Peace through superior firepower

Peace through superior firepower

A few days ago I was engaged in conversation with a non-conspiratorially minded chum who works in UK property sales

Times are definitely a changing as, for the first time, he acknowledge to me that, yes, the UK possibly was headed towards a period of severe economic hardship for the massses. He was, however, confident that the UK government ‘has got clever people working behind the scenes who can see what’s coming and the government probably has already started spending money on starting up some industries that will help pay us out of the mess the country’s in’

My response was that there is absolutely no sign of that whatsoever and that whatever industry we could think of getting into, the Asian economies can think of getting into with a much lower cost base.

Even if they consented to enduring the same standard of living as the Chinese or Indians, the wages of British workers cannot be slashed to be competitive with Chinese or Indian labour because UK property costs are so much higher. Property costs that the British have to meet directly in rent or mortgages and indirectly through the rentier element concealed within the price of essential goods and services

However, as I explained to my chum, I have seen copious evidence that the British, and other Western, establishments are preparing for the possiblity of some kind of economic collapse. They haven’t invested much in the way of productive manufacturing industry but they have spent shed loads on tooling-up their police forces

But that, my chum argued, was necessary because of the threat of terrorism…

Evidently, he’s still in need of a little more conspirasizing


I’ve been pulled up a couple of times in this blog for suggesting that British police have become more like para-militaries in recent years. The people who’ve pulled me up have have referred to the pitched battles, complete with cavalry, during the miners strike and the treatment meted out to people like Blair Peach and Stephen Waldorf as being evidence that the police have always been a bit ‘tasty’ when it comes to dealing with people who get in their way

And, yes, these commentators have a point but, with all respect, have you taken a look at the British police recently…

Even former senior coppers and yes, though I still can’t quite believe it, Max ‘Have you read my book about how great the SS were‘ Hastings have recently written articles suggesting that having machine-gun toting police who can execute people with impunity is probably not the way for supposedly civilised societies to go…

Sir Max Hastings – sole liberator of the Falkland Islands and born-again bleeding heart pinko fag subversive

But even these (presumably) principled voices against the militarisation of our police compromise their argument by agreeing that, because of the threat of terrorism, there is a place for some British policemen to be kitted out with the kind of weaponry and mentality that wouldn’t be out of place in a 1970s junta, but only sometimes

Now, to me, it’s plain as day that the Terror threat is being at least bigged-up, and possibly at least partially instigated, by the numerous interest groups that benefit from a society collectively crapping its pants

But that’s actually a moot point

Even if I believed that the Terror threat was 100% genuine and as really, really scary as our Overlords keep telling us it is, we should still reject the surveillence state and militarised police on the time-honoured bases that those who surrender liberty for a little temporary safety really do deserve neither, that freedom has a price and that if we change our society in response to terrorism the terrorists have achieved their objectives

You will hear none of these arguments being promoted by British politicians, journalists or officially sanctioned (low) pressure groups like Liberty


The gun fashionably displayed by the group of licenced potential killers in this photo is a variant of the iconic Heckler & Koch MP5

The MP5 can chuck out bullets at rates of up to 500-600 rounds a minute. It’s black, it’s scary looking and it can kill a lot of people very quickly. It’s the kind of high-quality weapon that gives serious gun nuts a roaring chubby just thinking about it.

MP5s, and a smattering of the higher velocity H&K G36, are now a common sight in London in the hands of Metropolitan police officers. If you’re ever at one of London’s airports take a look up sometime and you’ll see police officers at the mezzanine levels strutting around with their MP5s, presumably ready to cut loose from elevated positions of fire at the drop of a hat.

If you think about it for a moment that doesn’t make a whole lot of sense. Even if the quality of domestic terrorist was to take a quantum leap up from the kind of sad losers who make bombs out of flour and set fire to their underpants to the kind of terrorists who actually have access to guns, are the police really going to open fire with machine guns in crowded airport terminals? And, even if so, why do those armed police have to be there right in front of our fucking faces all the time?

The answer, I fear, is the same reason why the government sent light tanks to Heathrow before the invasion of Iraq. That weaponry is not there to scare potential (and, remember, allegedly suicidal) terrorists. It’s there to scare us

The reason why I mention all of this now is because of this recent snippet from the State Broadcasting Company…

Police in training for ‘Mumbai-style’ gun attack in UK

…suspects were planning to copy the 2008 attacks in the Indian city of Mumbai*, where 10 gunmen went on a three-day rampage, killing 166 people and injuring more than 300, the sources said.

In response police armed response units are being given more powerful weapons.

Our correspondent said the UK authorities had been planning for such an attack ever since Mumbai* happened.

“David Cameron has taken a personal interest in the problem ever since his first threat assessment given to him when he took office in May.

“Now police armed response units are getting their firepower and their stocks of ammunition increased to deal with multiple terrorists armed with automatic weapons,” he said.

More powerful than MP5s and G36s?!

What the fuck are they planning to start dishing out?

Bring me the head of Silvino Herrera

[The beheading story is eerily similar to this quote I received from a troubled Marine vet, about beheading a Panamanian officer to send the head back to Noriega before the invasion:

"One of the ops I remember, "we" (me and the Army guys), took the head of a (what I now believe) high ranking military officer.  I carried "it" back to the C-141 we rode on, in a black cloth bag, and put it in a cooler with ice.  I vaguely remember the CIA guy talking about sending it to Noriega." ]

Bring me the head of Silvino Herrera

“Us versus them” and other “modern” myths of war and civilization

By Daniel Patrick Welch
Against the background of the leaking of the USA’s  secret Iraq war crimes files by the whistleblower website WikiLeaks, Daniel Patrick Welch peers beneath the West’s self-proclaimed cultural and moral superiority in the face of atrocities against innocent people all over the world.

“When we peel away all the layers of burning flesh, all the carefully constructed fiction of human progress and benefits of science and technology, we must face a reality perhaps even more grim. There simply is no ‘us versus them’. The side claiming to represent progress has done more and done worse, using as low-tech and brutal methods as any on either side of the technological and cultural divide.” (Daniel Patrick Welch)

They behead – we do it with smart bombs. There is, of course, an ugly truth to this recently minted axiom: the horror of state terrorism is that the overwhelming machinery of death in the hands of all-powerful governments far outweighs individual atrocities by madmen, small groups and non-state entities. While, with their beheadings and murders of innocents, the heathen thugs and killers may indeed be barbarians, it is almost impossible to accomplish with their amateur methods the slaughter of half a million children, as did the Anglo-American/UN sanctions in Iraq.

“… the brutal repression of movements that strive for greater human freedom, workers’ rights and a life worth living is ignored, while the “atrocities” of those trying to resist are seen as backward and evidence of cultural and moral inferiority.”

This is the same reasoning that puts the lie to the sanitized concept of war and destruction which makes the self-satisfied “West” so smug and confident of its moral superiority. There is an underlying, and often overt, racism which allows so-called “modern” warmakers and their electorates to tolerate the huge disparities in casualties that have come to define modern conflict. In virtually every case, the brutal repression of movements that strive for greater human freedom, workers’ rights and a life worth living is ignored, while the “atrocities” of those trying to resist are seen as backward and evidence of cultural and moral inferiority.

However, one problem is not just that the disparity in terror torpedoes the moral superiority argument. It is true that the 20th century was indeed a most horrific one, unbeknownst to most lay observers: at its dawn, 90 per cent of war dead were combatants and 10 per cent non-combatants. By its end, the ratio was reversed, making it the most deadly and, arguably, least “advanced” century in human history. True also, the machinery of war, with its amoral measurements in “kilomorts”, its chemistry of napalm designed to stick to human skin and burn, its phosphorous and gas, its cluster munitions – not to mention the almost surreal evil of neutron bomb technology, which are meant to kill people while leaving buildings intact – shows that the actual brutality of burning flesh and exploding body parts is in no way less barbaric than other methods. The United States gets no props from the rest of the “civilized” world for instituting the pain-free technology of lethal injection to a practice most governments consider a barbarous anachronism.

When we peel away all the layers of burning flesh, all the carefully-constructed fiction of human progress and benefits of science and technology, we must face a reality perhaps even more grim. It is not merely us standing cynically by, wringing our hands while they hack each other to death with machetes, as when almost a million Tutsis died in Rwanda. There simply is no “us versus them”. The side claiming to represent progress, the “march of history” and the fulfilment of the human desire for freedom and self-rule, has done more and done worse, using as low-tech and brutal methods as any on either side of the technological and cultural divide. There is a famous photo, not of Nick Berg, not of John the Baptist, but of Silvino, one of the lieutenants in Augusto Sandino’s resistance army. Rather, it is a photo of Sr Herrera’s head held triumphantly aloft by a US Marine, a conquering hero of the few and the proud. It turns out we behead, too.

