Explaining U.S. market psychology

Explaining U.S. market psychology

Insider selling has continued to accelerate throughout this entire rally

[Editor’s note: the following article first appeared on the website Bullion Bulls Canada on August 17.]

As U.S. equity markets have mounted a huge, phony “rally” based on nothing but hot air from the propaganda-machine and Plunge Protection Team manipulation, one fact has seemed to defy explanation to myself and many other commentators. How have these Manipulators been able to push U.S. markets this far above any rational valuations?

With another report out today showing that “insider selling” has continued to accelerate throughout this entire “rally”, the people who know these companies the best are demonstrating in the clearest possible terms how grossly inflated U.S. equity valuations have become.

Meanwhile, the hard data on the U.S. economy (i.e. numbers which can’t be falsified) show that the economy continues to plummet downward. Thus, the “big picture” confirms the signal which insider-selling has sent to markets.

I, and many other commentators have made continual, disparaging references to “market sheep”, who have apparently allowed themselves to be herded and directed effortlessly by the PPT. Yet, at the same time, we were all flabbergasted that these huge equity markets could be so completely dominated by this “herd mentality”.

What finally struck me over the weekend is that the answer has been sitting right in front of my nose all this time. I have referred on many occasions to Chris Martenson’s stunning analysis/presentation which he has titled the “Crash Course”. Among the nuggets of valuable data was a breakdown on the disgusting wealth-distribution numbers for the U.S. population.

With 80% of the U.S. population holding only a minute 15% of total wealth, this means that just 20% of the U.S. population holds 85% of all wealth. However, the even more shocking numbers are the obscene pools of wealth held by the wealthiest 1% of U.S. society. This microscopic segment of U.S. society holds 35% of all wealth, and even more stunningly, they hold 55% of all stock.

It was when I finally focused on that last figure that all became clear. While U.S. equity markets may be huge in terms of the nominal dollar values involved, what Martenson’s demographic data illustrates is that controlling and manipulating U.S. markets only requires controlling the actions of a relatively tiny group of investors.

The job of the Plunge Protection Team gets easier still when we consider who manages the vast majority of the wealth for the U.S.’s filthy-rich: Wall Street. For people with these obscene sums of money, it is considered totally beneath them to manage their own money – this is something that the very rich pay others to do for them. As a matter of status alone, these people feel compelled to put their money in the hands of the Wall Street crime syndicate, since for this extremely insulated cross-section of U.S. society, they have still not lost their stature.

Thus, to manipulate U.S. equity markets, not only are the number of sheep who need to be “herded” far fewer than most of us would ever imagine, but the vast majority of their wealth is sitting in the hands of the same people who direct the actions of the PPT. Suddenly, manipulation of U.S. markets becomes a stunningly easy proposition.

With the Wall Street crime syndicate directly controlling more than half of all U.S. equities, in essence, the banksters have “enlisted” the ultra-wealthy as part of the Plunge Protection Team – using their money to do most of the “heavy-lifting” in U.S. equity markets.

Pushing markets completely against the direction of economic fundamentals is extremely difficult when you only control a small percentage of the total equity of the listed companies. However, manipulating markets when you directly control a majority of all equities is so easy that even Wall Street banksters can accomplish this without screwing-up.

What makes it possible to continue this scam, even as more and more pieces of data emerge which refute any possibility of a “U.S. economic recovery” is that the filthy-rich are totally insulated from this Greater Depression. People with $10’s of millions, or $100’s of millions or billions of dollars in wealth are totally unaffected by even the most extreme collapse of an economy.

As a result, these are the easiest people in society to dupe into believing that “things are getting better” since they have no real-life, database of experience which allows them to comprehend the actual state of the economy.

Clearly I and many other people have been giving the Plunge Protection Team far too much credit for their ability to fabricate this enormous market “rally”. When the Manipulators control a majority of all U.S. equities, and when the owners of these equities will believe anything they are told it should be no surprise to anyone that they can instantaneously reverse the direction of U.S. markets in all but the most-extreme sell-offs.

