Socio-Economics History Blog

Socio-Economics & History Commentary

War Drums Beating Louder

  • The invasion of Gaza by the Israelis does not seem to be coming to an end soon. Could this invasion be due to internal politics or the natural gas fields off the coast of Gaza? José Miguel Alonso Trabanco, The Middle Eastern Powder Keg Can Explode at Anytime :
      
    Israel’s operation Cast Lead, as Professor Michel Chossudovsky demonstrates in his analysis entitled “War and Natural Gas”, was in part motivated by Israel’s desire to control gas reserves. It is conceivable that a political factor plays an important role as well. Israeli current government, headed by the Kadima-Labor Axis Ehud Olmert-Tzipi Livni-Ehud Barak can be defeated in the upcoming elections by Likud’s Benyamin Netanyahu so perhaps they are trying to demonstrate to Israeli voters that they are not hesitant about using hard power. There is not a huge difference between both factions, but it cannot be denied that Netanyahu is far more hawkish than the Olmert-Livni-Barak trio. If Netanyahu becomes the next Prime Minister, the likelihood of war will increase.
     
  • War is always about deception. What most people don’t realize is that the cause for wars are very seldom what it appears. Was Operation Iraqi Liberation about : Freedom, Democracy and getting rid of tyrant Sadam Hussain? Hardly. It is about OIL, natural resources, economic gain as always.
     
  • We may never know the real reasons for the massacre in Gaza. But we can be sure it is not about Hama’s rocket attacks into Israel. See :
     

     
  • The middle east powder keg can explode any time. As explained by José Miguel Alonso Trabanco :
       
    In short, the necessary conditions for a major war in the Middle East are given. Such conflict could rapidly spiral out of control and thus a relatively minor clash could quickly and dangerously escalate by engulfing the whole region and perhaps even beyond. There are many key players: the Israelis, the Palestinians, the Arabs, the Persians and their respective allies and some great powers could become involved in one way or another (America, Russia, Europe, China). Therefore, any miscalculation by any of the main protagonists can trigger something no one can stop. Taking into consideration that the stakes are too high, perhaps it is not wise to be playing with fire right in the middle of a powder keg.
     
  • There are just too many politicians, too many war mongers, too many foreign powers. too much oil in the middle east. Peace does not seem at all likely. War drums seem to be increasing their beat. Michel Chossudovsky says in Unusually Large U.S. Weapons Shipment to Israel: Are the US and Israel Planning a Broader Middle East War? :
     
    The large shipments of US ordinance, slated to arrive in Israel after the inauguration of Barack Obama as President of the United States and Commander in Chief are part of the broader program of US-Israeli military cooperation in relation to Iran. 
     
    The reinforcement of Israel’s missile defenses combined with the large shipments of US weapons are part of an escalation scenario, which could lead the World under an Obama Administration into a broader Middle East war. 
     
  • Over in South Asia, war drums are again being ratcheted up. Could we see a major nuclear conflict between India and Pakistan? If politicians behave rationally and responsibly it will not happen. But politicians are more concerned about being elected and remaining in power than anything else it seems. The Times of India , Time for action against Pakistan: BJP :
     
    Time has come for India to move away from waging a war of words with Islamabad to taking action, BJP president Rajnath Singh said in Bhopal on Saturday supporting military action against terrorist outfits based in Pakistan.”India has no other option but to take military action against Pakistan,” he said.
     
    “The Prime Minister and his council of ministers have only been giving statements, which is not enough. The Union government should stop this ineffective verbal war with Pakistan. There is no need to just create a war hype in the country without real action. Since Pakistan is not taking any initiative to stop terrorist organisations within its territory, the time has come for us to take the world community into confidence and go for military action against the country which will not stop terror organisations from killing our innocent citizens,” Rajnath said
      
  • Let us hope all these are merely pre-election rhetoric. Elections are due this month.
     
  • Over in Georgia, the South Ossetians are reporting deployment of Georgian troops near their border again. Tskhinvali says Georgia moves troops to S.Ossetia border :
     
    The Defense Ministry of South Ossetia said Friday Georgia was moving troops towards its border, the republic’s information and press committee said. The committee cited South Ossetian Deputy Defense Minister Ibragim Gasseyev as saying that four Georgian armored vehicles and 16 trucks had approached the village of Mereti, Gori district.
     