US Marine Lt Remmington holding Silvino Herrera's head, 1930

US Marine Lt Remmington holding Silvino Herrera’s head, 1930

When I was in Nicaragua, I heard testimony of the victims of Somoza’s National Guard, women with their breasts cut off, left alive and maimed on purpose to terrorize their families. Resistance fighters and their supporters and trade unionists killed with their genitals cut off and stuffed in their mouths. Victims forced at gunpoint to swallow a button on a string while laughing guardsmen kept trying to pull it up. Like all the henchmen throughout Latin America, these murderers, nun-rapists, “deplaners” (who simply pushed terror victims out of a moving plane to their unacknowledged deaths), clown-killers and assorted scum received training and backing from the CIA, the Pentagon and the dreaded School of the Americas. As Franklin D. Roosevelt, hero of the US mainstream left, once bragged: “Somoza may be a son of a bitch, but he’s our son of a-bitch.” It turns out we do all that other stuff, too.

Likewise, I had mostly considered the shot of triumphant soldiers standing atop a pile of bones of the conquered dead to be mainly a cartoon representation. Wrong again – the only such true photo I have ever seen was of US soldiers in the Philippines at the turn of the 20th century, when over a half million Filipinos were slaughtered in the successful attempt to secure the islands for the American empire. The scene is repeated ad nauseum in US history, in murderous rampages across our own continent from sea to shining sea, through Central America, the Caribbean and the Pacific. Despite George Bush’s audacity and isolation, there is absolutely nothing new about Iraq. Conquest, pacification, occupation and the transfer of “sovereignty” to a puppet government is the textbook modus operandi. The only phase yet to be completed is the few decades in which the world is supposed to forget the origins of the dictatorship, after which US forces return to suppress rebellion or resistance movements and install democracy, as if the cycle had no beginning.

In this context, it is almost unbearable to hear the shallow, mind-deadening “debate” between Democrats and Republicans about “how to handle” Iraq, not to mention the infrastructure of organized theft that transfers trillions of dollars from South to North, from workers to capital, from poor to rich, from brown to white. To my mind, there are three crises – allowing for some consolidation and overlap – which surpass all else in their urgency today. They can be summarized as empire (by which we include Iraq, Israel-Palestine, Venezuela, Colombia and the rest), WalMart and the crushing of labour, with its attendant rape of the national treasury and the healthcare system, and the prison state, whereby incarceration is abetting and supplanting vote suppression, the Klan and slavery as the new racist ideology.

“Self-delusional, feel-good bromides about the ‘greatness of America’ and a wilful suppression and misrepresentation of our history will seal the deal, and we will plummet headlong into the looming environmental catastrophe that is waiting to engulf us all.”

These are, of course, big problems. They are, however, exploding problems, and ones which threaten the very existence of humankind (combined with the rapacious consumerism which holds the lot together). Just the kind of all-encompassing issues one might foolishly expect a national election campaign to address. This huge history, soaked with blood and death for the benefit of profit and oligarchy, is completely unconcerned with the party hacks nibbling at its corners, unthreatened by the sorry excuse for “ideology” and “values” espoused by the political and economic system it nurtured and generated. Self-delusional, feel-good bromides about the “greatness of America” and a wilful suppression and misrepresentation of our history will seal the deal, and we will plummet headlong into the looming environmental catastrophe that is waiting to engulf us all.

As a young pupil celebrating America’s bicentennial, I remember being paraded in a choral production called “Our Country ’tis of thee”. One lyric still sticks in my mind and in my craw, sung by our chorus of mind-controlled, ignorant, chirpy sixth graders:

There’s a peaceful sky in my backyard
Far away from fear and doubt
But the whole wide world is my hometown
And I’ve gotta help my neighbour out
There’s a peaceful sky in my backyard
Far away from a far off land
But the whole wide world is my hometown
When freedom needs a helping hand

Thinking about it today still makes my skin crawl with embarrassment and self-loathing, even though I was only 11 years old. Sort of like a post-traumatic lapse for a former cult member. Lack of self-doubt combined with ignorance of one’s history is perhaps the most dangerous combination known to humankind. Torture at Abu Ghraib is not the tip of the iceberg; it is simply the latest link in the chain. Facing that history head on, with the disillusionment, fear and doubt that rationality and honesty implies, is the sobering task of those who would resist the current onslaught. It is the first step in a long, long road to sanity, and it is not a comfortable one. As Rosa Luxembourg famously remarked, “it will always be the most revolutionary act to say the truth out loud”.

Translations of this article are available in GermanPortugueseSpanish, and Turkish.

© Daniel Patrick Welch. Reprint permission granted with credit and link to

Crimes of the dictatorships in Eastern Europe

Unterzeichnung des "Hitler-Stalin-Pakt" im Jahr 1939 (Bild: AP) Signing of the Hitler-Stalin pact in 1939 (photo: AP)

Nazi torturers simply changed to the Stalinists

“Crimes of the dictatorships in Eastern Europe” conference of the Literature House in Berlin

Frank Hessenland

At a conference in Berlin, researchers discussed the cooperation between fishing Nazi crimes and those of the Stalinist dictatorship in the Soviet Union. But many projects have stalled.

In addition to the 40 speakers were more than a handful of listeners come, it would have probably been a hot debate in the rotunda of the Käthe-Kollwitz-Museum in Berlin-Charlottenburg. Because the focus of the three-day international conference on “crimes of the dictatorships in Eastern Europe” was the internationally controversial documentary “The Soviet Story”. It tries the Baltic director Edvins Snore show that between Stalin and Hitler, between SS and NKVD between Reichswehr and Red Army until 1941, such a close and friendly ‘working relationship’ was that one can speak of the equivalence of the two terrorist regimes, such example, the British historian Norman Davies in the movie.

“The whole Western world has lived for over 60 years with the assumption that the crimes were in the 20th century essentially Nazi crimes. And this assumption is very difficult to change. But mass murders are still mass murder.”

The film recalls the long-forgotten fact that Stalin had already starved seven million Ukrainians in 1932 on purpose, just as Hitler did 1942/43 with three million Poles. It displays documents to which experts on torture and forced labor camps of Nazi Germany and the Soviet Union exchanged words. Even with respect to the totalitarian claim of creating a ‘new man’, the design of propaganda similar to the regimes in the 30er/40er-Jahren. Only the terrorist walked into the Soviet-occupied countries after the war just continues, as reported at the conference “crimes of the dictatorship” from Eastern Europe who had come historians, archivists, and journalists. From Hungary, half a million went to the Siberian labor camp, from the Baltic States or from Romania even more, says historian Marius Oprea and civil rights activist from Bucharest.

“Deported came during the communist period are over 600,000 people for political reasons in labor camps and many have been. 200 000 died during this time and we are still hidden mass graves of people who were shot without trial, in the mountains and forests.”

Not infrequently, confirmed the deputy director of the museum “House of Terror” in Budapest, Hungary, the tormentors of the Nazis changed after the lost war, just the sides and continued for the Stalinists. Accordingly, today, many civil rights activists demand in Central and Eastern Europe of the legal equality of the two great crimes of dictatorships, for example, Hubertus Knabe, director of the memorial Hohenschönhausen:

“The same cars, same situation in the home loss and large population displacements. This is basically extremely inhumane totalitarian approach that is quite so universal that you discuss this topic is not always against each other, but can rather talk about how these regimes each have produced millions of victims. “

Have achieved the former civil rights activist last year at the European level, the declaration of a Memorial Day for the Victims of Communism 23 August, the date of the signing of the Hitler-Stalin pact. But other projects are stalled, such as uniform European rules in dealing with the perpetrators, research initiatives consistent or uniform educational standards in dealing with the communist dictatorship. Considerable resistance experienced such efforts not only by the socialist parties in many European countries. Jewish organizations also fear the relativization of the Nazi past for obvious reasons. And then there’s the research from the perspective of perhaps the most important point is that the Russian archives for historians remain extremely difficult to access.

Crime turf war fear in Winter Olympics city of Sochi

THE huge cash influx for the 2014 Winter Olympics has raised fears of rampant corruption and a bloody turf war between crime clans.

