Stratfor On Japan, the Persian Gulf and Energy

Stratfor On Japan, the Persian Gulf and Energy


Submitted by Tyler Durden on 03/15/2011 15:43 -0400

From Stratfor
Japan, the Persian Gulf and Energy
By George Friedman
Over the past week, everything seemed to converge on energy. The unrest in the Persian Gulf raised the specter of the disruption of oil supplies to the rest of the world, and an earthquake in Japan knocked out a string of nuclear reactors with potentially devastating effect. Japan depends on nuclear energy and it depends on the Persian Gulf, which is where it gets most of its oil. It was, therefore, a profoundly bad week for Japan, not only because of the extensive damage and human suffering but also because Japan was being shown that it can’t readily escape the realities of geography.
Japan is the world’s third-largest economy, a bit behind China now. It is also the third-largest industrial economy, behind only the United States and China. Japan’s problem is that its enormous industrial plant is built in a country almost totally devoid of mineral resources. It must import virtually all of the metals and energy that it uses to manufacture industrial products. It maintains stockpiles, but should those stockpiles be depleted and no new imports arrive, Japan stops being an industrial power.
The Geography of Oil

There are multiple sources for many of the metals Japan imports, so that if supplies stop flowing from one place it can get them from other places. The geography of oil is more limited. In order to access the amount of oil Japan needs, the only place to get it is the Persian Gulf. There are other places to get some of what Japan needs, but it cannot do without the Persian Gulf for its oil.
This past week, we saw that this was a potentially vulnerable source. The unrest that swept the western littoral of the Arabian Peninsula and the ongoing tension between the Saudis and Iranians, as well as the tension between Iran and the United States, raised the possibility of disruptions. The geography of the Persian Gulf is extraordinary. It is a narrow body of water opening into a narrow channel through the Strait of Hormuz. Any diminution of the flow from any source in the region, let alone the complete closure of the Strait of Hormuz, would have profound implications for the global economy.
For Japan it could mean more than higher prices. It could mean being unable to secure the amount of oil needed at any price. The movement of tankers, the limits on port facilities and long-term contracts that commit oil to other places could make it impossible for Japan to physically secure the oil it needs to run its industrial plant. On an extended basis, this would draw down reserves and constrain Japan’s economy dramatically. And, obviously, when the world’s third-largest industrial plant drastically slows, the impact on the global supply chain is both dramatic and complex.
In 1973, the Arab countries imposed an oil embargo on the world. Japan, entirely dependent on imported oil, was hit not only by high prices but also by the fact that it could not obtain enough fuel to keep going. While the embargo lasted only five months, the oil shock, as the Japanese called it, threatened Japan’s industrial capability and shocked it into remembering its vulnerability. Japan relied on the United States to guarantee its oil supplies. The realization that the United States couldn’t guarantee those supplies created a political crisis parallel to the economic one. It is one reason the Japanese are hypersensitive to events in the Persian Gulf and to the security of the supply lines running out of the region.
Regardless of other supplies, Japan will always import nearly 100 percent of its oil from other countries. If it cuts its consumption by 90 percent, it still imports nearly 100 percent of its oil. And to the extent that the Japanese economy requires oil — which it does — it is highly vulnerable to events in the Persian Gulf.
It is to mitigate the risk of oil dependency — which cannot be eliminated altogether by any means — that Japan employs two alternative fuels: It is the world’s largest importer of seaborne coal, and it has become the third-largest producer of electricity from nuclear reactors, ranking after the United States and France in total amount produced. One-third of its electricity production comes from nuclear power plants. Nuclear power was critical to both Japan’s industrial and national security strategy. It did not make Japan self-sufficient, since it needed to import coal and nuclear fuel, but access to these resources made it dependent on countries like Australia, which does not have choke points like Hormuz.
It is in this context that we need to understand the Japanese prime minister’s statement that Japan was facing its worst crisis since World War II. First, the earthquake and the resulting damage to several of Japan’s nuclear reactors created a long-term regional energy shortage in Japan that, along with the other damage caused by the earthquake, would certainly affect the economy. But the events in the Persian Gulf also raised the 1973 nightmare scenario for the Japanese. Depending how events evolved, the Japanese pipeline from the Persian Gulf could be threatened in a way that it had not been since 1973. Combined with the failure of several nuclear reactors, the Japanese economy is at risk.
The comparison with World War II was apt since it also began, in a way, with an energy crisis. The Japanese had invaded China, and after the fall of the Netherlands (which controlled today’s Indonesia) and France (which controlled Indochina), Japan was concerned about agreements with France and the Netherlands continuing to be honored. Indochina supplied Japan with tin and rubber, among other raw materials. The Netherlands East Indies supplied oil. When the Japanese invaded Indochina, the United States both cut off oil shipments from the United States and started buying up oil from the Netherlands East Indies to keep Japan from getting it. The Japanese were faced with the collapse of their economy or war with the United States. They chose Pearl Harbor.
Today’s situation is in no way comparable to what happened in 1941 except for the core geopolitical reality. Japan is dependent on imports of raw materials and particularly oil. Anything that interferes with the flow of oil creates a crisis in Japan. Anything that risks a cutoff makes Japan uneasy. Add an earthquake destroying part of its energy-producing plant and you force Japan into a profound internal crisis. However, it is essential to understand what energy has meant to Japan historically — miscalculation about it led to national disaster and access to it remains Japan’s psychological as well as physical pivot.
Japan’s Nuclear Safety Net

Japan is still struggling with the consequences of its economic meltdown in the early 1990s. Rapid growth with low rates of return on capital created a massive financial crisis. Rather than allow a recession to force a wave of bankruptcies and unemployment, the Japanese sought to maintain their tradition of lifetime employment. To do that Japan had to keep interest rates extremely low and accept little or no economic growth. It achieved its goal, relatively low unemployment, but at the cost of a large debt burden and a long-term sluggish economy.
The Japanese were beginning to struggle with the question of what would come after a generation of economic stagnation and full employment. They had clearly not yet defined a path, although there was some recognition that a generation’s economic reality could not sustain itself. The changes that Japan would face were going to be wrenching, and even under the best of circumstances, they would be politically difficult to manage. Suddenly, Japan is not facing the best of circumstances.
It is not yet clear how devastating the nuclear-reactor damage will prove to be, but the situation appears to be worsening. What is clear is that the potential crisis in the Persian Gulf, the loss of nuclear reactors and the rising radiation levels will undermine the confidence of the Japanese. Beyond the human toll, these reactors were Japan’s hedge against an unpredictable world. They gave it control of a substantial amount of its energy production. Even if the Japanese still had to import coal and oil, there at least a part of their energy structure was largely under their own control and secure. Japan’s nuclear power sector seemed invulnerable, which no other part of its energy infrastructure was. For Japan, a country that went to war with the United States over energy in 1941 and was devastated as a result, this was no small thing. Japan had a safety net.
The safety net was psychological as much as anything. The destruction of a series of nuclear reactors not only creates energy shortages and fear of radiation; it also drives home the profound and very real vulnerability underlying all of Japan’s success. Japan does not control the source of its oil, it does not control the sea lanes over which coal and other minerals travel, and it cannot be certain that its nuclear reactors will not suddenly be destroyed. To the extent that economics and politics are psychological, this is a huge blow. Japan lives in constant danger, both from nature and from geopolitics. What the earthquake drove home was just how profound and how dangerous Japan’s world is. It is difficult to imagine another industrial economy as inherently insecure as Japan’s. The earthquake will impose many economic constraints on Japan that will significantly complicate its emergence from its post-boom economy, but one important question is the impact on the political system. Since World War II, Japan has coped with its vulnerability by avoiding international entanglements and relying on its relationship with the United States. It sometimes wondered whether the United States, with its sometimes-unpredictable military operations, was more of a danger than a guarantor, but its policy remained intact.
It is not the loss of the reactors that will shake Japan the most but the loss of the certainty that the reactors were their path to some degree of safety, along with the added burden on the economy. The question is how the political system will respond. In dealing with the Persian Gulf, will Japan continue to follow the American lead or will it decide to take a greater degree of control and follow its own path? The likelihood is that a shaken self-confidence will make Japan more cautious and even more vulnerable. But it is interesting to look at Japanese history and realize that sometimes, and not always predictably, Japan takes insecurity as a goad to self-assertion.
This was no ordinary earthquake in magnitude or in the potential impact on Japan’s view of the world. The earthquake shook a lot of pieces loose, not the least of which were in the Japanese psyche. Japan has tried to convince itself that it had provided a measure of security with nuclear plants and an alliance with the United States. Given the earthquake and situation in the Persian Gulf, recalculation is in order. But Japan is a country that has avoided recalculation for a long time. The question now is whether the extraordinary vulnerability exposed by the quake will be powerful enough to shake Japan into recalculating its long-standing political system.
This report is republished with permission of STRATFOR

We Need Something to Lift Our Spirits Rite about Now....

Submitted by: Francis Soyer

Max Keiser on Banking updates

Frontrunning: March 3

Frontrunning: March 3

Submitted by Tyler Durden on 03/03/2011 08:06 -0500
•Why the Dollar's Reign Is Near an End (WSJ)

•Take a bow Hatzius: John Taylor takes apart Goldman's economic "achemists and quacks" (Bloomberg) - This is what happens when you sellout to the propaganda machine

•William Cohan joins the tinfoil hat brigade - A Conspiracy With a Silver Lining (NYT)

•Gaddafi strikes oil areas, Arabs weigh peace plan (Reuters)

•No criminal charges ever: Officials Disagree on Penalties for Mortgage Mess (NYT)

•Bernanke Sees 200,000 Hit to Jobs from Budget Cuts (Reuters)

•It's Taps For the Still Weakening Dollar (RCM)

•Asia Moves to Shore Up Strategic Oil Reserves (FT)

•Beijing home sales slump in February (China Daily)

•ECB Set to Deliver Inflation Warning (WSJ)

•Obama "outraged" by attack in Germany (Reuters)

•Europe Must Plan a Reform, Not a Pact (FT)

•Merkel names ally as new defence minister (FT)

•Congress Approves Temporary Budget Bill, Avoids Shutdown (BusinessWeek)

•Gross Says Treasury Yields Too Low as Fed Approaches End of Asset Buying (Bloomberg)

•Mukherjee Signals Higher Oil May Spur India Subsidy, Risk Deficit-Cut Plan (Bloomberg)

European economic highlights:
•Euro-Zone PMI Composite for February 58.2 - lower than expected. Consensus 58.4. Previous 58.4.

•Euro-Zone PMI Services for February 56.8 - lower than expected. Consensus 57.2. Previous 57.2.

•Euro-Zone GDP for Q4 0.3% q/q 2.0% y/y – in line with expectations. Consensus 0.3% q/q 2.0% y/y. Previous 0.3% q/q 2.0% y/y.