    “Considering that each vehicle has at least 20 people, Georgia has moved at least 300 people to Mereti,” Gasseyev said. At the same time Gasseyev voiced concern over the stance of the EU monitoring mission tasked with ensuring security along the border with two breakaway republics, Abkhazia and South Ossetia. Both republics have refused to allow EU observers on their territory.
     
    “Why don’t they ask why Georgia is moving troops to the South Ossetian border? In the light of the recent events the place and role of EU monitors is unclear to us,” he said.
     
    Earlier on Friday, local security agencies had reported that Georgia was preparing provocations against the South Ossetian security forces and the Russian troops stationed in the area. 
     
  • The backdrop is : U.S. signs strategic partnership pact with Georgia, on Jan 9, 2009. Any such troop deployment must be with the tacit understanding of the US government.
     
    U.S. Secretary of State Condoleezza Rice signed a strategic partnership charter with Georgia on Friday that her Georgian counterpart called a “stepping stone” to Tbilisi’s eventual membership in NATO.
     
    The agreement to cooperate in defense, trade, energy security, cultural exchanges and strengthening democratic institutions would help bind the former Soviet republic to the West just months after Georgia’s brief war with Russia, Georgian and U.S. officials said.
     
  • What wonderful peace loving people the American Neo Cons are. Most NATO member countries rejected Georgia as a member of NATO. America has decided to go it alone and take Georgia as a vassal state. Will the Neo Cons use Georgia as a proxy to attack Russia? It will not surprise anyone.
     
  • In terms of Long Cycle Theory like Kondratieff Cycle Theory,  the world is entering an economic social winter or Kondratieff Winter. This is marked by Depression and War. It looks increasingly like it.
     

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January 13, 2009 Posted by | EndTimes, GeoPolitics | , , | 3 Comments

Bond Bubble – Accident Waiting to Happen

  • Ambrose Evans-Pritchard writes in The bond bubble is an accident waiting to happen :
     
    The bond vigilantes slumber. As the greatest sovereign bond bubble of all time rolls into 2009, investors are clinging to an implausible assumption that China and Japan will provide enough capital to keep the happy game going for ever.
      …..
    They are betting too that debt deflation will overwhelm the effects of near-zero interest rates across the G10 and nullify a £2,000bn fiscal blast in the US, China, Japan, Britain, and Europe.
     
    Above all, they are betting that the Federal Reserve chief Ben Bernanke will fail to print enough banknotes to inflate the US money supply, despite his avowed intent to do so.
     
  • Mohamed El-Erian, the investment chief at the Pimco advised last week :
     
    “Get out of Treasuries. They are very, very expensive !”
     
  • Ambrose Evans-Pritchard again :
     
    It is lazy to think that China, Japan, the petro-powers and the surplus states of emerging Asia will continue to amass foreign reserves, recycling their treasure into the US and European bond markets.
     
    These countries are themselves bleeding as exports collapse. Most face capital flight. The whole process that fed the bond boom from 2003 to 2008 is now going into reverse. 
      …….
    Beijing needs the money at home in any case to prop up the Chinese economy – now in trouble. Even Japan has slipped into trade deficit.
     
    Clearly, the US and European governments cannot rely on Asia to plug the $3,500bn hole in their budgets this year. Asians are just as likely to be net sellers of their bonds. Which implies that central banks may have to “monetize” our deficits.
     
  • As for the inflation-deflation debate :
     
    The Fed’s December minutes reek of fear. The Bernanke team is no longer sure that stimulus will gain traction in time. The Fed’s “Monetary Multiplier” has collapsed, falling below 1. This is unthinkable. We are in a liquidity trap. So yes, printing money is not as easy as it looks, but to conclude that the Fed cannot bring about inflation is a leap too far. 
       
  • Bernanke’s FedRes is in deep deep trouble. They know it. It has never ever occurred to me that the Velocity of Money Multiplier can actually go below 1. It has happened ! How bad are things? The monkeys are running the zoo now.

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January 13, 2009 Posted by | Economics | , , | Comments Off on Bond Bubble – Accident Waiting to Happen

Professors – US in Depression & Decade of Weakness

  • More economists and professors are coming out and calling it a depression. This is quite evident to the man in the street I believe. At the very least this is not your normal 11 months average recession.
     
  • Professor Peter Morici, Expert calling it a U.S. depression :
     
    Morici noted 2.6 million payroll jobs have been lost since December 2007, the dollar is falling value and the nation has a big trade deficit with China. “The economy contracted at about a 5 percent annual rate in the fourth quarter. This looks worse than a recession to me,” he said. 
     