The Sochi Games are the pet project of Prime Minister Vladimir Putin, who, like Stalin before him, has his summer residence on the outskirts of the Black Sea resort.

The Games are estimated to cost a record $14 billion. All the sporting facilities and stadiums, new railways, new motorways and a new airport have to be built from scratch.

The Kremlin was embarrassed last week after the murder of a crime boss known as “the Carp” was linked to crime gangs seeking a cut of the Olympic investment cake.

Eduard Kakosyan was drinking coffee at his regular table in a cafe in Sochi when a black-clad hitman on the back of a motorbike opened fire with an AK-47 assault rifle.

Kakosyan is said by police to have represented the criminal interests in Sochi of Aslan Usoyan, 73, known as Grandpa Hassan and widely described as the former Soviet Union’s most powerful criminal godfather.

Hassan narrowly survived an assassination attempt last month when a sniper shot him near the Kremlin. The botched attack is thought by Russian police to be linked to a row between Hassan and another powerful figure in organised crime, who is in jail partly because of his involvement in lucrative racketeering and construction scams in Sochi.

“Hassan controls a lot of business interests in Sochi, especially hotels and restaurants,” said a Russian crime expert. “The cash flowing into the city since it was awarded the Winter Games has been phenomenal. It has attracted the interest of organised crime, big time.”

Police are now bracing themselves for revenge attacks and a full-scale turf war.

The Sunday Times

“Al-CIAda” In Belfast?

[First official reaction was that this was not linked to "global terror" incitement, but just wait....]

Police find two bombs in Northern Ireland

October 31, 2010 – 11:29PM


Northern Ireland police said on Sunday they had found and disarmed two bombs, one near Belfast airport, blaming groups intent on taking the once conflict-torn province “back to mayhem and misery”.

Staff at Belfast International Airport raised the alert on Saturday afternoon after spotting a vehicle in the long stay car park, which contained “a viable device along with suspected flammable liquid”, police said.

It was made safe by explosives officers and the alert ended about 2.00am (1300 AEDT) on Sunday.

Air traffic was not affected and police said there was no link to the global alert provoked by the discovery of bombs on two US-bound planes on Friday.

Meanwhile in Lurgan, a town southwest of Belfast, about 40 kilogrammes of home-made explosive materials were found in a beer keg on Friday, prompting police to carry out a number of controlled explosions.

A number of nearby homes were evacuated overnight and, because the device was found under a railway bridge, the main rail service between Belfast and Dublin was suspended for 24 hours, police said.

“Both devices had the potential to cause injury and damage. They were left in places used by the public and with no regard for the public,” said Assistant Chief Constable Duncan McCausland.

He added: “In recent days police have stepped up their measures to counter the threat posed by misguided individuals and groups who seek to drag the country back to mayhem and misery.

“Our efforts will continue and we would ask everyone in the community to be vigilant about their surroundings as they go about their daily business.”

There has been a resurgence in attacks and attempted attacks in recent months, most blamed on dissident republican groups seeking to undermine peace.

For three decades up until the 1998 peace accords, Northern Ireland was scoured by violence pitching Catholic nationalists against pro-British Protestant unionists. The conflict left about 3500 people dead.

Last month, the British government raised the threat level from Northern Ireland-related “terrorism” to suggest an attack was now a “strong possibility”.

© 2010 AFP

Diplomacy turbocharged

Diplomacy turbocharged

By Neena Gopal
Diplomacy turbocharged

It’s only natural, that it would be here in the gleaming glass-fronted National Convention Centre in Hanoi, celebrating its 1,000th year and festooned with Vietnam’s national flags, that India and China’s intricate minuet should come to some kind of part denouement.

The bonhomie in Hanoi — from the elaborate courtesy shown by the Chinese premier Wen Jiabao to the host nation, the praise showered by Mr Jiabao on Prime Minister Manmohan Singh over his “sagacity and wisdom”, and again, over the clinking of glasses at the high table during the gala dinner when Dr Singh was seated, interestingly, between Mr Jiabao and Japanese prime minister Naoto Kan — begs the question: In the face of India’s fledgling steps to strings its own pearls across a region long seen as China’s stomping ground, and some say egged on by the United States and Russia, has Beijing, tuned in to “understand the voices of others around the globe,” reverted from its newfound ‘frown’ diplomacy to the ‘smile’ diplomacy that won them entry into a slew of economies in the first place?

No asnwers as yet. But India has deftly played along. Dr Singh, borrowing a leaf from the Chinese perhaps, in mouthing platitudes in the public domain has finally moved at a surprising pace on his moribund Look East policy, tying up civil nuclear ties with Japan and South Korea, military ties with Vietnam and Malaysia, and trade and economic bonds with Singapore, South Korea and soon with Thailand and Indonesia. All, uniformly wary of the demonstrably muscular face of the new China.

Vietnam, chair of Asean, could be the starting point when the scales finally fall from Asian eyes. Vietnam stands as a bulwark at the mouth of the South China Sea, a beneficiary of Chinese largesse and investment as are other countries in the South East and East Asian region where Beijing seeks to bolster its own economy and tie the investment hungry countries into a much tighter embrace.

Vietnam is the only nation to have defeated every invader — the Mongols several centuries ago, the French, the Americans and the Chinese more recently. While it wants to be the next Asian tiger, not chary of accepting once sworn enemy

China’s help to pull itself up by the boot-straps, it is its invitation to India, the United States and Russia to the East Asian summit, that has to be seen for what it is — summoning the cavalry against the economic and sabre-rattling militaristic power of Beijing, which has in recent months, steadily upped the ante.

China has laid claim to the Spratlys, also known as the Paracel islands, held Japan to ransom by halting a supply of rare earths vital to the development of advanced technologies, and made a dramatic shift in its India policy by not only reiterating its claim to the Indian state of Arunachal Pradesh but weighing in on the side of Pakistan on Jammu and Kashmir by offering ‘stapled’ visas to people from that state. The meeting of the Asean 10 and the six from the immediate neighbourhood — which includes India and China, and now Australia, New Zealand, Russia and the United States — is therefore, no accident.

Vietnam’s concerns, that in return for trade and development investment from China to speed up

economic recovery after years of wars, it could face an economic implosion as China manipulates its currency to create an artificial imbalance in trade, are echoed across the region.

Chinese officials have baldly told the US that the South China Sea is a “core interest” of Beijing. At the ASEAN Regional Forum Hanoi meet in July this year, nearly half the heads of the 27 delegations raised the issue. Only for the Chinese foreign minister Yang Jiechi to castigate and remind the Southeast Asian leaders of their economic ties with Beijing, and angrily threaten that they could be broken at any point. Sitting in the room was US Secretary of State Hillary Clinton.

This Asean-East Asia Summit is therefore all the more an eye-opener, coming as it does just days ahead of US President Barack Obama’s visit to India on November 6, as significant a signal as Dr Manmohan Singh’s state visit to Washington in 2009, of the place that India holds in the American calculus. Ditto, the nations from this region.

India’s reaction to the Chinese bogeyman has been a carefully calibrated attempt to build its own security and trade architecture by seeking free trade agreements with all Asean states. It bears the comprehensive imprint of the Indian prime minister, who seems to publicly give the Chinese the benefit of the doubt, as do many Asian nations even in India’s South Asian backyard where there is a willingness to turn a blind eye to Beijing’s backing of Myanmar and even its moves to further nuclearise Pakistan. But not so in private.

Obama’s scepticism over China’s motives, too, have not been vocalized but they are shared by many in government who, however, are still deeply divided over whether India should tie itself further into a larger security wheel that already has Japan and Australia as the spokes. US plans to build India up as a counterweight to China, much denied all around, is no secret. Whether India has the moxy to take its newly rejigged Look East policy to its logical conclusion and be able to emulate and counter China’s smart power — even with the Americans holding our hands — is, however, the real question.

Rare earths & pouring rain

While in Japan, India moved quickly to offer to supply Japan rare earths, a group of 17 minerals that are vital for the manufacture of a wide range of sophisticated electronic items, industrial and military equipment. One such rare earth, Neodymium, is the reason why audio company Bose is able its tiny jewel-cube speakers. India’s offer came in the wake of attempts by China, which currently mines 97 per cent of the world’s supply of rare earths, to deny those minerals to Japan, the US and other big consumers — a move that was immediately described as the new “Great Game”. Until 1948, India and Brazil were the world’s main contributors of rare earths. By offering rare earths to Japan, India not only sought to revive that position, it also managed to soften Japan on a civil nuclear deal.