When we factor-in how completely detached these markets are from reality, it illustrates how totally ludicrous it is to cite the “rally” in U.S. markets as “evidence” that the U.S. is emerging from its economic collapse. The valuations in U.S. markets are just as false and contrived as the numerical fabrications which the U.S. government calls “economic statistics”.

As a final note, with “insiders” (i.e. Wall Street insiders) selling stock at an accelerating pace all through this “rally”, the Wall Street crime syndicate has shown it has no compunction about squandering the wealth of their ultra-rich clients by bidding up stocks to fantasy valuations to allow the banksters to rescue their own vast, stock holdings.

Just as they essentially destroyed their own sector during the reckless greed of their crime-spree, they are now destroying their best and most loyal clients – again, totally in the name of short-sighted greed. Over the long-term, greed is generally a self-destructive emotion. Thus, it should surprise no one that the insanely excessive greed of Wall Street banksters will ultimately result in their own self-annihilation.

This article was written by a member of the Stockhouse community.

ASEAN Deals Bringing Asia Closer Together

ASEAN Deals Bringing Asia Closer Together

2point6billion.com

Aug. 18 – The recently announced deals between China and India concerning ASEAN trade are expected to add a welcome boost to trade figures within the region, and to stimulate recovery following the global downturn. Accordingly it seems an appropriate time to revisit the prefaces to the China Briefing book “China’s Neighbors” as it provides a good overview of the region and which countries and organizations are players within it. The book’s complete contents and purchase details can be viewed here.

World Bank report on ease of Asian business
The ease of doing business across Asia varies significantly. According to the “Doing Business Report 2009″ prepared jointly by the International Finance Corporation and the World Bank, Singapore retains its number one position on the overall regulatory ease of doing business for a third consecutive year. While due to poignant regulatory reforms China’s rank improved from 83 from 90, out of 181 countries. India, however, slipped two notches to rank at 122nd, below its neighbors Nepal, Bangladesh and Pakistan which have been placed 121, 110 and 77 respectively in the overall ranking.

Among Asia-Pacific countries, the Philippines, ranked 140th, lags behind most of Asia for ease of doing business behind even Cambodia at 135 and only ahead of Laos at 165 and East Timor at 170. The average ranking for East Asia is 8. Consequently, Bangladesh is ranked 110 and has reduced the time needed to register property from 425 to 245 days. Bhutan is ranked 124th.

Eastern Europe, Central Asia and the Caucasus, led by Azerbaijan, made more changes than any other region to make doing business easier over the past year, according to the report. Azerbaijan improved its ranking by 64 places and is this year’s top reformer. Large economies that fell in the rankings include Germany, which dropped to 25 from 20, Mexico, to 56 from 42, and Russia, to 120 from 112.

The report ranks economies based on 10 indicators of business regulation that record the time and cost to meet government requirements in starting and operating a business, trading across borders, paying taxes, and closing a business.

The rankings do not reflect such areas as macroeconomic policy, quality of infrastructure, currency volatility, investor perceptions, or crime rates, said the report.

Asia’s regional economies: The cost of bowl of rice a day
In a region comprising the giant populations of China (1.3 billion), India (1.25 billion) and the emerging nations of Southeast Asia (collectively, about 880 million), much of the economic data on China trends misses two points; the massive impact on China that emerging Asia has; and the financial impact of the poverty level rising by just one more affordable bowl of rice a day, per person.

In the scramble to unravel China’s economics, and the questions inflation and a slowing GDP ask, much has been made of a potential recession in the U.S. markets and the competitive impact of a resurgent India. While the recession has made an impact, the rise in wealth of China’s neighboring countries also has had a major impact on the region, and on China. India’s population is set to shortly (if it hasn’t already) overtake China’s ageing one, while the combined populations of Indonesia, Pakistan, Bangladesh, the Philippines, Vietnam, Thailand, Myanmar, Malaysia, Cambodia and Laos are collectively close to three quarters of both China and India individually.

In the rush to understand China economics, the populations of smaller countries, such as Vietnam (85 million) have been forgotten. Yet collectively, the third part of the Asian triangle is nearly as large as the other two.