    “The economy will not recover without fundamental changes in banking and trade policy. A large stimulus package, though necessary, will only give the economy a temporary lift,” he said. “The economy is in a depression, not a recession.” 
     
  • Robert Shiller, Professor of Economics at Yale University, is of the opinion that America faces a decade of weakness. In Leading economist fears decade of weakness in US, he says :
     
    “We could have many years of a very weak economy. Big recessions are followed by years of weakness and typically unemployment keeps rising. To say that this will last years is not a dramatic statement. What is happening now is much worse than 1990. We could be facing a decade of real weakness. 
     
    This is no ordinary recession. There are signs that people see this as a different story. People are talking about a depression, something that we haven’t seen previously.” 
     
  • More eyes are being opened every day. People think the US government can do a great deal to stop a depression. I do not think so. All the actions so far by the FedRes and US government will simply make things worse. Who got us into this big mess in the first place? The FedRes and Uncle Sam.
     
  • Who are they really trying to help? The banksters and their casinos that caused this problem in the first place. Tax payers money are being used to bail them out and yet the FedRes refuses to reveal how they spend the money and for whom? Draw your own conclusions.

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January 13, 2009 Posted by | Economics | , , | Comments Off on Professors – US in Depression & Decade of Weakness

Yellowstone Super Volcano Rumbling ? About to Blow ?

  • Yellowstone National Park sits on top of an active super volcano.  Its eruption could be equivalent to the explosive force of 60 million atom bombs. It could wipe out the entire United States.
     
  • There have been 500 small earthquakes in Yellowstone since the 26th of December 08. This is abnormally high. The chances of a major eruption may be slim but not zero.
     
  • Below is History Channel’s documentary on what can happen when a super volcano like Yellowstone erupts. 
History Channel Mega Disasters – Yellowstone Eruption

Part 2     ,     Part 3    ,     Part 4     ,     Part 5    

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January 13, 2009 Posted by | History | , | Comments Off on Yellowstone Super Volcano Rumbling ? About to Blow ?

Paul C. Roberts – Depression Worse Than 1929. US being Led by Criminals.

  • Alex Jones interviews Paul Craig Roberts. He served as an Assistant Secretary of the Treasury in the Reagan Administration earning fame as the “Father of Reaganomics”. He is a former editor and columnist for the Wall Street Journal, Business Week, and Scripps Howard News Service. He is a graduate of the Georgia Institute of Technology and he holds a Ph.D. from the University of Virginia. He was a post-graduate at the University of California, Berkeley, and Oxford University where he was a member of Merton College. In 1992 he received the Warren Brookes Award for Excellence in Journalism. In 1993 the Forbes Media Guide ranked him as one of the top seven journalists in the United States. (wikipedia)
     
  • This is a no holds barred interview. Paul C. Roberts :
     

    • Deflation….inflation and probably hyperinflation.
    • Heavily dependent on imports, massive trade deficits and no way to pay for them.
       
    • Potential is far worse than the depression.
    • Steal from us to give to the banksters who caused the problems.
    • US leadership are criminals.
    • The police are out of control. They are basically thugs who like to use violence.
    • There is no accountability now because the government got away with 9/11.
    • I never believed in 9/11. I can tell when the buildings are being blown up by explosives. Any fool can look at those films and see that the building aren’t falling down. They are blowing up.
         
  •  Listen to the interview for the rest.

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January 13, 2009 Posted by | Economics, GeoPolitics | , , , , , | Comments Off on Paul C. Roberts – Depression Worse Than 1929. US being Led by Criminals.

Oil Price Speculation – 60 minutes

Vodpod videos no longer available.

  • The rise and plunge in oil prices: was it due to fundamentals or speculation? 60 minutes explores this issue and examines who are the major players behind the speculation/manipulation of oil prices.
     
  • Does this financial casino benefit suppliers and customers? Hard to say I suppose. But it does add to volatility and unpredictability. So in that sense it does not help suppliers and consumers.
     
  • Should there be legislation that prevents speculators that have no business in the oil trade to buy and sell oil futures? This will of course limit the futures market to genuine buyers and sellers of oil. The implementation will probably be tricky.
     
  • The biggest buyers/sellers of oil are speculators (as much as 60-70%) : Wall Street Banks, Hedge funds, Institutional investors….Go figure.

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January 13, 2009 Posted by | Economics | | Comments Off on Oil Price Speculation – 60 minutes