After the slaughter, gold will stand tall

After the slaughter, gold will stand tall

John Hathaway

The days of the US dollar as the dominant reserve currency are numbered and its breakdown will be will be chaotic, writes John Hathaway.

The world’s monetary system is in the process of melting down. We have entered the endgame for the US dollar as the dominant reserve currency, but most investors and policymakers are unaware of the implications.

The only questions are how long the denouement will last, and how much more damage will be inflicted by new rounds of quantitative easing or more radical monetary measures to prop up the system.

Advertisement: Story continues below

Whether prolonged or sudden, the transition to a stable monetary system will become possible only when the shortcomings of the status quo become unbearable. Such a transition is non-linear. So central bank soothsaying based on the extrapolation of historical data and the repetition of conventional wisdom offers no guidance on what lies ahead.

Telltale signs of future trouble are not hard to spot. Only a few months ago, the US Federal Reserve chairman, Ben Bernanke, and other high-ranking Fed officials were talking about exit strategies from the US central bank’s bloated balance sheet and the financial system’s unprecedented excess liquidity.

Now those same officials are talking about pumping more money into the system to stimulate growth.

They are not alone: six months ago, the chief economist of the International Monetary Fund, Olivier Blanchard, suggested that raising inflation targets to 4 per cent from 2 per cent would not be too risky.

This sort of talk must grate on the nerves of China, India, Russia and others, who have accumulated pyramids of non-yielding US Treasury debt. And bickering among central bankers over currency manipulation and rising trade tensions does not reinforce one’s confidence.

The prospects for an orderly unwinding of the extreme posture of global monetary policy are zero. Bernanke, Jean-Claude Trichet and Mervyn King, his counterparts in Europe and Britain respectively, are huddling together upon the most precarious perch in the history of monetary affairs. These alleged guardians of monetary stability have simply created the incinerator for paper money. We are past the point of no return. Quantitative easing may well become a way of life.

The consensus investment view seems to be that the credit crisis of 2008 was a freak occurrence. That is wishful thinking. Monetary policy has painted itself into a corner. Based on our present course, there will be more bubbles and more meltdowns.

Financial markets and institutions sense trouble, as reflected in the flight to supposedly safe assets such as treasuries and corporate-debt instruments with paltry yields, as well as the reluctance to lend by commercial banks. We are stuck in an epic liquidity trap. The irony is, if global central banks succeed in creating inflation, the value of these safe assets will be destroyed. It is a slaughter waiting to happen.

In the pedantic mentality of central bankers, their playbook creates just the right amount of inflation. As inflation accelerates, consumers will spend to get rid of their dollars of diminishing value and spur the economy. Once consumers start spending, it will be time to raise interest rates because a solid foundation for prosperity will have been established, they say.

But whatever the playbook promises, the capacity of financial markets to overshoot cannot be overestimated. The belief among policymakers and financial markets in the possibility of this sort of fine-tuning is preposterous.

The breakdown of the monetary system will be chaotic. When inflation starts, it will be highly disruptive. The damage to fixed-income assets will seem immediate. Foreign exchange markets will become dysfunctional. The economy will become even more fragile and unpredictable.

Gold is an imperfect, but comparatively reliable, market gauge for the extent of monetary destruction.

The anti-gold pundits provide a great service to those who grasp this historical moment: they facilitate the advantageous positioning of the one asset most likely to be left standing when the dust settles.


John Hathaway is a managing director of Tocqueville Asset Management in New York.

America Refuses to Understand

America Refuses to Understand

Tariq Alhomayed
After Afghan President Hamid Karzai acknowledged that his administration was receiving “bags of money” from Iran, US sources commented on this by saying that this behavior was a “mystery” that needs to be investigated. However the true mystery is not the Afghan or Iranian behavior, but the US being surprised at this, for Washington and its elite seems to be unable to comprehend the nature of the conflict that it taking place in Afghanistan, Iraq, or even Lebanon. Washington is also unable to understand the nature of this geographic region, and how the foreign element is one of the most important factors fueling the conflict in this region.

The problem that Washington and its elite are having [in understanding this] is that they are looking at the world from the perspective of the American experience, which is very simple: there is a civil war going on in every country – like America – and these countries will overcome this by maturing, on the basis that countries, like individuals, learn from their experience, becoming more rational. In other words, a country’s history of war and bloodshed guarantees that it will develop towards rationality. However this is something that is untrue with regards to the majority of our Arab and Islamic world. We are not neighbors with Europe or Japan, or even South Korea.

America is separated from the influence of the outside world by an ocean, which also protected America from constant foreign interference [in its affairs] for a long period of time, until the famous Pearl Harbor attacks In fact America remained far-removed from direct and constant foreign influence until the 9/11 terrorist attacks, which affected America in a divisive manner. However with regards to the Iraqi, or Afghan, or Lebanese situation, external influence has been constant and unceasing, whether historically or in the modern period. Lebanon, Afghanistan, and Iraq are united by the large number of wars that have taken place in their territories throughout modern history, as well as by the frequency of foreign involvement in their affairs.

Mexican President Porfiro Diaz once said “Poor Mexico, so far from God and so close to the United States” however what would he say about Iraq, Afghanistan, and Lebanon, who are close to Iran but far away from peace and stability? We have seen some major parties in Iraq receiving financial and military support from Iran, as well as Hezbollah publicly boasting of “pure” Iranian money, in addition to Karzai acknowledging that he receives “bags of money” from Tehran. Everybody is doing this openly! Despite all of this, Washington and its elite continue to deal with these regions and this conflict with a democratic and transparent mentality. However these are two things that are far away [from this], for these countries do not know stability, but rather are being plagued by tribal and sectarian problems, and there are [also] those who are working in the interests of Iran with regards to money and arms. As for Lebanon, the situation is getting worse whether this is due to the existence of Israel and its crimes, or the absence of a peaceful solution to defuse the situation there.

Therefore the Americans do not want to understand that these countries, and particularly Iraq and Afghanistan, are in need of a strong and rational central government to put an end to foreign intervention and domestic incitement, supporting natural progress, even if this is slow. This is better than the ongoing bitter conflict [that is taking place], and it is enough for Washington to contemplate the Turkish army’s experience and role in protecting Turkey as we see it today, economically, politically, and otherwise, particularly if the Americans recall the disaster of disbanding the Iraqi army, and the consequences of this.

What I mean to say is that the world is not America, and that in politics there is more than one solution to every problem. ….UNN

Georgia in the Crosshairs

[The crashing of Sakaashvili's delusions and the triumph of Vladimir Putin marked the turning point in history and  the current era of the "Russian reset."  This also confirmed for me that the great pipelineistan plan was also crashing down.  It also confirmed for me the fact that Israel does not really control American foreign policy, just most of it.  The failure of the mad Georgian leader to boot Russia out of the southern Caucasus was also the failure of Israel's plans to launch a sneak attack against Iran.  August the 7, 2008  marked the end of a two-week series of failures in the Evil Empire's secret plans.  Israel was no longer safe behind American lines in Georgia, where it could lash-out at the Mullahs.  Had there been American support at the last minute, things might have continued on their insane course, but, just like in the previous Israeli attacks upon Lebanon, no American air support was forthcoming.

The Georgian attack upon S. Ossetia was about a week late, coming on the heels of the total ruin of the Welch Club scheme in Gaza, which saw the forces of Hamas completely rout the forces of the Palestinian Authority/Fatah, in Gaza.  Bush and Cheney, as well as Condoleeza Rice and her Zionazi buddies, must have been in tears at the failure of their plan to let Israel do all the heavy lifting for the Empire in the Middle East.

It is a week that I have thanked God for.  The changes of that week meant that the locomotive has been slowed-down, if not derailed.  Thank God for bumblers like Sakaashvili and Mohammed Dahlen! (SEE: Can an Ex KGB General Save America From Itself?).]

Georgia in the Crosshairs

Walter Russell Mead

Part of any trip to Georgia getting the most out of local color: the food, the scenery, theStalin Museum.

But there’s another dimension to Georgia: geopolitics.  Divided, occupied in part by Russian troops, Georgia is one of the world’s most at-risk countries and the shadow of new crises with Russia hangs over everything in the country.