•Euro-Zone Retail Sales for January 0.4% m/m 0.7% y/y - higher than expected. Consensus 0.3% m/m 0.0% y/y. Previous -0.6% m/m -0.9% y/y.

•Germany Retail Sales for January 1.4% m/m 2.6% y/y - higher than expected. Consensus 0.5% m/m 1.7% y/y. Previous -0.3% m/m -1.3% y/y.

•Germany PMI Services for February 58.6 - lower than expected. Consensus 59.5. Previous 59.5.

•France PMI Services for February 59.7 - lower than expected. Consensus 60.8. Previous 60.8.

•Italy PMI Services for February 53.1 - higher than expected. Consensus 51.1. Previous 49.9.

•Italy PPI for January 1.1% m/m 5.2% y/y - higher than expected. Consensus 0.9% m/m 4.6% y/y. Previous 0.6% m/m 4.6% y/y.

•UK PMI Services 52.6 - lower than expected. Consensus 53.7. Previous 54.5.

•ECB Announces Interest Rates. Consensus 1.00%. Previous 1.00%.

Texaco dumped 18b gallons of toxicwaste and 17m gallons oil into Amazon waterways

(CNN) -- A judge in Ecuador this week awarded $8.64 billion to Ecuadorian residents of the Amazon who had sued Chevron for years of crude oil pollution, but both sides said Tuesday they will appeal the verdict.
Chevron charges the verdict against them is the "product of fraud," and the plaintiffs say the size of the award is too small in comparison to what would be needed to do a real cleanup.
Luis Yanza, speaking for the residents' group the Assembly of those Affected by Chevron, said at a news conference that the ruling was "historic" and a "collective victory." However, he said, "Eight billion dollars doesn't represent a significant amount to repair the environmental damages."
The judgment against Chevron is the latest in 18 years of litigation between the Amazon residents and Texaco, which was later purchased by Chevron. It was decided in a courtroom in the Amazon by Judge Nicolas Zambrano.
For its part, Chevron said it will also appeal.
"The Ecuadorian court's judgment is illegitimate and unenforceable," said Chevron, in a press release Monday. "It is the product of fraud and is contrary to the legitimate scientific evidence."
Both sides have until Friday to file their appeals.
Despite the pending appeal, one of the local leaders, Humberto Piaguaje, called the judgment a victory for the population that lives in the oil-producing area in northern Ecuador.
"The judge did justice and has seen reality," he said. "We know that this is only one part of our fight and we will continue until there is justice and the damage is healed. The world should know that what happened in the Amazon and our fight for life, for justice."
The case, Aguinda v. ChevronTexaco, was originally filed in New York in 1993 on behalf of 30,000 inhabitants of Ecuador's Amazon region. The suit was eventually transferred to the Ecuadorian court and Ecuadorian jurisdiction.
The lawsuit alleges that Texaco used a variety of substandard production practices in Ecuador that resulted in pollution that decimated several indigenous groups in the area, according to a fact sheet provided by the Amazon Defense Coalition.
According to the group, Chevron has admitted that Texaco dumped more than 18 billion gallons of toxic waste into Amazon waterways, abandoned more than 900 waste pits, burned millions of cubic meters of gases with no controls and spilled more than 17 million gallons of oil due to pipeline ruptures.
Cancer and other health problems were reported at higher rates in the area, the group says.

Chavez: U.S. distorting situation in Libya ‘to justify an invasion’

Chavez: U.S. distorting situation in Libya ‘to justify an invasion’
Catherine E. Shoichet,

CNN

March 2, 2011
Venezuelan President Hugo Chavez claims U.S. criticism of Libyan leader Moammar Gadhafi has a clear aim: military invasion.
“Let’s not get carried away by the drums of war, because the United States, I am sure that they are exaggerating and distorting things to justify an invasion,” Chavez said Monday, according to Venezuelan state media.
At a Monday meeting of the U.N. Human Rights Council in Geneva, Switzerland, U.S. Secretary of State Hillary Clinton said the United States was exploring “all possible options,” and that “nothing is off the table so long as the Libyan government continues to threaten and kill Libyan citizens.”
Asked at a news conference Monday whether the United States planned an imminent military response in Libya, Clinton said, “No.”
Speaking Monday in the Venezuelan capital, Caracas, Chavez proposed sending an international committee to Libya to mediate and help develop a peaceful solution to unrest in the North African country.
"Instead of sending Marines and tanks and planes, why don't we send a goodwill commission to try to help so that they do not continue killing in Libya? They are our brothers," he said in a speech televised on the government-run network.
Chavez and Gadhafi have a close relationship, having bonded partly over shared opposition to U.S. global influence.
At a lavish Tripoli celebration commemorating 40 years of Gadhafi's leadership in 2009, the two leaders sat side by side during a two-hour military parade. That same year, a new football stadium in Benghazi, Libya, was named after the Venezuelan leader.
As rumors swirled about Gadhafi and his whereabouts last week, some suggested that he may be en route to Venezuela. Those reports proved to be false; the Libyan leader later spoke publicly in Tripoli.
But the close ties between the two leaders remain strong. On Monday, Chavez said Gadhafi "has been my friend and our friend for a long time" in remarks broadcast on Venezuelan state television.
"We must be cautious. We know what our policy is: We do not support invasions or massacres or anything, no matter who does it. But there is no doubt that, regarding Libya, a campaign of lies is being woven -- the same that has been woven about Venezuela for a long time," he said.
The U.N. Security Council over the weekend voted for tough restrictions and possible war crimes charges against the Libyan regime.
The Security Council measures -- which include an arms embargo, an asset freeze and travel bans for Gadhafi and members of his family and associates -- also referred the situation unfolding in Libya to the International Criminal Court.
White House press secretary Jay Carney said Monday that the U.S. government was considering the possibility of imposing a no-fly zone over Libya.
"Col. Gadhafi and those around him must be held accountable for these acts, which violate international legal obligations and common decency. Through their actions, they have lost the legitimacy to govern," Clinton said Monday.
"And the people of Libya have made themselves clear: It is time for Gadhafi to go, now, without further violence or delay."

Hillary Clinton Says RT and Al Jazeera are embarrasing U.S. News Agencies

http://www.businessinsider.com/hillary-clinton-al-jazeera-2011-3

US Mint is cutting back on allocations of American Silver Eagles

Bill Haynes, President of CMI Gold & Silver, one of the largest dealers in the United States informed King World News today that the US Mint is cutting back on allocations of American Silver Eagles and this is resulting in higher premiums. Haynes told KWN in a phone interview, “Today the US Mint notified its eleven authorized purchasers that their allotments are being reduced and as a result the authorized purchasers increased their premiums to the dealers.”


Bill Haynes continues:
“Eric, the Mint sold about 10 million ounces of American Silver Eagles so far this year, 6.4 million in January and about half that in February. The Mint had no problem producing those record quantities, but now the US Mint is cutting allocations to its authorized distributors. There is a glitch somewhere but we just don’t know what it is.”
King World News also contacted the US Mint today to get a direct comment from them regarding a story that they had suspended production of Silver Amercan Eagles. As it turns out this information which was taken off of the US Mint’s website is over a year old. In a telephone interview with King World News Michael White of the US Mint stated, “This language was on our web site over a year ago when we did not produce American Eagle Silver Uncirculated Coins. The site will be updated shortly.”


We will have to wait and see what the update is from the US Mint, but we do know that Bill Haynes, a veteran of nearly four decades in the gold and silver business has confirmed a reduction in allotments of Silver American Eagles and an increase in premiums.

Ron Paul: Fall of the Federal Empire

Ron Paul: Fall of the Federal Empire


7 hours ago - FOXBusiness 8:43
1083 views

Congressman Ron Paul, (R-Texas), on Bernanke?s testimony on the Hill and what the future will be for the Arabs in the Middle East.

http://finance.yahoo.com/video/economy-18773128/ron-paul-fall-of-the-federal-empire-24394905

Board Member of Goldman Sachs and Procter & Gamble Charged in Insider Trading Scheme

Board Member of Goldman Sachs and Procter & Gamble Charged in Insider Trading Scheme


FOR IMMEDIATE RELEASE

2011-53

Washington, D.C., March 1, 2011 – The Securities and Exchange Commission today announced insider trading charges against a Westport, Conn.-based business consultant who has served on the boards of directors at Goldman Sachs and Procter & Gamble for illegally tipping Galleon Management founder and hedge fund manager Raj Rajaratnam with inside information about the quarterly earnings at both firms as well as an impending $5 billion investment by Berkshire Hathaway in Goldman.
The SEC’s Division of Enforcement alleges that Rajat K. Gupta, a friend and business associate of Rajaratnam, provided him with confidential information learned during board calls and in other aspects of his duties on the Goldman and P&G boards. Rajaratnam used the inside information to trade on behalf of some of Galleon’s hedge funds, or shared the information with others at his firm who then traded on it ahead of public announcements by the firms. The insider trading by Rajaratnam and others generated more than $18 million in illicit profits and loss avoidance. Gupta was at the time a direct or indirect investor in at least some of these Galleon hedge funds, and had other potentially lucrative business interests with Rajaratnam.

Gates: Libyan no-fly zone would mean widespread air strikes

Gates: Libyan no-fly zone would mean widespread air strikes


By John T. Bennett - 03/02/11 02:41 PM ET
Defense Secretary Robert Gates on Wednesday said the U.S. military could establish a no-fly zone over Libya, but he cautioned that doing so would first require widespread air strikes across that nation.
“If it’s ordered, we can do it,” Gates told the House Appropriations's Defense subcommittee.
But establishing control of Libyan air space would “start with attacks to destroy” Libyan air defense systems. That kind of assault would require more U.S. military aircraft than “you would find on a single aircraft carrier.”
With so many fighter jets involved in other conflicts, the needed additional jets would have to be redeployed.
Gates told the panel that U.S. military involvement in Libya would require Congress to approve a use-of-force measure.
Adm. Michael Mullen, Joint Chiefs chairman, reiterated on Wednesday that U.S. security officials have still been unable to confirm that Libyan military jets fired on opposition members.
White House press secretary Jay Carney and Secretary of State Hillary Clinton in separate appearances on Wednesday said all options remain on the table.
The White House on Wednesday insisted that there were no inconsistencies in administration policy when it comes to the no-fly zone.
"The fact that the no-fly zone idea is complex does not mean it's not on the table," Carney said. "We have not ruled any options out."
This story was posted at 11:42 a.m. and updated at 2:41 p.m.

