willing to stand up and say, ‘I’m a fascist; I think fascism is a great social and economic system.”
But I submit that if they were honest, the vast majority of politicians, intellectuals, and political activists would have to say just that.
Fascism is the system of government that cartelizes the private sector, centrally plans the economy to subsidize producers, exalts the police state as the source of order, denies fundamental rights and liberties to individuals, and makes the executive state the unlimited master of society.
This describes mainstream politics in America today. And not just in America. It’s true in Europe, too. It is so much part of the mainstream that it is hardly noticed any more.
It is true that fascism has no overarching theoretical apparatus. There is no grand theorist like Marx. That makes it no less real and distinct as a social, economic, and political system. Fascism also thrives as a distinct style of social and economic management. And it is as much or more of a threat to civilization than full-blown socialism.
This is because its traits are so much a part of life — and have been for so long — that they are nearly invisible to us.
If fascism is invisible to us, it is truly the silent killer. It fastens a huge, violent, lumbering state on the free market that drains its capital and productivity like a deadly parasite on a host. This is why the fascist state has been called the vampire economy. It sucks the economic life out of a nation and brings about a slow death of a once-thriving economy.
Let me just provide a recent example.
A Socialist victory in France’s parliamentary elections means the country will now try to tax and spend its way out of trouble, putting it on collision course with Germany.
But as France prepared to ramp the top rate of tax up to 75 per cent to pay for increased public spending, David Cameron made an extraordinary promise to welcome wealthy firms and individuals who want to move to the UK.
He said: ‘I think it’s wrong to have a completely uncompetitive top rate of tax. If the French go ahead with a 75 per cent top rate of tax we will roll out the red carpet and welcome more French businesses to Britain and they can pay tax in Britain and pay for our health service and schools and everything else.’
French Prime Minister Jean-Marc Ayrault said the new government would quickly implement its reforms to reduce the pension age from 62 to 60 – at a cost of £17billion a year – and boost the public sector.
Paris is also putting itself at the forefront of international efforts to relax anti-austerity measures.
Countries such as Greece claim a forced reduction in public spending is forcing them into deeper financial problems by suffocating growth.
EC president says European leaders have not come to Mexico to receive lessons on how to handle the economy
The opening day of the G20 summit was threatening to deteriorate into a fractious row between eurozone countries and other non-European members of the G20, notably the US, as EU commission president José Manuel Barroso insisted the origins of the eurozone crisis lay in the unorthodox policies of American capitalism.
As Europe‘s leaders came under intense pressure to act decisively to cure the euro‘s ills, and a campaign gathered pace to relax some of the austerity programmes laying waste to countries with unsustainable debt levels, Barroso said Europe had not come to the G20 summit in Mexico to receive lessons on how to handle the economy. Asked by a Canadian journalist: “Why should North Americans risk their assets to help Europe?” he replied: “Frankly, we are not here to receive lessons in terms of democracy or in terms of how to handle the economy.
“This crisis was not originated in Europe … seeing as you mention North America, this crisis originated in North America and much of our financial sector was contaminated by, how can I put it, unorthodox practices, from some sectors of the financial market.”
Late on Monday , Antonis Samaras, the Greek election victor, announced he had agreed to build a coalition with the head of the socialist Pasok, Evangelos Venizelos, with aides saying they expected negotiations to be concluded by Tuesday. The moderate Democratic Left party may participate as well.
The European council’s president Herman Van Rompuy, speaking alongside Barroso, said a draft G20 communique showed “support and encouragement for the euro area countries and leaders and for the European Union as a whole to overcome this crisis”.
“We are not the only ones that are so-called responsible for the current economic problems all over the world,” he said.
June 14, 2012 Leave a comment
ATHENS (Reuters) – Greek banks have seen a marked increase in the pace of bank withdrawals as a June 17 general election nears and fears grow that Greece could be forced out of the euro, senior bankers said on Wednesday.
Combined daily deposit outflows from the major Greek banks have reached 500-800 million euros over the past few days, with the pace picking up as the election draws closer and rising noticeably on Tuesday, two bankers said.
Deposit outflows at smaller and medium sized banks were running at 10-30 million euros.