Such oversights are misleading. Emerging Asia has a huge impact on what goes on in China and how it affects prices. While growth regionally in countries such as Cambodia and Laos — relative minnows with populations of 14 and 7 million each — would not seem to have any clout or impact on the China price, when included with the other regional markets — all growing from between 7-10 percent annually — the implications seem to become more serious. Just raising the level of wealth in these countries enough to allow each person an additional bowl of rice a day is having a profound impact.

While rice consumption in China has fallen by 860,000 tons annually over the past three years (the only Asian nation in which this has occurred), it has been far outstripped by an increase in consumption in India of 6,522,000 tons. Consumption in the additional emerging Asian economies we mention above collectively rose by a further 6,419,000 tons, almost equivalent to that of India’s rise. That’s an increase of over 12 million tons since 2005. Considering that in terms of global productivity for rice per acre, that means a rough estimate of an extra 8 million acres has had to be set aside during that same period just to meet that demand — and from a region whose arable land mass is far from efficient.

The cost impact has been huge, and is also difficult to track down. With such a stress on domestic suppliers, governments have been subsidizing the true cost of production by giving farmers handouts, and by literally digging into reserves. Cyclones earlier this year in Southeast India destroyed crops, forcing the government to step in to write off debt and keep families alive. Rice reserves held in stock are dropping, and much has been found to have been poorly warehoused. Meanwhile, prices in Pakistan have increased by US$200 per ton or about 30 percent in the past 28 months and prices have risen by similar amounts in Thailand and Vietnam.

China and emerging Asia’s continued growth and development is raising several questions: who has really factored in the micro-elements impacting the economies; what is truly the impact of an additional bowl of rice, per day, per head of regional population; and what are the costs and impacts upon the regional economies, including that of China, to deliver just such a basic staple.

Emerging Asia may be booming, but much of the commodity price impact, as the region places more demands on resources will surely affect China’s own provision of its basic resources as well as the China costs in doing so.

The Shanghai Cooperation Organization gathers regional strength
With the rise of Asia and the emergence of Central Asia in global economics and politics the role of the Shanghai Cooperation Organization is growing in importance. Founded in 2001 in Shanghai by the leaders of China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, the SCO was originally formed due to growing security concerns in the region. Its role has been extended to encompass economic benefits to member countries as well. India, Iran, Mongolia and Pakistan remain observers to the SCO.

SCO countries (full members and observers) comprise a hefty 25 percent of Earth’s land area. Although the declaration on the establishment of the Shanghai Cooperation Organization contained a statement that it “is not an alliance directed against other states and regions and it adheres to the principle of openness”, many observers believe that one of the original purposes of the SCO was to serve as a counterbalance to NATO and the United States and in particular to avoid conflicts that would allow the United States to intervene in areas near both Russia and China.

On the economic front, SCO members have agreed to improve the flow of goods in the region while prioritizing joint energy projects in the oil and gas sector the exploration of new hydrocarbon reserves, and joint use of water resources.

In order to bolster security among member nations, the SCO focuses on eradicating the threats faced from terrorism, separatism, extremism and drug trafficking. As a result, joint military exercises between the member countries play an important part in securing the region.

Cultural cooperation also occurs in the SCO framework, with member countries holding art festivals and cultural exhibitions in each other’s countries.

Iraqis accuse Sunni states of meddling before polls

Iraqis accuse Sunni states of meddling before polls

reuters logo

By Suadad al-Salhy

BAGHDAD, Aug 18 (Reuters) – Saudi Arabia is among several Arab countries funding and inciting a Sunni Muslim insurgency to destabilise Iraq, now under Shi’ite rule, Iraqi lawmakers said.

The accusations, rejected by Saudi Arabia, come ahead of an election next year. Ties between Iraq and its Sunni neighbours have been strained since the 2003 U.S. invasion toppled Sunni dictator Saddam Hussein and handed power to the Shi’ite majority. Further tension could unsettle regional security.