China "Attacks The Dollar"

China "Attacks The Dollar" - Moves To Further Cement Renminbi Reserve Currency StatusSubmitted by Tyler Durden on 03/02/2011 20:24 -0500
In a surprising turn of events, today's biggest piece of news received a mere two paragraph blurb on Reuters, and was thoroughly ignored by the broader media. An announcement appeared shortly after midnight on the website of the People's Bank of China. Reuters provides a simple translation and summary of the announcement: "China hopes to allow all exporters and importers to settle their cross-border trades in the yuan by this year, the central bank said on Wednesday, as part of plans to grow the currency's international role. In a statement on its website www.pbc.gov.cn, the central bank said it would respond to overseas demand for the yuan to be used as a reserve currency. It added it would also allow the yuan to flow back into China more easily." To all those who claim that China is perfectly happy with the status quo, in which it is willing to peg the Renmibni to the Dollar in perpetuity, this may come as a rather unpleasant surprise, as it indicates that suddenly China is far more vocal about its intention to convert its currency to reserve status, and in the process make the dollar even more insignificant.

A less diplomatic version implies that the relationship between China and the US would suffer a seismic shift in which the game theoretical model of Mutual Assured Destruction, and symbiotic monetary and fiscal policies, would no longer exist, allowing China to pursue its fate completely independent of any economic shocks that the increasingly distressed United States may be going through.
And confirming that the PBoC announcement is far more serious than the amount of airtime allotted to it by the mainstream media, is the just released article in Spiegel "China Attacked the Dollar" (google translated):
The Chinese central bank surprised with a spectacular announcement: The would-be superpower wants to handle their entire future foreign trade in yuan, not in dollars. Beijing shakes America's claim to represent the key currency - with serious consequences for the U.S..
The announcement was inconspicuous , but it has the potential, to permanently change the balance of power on the world currency market: China strengthens the international role of the yuan. All exporters and importers will, this year, be allowed to settle their business with their foreign partners in Yuan, the central bank said on Wednesday in Beijing.
This will respond to the growing importance of the yuan as a global reserve currency. "The market demand for cross-border use of the yuan rises," said the central bank. The PBoC had previously tested this plan by allowing 67 000 enterprises in 20 provinces to run their business abroad in yuan. The trade volume amounted to the equivalent of €56 billion.
Now the amount of yuan to be extended, it should be handled much more business in Chinese currency - and less in the U.S. Chinese companies trade at present often in dollars, they are thus dependent on the decisions of the U.S. Federal Reserve to pay on it in a rising oil price and will have pay higher transaction fees than necessary. That should change now.
Currently, the People's Republic can hardly take yuan out of the country and even that is monitored within the boundary of all legitimate capital flows. Chinese exporters have to change a large part of their euro, yen or dollars at a fixed rate revenue in yuan. Foreign companies wishing to do business in China must do so in Yuan, they can exchange their money in the People's Republic. Tourists are allowed a maximum of 20,000 yuan and exporting. Yuan an international market can not occur - and not on supply and demand-based exchange rate.
Needless to say, should the yuan be seen increasingly as a reserve currency, all of this, and virtually everything else is about to change.
The only question is whether or not the Yuan will cement its status at the top of the currency pyramid by allowing the backing of the currency with individual or a basket of commodities. If that were to happen, it would be the last nail in the coffin of the already terminally ill dollar.

Muslim Brotherhood Plans Day of Rage for March 3rd in D.C.

Feb 21,2011
Whether or not Muslim extremists Anjem Choudary, Abu Izzadeen and Sayful Islam will actually be able to pull it off or not remains to be seen. However, the trio are planning to stand on American soil in front of the White House on March 3 and proclaim a “call to arms” in which they will , “call for Sharia law to be established across the U.S.,” according to the Daily Mail on Sunday.
Anjem Choudary is the same extremist who has insisted that the Islamic flag will one day fly over the White House. He also said that he anticipates that thousands will turnout. Whether that is a bunch of psychological warfare or there has truly been some focused organizing going on behind the scenes will eventually become evident.
Meanwhile, the AP has reported that Moammar Gadhafi has declared that if Libya ends up in a civil war, that there will be oil wells in Libya that go up in flames.
To make matters even more interesting, Haaretz reported on Sunday that Iranian warships have made it through the Suez Canal while Al Jazeera reports that Egypt is denying the claim.
If a crowd ends up being drawn to the White House on March 3, it’s possible that the U.S. government will be in shut-down mode anyway given the fact that Reuters reported on Sunday that there has been some talk of a government shutdown if lawmakers can’t agree on a budget. It was also noted that the government is only funded through March 4. One can’t help but wonder if America would have Sharia law thrust upon it if the Republicans were to leave the state like the Democrats did in Wisconsin.
It would seem that Brigitte Gabriel’s warning about the attempt of Muslim Extremists to force an Islamic government into power in the United States is beginning to manifest. The Arab Christian is the founder and president of ACT! for America and has written a bestselling book entitled They Must Be Stopped: Why We Must Defeat Radical Islam and How We Can Do It. She told One News Now earlier this month that, “I actually dedicate a chapter to the Muslim Brotherhood's project for North America -- not only to what they have done in the Middle East and their goals of bringing back an Islamic government totalitarian regime worldwide, but their plan to the United States as well.”
She also stated that, “We not only have the fox watching the hen house; we have the fox inside the hen house right now," she notes. "This is why Obama is being wishy-washy on what's happening in Egypt, because the Obama administration right now is basically taking advice on Middle East policy from the Muslim Brotherhood front organizations in America."
It will certainly be interesting to see just how all the convenient crises brewing in DC will be taken advantage of in the coming days.

U.S. stock index futures pared gains on Tuesday as crude oil prices advanced.

LATEST NEWS


Stock futures pare gains as crude oil rises
NEW YORK (Reuters) - U.S. stock index futures pared gains on Tuesday as crude oil prices advanced.
Full Article
Bernanke to tread cautiously before Congress
March 01, 2011 02:36 AM ET

WASHINGTON (Reuters) - Federal Reserve Chairman Ben Bernanke will likely remain skeptical about the strength of the economic recovery in testimony on Tuesday, despite recent data pointing to improvement, signaling the central bank is unlikely to cut short its $600 billion stimulus plan.
Full Article
February auto sales seen up but oil risk looms
March 01, 2011 03:48 AM ET

DETROIT (Reuters) - U.S. auto sales are expected to show a gain of about 20 percent from the still-depressed levels of a year earlier in February, but the recent rise in oil prices could slow or even derail the industry's recovery, analysts and industry executives say.
Full Article
Morgan Stanley hit by China-based hackers: report
March 01, 2011 07:17 AM ET

NEW YORK (Reuters) - Morgan Stanley experienced a "very sensitive" break-in to its network by the same China-based hackers who attacked Google Inc's computers more than a year ago, Bloomberg reported, citing leaked emails from an Internet security company.
Full Article
World factory input costs rising sharply
March 01, 2011 06:21 AM ET

LONDON/BEIJING (Reuters) - Factory input costs leapt across the globe in February, the latest sign of rising inflationary pressures, while euro zone manufacturing grew at its fastest in nearly 10 years, surveys showed on Tuesday.
Full Article
US TOP NEWS

Gaddafi deploys forces as world raises Libya pressure
March 01, 2011 07:40 AM ET

TRIPOLI (Reuters) - Libyan leader Muammar Gaddafi despatched forces to a western border area on Tuesday in defiance of Western military and economic pressure, stirring fears that the bloodiest Arab revolt may grow more violent.
Full Article
Wisconsin governor gives Democrats ultimatum
March 01, 2011 07:11 AM ET

MADISON, Wisc. (Reuters) - Republican Governor Scott Walker on Monday gave absent Democratic lawmakers an ultimatum to return to Wisconsin within 24 hours and vote on a proposal to reduce the power of public sector unions or the state would miss out on a huge debt restructuring.
Full Article
Blackstone buys Centro's U.S. malls for $9.4 billion
March 01, 2011 12:35 AM ET

SYDNEY (Reuters) - Private equity firm Blackstone Group LP has bought nearly 600 U.S. shopping malls from Australia's debt-laden Centro Properties for $9.4 billion in one of the biggest global property deals since the credit crisis.
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Government shutdown unlikely, but budget battle remains
February 28, 2011 06:32 PM ET

WASHINGTON (Reuters) - A deal to avert a government shutdown took shape in Congress on Monday, but the short-term spending measure would do nothing to resolve the bitter debate over federal spending.
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Lawmakers question Medicare payment contractors
March 01, 2011 12:13 AM ET

WASHINGTON (Reuters) - Democratic senators on Tuesday expressed concern that companies hired to help pay and oversee medical claims under the Medicare health insurance program may have costly conflicts of interest.
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Silver Hits Fresh Post Hunt Brother High Of $34.43 On News Saudi Has Sent Tanks To Bahrain

Silver Hits Fresh Post Hunt Brother High Of $34.43 On News Saudi Has Sent Tanks To Bahrain


Submitted by Tyler Durden on 03/01/2011 07:12 -0500
Middle East Newspaper Saudi Arabia
If RIA Novosti's update on the Middle East escalation is correct, the Middle East's worst kept secret, that Saudi Arabia would interfere militarily in Bahrain before the country fell, has just been confirmed. From RIA: "Saudi Arabia has sent dozens of tanks to Bahrain, where anti-government protests continue for about two weeks, Egypt's Al-Masry Al-Youm newspaper said on Tuesday. Eyewitnesses reported seeing "15 tank carriers carrying two tanks each heading towards Bahrain" along the 25-km King Fahd causeway, which links the small island nation of Bahrain to Saudi Arabia." And while nobody expects the DXY to do much if anything on this news, now that the dollar is irrelevant in the FX realm, the same can not be said about silver. Silver just hit $34.43 minutes ago, the highest print in the last 31 years.
More from RIA:
Protestors are mainly Shiites account for about 70% of the Bahraini population, but have long complained of discrimination and other abuses by the Sunni Khalifa dynasty that has ruled the tiny Gulf nation for more than two centuries.
In the worst unrest in the kingdom since the 1990s, a wave of protests swept across Bahrain in the past weeks. At least six people were killed and hundreds injured in clashes with police.
Opposition threatens to hold more protests and a nationwide strike if the government refuses to resign.
And a confirming report from Press TV:
Pro-democracy protests in Bahrain have shown no sign of decline after almost two weeks. The protesters are demanding the resignation of the government, constitutional reforms and the king's abdication.
Witnesses said that the causeway was blocked as "15 tank carriers carrying two tanks each were heading towards Bahrain," Egypt's al-Masry al-Youm daily reported in its latest edition.
Given the popular protests in the Persian Gulf kingdom, the transfer of the military hardware from Saudi Arabia to Bahrain seems highly unusual, commuters traveling along the 25-km causeway said.
The development follows a decision by the Bahraini military on Saturday to withdraw their vehicles out of the capital's Pearl Square after a deadly police attack on protesters, a condition the opposition had set to begin talks.
The arrival of tanks from Saudi Arabia also occurs on the eve of yet another scheduled pro-democracy rally on Tuesday organized by the Bahraini opposition and protesters in Manama's flashpoint Pearl Square.
Massive protests in Bahrain, which hosts the US Navy's Fifth Fleet in the region, have shown no sign of a decline after almost two weeks.
The protesters are demanding the resignation of the government, constitutional reforms and the king's abdication.
Fears of Saudi intervention in the ongoing Bahraini uprising first came to the fore last week when unconfirmed reports emerged on Wednesday.