“This includes cash withdrawals, wire transfers and investments into money market funds, German Bunds, U.S. Treasuries and EIB bonds,” said one banker, who spoke on condition of anonymity.
Fears that Greece may have to quit the single currency and return to a weak drachma have fuelled a steady stream of withdrawals by companies and businesses alarmed at the prospect of seeing the value of their deposits cut sharply.
The result of the election, called after a previous vote in May failed to produce a government, remains too close to call, with the conservative New Democracy party running neck and neck with radical leftist SYRIZA.
June 13, 2012 Leave a comment
Washington has granted waivers to sanctions on Iranian oil imports to several countries, leaving China the only major oil importer subject to US penalties. Chinese oil giant Sinopec announced it will not raise imports in an effort to allay sanctions.
The US government added India, South Korea and four more nations to the list of countries exempt from the sanctions on Monday.
Ten EU nations and Japan were granted waivers in March to US financial penalties.
The US considers that these countries have made a considerable effort to lower imports of Iranian crude with a view to stifling the Islamic Republic’s lucrative oil industry and curtailing its nuclear program.
US supporters of the sanctions against Iran say China has been receiving clandestine cargoes of Iranian oil which have had their tracking signals disabled.
Iran maintains that its nuclear research program is purely for civilian purposes, but the US and Israel insist the country is in the process of developing atomic weapons.
A new set of heavy sanctions may be introduced on June 28 by the US aimed at putting further pressure on Iran.
“By reducing Iran’s oil sales, we are sending a decisive message to Iran’s leaders: until they take concrete actions to satisfy the concerns of the international community, they will continue to face increasing isolation and pressure,” said US state secretary Hilary Clinton in a press release on Monday.
Earlier today there were reports that Spain could request a bank bailout this weekend. From the Financial Times:Spain poised to seek bailout and from Reuters: Exclusive: Spain poised to request EU bank aid Saturday
Spain is expected to ask the euro zone for help with recapitalizing its banks this weekend, sources in Brussels and Berlin said on Friday, becoming the fourth country to seek assistance since Europe’s debt crisis began.
Five senior EU and German officials said deputyfinance ministers from the single currency area would hold a conference call on Saturday morning to discuss a Spanish request for aid, although no figure for the assistance has yet been fixed.
Later the Eurogroup, which consists of the euro zone’s 17 finance ministers, will hold a separate call to discuss approving the request, the sources said.
“The announcement is expected for Saturday afternoon,” one of the EU officials said.
However, later in the day, from MarketWatch:
Deputy Prime Minister Soraya Saenz de Santamaria told reporters Friday that the government would make no decisions on any aid request before the results of various reports on Spanish banks were known.
“The government has to respect the process before taking any decisions about the data of the banks,” said Sáenz de Santamaría, in the televised press conference. She also said there were no plans for any meetings in the coming days, but sidestepped questions about whether a teleconference call would be held.
Iran is ready to mount a resistance against a possible outside attack on Syria, two senior generals of the Islamic Republic said. The statements come as the level of violence in war-torn Syria continues to escalate.
The pro-Assad “resistance” would ensure that aggressors do not survive the conflict, a senior commander of Iran’s Revolutionary Guards, Brigadier Gen. Massoud Jazaeri told Mashregh, a media outlet run by the Guards.
“A conflict in Syria will engulf the region and its main victims will be the people of Syria themselves,” he also noted. “The Zionist regime and the interests of the enemies of Syria are all within range of the resistance fire.”
“The defeat of the enemy at this stage will be a big event and, God willing, we will witness that,” Jazaeri added.
Mashragh earlier reported that Iran’s armed forces had formed a joint war room with officers from “the resistance,” which includes Iran, Syria and Hezbollah, which controls parts of Lebanon.
Brigadier General Mohammed Reza Naqdi, the head of Iran’s Basij militia who was sanctioned by the US Treasury Department for alleged human rights abuses, said Tehran would not tolerate foreign interference to topple President Bashar al-Assad. He alleged that the United States was considering taking action in Syria to protect Israel.