“There are regional powers that pay billions of dollars … to push for the failure of Iraq’s democracy,” said lawmaker Haidar al-Ibadi of Prime Minister Nuri al-Maliki’s Dawa party.

“The reports that we have … indicate a multi-billion dollar plan by Saudi Arabia and other states,” he added when asked about a spike in bombings that could hurt confidence in the Shi’ite-led government ahead of the January election.

Many Sunni Arabs fear Shi’ite dominance in Iraq will boost the regional influence of non-Arab Shi’ite Iran.

Another senior lawmaker, Sami al-Askari, said intelligence reports indicated Saudi Arabia was trying to undermine security by supporting and inciting insurgents. He also accused Riyadh of seeking to wield political influence by financing Shi’ite, Sunni and Kurdish politicians and tribal leaders.

“Saudi Arabia is not happy that Shi’ites lead this country,” said Askari, a member of parliament’s foreign relations panel. He said Egypt and Jordan were also meddling in Iraq.

Kurdish lawmaker Adel Berwari of parliament’s security and defence committee said he had received the same information.

Analysts said Saudi leaders seemed to think Maliki was sectarian and might want to undermine him personally.

NO PROOF

The Saudi Foreign Ministry dismissed the accusations, and U.S. military commanders and Iraqi diplomats say there is no evidence the Sunni Islamist insurgency in Iraq has the backing of the Saudi government. Support from Saudi individuals, religious leaders and groups is another matter, they say.

“These allegations are baseless and not serious. Since day one of the Iraqi crisis, the Kingdom of Saudi Arabia has distanced itself from interfering in Iraqi internal affairs,” Saudi Foreign Ministry spokesman Osama Nugali said.

Ibadi and Askari did not provide proof of meddling by Saudi Arabia, which is itself battling al Qaeda militancy.

The sectarian mayhem that killed tens of thousands of Iraq’s Shi’ites and Sunnis has abated, but Iraqi officials are worried about attempts to reignite it. A recent spate of bombings by suspected al Qaeda militants has put many Iraqis on edge.

Maliki on Saturday said those “spending money” to weaken Iraq would fail and has repeatedly accused unidentified neighbouring countries of funding the insurgents in Iraq.

Despite an initial frosty reception after the 2003 invasion, most Arab states have now opened embassies in Baghdad or sent high level delegations. Saudi Arabia is conspicuously absent.

“There is no indication Saudi Arabia will open an embassy in Baghdad anytime soon. The Saudis think Maliki is too close to Iran,” said a diplomat in Saudi Arabia who declined to be named.

Saudi Arabia, the birthplace of Islam, follows a strict brand of Sunni Islam known as Wahhabism. Many Saudis consider Shi’ites apostates. Iran, home to Shi’ite religious learning, is Saudi Arabia’s regional rival.

Several Iraqi Shi’ite politicians lived in exile in Iran during Saddam’s brutal rule, and relations between Baghdad and Tehran are generally warm.

Many foreign insurgents caught in Iraq are Saudi, though their flow, mainly via Sunni Arab Jordan and Syria, has slowed.

The top U.S. commander in Iraq, Gen. Ray Odierno, said Saudi Arabia and Iraq needed to be encouraged to sit down and talk.

“I think it’s important not only for Iraq but for the Middle East as a whole,” he said.

The accusations also come as Iraqi politicians gear up for the election and claims that foreign countries foment violence could deflect blame.

“These accusations and talk of conspiracies are political propaganda,” said Baghdad university analyst Hazim al-Nuaimi.

(Additional reporting by Ulf Laessing and Souhail Karam in Saudi Arabia, Michael Christie in Baghdad, Writing by Mohammed Abbas;Editing by Samia Nakhoul)

© 2009 Reuters

More News from Reuters

Iraqis accuse Sunni states of meddling before polls

By Suadad al-Salhy

BAGHDAD, Aug 18 (Reuters) – Saudi Arabia is among several Arab countries funding and inciting a Sunni Muslim insurgency to destabilise Iraq, now under Shi’ite rule, Iraqi lawmakers said.