Some of Georgia’s problems are, frankly, the fault of bad decisions by its government.  The reckless and aggressive Georgian policies toward Russia in the summer of 2008 — policies it undertook in defiance of warnings from the Bush administration and the rest of the West — gave Putin an opportunity to occupy South Ossetia, create a new wave of Georgian refugees, and make trouble for both Georgia and the United States.  Even today, there is a certain trust deficit.  Many in western Europe for example simply do not trust Georgia’s president and I do not believe that Georgia will be admitted to NATO until either he or his successor convinces skeptics in Europe that things have changed.  Most of the Georgians I spoke with, including political allies of President Mikheil Saakashvili understand this.  But it is not clear that Georgia’s president or its political process can or will summon up the necessary “strategic patience”.

President Mikheil Saakashvili of Georgia, speaking at the United Nations in 2009 (Credit: UN).

In fact, while I was visiting the country Georgia announced a new policy of ‘visa-free’ travel for residents of the Northern Caucasus — including places like Chechnya.  The move angered Russia (which wants to keep the lid on tightly in the North Caucasus and already blames Georgia for allowing arms and people smuggling in and out of the troubled region); it also seriously annoyed the United States, which does not does not want Georgia poking at the Russian bear; the US also objects, strenuously, to the idea of Islamic militants crossing the Georgia border and then roaming freely around a country with many US Peace Corps volunteers, diplomats and other personnel.  Georgia is trying to attract many more native English speakers to beef up the country’s fluency; good luck with that if militants are crossing over from the North Caucasus.

The visa move also struck a blow at Georgia’s relations with the EU; Georgia’s hopes for easing the restrictions on Georgians working in or traveling to the EU were not furthered by demonstrating a careless attitude toward a serious security issue on its frontiers.  One suspects that the foreign investors Georgia seeks desperately to lure are also put off by a decision that, to say the least, does not enhance the security of foreign personnel and installations.

As far as I could determine, the Georgians did not consult with the Europeans, the Americans or anyone else before taking this step, reinforcing the belief that Georgia’s hotheaded leadership is unpredictable and impulsive.  The hard and even brutal lesson that Georgia needs to learn is this:  NATO’s European members will not accept a rash and headstrong Georgia into the alliance.  Ever.

Georgia’s worst enemy could scarcely have harmed the country more.

The behavior of the Georgian president, rightly or wrongly perceived as reckless and rash by both Europeans and Americans, has so spooked the NATO alliance that Georgia will not be joining it anytime soon.  The US has no power to change this; European members of NATO are free to make up their own minds and new members must be admitted by a unanimous vote.  (A military alliance could hardly run its affairs in any other way; free peoples cannot be bound to go to war in defense of someone else without at some point giving their consent.)  The US supports Georgia and Georgia’s aspirations to NATO, but we are not going to make a bilateral security treaty with Georgia like the one we have with Japan.

That leaves Georgia in a pickle.  It is embroiled in a series of disputes with Russia, with Russian troops currently occupying Abkhazia in the northwest and South Ossetia in the north-center.  Almost 300,000 Georgian refugees were driven from or fled their homes in these regions.  With Russia’s blessing, Abkhazia and South Ossetia have declared their independence.  Georgian public opinion can be rabidly nationalistic, and the 4.4 million residents (about 85% of whom are ethnically Georgian) are divided by geographical, cultural and clan lines into many quarreling factions.  Since the collapse of the Soviet Union in 1990, Georgia has known two revolutions and, depending on how you count them, three civil wars and two significant international ones.  New wars could flare up unpredictably, though it seems to me that with the Winter Olympics scheduled in nearby Sochi in 2012, Russia is unlikely to seek new conflicts that could spoil its Olympic celebration.

A Georgian magazine laments NATO’s perceived tardiness (photo by Walter Mead).

Hotheaded Georgian policy has made matters worse, but Georgians have a point when they complain that many of the country’s problems are not its fault.  As a transit route for oil and gas from the Caucasian Sea and Central Asia to the west (the only such route not controlled by Russia), Georgia engages the attention of many powerful countries; Russia wants to control the pipeline, and the US and the Europeans don’t want that to happen.

Georgia’s situation is to some degree a hostage to developments in Ukraine.  While Ukraine’s government was pushing the country toward NATO membership, Georgia’s aspirations seemed reasonable.  Now, with NATO pretty much off the table for Ukraine, Georgia (despite its border the fellow NATO member Turkey) seems a long way from NATO’s headquarters in Brussels.

The cooling of expansionist fervor in the EU also leaves Georgia exposed.  There was a time, not all that long ago, when many observers thought that Turkey and Ukraine would both be joining the EU.  It now seems likely (though in my view very unfortunate) that neither country will get an invitation.  There is simply no way that Georgia can get in if both of these larger countries stay out.  That leaves Georgia out in the cold as far as powerful international organizations and alliances are concerned.

Again, none of this is Georgia’s fault.  The incompetence, corruption and political infighting that doomed the hopes of Ukraine’s Orange Revolutionaries also changed the character of the ex-Soviet space.  The serial political and economic crises and failures of the EU have dramatically weakened the ability of EU elites to impose large, unpopular changes like eastward expansion on their sullen and resentful publics.  Geography and politics make it profoundly unlikely that Georgia can enter the EU before Turkey does; with Turkish membership looking increasingly as if it is scheduled for the 12th of Never (or the Greek kalends as the ancients used to say), it looks as if Georgia’s accession date will be on the 13th.  The growing distance between the new foreign policy of the AK Turkish government and the US threatens over time to make it more difficult for Georgia to please both its Western patrons and its Turkish partners.  The confrontation between Iran and the United States continues to cast shadows over the prospects for peace and stability throughout the region.

An American visiting Georgia is in an interesting situation.  On the one hand, Georgians are grateful to the United States for our support; more than one person told me that without US help, Georgia would have long since been eaten by the hungry bear.  On the other hand, there’s some bitterness that we don’t do more.  Where is Georgia’s membership in NATO?  Where are missiles Georgia needs to protect itself?  Why is the US trying to ‘reset’ its relationship with Russia, and isn’t this a cynical sacrifice of Georgia’s vital interests?

Georgians in the opposition want to know why the US supports the current president.  Georgians aligned with the president want to know why we criticize him so much and support him so little.  Refugees from Abkhazia and South Ossetia want to know why we are doing so little to help them get back to their homes.  Members of Georgia’s ethnic minorities want to know why we aren’t doing more to protect their cultural rights.

Many Georgians believe that the Republicans are their true and loyal friends, while Democrats are a bunch of spineless wimps and appeasers.  The road in from the airport is named for George W. Bush; if there are plans to name anything big after President Obama, I didn’t hear about them during my trip.  Some Georgians were clearly hoping that GOP majorities in Congress after the midterms would bring more support from the US.

These hopes, I think, are misplaced, and only partly because Congress doesn’t have all that much power over American policy towards Georgia.  More fundamentally, Georgians seem to have forgotten what happened in the summer of 2008.  Various western diplomats I spoke to in Georgia told me that according to their information the Bush administration categorically warned the Georgians in 2008 to avoid responding to Russian provocations.  Georgia ignored those warnings, perhaps hoping that the US would have no choice but to back it in a conflict with Russia.  The Bush administration felt there was no alternative but to let Georgia face the consequences of its folly.  The Bush administration, not President Obama, pulled the plug on Georgia.

Yet Georgians are easily led by their hopes rather than their reason.  ”Georgia has some very good friends in America,” one Georgian said by way of rebutting my comments that Georgia cannot afford provocative or hotheaded behavior.  And there are people in the US whose natural sympathy for a small, threatened nation in a strategic hotspot moves them to say things that Georgians like to hear.

Americans and Georgians would both do well to remember the Hungarian tragedy of 1956.  American politicians were talking about ‘rolling back’ Communism, but they were indulging in political rhetoric rather than making serious plans to send tanks across the Iron Curtain.  Unfortunately the Hungarians failed to understand that these were just vain and empty words; in part because they were deceived by rhetoric on Voice of America, the Hungarians rose against the Soviets — and were left alone to face the Soviet tanks.

This is not a pleasant message to carry, and I did not enjoy delivering it to a country under the shadow of a partial Russian occupation, but to do anything else would be irresponsible, dangerous and cruel.

There is approximately zero prospect that Georgia will join NATO anytime soon.  There is even less chance that the Russian occupation of large chunks of Georgia will end in the near future.  Georgian anger and fear given these facts is natural and understandable.  But rash Georgian action will only make a bad situation worse — perhaps catastrophically worse.

To improve their situation, the Georgians are going to have to the kind of dull and boring things that many Georgians don’t like.  They are going to have to follow a discreet and modest foreign policy, avoiding all unnecessary provocations of Russia and being guided by the advice of their friends.  They are going to have to take a very long-term view about Abkhazia and South Ossetia.  They need to work on developing the territory they still have, at building a prosperous economy and a stable democracy.