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

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• Arab World Embraces Israeli’s YouTube "Zenga Zenga" Spoof of Qaddafi Rant; Two Versions, With and Without Dancers

• China Cracks Down on Mid-East Style Protests With Water Canons; Police Blanket Shanghai, Beijing; Internet Search for "Egypt" and "Tunisia" Blocked

• Libyan Rebels Tighten Ring Around Tripoli; Oman Sultan Reshuffles Cabinet After Protests

• Massive Rout in Irish Elections; Collision Course with the EU; Default the Best Option for Ireland

Arab World Embraces Israeli’s YouTube "Zenga Zenga" Spoof of Qaddafi Rant; Two Versions, With and Without Dancers

Posted: 27 Feb 2011 04:27 PM PST

The New York Times reports Arab World Embraces Israeli’s YouTube Spoof of Qaddafi Rant.

A satirical YouTube clip mocking Col. Muammar el-Qaddafi’s megalomania is fast becoming a popular token of the Libya uprising across Middle East. And in an added affront to Colonel Qaddafi, it was created by an Israeli living in Tel Aviv.
Noy Alooshe, 31, an Israeli journalist, musician and Internet buff, said he saw Colonel Qaddafi’s televised speech last Tuesday in which the Libyan leader vowed to hunt down protesters “inch by inch, house by house, home by home, alleyway by alleyway,” and immediately identified it as a “classic hit.”
“He was dressed strangely, and he raised his arms” like at a trance party, Mr. Alooshe said in a telephone interview on Sunday. Then there were Colonel Qaddafi’s words with their natural beat.
Mr. Alooshe spent a few hours at the computer, using Auto-Tune pitch corrector technology to set the speech to the music of “Hey Baby,” a 2010 electro hip-hop song by American rapper Pitbull, featuring another artist, T-Pain. He titled it “Zenga-Zenga,” echoing Col. Qaddafi’s repetition of the word zanqa, Arabic for alleyway.
Mr. Alooshe said he was a little worried that if the Libyan leader survived, he could send one of his sons after him. But he said it was “also very exciting to be making waves in the Arab world as an Israeli.”
As one surfer wrote in an Arabic talkback early Sunday, “What’s the problem if he’s an Israeli? The video is still funny.” He signed off with the international cyber-laugh, “Hahaha.”

Two Versions, With and Without Dancers
original smash hit with dancers


Zenga Zenga Original Link: http://www.youtube.com/watch?v=cBY-0n4esNY


revised version without dancers
Zenga Zenga Revised Link: http://www.youtube.com/watch?v=6GcUutnU2gk


Mike "Mish" Shedlock

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A Higher Percentage of Americans Believed in King George During the Revolutionary War than Believe in Congress Today

A Higher Percentage of Americans Believed in King George During the Revolutionary War than Believe in Congress Today


Submitted by George Washington on 02/27/2011 15:57 -0500
Washington’s Blog
Influential Harvard and Stanford law professor Lawrence Lessig noted in a must-watch speech last week that polls show that only 11% of the American people have confidence in Congress.
He notes that more people believed in King George at the time of the Revolutionary War than believe in congress today.
He's right.
Historians have estimated that between 15 and 20% of the white population of the colonies were Loyalists
Watch:

Feb 25 (Reuters) - Regulators closed one bank in the U.S. on Friday, bringing to 23 the total number of bank failures in 2011

Feb 25 (Reuters) - Regulators closed one bank in the U.S. on Friday, bringing to 23 the total number of bank failures in 2011
In 2010 157 banks failed following 140 failures in 2009.

The bulk of the failures increasingly have been smaller institutions, those with less than $1 billion in assets, as large banks have recovered more quickly from the 2007-2009 financial crisis.

The FDIC announced the closure on Friday of Valley Community Bank, St. Charles, Illinois, which had about $123.8 million in assets and $124.2 million in deposits as of December 31. First State Bank, Mendota, Illinois will assume the deposits and has agreed to purchase essentially all of the assets.

Banks that failed in 2010 had total assets of $92 billion, compared with $169.7 billion the previous year.

FDIC Chairman Sheila Bair has said the agency expects the number of failures to drop in 2011.

In the FDIC's most recent quarterly report, released on Feb. 23, the agency said the number of banks on the "problem list" grew to 884 from 860.

Most of these institutions will not fail but the list provides an indication of how many banks are struggling.

Earlier this week, however, Bair said the outlook for the industry as a whole is improving including for small institutions.

In its quarterly update, the FDIC reported that banks had combined earnings of $21.7 billion in the fourth quarter of 2010, marking their fourth profitable quarter in a row.

But statistics showed lending continued to contract, down 0.2 percent or $13.6 billion for the quarter, and Bair warned it would have to pick up for the industry to take the next step in its recovery from the 2007-2009 financial crisis.

Washington Mutual, which had $307 billion in assets when it was seized in September 2008, remains the largest bank to fail during the financial crisis. (Reporting by Richard Cowan; Editing by Carol Bishopric)

Marc Faber: "I Think We Are All Doomed"

Marc Faber: "I Think We Are All Doomed"

Submitted by Tyler Durden on 02/27/2011 14:31 -0500
All who enjoy hearing a meaty Marc Faber fire and brimstone sermon, that cuts through the bullshit, will be happy to know that the Gloom, Boom and Doom author conducted a 40 minute interview with the McAlvany Financial Group, which covers all the usual suspects: gold, silver, precious and industrial metals, the "crack up boom", the future of the Ponzi and capital markets in general and much more. Of course, it wouldn't be a Faber interview without the requisite soundbite: "I think we are all doomed. I think what will happen is that we are in the midst of a kind of a crack-up boom that is not sustainable, that eventually the economy will deteriorate, that there will be more money-printing, and then you have inflation, and a poor economy, an extreme form of stagflation, and, eventually, in that situation, countries go to war, and, as a whole, derivatives, the market, and everything will collapse, and like a computer when it crashes, you will have to reboot it." Of course, on a long enough timeline...
Key extract from the Faber speech:
I think we are all doomed. I think what will happen is that we are in the midst of a kind of a crack-up boom that is not sustainable, that eventually the economy will deteriorate, that there will be more money-printing, and then you have inflation, and a poor economy, an extreme form of stagflation, and, eventually, in that situation, countries go to war, and, as a whole, derivatives, the market, and everything will collapse, and like a computer when it crashes, you will have to reboot it.
For the investor, the question is: How do I navigate through this complete disaster that is going to unfold? And I think if you look at different asset classes – real estate, equities, bonds, cash, precious metals – I suppose that you have to be diversified. I think real estate in the U.S. may go down another 10% or so, or even 15%, but I am always telling people, if you can buy the piece of land or the house you like, what do you actually care if it does down another 10%? If everything I bought in my life had only gone down 10-15%, I would be very rich, because a lot of things became worthless, especially loans to friends, and bonds, and so forth.
Look at the history, for example, of Germany, for the last 100 years. They had World War I. They had the hyper-inflation in World War II. The bond-holders got wiped out three times. If you owned Siemens, and you still own Siemens today, it was not a fantastic investment, but at least you still have something. You were not wiped out. I think that in equities you will be better off because you have an ownership in a company, than by being the lenders to companies, and the lenders, especially, to governments.
Faber on the key distinction between nominal and real, which nobody on CNBC seems to grasp yet, why gold now is cheaper than it was in 1999, and on the Dow and gold reaching parity.
In a money-printing environment, it is very difficult to know what is actually cheap and what is expensive. Is the price of wheat high, or is it low? Inflation-adjusted, it is extremely low. In nominal terms, it is relatively high. I believe that, in March 2009 when the S&P was at 666, the market was actually much cheaper than is generally perceived, because of the money-printing, and I do not anticipate that we will see 666 on the S&P again, in nominal terms.

In other words, they are going to print so much money that the S&P could be at, perhaps, 2000, but in real terms, it could be down below the lows of March 6, 2009. Maybe in gold terms, we could one day reach a ratio of Dow Jones to gold of 1-to-1, as we were in 1980. In other words, the Dow could be perhaps at 10,000 or 12,000, and gold could be at the same level.
That is why I am advising people to accumulate gold. Can gold have a correction? Yes, there has been a little bit too much euphoria about gold, and we may have a correction, but I do not think we are in a bubble in the price of gold. In fact, I could make a case that gold, at this level of $1400 an ounce, is cheaper than in 1999, when I look at the unfunded liability growth of the U.S., at the credit growth of the U.S., and at the household growth, and at the money printing, and at all the wealth creation that happens in China and Russia.

Frontrunning: February 25 new

Frontrunning: February 25 new


Submitted by Tyler Durden on 02/25/2011 08:11 -0500


•Irish Voters Set to Take Revenge on Ruling Party (FT, Bloomberg)

•Saudi youth call for protest in solidarity with Libyan uprising (Monsters and Critics)

•Wisconsin Assembly approves plan to curb unions (Reuters)

•Special report on Glencore: The biggest company you never heard of (Reuters)... actually that would be the DTCC

•US Warns Extreme Food Prices Will Stay (FT)

•Gotta love Bloomberg headlines: Fannie Mae, Freddie Mac Seek $3.1 Billion Amid Improved Earnings (Bloomberg)

•More completely expected criminal fraud out of Citigroup: What Vikram Pandit Knew, and When He Knew It (Bloomberg)

•CFTC, SEC halt criminal investigations, blame lack of money (WSJ)

•Sentance Says BOE Must Tighten Now to Prevent Tough Moves Later (Bloomberg)

•House Republicans Move to End U.S. Foreclosure Aid Criticized as Harmful (Bloomberg)

Straight from the Horses Mouth Folks, USA is headed to the same situation as Greece, Ireland, Etc.

Submitted by: Francis Soyer
2/24/11


Hope can be a dangerous thing. I have noticed that when talking to now retired Baby Boomers when talking about the economy there seems to be a disconnect with reality. A belief that inspite of some minor issues in relation to current events that all is well and that our country the USA would never fall victim to such scenairos we see play out day in day out of the likes of Ireland, Greece, Spain, Portugal etc.