The accusations, rejected by Saudi Arabia, come ahead of an election next year. Ties between Iraq and its Sunni neighbours have been strained since the 2003 U.S. invasion toppled Sunni dictator Saddam Hussein and handed power to the Shi’ite majority. Further tension could unsettle regional security.

“There are regional powers that pay billions of dollars … to push for the failure of Iraq’s democracy,” said lawmaker Haidar al-Ibadi of Prime Minister Nuri al-Maliki’s Dawa party.

“The reports that we have … indicate a multi-billion dollar plan by Saudi Arabia and other states,” he added when asked about a spike in bombings that could hurt confidence in the Shi’ite-led government ahead of the January election.

Many Sunni Arabs fear Shi’ite dominance in Iraq will boost the regional influence of non-Arab Shi’ite Iran.

Another senior lawmaker, Sami al-Askari, said intelligence reports indicated Saudi Arabia was trying to undermine security by supporting and inciting insurgents. He also accused Riyadh of seeking to wield political influence by financing Shi’ite, Sunni and Kurdish politicians and tribal leaders.

“Saudi Arabia is not happy that Shi’ites lead this country,” said Askari, a member of parliament’s foreign relations panel. He said Egypt and Jordan were also meddling in Iraq.

Kurdish lawmaker Adel Berwari of parliament’s security and defence committee said he had received the same information.

Analysts said Saudi leaders seemed to think Maliki was sectarian and might want to undermine him personally.

NO PROOF

The Saudi Foreign Ministry dismissed the accusations, and U.S. military commanders and Iraqi diplomats say there is no evidence the Sunni Islamist insurgency in Iraq has the backing of the Saudi government. Support from Saudi individuals, religious leaders and groups is another matter, they say.

“These allegations are baseless and not serious. Since day one of the Iraqi crisis, the Kingdom of Saudi Arabia has distanced itself from interfering in Iraqi internal affairs,” Saudi Foreign Ministry spokesman Osama Nugali said.

Ibadi and Askari did not provide proof of meddling by Saudi Arabia, which is itself battling al Qaeda militancy.

The sectarian mayhem that killed tens of thousands of Iraq’s Shi’ites and Sunnis has abated, but Iraqi officials are worried about attempts to reignite it. A recent spate of bombings by suspected al Qaeda militants has put many Iraqis on edge.

Maliki on Saturday said those “spending money” to weaken Iraq would fail and has repeatedly accused unidentified neighbouring countries of funding the insurgents in Iraq.

Despite an initial frosty reception after the 2003 invasion, most Arab states have now opened embassies in Baghdad or sent high level delegations. Saudi Arabia is conspicuously absent.

“There is no indication Saudi Arabia will open an embassy in Baghdad anytime soon. The Saudis think Maliki is too close to Iran,” said a diplomat in Saudi Arabia who declined to be named.

Saudi Arabia, the birthplace of Islam, follows a strict brand of Sunni Islam known as Wahhabism. Many Saudis consider Shi’ites apostates. Iran, home to Shi’ite religious learning, is Saudi Arabia’s regional rival.

Several Iraqi Shi’ite politicians lived in exile in Iran during Saddam’s brutal rule, and relations between Baghdad and Tehran are generally warm.

Many foreign insurgents caught in Iraq are Saudi, though their flow, mainly via Sunni Arab Jordan and Syria, has slowed.

The top U.S. commander in Iraq, Gen. Ray Odierno, said Saudi Arabia and Iraq needed to be encouraged to sit down and talk.

“I think it’s important not only for Iraq but for the Middle East as a whole,” he said.

The accusations also come as Iraqi politicians gear up for the election and claims that foreign countries foment violence could deflect blame.

“These accusations and talk of conspiracies are political propaganda,” said Baghdad university analyst Hazim al-Nuaimi.

(Additional reporting by Ulf Laessing and Souhail Karam in Saudi Arabia, Michael Christie in Baghdad, Writing by Mohammed Abbas;Editing by Samia Nakhoul)

© 2009 Reuters

Saudi Arabia blamed for Yemen clashes

Saudi Arabia blamed for Yemen clashes

Sun, 16 Aug 2009 00:04:17 GMT

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A building destroyed during the recent bombing of opposition strongholds in northern Yemen, AP photo.