If Georgia can do these things, over time its prospects will improve.  As the west (slowly) regains confidence in Georgia’s political leadership, and perhaps also as NATO-Russia relations improve, NATO membership could once again be a realistic prospect.  Russia itself ultimately needs stability in the Caucasus more than anything else; a prosperous and stable Georgia would be an important regional partner in helping Russia bring security and peace to the restless peoples of its southern fringe.

I hope Georgia succeeds.  This is a beautiful country with a glorious past and an extraordinary culture.  But Georgia’s future today is as cloudy as it was when I first visited twenty years (and several wars) ago.

Building Nuclear Reactors In Spite Of Uranium Supply Deficit

Will ‘Megatons To Megawatts’ Solve The Uranium Supply Pinch ?

By: Andrew_McKillop


Best Financial Markets Analysis ArticleMEGATONS TO MEGAWATTS
World uranium supply deficit, currently running at about 12 500 to 15 000 tons (2010 mine and supply forecasts relative to demand forecasts), or about 20 percent, is covered from sources especially including stocks held by mining companies, power plant operators and builders. This massive deficit is also partly covered, perhaps by 4 000 tons of uranium equivalent per year, with recycled and diluted highly radioactive wastes including plutonium that are converted to so-called MOX fuel (Mixed OXide), almost exclusively in France and the UK.


There is one other “supply side solution”, which is given periodic headline treatment, and that is the US-Russian “Megatons to Megawatts” programme, turning Russian arms, and an undisclosed number of US warheads into ploughshares by dismantling surplus atom bombs and recycling their atomic materials as reactor fuel. This programme was first mooted from just before the collapse of the USSR, in 1990-1991. The first physical operations, concerning 500 tons of Highly Enriched Uranium (HEU) from Russian bomb warheads started in July1993, but the first arrivals in the USA of 24 tons of Low Enriched Uranium (LEU) reactor grade fuel produced from 0.786 tons of Russian HEU only started in January 1995.

For this first year of shipments from Russia, the specially created US public-private entity US Enrichment Corp. (USEC) which administers this trade and partners with a small number of fully private entities on the commercial downstream received atomic materials equivalent to about 244 nuclear warheads (or 6.1 tons of HEU able to replace 186 tons of LEU reactor grade fuel). As of end 2009, the USEC says on its Web site that some 15 294 warheads have been “recycled” this way. According to the US Natural Resources Defense Council, the combined US and Russian atomic weapons stockpiles peaked in the 1985-1987 at about 41 000 warheads, and had already fallen well below 40 000 warheads by the time the Soviet Union collapsed.

Megatons to Megawatts is basically a “diluting” operation, stepping weapons-grade HEU down to the LEU fuels needed for most conventional civil power reactors. Plutonium is also separated, and can be “cut” into utilisable fuel using the MOX route although the amounts treated this way are not published and may be very low. The amount of fresh mined uranium the programme “displaces” , almost exclusively in the USA and not elsewhere, is however controversial. It is claimed by some sources like the WNA (World Nuclear Association) and the OECD’s NEA (Nuclear Energy Agency) to have “displaced” about 13 percent of world reactor fuel requirements, around 8 000 tons of uranium in 2009, covering about 45 percent of the USA’s total reactor fuel that year.

According to the US Council on Foreign Relations in a paper published January 14, 2010 and as of December 2009, a total of about 382 tons of HEU, equal to 15 294 warheads, has been turned into about 11 000 tons of fuel, for which the Russian government received more than US $8 billion, valuing the uranium equivalent fuel at around US $ 72 per kilogram (well below the current uranium price and far behind the 2007 most recent peak price of about US$ 290 per kilogram). The potential value of cut-down and diluted bomb materials, recycled as reactor fuel, can be gauged from analysts forecasts for uranium prices, in 2011, probably attaining US $ 175 per kilogram


One major problem for this rather small but heavily mediatized fuel source is the probable near-term end to the “Megatons to Megawatts” programme, which is presently scheduled to stop in 2013. The “political and policy considerations” include just how much more of their weapons stockpiles the USA and Russia want to scrap. They also include the willingness or not of Russian suppliers to sell at below-market prices, into a very opaque market that can quickly add 20% or more to reported prices for the declared transactions that are used to report prices. Other factors weighing against Megatons to Megawatts include technical and technology issues, notably the amount of converted bomb material that can be used in reactors.

When we look at the actual declared amounts that are traded, by commercial private companies, we find quite large “missing amounts” of finished fuel (or upstream scrapped weapons), suggesting that uranium stocks and reactor (but not bomb warhead) materials are increasingly entering the programme.

The major authorized private company operating this market, the world’s largest uranium mining and fuel supply company Cameco, is estimated by industry observers as buying and reselling around 7 million pounds (3182 tonnes) of Russian ex-military source uranium fuel each year, in the past 2 to 3 years. Other suppliers handle much less than this, and Cameco’s agreement with the sole Russian supplier, the state firm Techsnabexport (Tenex) will terminate in 2013 unless president Obama and the Medvedev-Putin duo make a decision to continue scrapping warheads.

For the select group of North American re-seller companies including Cameco, for which this supply represents about one-quarter of its total sales of uranium, termination will represent a major challenge. For the USA’s 100-plus civil reactors in current operation, a claimed 45 percent or more of their present annual fuel generates a need for at least 8000 tons a year, perhaps more, to satisfy the 45 percent claim.

The most important point is that any start of phasing down in operations of the Megatons to Megawatts programme from the most recent rate (since 2006) of an average 1200 warheads scrapped each year, which was already lower than the rate in the preceding 3 years 2002-2005), will automatically increase the quantities of “fresh mined” uranium needed by US reactor operators. This will quickly add another twist to a world supply/demand context already heavily in deficit.


There is no “open market” for uranium fuel of any kind, either produced or “fabricated” from fresh mined uranium, or MOX fuels derived from nuclear wastes, or fuels from scrapped nuclear weapons. The few entities which provide price data, such as TechTrade and UxC, report prices given on private transactions by the parties concerned, often with several weeks delay, and with no capacity for verifying the actual or real amounts, and prices. The Megatons to Megawatts programme fits well with this secretive hard to verify business, to the extent that real amounts of uranium equivalent fuel supplied may be well below the published amounts. On the Russian side these are likely made up to the declared amounts through mine stocks of uranium, and uranium fuel stocks from so-called “research and military” reactors, for which no data is available.

All of these sources to, and substitutes of the Megatons to Megawatts programme are unlikely to increase their net supplies of uranium equivalent fuel, and the majority may quite rapidly decrease. As already mentioned we have a basic and massive undersupply of world uranium fuel supply, but also have some 56 new reactors under construction and 439 in operation, with perhaps as many as 200 more reactors planned or proposed for the next 9 years (2011-2020). Results of this “outright and announced crisis” will certainly include a radical increase of uranium prices, triggering more mine investment and development, and possibly a Russian decision to cash in on the coming uranium price boom through staying their decision to stop scrapping bomb warheads in 2013.

To be sure, fuel costs for nuclear reactors are a small slice of total costs, but over and above about a uranium price of US $ 80 to 100 per pound, fuel costs start to become very significant for power plant operators and builders, because of stockpiling needs and their costs, with first loading requirements of a typical industry standard 900 MW reactor being about 250 – 350 tons. Probably much more important for the industry, any long-term structural-type fuel shortage will cast a long and deep shadow on the highly mediatized “Nuclear Renaissance”.

By Andrew McKillop

Project Director, GSO Consulting Associates

Former chief policy analyst, Division A Policy, DG XVII Energy, European Commission. Andrew McKillop Biographic Highlights

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.


© 2010 Copyright Andrew McKillop – All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2010 – The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Nord Stream gas pipeline underwater construction starts

[Thanks to hughbris for this article.]

Nord Stream gas pipeline underwater construction starts

A construction worker during a ceremony marking the start of Nord Stream pipeline construction

The construction project is due for completion in 2012

Construction of the controversial Nord Stream pipeline from Russia to western Europe under the Baltic Sea has been officially launched.

Gazprom holds 51% of Nord Stream, which will run from the Russian port of Vyborg to Germany’s Greifswald.

Russian President Dmitry Medvedev and German Chancellor Angela Merkel attended the ceremony near Vyborg.

The project was given the go-ahead only in February amid fears that the pipeline could damage the Baltic Sea.