This hearing and testimony occured last month. I can not recall if this event attracted any media attention or not, from the looks of the guy to the left and rear of Ron Paul who looks like he may be suffering from a minor case of down syndrome and the abundance of empty chairs I am assuming the hearing attracted little to no main stream media attention. But if you pay close attention to the testimony the message is clear. The USA is next on the chopping block for the Global banking system and we are in for some major changes.

Gaddafi's Private Plane, Reportedly Loaded With Gold, Ready To Leave For Zimbabwe As Early As Tomorrow

Gaddafi's Private Plane, Reportedly Loaded With Gold, Ready To Leave For Zimbabwe As Early As Tomorrow


Submitted by Tyler Durden on 02/24/2011 09:38 -0500
Activist Shareholder
The latest news from the ABC.net.au should come as no surprise to those who know all too well that one can't eat gold: "Gaddafi own private plane is loaded with gold bullion and lots of hard currency, mainly dollars, and is preparing to flee to Zimbabwe to stay there with his friend Robert Mugabe." Yet there is speculation that instead of pulling a Ben Ali, Gaddafi may pull a Hitler: "Earlier, one of Mr Gaddafi's former ministers predicted the Libyan leader will follow in Adolf Hitler's footsteps and commit suicide rather than give up power. Mustapha Abdeljalil, justice minister until he quit over the bloody crackdown on protesters, says he expects Mr Gaddafi to make good on his pledge to die on Libyan soil rather than slink into exile. "Gaddafi's time is up. He is going to go like Hitler. He is going to commit suicide," Mr Abdeljalil told Swedish media." In either case, we are skeptical that much of Libya's oil infrastructure will survive the binary outcome. As a reminder, Libya had 143.8 tonnes of gold (or Tungsten as the case may be) as of December 31, per the WGC.
More from ABC:
There are reports of gun battles taking place between forces loyal to Mr Gaddafi and his opponents in the town of Zawiyah, 50 kilometres west of Tripoli.
Mr Gaddafi no longer controls much of the east around Benghazi, where there are reports residents have jailed those they say are mercenaries and set up committees to run the city.
London-based Libyan political activist, Guma el-Gamaty, has told the ABC's Lateline that "quite reliable sources" believe Mr Gaddafi is readying to flee his country.
"Gaddifi's own private plane is loaded with gold bullion and lots of hard currency, mainly dollars, and is preparing to flee to Zimbabwe to stay there with his friend Robert Mugabe," he said.
"We think this could happen very shortly because the Security Council is threatening to impose a no-fly zone and we think that Gaddafi will try to escape before this no-fly zone is imposed, possibly by tomorrow.
"So this is the most serious story we've heard today. It's very indicative of the fact that Gaddafi is totally isolated, surrounded more or less and is probably in a state of mind where he's just concentrating and thinking about how to escape and run away and stay alive."
A noble end?
Earlier, one of Mr Gaddafi's former ministers predicted the Libyan leader will follow in Adolf Hitler's footsteps and commit suicide rather than give up power.
Mustapha Abdeljalil, justice minister until he quit over the bloody crackdown on protesters, says he expects Mr Gaddafi to make good on his pledge to die on Libyan soil rather than slink into exile.
"Gaddafi's time is up. He is going to go like Hitler. He is going to commit suicide," Mr Abdeljalil told Swedish media.
Hitler committed suicide in his bunker in Berlin in April 1945 as he witnessed the disintegration of his Nazi empire.
Mr Mr el-Gamaty says that is "a small possibility".
"We believe that probably Gaddafi doesn't really have the courage to kill himself. We think he still have this grandiose idea that he will go to Africa and rally all the Africans," he said.
"Remember he has the title of the "King of Kings" of Africa, so he thinks he can still go to Africa and rally all the Africans around him and come back to Libya and take it over again.
"But, who knows? That is also a possibility. But whether he flees, whether he kills himself, whether he gets arrested, I think he is doomed and I think his end is very imminent."

Virginia State Legislature can see where things are headed with the dollar, Silver and Gold

Submitted by: Francis Soyer
2/24/11


Hats of to the Virginia State Legislature for seeing down the road a bit. For all those who think Gold and Silver hype is just a bunch of paranoid bunk, put this in your pipe and smoke it. If the State Legislature is taking this seriously so should you. Good luck using cash to buy groceries or gas when the shit hits the fan which based on this bill and its ominous language is not too far down the road.

HOUSE JOINT RESOLUTION NO. 557


Offered January 12, 2011

Prefiled January 5, 2011

Establishing a joint subcommittee to study whether the Commonwealth should adopt a currency to serve as an alternative to the currency distributed by the Federal Reserve System in the event of a major breakdown of the Federal Reserve System. Report.

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Patron-- Marshall, R.G.

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Referred to Committee on Rules
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WHEREAS, the Supreme Court of the United States has ruled in In re Rahrer, 140 U.S. 545, 554 (1891), that “the police power” of a State “is a power originally and always belonging to the States, not surrendered by them to the general government, nor directly restrained by the Constitution of the United States, and essentially exclusive”; and
WHEREAS, the Supreme Court of the United States has ruled in Beer Company v. Massachusetts, 97 U.S. 25, 33 (1877), that the police power of the States “extend[s] to the protection of the lives, health, and property of the[ir] citizens, and to the preservation of good order”; and
WHEREAS, the protection of the lives, health, and property of Virginia’s citizens, and the preservation of good order in the Commonwealth, depend upon the maintenance of both an adequate system of governmental finance and a sound and robust private economy; and
WHEREAS, an adequate system of governmental finance and a sound and robust private economy cannot be maintained in the absence of a sound currency; and
WHEREAS, the present monetary and banking systems of the United States, centered around the Federal Reserve System, have come under ever-increasing strain during the last several years, and will be exposed to ever-increasing and predictably debilitating strain in the years to come; and
WHEREAS, many widely recognized experts predict the inevitable destruction of the Federal Reserve System’s currency through hyperinflation in the foreseeable future; and
WHEREAS, in the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System, for which the Commonwealth is not prepared, the Commonwealth’s governmental finances and Virginia’s private economy will be thrown into chaos, with gravely detrimental effects upon the lives, health, and property of Virginia’s citizens, and with consequences fatal to the preservation of good order throughout the Commonwealth; and
WHEREAS, Virginia can avoid or at least mitigate many of the economic, social, and political shocks to be expected to arise from hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System only through the timely adoption of an alternative sound currency that the Commonwealth’s government and citizens may employ without delay in the event of the destruction of the Federal Reserve System’s currency; and
WHEREAS, “legal tender” denotes a currency that must be accepted in payment of a debt denominated in United States “dollars” if the parties have not stipulated that some alternative currency is to be used as their medium of payment or are not otherwise required to use such alternative currency; and
WHEREAS, the Federal Reserve System’s currency has been designated “legal tender” under color of Title 31, United States Code, Section 5103; and
WHEREAS, under Title 12, United States Code, § 411 and Title 31, United States Code, § 5118(b) and (c), the Federal Reserve System’s currency is not redeemable in gold or silver coin or the equivalent in bullion; and
WHEREAS, that the Federal Reserve System’s currency is not redeemable in gold or silver coin or the equivalent in bullion is being identified by more and more experts as a, if not the, major reason for the ever-increasing instability of the Federal Reserve System; and
WHEREAS, all gold and silver coins of the United States are designated “legal tender” under the aegis of Title 31, United States Code, §§ 5103 and 5112(h), and must be so designated perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of the Constitution of the United States; and
WHEREAS, pursuant to Article I, Section 10, Clause 1 of and the Tenth Amendment to the Constitution of the United States, each State must make gold and silver coin a Tender in Payment of Debts; and
WHEREAS, the Supreme Court of the United States in Lane County v. Oregon, 74 U.S. (7 Wallace) 71, 76-78 (1869), and Hagar v. Reclamation District No. 108, 111 U.S. 701, 706 (1884), has ruled that the States may adopt whatever currency they desire for the purposes of performing their sovereign governmental functions, even to the extent of adopting gold and silver coin for those purposes while refusing to employ a currency not redeemable in gold or silver coin that Congress has designated “legal tender”; and
WHEREAS, “the police power” being the primary sovereign governmental function of every State, under Lane County and Hagar every State may adopt its own currency, consisting of gold or silver, or both, whenever necessary and proper to facilitate exercises of that power in aid of the general welfare of the State and its citizens; and
WHEREAS, under the aegis of Title 31, United States Code, § 5118(d)(2), and perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of, and the Ninth and Tenth Amendments to, the Constitution of the United States, Americans may employ whatever currency they choose to stipulate as the medium for payment of their private debts, including gold or silver, or both, to the exclusion of a currency not redeemable in gold or silver that Congress may have designated “legal tender”; and
WHEREAS, under the aegis of Title 31, United States Code, § 5118(d)(2), and perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of, and the Ninth and Tenth Amendments to, the Constitution of the United States, the citizens of Virginia may choose to employ as the medium for payment of their private debts whatever alternative currency, consisting of gold or silver, or both, that the Commonwealth may adopt in the exercise of “the police power”; and
WHEREAS, in light of the possible instability of the Federal Reserve System, proposals for states and their citizens to adopt an alternative currency consisting of gold or silver, or both, are receiving increasing attention throughout the United States, as evidenced by bills that have been or are being introduced in the legislatures of the States of Georgia, Indiana, Montana, New Hampshire, and South Carolina; and
WHEREAS, various systems of alternative currency employing gold or silver, or both, in the form of coin or its equivalent in bullion have already proved themselves in the free market, and could either be employed by the Commonwealth directly or be used as models for a new system created by the Commonwealth to meet Virginia’s unique needs; and
WHEREAS, the adoption of an alternative currency consisting of gold or silver, or both, would not destabilize the present monetary and banking systems, the Commonwealth’s governmental finances, or Virginia’s private economy, because it would not compel or commit the Commonwealth or her citizens to employ such alternative currency to the exclusion of the Federal Reserve System’s currency immediately, but would merely make the alternative currency available, and enable it to be used in competition with and preference to the Federal Reserve System’s currency, to the degree that the need for such use became apparent; and
WHEREAS, the United States Congress, the U.S. Department of the Treasury, and the Federal Reserve System have taken and are preparing to take no action to provide the United States with an alternative to the Federal Reserve System’s currency, in the likely event that the latter would be destroyed through hyperinflation; and
WHEREAS, because legislators in Virginia know or should know all of these facts; and because the General Assembly has the authority, the ability, and the duty to take timely action to deal with this situation without first seeking the approval of or assistance from Congress or any other state; and because the Constitution of Virginia provides, “That all power is vested in, and consequently derived from, the people, that magistrates are their trustees and servants, and at all times amenable to them”—for these reasons, the citizens of the Commonwealth will properly conclude that the members of the General Assembly will be primarily responsible if the Commonwealth is found to be without an alternative currency when the Federal Reserve System’s currency collapses in hyperinflation, or some other related economic calamity supervenes; now, therefore, be it
RESOLVED by the House of Delegates, the Senate concurring, That a joint subcommittee be appointed to study whether the Commonwealth should adopt a currency to serve as an alternative to the currency distributed by the Federal Reserve System in the event of a major breakdown of the Federal Reserve System.
The joint subcommittee shall consist of eight legislative members who shall be appointed as follows: five members of the House of Delegates to be appointed by the Speaker of the House of Delegates in accordance with the principles of proportional representation contained in the Rules of the House of Delegates and three members of the Senate to be appointed by the Senate Committee on Rules. The joint subcommittee shall elect a chairman and vice-chairman from among its membership.
In conducting its study, the joint subcommittee shall call or hear from such witnesses and take such other evidence as it deems appropriate and shall consider recommendations for legislation, with respect to the need, means, and schedule for establishing such an alternative currency.
Administrative staff support shall be provided by the Office of the Clerk of the House of Delegates. Legal, research, policy analysis, and other services as requested by the joint subcommittee shall be provided by the Division of Legislative Services. Technical assistance shall be provided by the Treasurer of the Commonwealth of Virginia and the Bureau of Financial Institutions of the State Corporation Commission. All other agencies of the Commonwealth shall provide assistance to the joint subcommittee for this study, upon request.
The joint subcommittee shall be limited to six meetings for the 2011 interim, and the direct costs of this study shall not exceed $12,000 without approval as set out in this resolution. Approval for unbudgeted nonmember-related expenses shall require the written authorization of the chairman of the joint subcommittee and the respective Clerk. If a companion joint resolution of the other chamber is agreed to, written authorization of both Clerks shall be required.
No recommendation of the joint subcommittee shall be adopted if a majority of the House members or a majority of the Senate members appointed to the joint subcommittee (i) vote against the recommendation and (ii) vote for the recommendation to fail notwithstanding the majority vote of the joint subcommittee.
The joint subcommittee shall complete its meetings by November 30, 2011, and the chairman shall submit to the Division of Legislative Automated Systems an executive summary of its findings and recommendations no later than the first day of the 2012 Regular Session of the General Assembly. The executive summary shall state that the joint subcommittee intends to submit to the General Assembly and the Governor a report of its findings and recommendations for publication as a House or Senate document and shall specify the date by which the report shall be submitted. The executive summary and the report shall be submitted as provided in the procedures of the Division of Legislative Automated Systems for the processing of legislative documents and reports, and shall be posted on the General Assembly’s website.
Implementation of this resolution is subject to subsequent approval and certification by the Joint Rules Committee. The Committee may approve or disapprove expenditures for this study, extend or delay the period for the conduct of the study, or authorize additional meetings during the 2011 interim.