Yemen’s oppositionists allege that a five-year-old military campaign launched against them has been orchestrated by Saudi Arabia.

An opposition official, Yahya al-Houthi, said on Saturday that Saudi Arabia has gone so far as to deploy warplanes to Yemen to bomb opposition strongholds, Fars News reported.

“In 2004 [Yemeni] President Ali Abdullah Saleh attacked our brothers with the help of Saudi Arabia. Saudi warplanes were used in that strike,” he said.

Al-Houthi said that the same practice has been used in Sanaa’s ongoing crackdown on Shia groups which was launched on Monday in the northern areas of Yemen.

Yemen’s government officials accuse opposition groups of trying to reinstall a religious reign, toppled by a 1962 military coup in northern Yemen.

In addition, government officials on August 13 announced 6 conditions for halting their offensive.

These included the opposition’s withdrawal from all districts of Sa’ada and mountainous sites and giving up the military hardware they had seized from the army.

MMN/SME/MMA

Houthis forced from many areas, weapons stores destroyed

Houthis forced from many areas, weapons stores destroyed

Posted in: Front Page
Written By: Zaid al-Alaya’a & Nasser Arrabyee

YEMEN – Many districts in Sa’adah have been cleared of Houthi rebels and their weapons stores destroyed by Yemeni armed forces, said a source at the Defense Ministry on Monday.
The defense source said that the end of the Houthi rebellion is drawing near. “The district of al-Safra has been cleared of all rebels,” said Mohammed al-Imad, Secretary General of the Sa’adah local council.
Thousands tribesmen from all of the country’s governorates are heading to Sa’adah Governorate to take part in the fight against the Houthi rebels, said a military source last Monday.
The military-run 26sep.net quoted tribal sources saying that the Houthis crimes have provoked them to defend Yemen’s security and stability, as well as the innocent citizens of Sa’adah.
Well-informed sources said that businessmen and merchants have begun donating money to the security and armed forces fighting against the rebels.
Hundreds of thousands of youth have announced their readiness from different governorates to battle to the insurgents in the Governorate of Sa’adah, according to the website.
The Defense Ministry affirmed that members of the insurgent groups in Sa’adah received painful strikes on Sunday by the armed forces, noting that many rebels have been arrested. Furthermore, the armed forces announced the death of the rebel leader in Harf Sufyan district of Amran Governorate, Hussain Kazmah, last Saturday.
Government forces increased their military offensives against the al-Houthi rebels in Sa’adah, paralyzing their movement and arresting some rebels, the Minister of Defense said.
Last Sunday, al-Houthi rebels broke in to a camp for displaced people at al-Anad, said sources at aid and relief organizations working in Sa’adah, expressing their fears that al-Houthis are using civilians as human shields. Sources at the aid organizations who spoke on condition of anonymity said that the area has witnessed severe clashes in the past several days.
Six soldiers were injured last Sunday in the clashes with the rebels and were rushed to hospital, said the Interior Ministry.
In the same context, The Defense Ministry denied the news reported on Iran Radio Station that the Saudi Air Force has taken part in the attacks against Houthi rebels in Sa’adah, describing the news as false and fabricated.
Defense sources said that the information reported on the Iranian Radio Station has no credibility and accuracy, expressing regret towards the false information reported by official Iranian media to promote such misleading information.