President Medvedev said at the ceremony that the pipeline “for the first time – which may be one of its main achievements – will ensure direct supplies of Russian gas to western Europe, bypassing transit territories”.

The existing pipelines run from Russia to EU countries via Ukraine, Belarus and Moldova.

‘Binding obligations’

All the gas volumes have either been contracted, or have been formalized in binding obligations
Alexander Medvedev, Gazprom

Russia provides up to 30% of the gas consumed in Europe, and many European countries have been keen to secure alternative energy supplies.

Critics have argued that European countries do not need more gas from Russia and that the project is too expensive.

But Gazprom deputy chief executive Alexander Medvedev said there was plenty of demand for the gas.

“All the gas volumes have either been contracted, or have been formalized in binding obligations,” he told journalists.

Gas supplies from Russia to Europe have been threatened or disrupted in the past due to political and financial disputes between Moscow and its neighbours.

But Russian President Dmitry Medvedev said at the ceremony: “This country [Russia] has been cooperating with European neighbours in the gas sector for over 40 years.

“This cooperation has stood the test of time to the full extent.”

The ceremony was also attended by Nord Stream board chairman and former German Chancellor Gerhard Schroeder, Dutch Prime Minister Jan Peter Balkenende and European Commissioner for Energy Gunther Oettinger.

First phase

Gazprom CEO Alexei Miller, Russian President Dmitry Medvedev and former German Chancellor Gerhard Schroeder

President Medvedev and Gerhard Schroeder were among the guests

Russian gas monopoly Gazprom said on Wednesday that the first pipe had been laid under the sea.

The pipeline will be passing through Russian, Finnish, Swedish and German waters.

Last month, Nord Stream secured a 3.9bn-euro ($5.4bn; £3.5bn) fund to complete the first phase of the pipeline.

“Debt financing will cover 70% of the project costs while the remaining 30% will be provided by the project shareholders,” said Paul Corcoran, financial director of Nord Stream AG.

German companies BASF-Wintershall and E.On Ruhrgas each own 20% of Nord Stream, while Gasunie of the Netherlands holds 9%.

Alexey Bulgakov from Troika Dialog investment bank pointed out that “Gazprom and its partners seem to have managed to raise funds at rather low interest rates.”

The overall cost of the project, due for completion in 2012, is expected to reach 7.4bn euros.

Environmental worries

Nord Stream

The first pipe was laid under the sea on Wednesday

Russia hopes to pump up to 55bn cubic metres of gas a year to EU countries through the pipeline.

Supporters of the project say that it will secure gas supplies from Russia to Europe.

But environmentalists argue that building the pipeline could lead to toxins lying on the sea bed being stirred up, as the Baltic sea is one of the most polluted in the world.

Finland had refused to give the green light to construct the pipeline, but finally agreed to it in February under the condition that ships laying the pipeline do not lay anchor in Finland’s economic zone.

The final hurdle was overcome after Russian Prime Minister Vladimir Putin assured Baltic leaders that the project was safe, as extensive research had been carried out into any environmental impact of the pipeline construction.

Alternative projects

Apart from the Nord Stream, Russia has been planning another pipeline, the South Stream, which will run from southern Russia to Bulgaria under the Black Sea.

Meanwhile, Turkey, Romania, Bulgaria, Hungary and Austria last July signed an agreement to construct the long-planned 3,300km Nabucco natural gas pipeline.

It is expected to pump up to 31bn cubic metres of gas annually from the Caspian and the Middle East across Turkey and into Europe.

Projected routes of Nord Stream, Nabucco and South Stream pipelines

Al-CIAda fishes for Turks seeking jihad

[Suddenly, with reports of the car-bomb in Istanbul, we see a wave of Western sources urging us to believe in the reality of a new "Al-CIA-da wave" sweeping across Europe and Turkey.  This is the method of American "public diplomacy," begun by Reagan and Casey in Nicaragua (SEE: Iran-Contra's 'Lost Chapter')--reports emerge in the foreign press, warning about the terror threat and simultaneously new waves of terror take place.  Especially suspicious is this report from a known "mouthpiece" of the CIA and ISI (SEE:  CIA Agent Sees Dead People).  Since we know that "CIA-da" is CIA, we know that any European attacks are agency actions.  The big question becomes, once again, as it does wherever the "Islamists" raise their ugly heads, whether Turkey's own intelligence agencies or Ergenekon elements are staging false flag attacks themselves.  Recall the recent reports of Turkey's enlistment for joint action with the West (SEE: Is Death of Nabucco Bringing “Al CIA da” and Ergenekon Together in Turkey? ).  It is unlikely that this hints at future spook attacks across Europe.  What is more likely is that this is all just psy-op, intended to convince the people of the West that terror central in N. Waziristan (and now, they say, Balochistan) must be wiped-out.  Everything points to an imminent invasion of Pakistan as the only possible solution to Obama's war problems.]

Al-CIAda fishes for Turks seeking jihad

By Simon Cameron-MooreTurks have been bit part players in Al-Qaeda’s global jihad, but a recent security scare in Europe pointed to a small but growing number in Germany and Turkey who have joined militant ranks in Pakistan. Muslims from many parts of the Islamic World went to Pakistan during the jihad to end the Soviet occupation of Afghanistan in the 1980s. There may be nothing new about Turks taking that path, but recent obituaries on jihadi websites and tales of the exploits of Turkish jihadis have been eye-catching.

Turkey serves as a gateway for Al-Qaeda, through which it channels both funds and recruits for operations abroad,” said Tim Williams of Stirling Assynt, a political and terrorist risk consultancy in London. “The growing number of Turks appearing in the Af-Pak theatre…(is) evidence of that.” Turks returning from Afghanistan were involved in the Nov 2003 bombings that killed 57 people in Istanbul and wounded hundreds more in a series of attacks that targeted the British consulate, an HSBC bank and two syn

I am concerned about increased radicalisation among Turkish youth – not just in Turkey but also in Europe,” said Zeyno Baran, a scholar at Washington’s Hudson Institute. An more critical focus on Israel and the West by some sections of the media has hardened attitudes in a society that is becoming more conservative, more Islamic, according to Baran. “That propaganda has a powerful impact on the youth, some of whom seem to be joining the militant ranks in Af-Pak region.

Surveys by Washington’s Pew Research Center show Turks share similar levels of antipathy toward the United States as Egyptians, Pakistanis and Palestinians. Gareth Jenkins, an Istanbul based security analyst noted a proliferation of jihadi websites with Turkish language pages over the past couple of years. With an overwhelmingly Muslim population of 75 million, and a large diaspora, particularly in Germany, it is natural that Islamist militant groups should try to make inroads.

Turkey, with its democratic foundation and orientation towards the West, is not a natural breeding ground for Islamic militancy. Prime Minister Tayyip Erdogan’s brand of religious conservatism, while opening the door to the Islamic Middle East, gives no quarter to the likes of Al-Qaeda. If militancy is growing, it remains at least for now on the fringe. Israel’s Gaza offensive two years ago fuelled sympathy for militant causes among some, analysts say. “The Israeli incursion into Gaza in 2008 had a profoun
d effect, leading to increased recruitment of Turks by Al-Qaeda and allied groups,” Williams said. “We believe that the numbers increased dramatically in the wake of that operation.

It is a touchy issue for NATO’s only Muslim member. Turkish troops serve in non-combat roles in Afghanistan. Officials are guarded about the presence of Turkish militants in Afghanistan and Pakistan. They say nationalities of the martyrs named on jihadi websites are unconfirmed. But arrests back in Turkey show the authorities are vigilant. In January, police detained more than 120 Al-Qaeda suspects in raids mostly in east and central Anatolia, though barely any details emerged from those arrests. Then last
week, police arrested a maths student from a university in the western city of Izmir who was in contact with a Turkish militant described as the head of Al-Qaeda’s Aegean cell and who is now fighting in Afghanistan and Pakistan.

Student Abdulkadir Kucuk’s extra-curricular studies involved bomb-making and devising computer programs to jam flight signals for drone aircraft used by NATO forces in Afghanistan. Four other suspected fundraisers for the cause were detained too. They were later freed pending trial, but in a follow up operation this week police in Istanbul rounded up a dozen more. A senior Turkish security official told Reuters that all the Turks who have joined Al-Qaeda’s ranks in Afghanistan-Pakistan belong to one group.
He went on to name its chief as well as a commander, Zekeriya, whom Kucuk was caught emailing. “Their leader is named Ebuzer, the leader of all Turks in Al-Qaeda. Zekeriya is another high-ranking leader of Turks there,” he said.