“After the expulsion of the Americans from Iraq, and the disruption to their defensive posture in protecting the Zionist regime, America in order to defend the regime of the occupier of the Quds [Jerusalem] is after a new scenario in Syria,” he said. “But they will be defeated.”
A Pentagon-led program that equipped more than 17,000 police and sheriff’s departments across the country with military-grade surplus weaponry will be put on hold while auditors try to account for $2.6 billion worth of handouts.
The US Department of Defense made a surprise move on Friday when they announced that the Pentagon program responsible for supplying local law enforcement agencies across America with armored cars, automatic weapons and even aircraft is being temporarily halted while an investigation tries to locate items issued during the last few years of the initiative.
Defense Logistics Agency spokesman Kenneth MacNevin tells the Associated Press that the audit was not triggered by any specific incident, but news of the change in procedure comes after a handful of stories made it to the mainstream media in 2012 alleging mismanagement of the weapons. The agency says that they temporarily suspend the arms program as they take inventory of their last round of handouts, but that could be a major chore until itself: last year the Pentagon gave away half a billion dollars’ worth of military gear through the agency’s Law Enforcement Support Office.
“Leadership decided to make sure we have a good, full accounting for all of this,” MacNevin tells AP. “We’re not doing this based on any thought there’s a problem. We’re doing it because accountability is accountability.”
Only one month earlier, however, accountability was an issue being brought up for discussion in rural Arizona, where the Pinal County Sheriff’s Office was in the spotlight for its relationship with the Law Enforcement Support Office. The Arizona Republic newspaper was able to uncover documents suggesting that Sheriff Paul Babeu’s office has been handed more than $7 million worth of Humvees, fire trucks, guns, defibrillators, barber chairs, underwear, thermal-imaging scopes, computers, motor scooters and more from the Pentagon — but not before trying to sell them on the street for extra cash.
March 26, 2012 Leave a comment
Thandeka Gqubule and Andile Ntingi
South Africa will this week take some initial steps to unseat the US dollar as the preferred worldwide currency for trade and investment in emerging economies.
Thus, the nation is expected to become party to endorsing the Chinese currency, the renminbi, as the currency of trade in emerging markets.
This means getting a renminbi-denominated bank account, in addition to a dollar account, could be an advantage for African businesses that seek to do business in the emerging markets.
The move is set to challenge the supremacy of the US dollar. This, experts say, is the latest salvo in the greatest worldwide currency war since the 1930s.
In the 30s, several nations competitively devalued their currencies to give their domestic economies an advantage over others.
And this led to a worldwide decline in overall trade volumes at the time.
The north will be pitted against the entire south in a historic competitive currency battle – whose terrain has moved to the Indian capital New Dehli – where the Brics (Brazil, Russia, India China and South Africa) nations will assemble next week.
China seeks to find new markets for its currency and to lobby to internationalise it throughout the Brics states.
For China this is not a new game. In 2009, senior Chinese banking officials issued a statement that the international monetary system was flawed owing to an unhealthy dependence on the US dollar and called for a “super-sovereign” international reserve currency.
Experts say Beijing’s first step is to internationalise its currency (by expanding its reach beyond China), liberalise it (to allow its value to be determined by the market instead of actively managing it as they currently do) and then make it a reserve currency for many nations in the developing world.
Africa’s largest bank, Standard Bank, says in a research document: “We expect at least $100 billion (about R768 billion) in Sino-African trade – more than the total bilateral trade between China and Africa in 2010 – to be settled in the renminbi by 2015.”
The bank anticipates that the use of the renminbi will lower transaction costs in Africa, thus lowering the barriers to doing business.
It also says that the Chinese will be more successful in transacting in renminbi in Africa than anywhere else because most currencies are weak and somewhat localised.
Not only will the US dollar be challenged, but also the entire international financial regime – led by the World Bank and the International Monetary Fund – which has been dominant since the end of World War II.
South Africa’s place in the emerging international financial regime is set to be enhanced.
Zou Lixing, vice-president of the Institute of Research of the China Development Bank, told the Brics preparatory meeting recently that “although the economic aggregate of South Africa is small relative to the Brics, South Africa provides a gate for the Brics to get access to the huge African market”.