“Iranian radio was supposed to commit itself to neutrality and to not be taken by lies. This puts Iran in a suspicious position that raises many questions about the possible ulterior motives it pursues in reporting such information,” said the source.
In the early hours of Friday morning, five Yemeni soldiers and 16 Houthi rebels were killed in clashes between the Yemeni military and Shiite al-Houthi rebels in Sa’adah Governorate.
In clashes between the warring parties on the fifth day of fighting, government forces tightened their siege around Sa’adah. According to official sources, the al-Houthi rebels have opted for violence and rejected all calls for peace.
The Governor of Sa’adah, Hassan Mana’a, accused al-Houthi rebels of kidnapping 15 local aid workers working for the Red Crescent when they attacked the refugee camp in al-Anad district.
Al-Houthi sources in a response to the official media reports that the real confrontations have not started yet and that their military plans are still kept for the right time. Al-Houthi office told newsyemen that the district of al-Safra is still far from the clashes and that they have gained control over two military location in al-Malhedh.
The al-Houthi followers attacked the Agriculture Office in the al-Anad district on Friday, damaging equipment, furniture, and an irrigation network which distributes water to hundreds of farmers, said Mana’a.
As a result of the war in the area, around 17,000 families have been forced to leave their villages in 10 districts of the province’s total 15 over the past four days.
Military sources said that al-Houthi rebels killed four tribal chiefs and 15 civilians, women and children among them.
Days ago, the army launched some of the strongest offensives seen in the conflict’s four and a half year history against the rebels, who have continuously violated past agreements.
In the same context, why has the war in northern Yemen erupted now, for the sixth time, despite the fact that President Ali Abdullah Saleh announced one year ago that it would stop forever? Will the government’s military actions end the conflict and the five-year Shiite rebellion this time, unlike the previous five rounds that have occurred since 2004? And who is supporting the al-Houthi rebels in this war which has cost Yemen a great deal in human and material losses over the past five years?
The Yemen Observer has tried to find answers to these questions from experts and from people in the field.
Najeeb Ghallab, researcher and political analyst at Sana’a university, says the war has erupted now because of al-Houthi’s expansion strategy, which has included increasing their dominance over Sa’adah and gaining new supporters in areas like al-Jawf, Amran, and Sana’a.
“Before this military strike, al-Houthi rebels blockaded military camps and arrested a lot of soldiers, so it was either let them expand until they attack Sana’a, or strike them with an iron fist and enforce the sovereignty of the state,” Ghallab said. “The military option, however, may impose the control of the State, but it will not necessarily solve the problem,” he admitted.
After imposing the control of the State, he said, the ultimate solution will be for the tribesmen of Sa’adah to take a unified position against the rebels.
“The tribesmen should tell the rebels clearly in a tribal conference, for instance, ‘we will all be against you if you do not lay down your weapons and descend from the mountains,'” he said.
Concerning who is behind the al-Houthis, Ghallab stated that the Iranian Mullas have a big hand in supporting the al-Houthi rebels.
“Iran has strategic goals for their support. They believe an army will come from Yemen to support the long-awaited 12th Imam al-Mahdi,” he said.  He added that, “The collapse of the state in Yemen will threaten Saudi Arabia, the only force that can confront Iran.  So Iran wants this collapse to happen.”
Yahya al-Mukhafi, a lawyer from Sa’adah, disagrees with Ghallab, saying that Houthi rebels are receiving their support from inside Yemen, not from outside.
“The strength of the Houthis comes from the weapons they captured from previous wars, and also from the sympathy of a lot of people throughout the country, especially from the Hashemites, because the war was declared against the Hashemites at the beginning,” said al-Mukhafi, who is himself a Hashemite and close to the al-Houthi family.  He concluded by reasserting, “I do not think there is any external support, and if there is any, it is only from sympathetic organizations and individuals.”
For his part, Sana’a University Professor Ahmed al-Daghashi, author of the book “The al-Houthi phenomenon,” says the problem in Sa’adah has very complicated dimensions, which span ideology, politics, geography, and development. “Although the military option is very important at the moment, it will not end the problem without addressing all these dimensions,” he explained.
Al-Daghashi believes there is internal and external support for the rebels and that there is external support from some officials of the State.
Concerning this support, he describes it as being more political than ideological. “I believe the regional political conflict is the main reason behind the external support,” he clarified, going on to say, “I think there is only some coordination and cooperation, because of the similarities, but this does not mean that there is concurrence between the Houthis and Iranian Shiites about the belief of the 12th Imam, Twelver Shiite.”
The government began the offensive against al-Houthi rebels last Tuesday. On Wednesday, the government announced conditions for a ceasefire which was rejected by the rebels. The conditions included that the rebels withdraw from all districts of Sa’adah, eliminate checkpoints, and hand over their weapons.
Battles between the al-Houthi rebels and the government started in 2004 when rebels started to form militias and interfere in the local government’s duties.
In 2008, a truce was reached between the two sides and confrontations ended until skirmishes started again earlier this year.
Recent reports note that the rebels have killed and injured about 172 people and have destroyed thousands of homes since the truce was declared in July.