The Washington-based Jamestown Foundation identifies Ebuzer as Serdar Erbashi, a veteran of the second Chechen war, who, it says, had headed Al-Qaeda’s cell in Ankara. The Turkish official didn’t name the group, but a Pakistani security officer in Peshawar, the main city in Pakistan’s North West Frontier Province, identified it as Taifatul Mansura, a Quranic reference meaning “Assembly of the Victorious”.

Based in North Waziristan, a Pakistani tribal region known as a hotbed of Al-Qaeda and Taliban activity, Taifatul Mansura’s profile has risen over the past year on jihadi websites and anti-terrorism blogsites. The Pakistani security official says its ranks have been depleted by clashes and drone missile attacks, and a splinter group broke off a few months ago. The faction appeared to emerge out of the Ittehad-e-Islami, or Islamic Jihad Union (IJU).

The ISU is itself a by-product of the Islamic Movement of Uzbekistan (IMU), a Central Asian jihadi movement that has forged ties with Al-Qaeda and actively recruits in Europe. Jihadis who do not fit easily into South Asian or Arab militant camps gravitate to groups like Taifatul Mansura which, according to the Pakistani official, is made up of Turkic-language speaking Central Asians, as well as Turks and European Muslims, notably from Germany. “It is a motley crowd out there in the North (Waziristan),” the
Pakistani security official told Reuters. “There are people from virtually everywhere, including the Turks.” – Reuters

Portugal meeting builds anti-NATO protest

Portugal meeting builds anti-NATO protest

Special to Workers World
Oporto, Portugal

A forum at the Literary Club here on Oct. 23 heard two speakers discuss the dangers facing the world’s people coming from the U.S. and NATO’s war machines.

From left, Frederico Carvalho, John Catalinotto..
From left, Frederico Carvalho, John Catalinotto..
WW photo: Ellen Catalinotto

John Catalinotto, representing the U.S. anti-war movement, spoke on the U.S. use of NATO in a strategy of reoccupying and controlling areas of the world that had been liberated during the period of existence of the Soviet Union. Catalinotto is a managing editor of Workers World newspaper.

Frederico Carvalho, a Portuguese environmentalist and expert who studies the impact of weapons, discussed the dangers posed by nuclear weapons and the new U.S. weapons systems such as the drones, where there is a great distance between the operator of the weapon and its targets.

Speakers and the organizers discussed the upcoming NATO summit in Lisbon Nov. 19-21 and the Portuguese anti-war movement’s plans to hold a mass protest on Nov. 20.

Articles copyright 1995-2010 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.

Istanbul blast injures at least 15, may be suicide bomb

Istanbul blast injures at least 15, may be suicide bomb

Turkish police in Istanbul - 31/10/10Riot police may have been the target

At least 15 people have been injured in what appears to have been a suicide bomb attack in the centre of Istanbul, Turkish media say.

Police have cordoned off the area around Taksim Square where the blast occurred on Sunday morning.

Television pictures from Taksim Square showed body parts lying on the ground.

No group has said it carried out the attack, but a two-month-old ceasefire by Kurdish rebels was due to expire later on Sunday.

Ambulances have been taking some of the injured to hospital, while medical staff are treating others at the scene.

The blast occurred near the independence monument in Taksim Square, says the BBC’s Jonathan Head in Istanbul, near a point where anti-riot police are stationed.

Istanbul police chief Huseyin Capkin said six of the injured were civilians, while nine were policemen.


Our correspondent says suspicion is likely to fall on Kurdish separatist factions or groups linked to al-Qaeda.

The Kurdish separatist PKK party has carried out bomb attacks in Istanbul in the past, as have extreme left-wing and Islamist groups.

Taksim Square is on the European side of Istanbul and is a popular destination for tourists.


[This is a re-post from July 11, 2008, one of my earliest entries on this blog.  Thanks to Kenny over at Kenny’s Sideshow, for running this article on the theme of this site.  It’s about time somebody got it.  I guess I should thank the folks at AMC channel for running “They Live,” yet again.  I thought that everybody had already seen this sci-fi classic; my all-time favorite John Carpenter movie.  By the way, Carpenter is remaking the movie, with an updated formula, which might leave-out the sunglasses angle.  It has not begun production yet, but they released the following trailer:





THEY LIVE, the movie, is the theme of this blog; some people ask why? What’s the deal with the the “No Sunglasses” thing?

The premise of this resistance blog is based on the small resistance movement in the movie, which formed to resist the secret dictatorship. The movement was based on the idea that resistance scientists had discovered that society was dominated by a parasitic super-class, who were something other than human.

The discovery that the wealthy elite had created a scientific method for hypnotizing the human race into a kind of mental and spiritual blindness, led these scientific resisters to the discovery of a polarized sunglasses lens, which filtered-out the hypnotizing technology, allowing the wearer of the glasses to actually see the secret elitists (who turned-out to be an alien species), hidden amongst the people.

The wearer of the sunglasses was thus freed from the brainwashing subliminal suggestions, which were covertly influencing our lives, every minute of every day. The scientists had discovered that there was a hidden signal buried in the broadcast transmissions of every TV station. The signal was a carrier wave that directly affected the subconscious and unconscious minds. Shutting this signal off, instantly revealed the hideous parasitic vulture race that was feeding upon humanity, for who knows how long.

THERE ARE NO SUNGLASSES is here to shut the signals down! We have found the secret signals hidden within every facet of our daily existence.

more about “They Live“, posted with vodpod

“Our impulses are being redirected.

We live in an artificially-induced state of consciousness.

The movement began…by a group of scientists…accidentally

discovered these signals being sent.

The under-class is growing.

Human rights are non-existent.

In their repressive society, we are their unwitting accomplices.

Their intention to rule rests with the annihilation of consciousness.

We have been lulled into a trance.

They have made us indifferent.

We are focused only on our own gain.

They are safe as long as they are not discovered.

That is their method of survival.

Keep us asleep.

Keep us selfish.

Keep us sedated.

We are their cattle.

We are being bred for slavery.

We cannot break their signal.

The signal must be shut off at the source.

They want benign indifference.

All we really are is livestock.”

From “They Live” script:

This new website, is dedicated to building the American resistance movement. It will be limited in scope at first, so that it can remain focused on the search for finding more effective ways to resist the empire, as it moves against the American people, freedom’s last defense.

It is pretty amazing, the similarities between the story line of “They Live” (a parasitic elitist class covertly dominates the world for alien commercial interests) and our own situation. Our world has been drained economically by a parasitic capitalist blood-letting that is only intensifying, as the elitist plan escalates the military stalemate to complete their domination of all resources before the sleeping majority awakens to their schemes.

The purpose of this blog is to find ways to give the sleeping sheeple a wake-up call. They will not be able to successfully maneuver the heavily sedated herd into the waiting stockyards if enough of the sheep are awakened, to create the resistance necessary to stop the forward surge of the human lemmings into the pens and over the cliff.

American freedom and democracy stand on the edge of oblivion, prepared for flushing down the memory hole. It is no secret that the insane men and women who lead us are working overtime, driving the American sheeple toward the big round-up. But there is a secret history of our country that has been suppressed by the elitists and their “mainstream media” which explains why our country stands on the edge of that precipice today.

The secret history reveals the patterns created from testimony and circumstantial evidence, which proves that the “war on terror,” the creation of the international Muslim brigades (a.k.a. “al Qaida”), the crashing of the American (and global) economy, the conversion of American democracy into a dictatorship, as well as many other elements are all parts of the plan to destroy this Nation, carried-out by our own government and its collaborators. This blog exists to provide the evidence that our own government has purposely worked in collusion with financial and corporate interests to subordinate American national security to foreign interests.

The small minority of us who really understand what has been happening to our country and what is about to happen have little to show for all our efforts to organize antiwar resistance to the rapidly approaching disaster. If this blog fulfills its purpose, then we will have helped to raise an aroused, enraged American resistance movement. Such a movement would then move forward to erase all the awful things that will be described in this blog. Americans must wake-up to our own interests as a free Nation, in order to free us from those deadly “foreign entanglements” that George Washington tried to warn us about.

As for right now, it seems like there is little, or no hope.

That’s what “THEY” want you to believe. The tiny elite minority that controls most everything in our world is counting on you to give-up hope. Don’t do it! RESIST!!!

Do not give your consent to your own slavery! Find ways to contribute to the resistance. Do not conform to their directives.