Middle East Chaos: What To Learn And What To Expect

Submitted by Giordano Bruno of Neithercorp Press
Middle East Chaos: What To Learn And What To Expect
There are many different kinds of revolution; some more effective than others. Telling the difference between a successful revolution and a failed revolution can be tricky. Often, on the surface, they look exactly the same. The secret is to set aside what we would “like” to see, and be brutally honest about what was actually accomplished in the course of the dissenting action. Has power been fully rescinded by the offending government or regime to the people, or, to yet another corrupt bureaucracy with a slightly different face? Have the puppet strings of corporate globalists been severed from your country, or do they remain strong as ever? Has ANY corrupt official actually been punished for the crimes that led to the insurgency in the first place, or, did they fly off scot-free to their million dollar villas in Ecuador, drinking mojitos in wicker recliners and watching the disaster they created unfold on CNN? Who ultimately benefited from the event?
Today, the entire Middle East is on the verge of complete destabilization and possibly civil war. Tunisia, Egypt, Libya, Bahrain, Yemen, and other nations are experiencing a shockwave of unrest not seen since the 1970’s. Western media sources are calling it a “people’s revolt”, one which the Obama administration is heartily embracing like an old relative. But are we witnessing the democratization of the cradle of civilization, or something else entirely? How will we be affected by this tide of confusion? Instead of falling into panic and fear over the growing chaos, what can discerning Americans learn from a social implosion on the other side of the world that will help us to survive a similar occurrence here? Let’s examine some of the distinct moments that have characterized the Middle East debacle, the underlying and corrupt influences that surround them, as well as certain historical facts of the region that globalist engineers would rather we forget…
Molding The Arab World
Are globalist interests involved in the breakdown of the Middle East? Most certainly. However, this much widespread resentment and pent-up collective rage is not something that can be easily fabricated. It is far more likely that anger over the feudal governing tactics of dictators in the Arab world (many of which were installed or supported by U.S. and European interests) is very real, and has been building for quite some time. So then, why are Western governments applauding the overthrow of despots they themselves placed in power?
The Mubarak regime was the second largest recipient of U.S. financial and military aid in the world. One third of ALL publicly reported U.S. foreign aid goes to Egypt and Israel:
http://www.vaughns-1-pagers.com/politics/us-foreign-aid.htm
Without this vast military aid from the U.S., Mubarak would not have been able to maintain his 30 year reign. This is a cold hard fact. So then, why go against a leader you already have firmly in your grasp?
When the Shah of Iran (a violent madman we anointed) was overthrown by popular revolt in 1979, the U.S. government responded with vitriol and saber rattling. When Hosni Mubarak (a violent madman we anointed) was overthrown this past month, the U.S. government responded with cheers and warm regards. What was the difference between the revolution in Iran, and the revolutions all over the Middle East today? Insurance…
Like most puppet leaders and figureheads, Mubarak was an errand boy, a conduit for implementing globalist policies in Egypt. His relinquishment of power was in reality nothing of the kind, because the power was never his to give back. It is important to take note that Mubarak’s cabinet and most of the existing government and military structure remains firmly entrenched:
http://www.haaretz.com/news/international/egypt-swears-in-new-cabinet-retains-mubarak-era-ministers-1.345069
Field Marshal Mohamed Hussein Tantawi, who leads the ruling military council and has been defense minister for about 20 years, took “temporary” control of Egypt after Mubarak ceded authority. Tantawi retains very strong ties to Washington D.C. and an unerring loyalty to Mubarak’s policies, which is perhaps why Barack Obama seemed so jubilant about Mubarak’s departure. In the recent and controversial Wikileaks release of private diplomatic cables, Tantawi is famously referred to as “Mubarak’s Poodle”:
http://www.cbsnews.com/stories/2011/02/16/501364/main20032166.shtml
The key here is that globalist circles support the change in Egypt exactly because nothing will change for the citizenry. The Egyptian people will not gain true influence in the politics of their own country, and they may have even less influence over their own lives if a military infrastructure remains embedded within their government. Their entire rebellion was diluted and redirected, because they naively focused on Mubarak as the source of all their ills, instead of the corrupt system he was a mere front-man for.
What about Libya? Muammar Gaddafi, the crazy bag lady of third world dictators, was the darling of the UN in 2009 when he was nominated the head of the African Union. He was just as much a monster then as he is today, and as far as I know his human rights record has remained dismal, but then again, he was helping the globalists by paying the AU dues of numerous countries with Libyan oil money and luring them towards centralization:
http://www.saiia.org.za/diplomatic-pouch/libya-s-oil-makes-all-the-difference.html
Apparently, Gaddafi has outlived his usefulness as international bodies now fully support the rebellion in Libya.
Remember Tunisia? That fight for freedom that the mainstream media essentially ignored until it was almost over and the two decade rule of Zine al-Abidine Ben Ali (another despot with a history of human rights violations who was also installed with the help of Western interests, primarily Italy) was finally overthrown? Well, now globalist proponents suddenly “love” Tunisia and are promoting it as a “model revolution”. Why? Maybe because the dastardly duo of McCain and Lieberman are in town to offer the new Tunisian government “training from the U.S. to help Tunisia’s military provide security”:
http://www.reuters.com/article/2011/02/21/us-tunisia-turkey-idUSTRE71K2YE20110221
Yikes. These are the same guys who drafted the ‘Enemy Belligerents Act’ which would allow the U.S. government to treat any American citizen as an “enemy combatant”, removing Habeas Corpus and all Constitutional rights to a fair trial. I guess the lesson to Americans and most importantly the Liberty Movement is that if they can’t beat you, they’ll try to join you, and then co-opt you. My hope is that the Tunisians will turn down the Trojan Horse offerings of sewer rats like McCain and Lieberman, but if they do, I imagine the globalists will not be quite so friendly anymore.
What is happening in the Middle East is a perfect example of the manipulation of existing dissent towards establishment ends. The surface trigger for these events is obviously the doubling of food prices across the world in the past two years (you can thank the orchestrated devaluation of western currencies for a large part of this). People have a bad tendency to weather all kinds of atrocities as long as they are fed, but once certain necessities are taken from the masses, they WILL act, usually in a violent and unfocused manner. These revolutions are, for the most part, legitimate when they begin, but are co-opted as they progress, chiefly because the cultures involved do not understand where the real threat is coming from. Is centralization of the Middle East through catastrophe the goal? Perhaps, though, when all is said and done, I think the upheaval in the Middle East is much more about the U.S., than the Muslim world…
Déjà Vu All Over Again…
For those who really want a comprehensive sense of what is happening in the Middle East and why, I suggest a look into the last major Egyptian revolution of 1952. At that time, Britain was still the preeminent western power in the Arab world, and its control of the oil supply was absolute, much like the stranglehold the U.S. has enjoyed for many decades. Oil was pegged to the British sterling and any trade in crude required a conversion to the British currency. In fact, it was often said that the British Empire’s power after World War II was entirely dependent on its reserve currency status in oil markets. Any of this beginning to sound familiar?
In 1952, a revolution against the Egyptian puppet monarchy and its British overseers burst seemingly from nowhere, led by a group called the “Free Officers Movement”. In reality, the insurrection, fed by years of corrupt Aristocratic rule, was initiated and in some cases funded by both U.S. and Soviet agencies in tandem! In 1951-1952, nationalist police officers backed by the U.S. and Russia began supporting fedayeen terrorist groups using false flag attacks to weaken the region (is this sounding even more familiar?). Interestingly, this era was the birth of the so called “Muslim Brotherhood”, a group which has suddenly resurfaced in media discussion today.
Riots spread through Cairo, King Farouk was overthrown, the British were eventually run out, and their control of the Suez Canal was lost. But the story doesn’t end there…
The British and the French wanted the Suez back (at least that’s what they claimed), for control of the Suez meant control of Middle East oil markets. A plan was initiated by the two European powers to take back the canal using an Israeli invasion of the Gaza Strip as a spring board. This time, Israeli agents were used by the British to conduct false flag attacks, which were presented as a pretext for Israel to move against Egypt. The British and French followed by landing troops near Cyprus and Algeria.
The plan would have worked, except for one thing, the British were financially weak after two world wars and were completely dependent on American investment in their treasury debt. In response to the British action, the U.S. along with the UN threatened to halt investment in British debt and to stop price support of the Pound Sterling. This led to the eventual fall of the pound as the world reserve currency, and the rise of the dollar.
Official history portrays this move by the U.S., Russia, and the UN, as an attempt to undermine the long reach of the English. It is rather convenient however that the pound was dethroned just as plans for the European Union were beginning to be implemented in the early 1950’s. It seems to me that the British elites were fully aware that their futile attempts to hold onto the Middle East would result in the fall of the Pound; it was simply the British people’s turn to be taken down a few notches, and centralized. The similarities between the British Empire’s decline over Middle East oil in the 1950’s and our decline over Middle East oil today, are startling.
If history was to repeat itself, I would guess that the U.S. will soon be embroiled in political or even military operations to control the Suez, and retain its dollar peg to oil, which will illicit a negative response by international investment, causing central banks to dump their U.S. treasury investments and the dollar as a reserve currency.
Think of it as a grand theater meant to amuse only global bankers…
Energy Crisis To Strike The U.S. And Protect Globalists
An unstable Middle East benefits very few people, and that, I suppose, is the point. As we have covered here in a multitude of articles, the U.S. is on the verge of engineered economic collapse, driven mainly by the steady and purposeful devaluation of the dollar and our quickly expanding national debt. If you are a corporate central banking group seeking the death of the greenback as the world reserve currency, you face the very serious problem of avoiding immediate blame or retribution for your actions. What better way to escape the torches and pitchforks of the furious populace than to find a scapegoat, or a distraction even more terrifying than poverty?
Middle East turbulence provides the perfect smokescreen for the inflationary destruction of the dollar.
First and foremost, it hides the already skyrocketing price of energy, which was inevitable due to our devaluing currency (oil is traded primarily in dollars), but can now be blamed entirely on “Middle Eastern instability”. Already, the cost of crude has spiked to $100 a barrel, with no sign of relenting. Certainly, many Americans will now blame Egypt or Libya for their empty wallets, instead of global banks.
To add to the confusion, various agencies are feeding the MSM with a rainbow of mixed messages, which leave Americans vulnerable to uncertainty, making them far more malleable. For instance, the IMF has recently stated that the world can easily withstand $100 oil (a lie), while the International Energy Agency has stated that $100 oil would be “very very bad”, leading to a complete derailment of the global economy (which was going to occur anyway):
http://www.bloomberg.com/news/2011-02-22/world-s-economy-can-survive-short-term-surge-in-crude-oil-prices-imf-says.html
http://www.cnbc.com//id/41714336
Social and economic disaster ANYWHERE in the world today will invariably cut the thin threads of psychological faith in our so called recovery. The system was a sham to begin with, and the quantitative easing methods of the Federal Reserve were never intended to actually “save” our financial house from collapsing, just prolong the event until they were ready to sweep away the ailing remains and offer us an IMF controlled replacement. It is designed to fail, and fail spectacularly. However, these facts will sink into the fog of history if Americans are suckered into fixating on a single area of the planet as the sole source of economic catastrophe.
Finally, if the tension spreads to other nations such as Saudi Arabia and triggers violent in-fighting, or Israel is tapped as an asset to instigate wider conflict, we could be looking at all out war on an incredible scale. This would be the distraction to top all distractions.
Is American Upheaval Next?
If crude oil continues to climb above $100 for more than a couple months, the negative effects will be undeniable. If you thought we had inflation before, just wait until gas hits $5 to $6 a gallon, and shipping costs for goods explode. This doesn’t even take into account the very real possibility that once the Middle East is fully destabilized, and certain political influences are dissolved, OPEC will completely de-peg oil from the dollar. From there, the sky is the limit on gasoline values. Already, Mohamed El-Erian, chief executive officer at Pacific Investment Management Co. (PIMCO) is calling for a “stagflationary” market reaction to the turmoil in Libya:
http://www.bloomberg.com/news/2011-01-12/europe-faces-difficult-balancing-act-tackling-debt-crisis-el-erian-says.html
What will be the U.S. government response to a crashing currency and climbing costs? Austerity! Although, they will probably use different terminology to describe it. The onset of cost cutting measures is becoming more visible, especially within the states, where municipal bond investment has run screaming off a cliff. Large scale protests are erupting in Wisconsin and Ohio due to state cuts designed to help them stay financially afloat:
http://www.reuters.com/article/2011/02/22/us-ohio-protests-idUSTRE71L7SR20110222
The debate here becomes two sided; do state workers deserve to have their wages or benefits cut because state governments were fiscally irresponsible? Should states continue to run up incredible deficits just to appease state workers (who many consider overpaid) in the short term? They are both meaningful positions that need to be considered, however, these two sides miss the full picture.
The fact is, state governments are beyond broke, and eventually, they will have to nix spending and entitlement programs regardless of how anyone is affected, especially in the face of unchecked inflation. State employees and all people dependent on welfare are not necessarily the culprits behind financial clear-cutting either. The argument cannot be allowed to devolve into a mindless cage match over who deserves the money, because, first, there is no money, and second, this distracts from the original cause of the distress; the corporate banking elites who instigated the disaster in the first place. Already, I can see a certain subsection of the populace lashing out wildly at figureheads and opposition parties, just like in Egypt, instead of the corrupt system and the banking moguls who built it.
If an Egyptian or Libyan style revolt, driven by blind mob mentality, takes place in the U.S., we can expect several things to occur. Normal means of communication will be disrupted; both Egypt and Libya responded to protests by shutting down all internet and cell phone traffic. Martial Law will be enacted, and Constitutional rights suspended; continuity of government programs are already in place to legally bind states into bowing to DHS and FEMA authority in the event of any “national disaster”, including a dissenting citizenry. Immediate bank closures will follow, just as occurred in Egypt, causing a lack of liquidity in local markets and panic among those who were financially unprepared. Violence will unavoidably result, giving the Department of Homeland Security the perfect excuse to implement even more controls, all for our own “safety” of course.
Some may welcome such bedlam as a sign of change. I don’t see it that way. Revolution without direction, without a plan, and without a clear understanding of the source of the problem, is meaningless. We can allow ourselves to be herded by our own rage into even more pronounced tyranny, or we can stay focused, collected, and act with purpose by organizing our communities with the objective of self sufficiency and self protection. We can work with state legislators to bring support to Tenth Amendment issues, giving them the strength to withstand an economic collapse and the ability to turn down DHS or FEMA’s “help” when the time comes. We can organize intelligently, without centralized control, or we can hand over our destinies to yet another elite group of unaccountable autocrats. As impossible as it might seem, the choice really is up to us. How we act and react in the coming months will mean the difference between a free and prosperous America, or a scorch mark in the annals of history.