Shiite rebel leader among dozens killed in renewed Yemen clashes

[Natural uprising against the tyrant state, or second phase of Western anti-Iran “democratic-revolutionary”  offensive?]

Shiite rebel leader among dozens killed in renewed Yemen clashes

Daily Star

SANAA, Yemen: Yemeni security forces killed a Shiite rebel leader in renewed clashes in the north of the mainly Sunni Muslim Arab country, in which dozens of troops and rebels also died, government sources said on Monday. Fighting in the Yemen’s north appeared to escalate Monday with the rebels claiming in statements to have made a number of advances, including taking control of several strategic areas in the northern Saada Province which borders Saudi Arabia.
The rebels also claimed to have launched Katyusha rockets on an army camp in Saada and promised more strikes in the future.
The rebels’ claims came after
Yemen’s defense minister earlier in the day said a stepped-up counteroffensive by government troops had paralyzed the rebels’ movements and dealt them a severe blow.
A government official told Reuters that Hussein Kamza, who led rebels in the northern Amran Province loyal to Abdul-Malik al-Houthi of the Houthi tribal group, was killed during fighting on Sunday.
Fighting in Saada between Yemeni troops backed by fighter aircraft and Shiite rebels has killed dozens on both sides since the government launched a wide offensive against the rebels earlier this month after weeks of skirmishes.
Saada is also where the rebels kidnapped 15 local aid workers last week, according to the province’s governor.
Yemen on Thursday announced conditions for a ceasefire to end its offensive, but the rebels rejected the truce offer and denied holding any kidnapped civilians.
The province has been closed to journalists, and the reports could not be independently verified.
The current round of fighting that began last week marks a major escalation in the five-year-old conflict.
The Shiite rebels complain the government ignores their needs and has allowed Wahhabis – people adhering to an ultraconservative version of Sunni Islam found in Saudi Arabia – too strong of a voice in the country. The Wahhabis, who consider Shiites to be heretics, gained influence after helping the Yemeni government win the 1994 civil war with the secessionist south.
The Yemen government has portrayed the rebels as a fundamentalist religious group supported by Iran.
The stability of Yemen – the ancestral homeland of Osama bin Laden – is a key concern for both Saudi Arabia and the US who worry that the lawlessness there could provide cover for Al-Qaeda militants who have sought sanctuary in the impoverished nation.
Along with rampant lawlessness, Yemen is also struggling with a worsening economy as a result of

falling oil prices.

Meanwhile, also on Monday, a delegation of US senators led by John McCain and the president of Yemen discussed ways to help the impoverished Arabian Peninsula country battle another threat the country faces – that of Al-Qaeda.
The state SABA news agency said the American team and Yemeni President Ali Abdullah Saleh focused on “bilateral issues and fields of joint cooperation.” No details immediately emerged from the meeting, but McCain spokeswoman Brooke Buchanan confirmed earlier that the talks would include counterterrorism cooperation and Guantanamo detainees.
Yemen has been a professed US ally in the fight against terrorism but President Barack Obama has hesitated to send home the nearly 100 Yemeni inmates held at Guantanamo Bay prison because of Yemen’s history releasing extremists.
The country, which is the ancestral homeland of Osama bin Laden, has been the site of numerous high-profile, Al-Qaeda-linked attacks, including the 2000 bombing of the USS Cole in the Gulf of Aden, which killed 17 American sailors.
The US visit comes at a particularly difficult time for Yemen.
In addition to the Al-Qaeda threat and the escalating tribal Shiite rebellion in the Saada province, Saleh’s Sunni-led government is facing a vigorous southern secessionist movement. – Reuters, AP