Frontrunning: February 24

Frontrunning: February 24
Submitted by Tyler Durden on 02/24/2011 07:59 -0500
•Gadhafi Flails as Libya Splinters (WSJ)

•As reported on Zero Hedge two days ago... Libya placed billions of dollars at U.S. banks (Reuters)

•Bullard Is ‘Bellwether’ as Fed Weighs Duration of Asset Buying (BusinessWeek)

•Is Stevie Cohen the Feds' Moby Dick? (Reuters)

•Those delusionary brits...Miles Says BOE Outlook Warrants ‘Very Gradual’ Rate Increase (BusinessWeek)

•Bonuses on Wall Street Declined 8% in 2010, N.Y.'s DiNapoli Says (Bloomberg) The average Wall Street employee took home a cash bonus of $128,530 in 2010

•Fleeing Egyptians Tell of Qaddafi's `Bloodbath' Across Libya (Bloomberg)

•Senator Wyden's Son Starts Hedge Fund After D.E. Shaw Internship (Bloomberg)

•Indian Rally Raises Pressure on Singh (FT)

Eric Sprott: "There Is No More Silver Left"

Eric Sprott: "There Is No More Silver Left"


Submitted by Tyler Durden on 02/23/2011 15:05 -0500
Eric Sprott
Eric Sprott made an appearance at Casey Research Gold and Resource Summit where in addition to providing a succinct summary of all his monthly letters from the past year, whose forecasts are all gradually panning out, he spoke about the prospects for gold, and particularly silver. We will leave it to readers to parse through the brief must watch clip, but here is the punchling for those wondering why increasingly more distributors are reporting indefinite lack of physical silver inventory: "There's $22 billion of silver available in the world, of which the ETFs already own half, and between you guys and us we probably own the other half... Which means there's nothing left."

And Wow: Fed's Hoenig Says United States Has "Deeply Undermined Free-Market Capitalism"

And Wow: Fed's Hoenig Says United States Has "Deeply Undermined Free-Market Capitalism"


Submitted by Tyler Durden on 02/23/2011 12:33 -0500
The Fed mutiny has arrived:
•HOENIG SAYS U.S. HAS `DEEPLY' UNDERMINED FREE-MARKET CAPITALISM

•HOENIG WARNS OF ESCALATING SERIES OF CRISES WITH RISING COSTS

•HOENIG: LARGE FINANCIAL FIRMS CAN EXPECT BAILOUTS IN FUTURE

•HOENIG SAYS BIG FINANCIAL FIRMS MUST NOT HOLD ECONOMY `HOSTAGE'

•HOENIG: LARGE FIRMS WERE `GAMING' CAPITAL STANDARDS PRE-CRISIS

•HOENIG:BIG FIRMS `HAVE SIGNIFICANT INCENTIVES' TO INCREASE RISK

•HOENIG: TOO-BIG-TO-FAIL FIRMS POSE `GREATEST RISK' TO ECONOMY

•HOENIG SAYS BIG FINANCIAL FIRMS ENJOY `HUGE' FUNDING ADVANTAGE

And the last one:
•FED'S HOENIG SAYS `HISTORY IS ON MY SIDE'

Geithner Says Not To Worry About Surging Oil Prices: "Central Banks Have A Lot Of Experience In Managing These Things"

Geithner Says Not To Worry About Surging Oil Prices: "Central Banks Have A Lot Of Experience In Managing These Things"


Submitted by Tyler Durden on 02/23/2011 11:51 -0500
You really can't make this shit up: "The economy is in a much stronger position to handle” rising oil prices, Tim Geithner said today during a Bloomberg Breakfast in Washington. “Central banks have a lot of experience in managing these things." We are, all of us, now doomed.

Brent Passes $110

Brent Passes $110
Submitted by Tyler Durden on 02/23/2011 10:19 -0500
CrudeGreat Depressionrecovery
A $10 move in a week is just what the doctor ordered to destroy the last trace of surreality in the whole "economic recovery" story. At this rate we will take out all time high crude prices by mid March. As we have been saying since December, a rapid move in oil will undo years of carefully planned propaganda and money printing. Yet the weakness that "nobody could have possibly predicted" is just as we had forecast: global and US weakness in late February/March, market swoons in March/April (as per DeMark's repeat appearance), Fed releases early indications of QE3 in May. In the meantime, we also get a war as a bonus to boost the US military-defense industrial complex. Pretty much a rerun of the first great depression to the dot.

Gaddafi Son Says Army Will Protect Oil Infrastructure, Blames Al-Qaeda For Carpet Bombing As 10,000 Now Reported Dead

Gaddafi Son Says Army Will Protect Oil Infrastructure, Blames Al-Qaeda For Carpet Bombing As 10,000 Now Reported Dead
Submitted by Tyler Durden on 02/23/2011 14:00 -0500
AfghanistanItalyNewspaperRealityTwitter
And so we go from one lunatic to another. In an "exclusive interview" with the FT, Muammar Gadaffi's son, al-Saadi, told the newspaper, whose parent Pearson PLC is 3% owner by the Libyan Sovereign Wealth Fund, "made it clear that he believed any such new regime would still include his father. “My father would stay as the big father who advises,” he told the Financial Times, adding that direct administrative powers should be handed over to a new generation." And further confirming the soon to be deposed ruler's break with reality, were accusations that the reason why the Libyan airforce has been shooting at protestors over the past week, was to protect the country from "thousands of al-Qaeda" infiltrators who had taken over the eastern part of the country. Touching on a topic discussed yesterday, namely that the Gaddafi regime may engage in sabotage against its oil industry, al-Saadi “said that the army would be sent to guard facilities if necessary. The army is still very strong,” he said. “If we hear anything, we will send some battalions. When people see the army, they will be afraid.” In other words, expect to hear news of major disruptions in the country's oil infrastructure which will promptly be blamed on al-Qaeda by the Gaddafis. And going back to reality, we read that the death toll in Libya has surpassed 10,000 people.

Meanwhile Back in Greece, the country where Democracy was Born Peacefull Rioting gives way to outrite Violence

Submitted by: Francis Soyer

Keiser Report: Fed's Reign of Terror (E123)

http://www.youtube.com/watch?v=ZF_QXKFSDAU&feature=player_embedded

Korean Bank Run Spreading: Eighth Bank Closes Following "Massive Withdrawals"

Korean Bank Run Spreading: Eighth Bank Closes Following "Massive Withdrawals"


Submitted by Tyler Durden on 02/22/2011 19:28 -0500
Bank RunFederal Deposit Insurance CorporationKIM
The quietest bank run that has so far completely evaded mainstream attention, that of Korea, is spreading, and an eighth bank has now shuttered after "Domin Bank, a savings bank with a capital adequacy ratio below 5 percent, voluntarily decided yesterday to suspend its operations temporarily because of massive withdrawals." As JoongAng reports: "The decision took both depositors and financial regulators by surprise since it was the first time that a local bank shut its doors on its own." Apparently the courageous decision by the Financial Services Chairman Kim Seok-dong to deposit $17,864 in a troubled bank has not done much if anything to prevent the locals from realizing that their banking system is built on a house of cards.
From JoongAng Daily:
Domin Bank, which has six branches in Gangwon, was placed on a watch list last week by the Financial Services Commission. The move triggered a bank run on Domin Bank.
According to Domin Bank, deposits amounting 31.8 billion won ($28.2 million) were withdrawn since last Thursday, including 18.8 billion won on Monday.
The news of Domin Bank’s temporary closure came as FSC Chairman Kim Seok-dong was visiting Mokpo, South Jeolla, where recently suspended Bohae Savings Bank is located.
Seok-dong unhappy:
“This savings bank was supposed to submit a management improvement plan to the FSC by Feb. 24,” said Kim. “We will now have to review whether [the closure] is even legally O.K.”
More classic quotes follow:
Bae Joon-soo, senior FSC deputy director, said, “I think it is legally and morally wrong for a financial firm to do such a thing.”
Now we get it: according to the banking cartel's ethical standard it is "legally and morally wrong" for a bank to admit it is insolvent. Perhaps if America had made this clear 2 years ago, we could have spared ourselves two years of fingerpointing and fictitious lawsuits. After all, say what you will about the tenets of banker national socialism, at least it's an ethos.
The financial regulator and the Federation of Savings Banks failed to persuade Domin Bank to resume its operation yesterday.
The bank in notices posted on the doors of every branch said that it had taken the move “as a means to soothe the crisis involving massive withdrawals.”
The notice continued, “We will resume operation after we are reborn as a sound savings bank by increasing our paid-in capital to achieve a capital adequacy ratio of 8 percent.”
We repeat our appeal for the FDIC and Treasury to send our crack fraud and book cooking team to guarantee to the Koreans that their bankrupt banks are perfectly ok before this thing gets really out of control, and migrates to China, where a billion man bank run will be a little harder to keep under wraps.

Federal Reserve Board

More and more people are popping out of the woodwork these days offering startling new revelations about the crime family that runs the Federal Reserve Board. Here are just a few of their crimes: the creation of the Red Brigades and Baader Meinhof Group to assassinate politicians like Italy’s Aldo Moro, the use of falsified international treaties to seize control of global finance, the replacement of the real Dalai Lama with a stooge and plans to induce massive global starvation this spring and summer.
The reason more people are willing to come forth and testify is that they finally see the Illuminati, or gang (committee) of 300, Khazarian Satanists or whatever label you choose to use for them, as headed for a final takedown. Perhaps that explains the latest rash of attempts to bribe members of the White Dragon Society, including this writer.
The Satan worshipping owners of the Federal Reserve Board, however, are extremely fanatical about their religion and many continue to believe their plans are pre-ordained and unstoppable. Their campaign to overthrow governments world-wide, starting in the Middle-East is part of a plan to vastly hike oil and food prices in an effort to engineer famine and war by late spring or summer.
Here is some of what self-described Olympians (David Rockefeller has referred to himself as “Zeus” in the past) or committee of 300 members including Joseph Rattinger, John McClay, Fred Potter and Alexander King, among of others, have to say about their activities:
“When Queen Elizabeth II was enthroned, the ceremony was presided over by a committee of 300 (hereafter “member.”) leader.”

“We do not believe in God and worship Lucifer.”

“Whenever a US President speaks a member can be seen in the background.”

“The Club of Rome works for us.”

“We want a small and better world without useless eaters.”

“Industrial progress leads to population growth so we are dedicated to the destruction of the industrial state.”

“We remove any leader who, like Kennedy, stands in our way.”

“We were formed by an alliance between the Anglo Financiers and the Black Nobility of London, Venice and Genoa.”

“We have a chapter in Washington.”

“Interpol, Mossad and the FSB all work for David Rockefeller.”

“Henry (Heinz) Kissinger is one of our most important agents; he belongs to the Grand Alpine Lodge in Switzerland that controls the Italian P2 lodge.”

In a typical move by committee monster Kissinger he told Prime Minister Zulfikar Ali Bhutto “We will make a horrible example of you if you continue with your nation building.” Bhutto was later judicially assassinated by committee member General Zia-ul-Hak. The same people killed his daughter Prime Minister Benazir Bhutto.
Prime Minister Aldo Moro was killed on the orders of committee member Bettino Craxi, who created the Red Brigades in order to have an enemy required to justify fascism.
This information was given to the White Dragon by committee members who thought it would convince us they were invincible and that attempts to bring them to justice would fail. They say their members hide in public places like 10 Downing St., Congress and the White House.
The US House of Representatives Sub-Committee on Energy is one of their main strongholds in Washington.

Meanwhile a Japanese agent who has sub-contracted for David Rockefeller and the committee had his own startling revelations.
According to this agent, the Dalai Lama was replaced as a young child with a committee selected candidate. He says the Tibetans of the Dalai’s clan, together with members of the Tibetan Royal family were trying to remove this impostor in order to liberate world Buddhist organizations from committee control.
The head of Japan’s largest Buddhist Lay organization, Son Tae Chuck (Japanese name Daisaku Ikeda) is in a coma and his organization, which controls much of the Japanese police establishment, was also about to be liberated from committee control, he said.
Also, committee agent Dr. Nakamatsu is trying to take over the cult Kofuku no Kagaku (Happy Science). Happy Science funnels money to the advertising giant Dentsu. Dentsu is used by the CIA in Japan as part of their media control grid.
The two top committee agents in Japan now were Nobuo Tanaka from the International Energy Agency:
http://en.wikipedia.org/wiki/Nobuo_Tanaka

and Isao Iijima, arch-traitor Prime Minister Junichiro Koizumi’s former secretary. They are in control of distribution of dollars and yen created by the Bank of Japan. Korean pretending to be Japanese Tokyo Governor Shintaro Ishihara is also a Rockefeller flunky, the agent said. These traitors will all be hearing from the White Dragon society soon.
The agent had many more revelations that we will keep from the public record at present in order not to impede ongoing criminal investigations.
We can also now report the White Dragon Society has obtained copies of treaties such as Schweitzer Agreement and other international treaties that prove the so-called owners of the Federal Reserve Board and the US dollar printing machine have been using fraudulently altered versions of these treaties to justify their stranglehold on global financial transactions.
The same scumbags have been trying to take over various Middle-Eastern nations in order to loot their central banks, jack up the price of oil and start World War 3. They will be stopped. If any mass starvation begins, it will signal the start of a total purge of all committee members and their flunkies.
Representatives of a Southern Chinese power broker, who claimed connections with the Federal Reserve Board, also came to offer this writer an astronomical bribe last week. There is an Intaglia printing press in Southern China that prints US dollars and clearly the owners of this printing press wish to maintain their control over this particular dollar printing subsidiary. This can be arranged provided the Southern Chinese faction ceases to cooperate with the Satanist committee and their agents. No bribes, however, will be accepted by the White Dragon.
The White Dragon Societies calls for the creation of a new meritocratically staffed organization to replace the Federal Reserve Board and the IMF to take over the issuance of US dollars. It also wants a global economic planning agency to be set up to carry out projects, such as ending poverty, stopping environmental destruction, greening deserts, exploring space etc.
The Rothchilds and European Royal Bloodlines, for their part, are asking for a sovereign island with two UN seats and unlimited funding in exchange for their cooperation. This is something the White Dragon can live with

Frontrunning: February 22

Submitted by Tyler Durden on 02/22/2011 08:01 -0500
Bank of EnglandBOEConsumer ConfidenceGermanyItalyNew ZealandratingsSwitzerlandTrade BalanceUnited Kingdom
•Housing data may have understated extent of collapse (Reuters)

•Powerful 6.3 Earthquake Hits New Zealand, NZD slides (FT)

•Shutdown Fears Raise Hopes for US Budget (FT)

•Oil price shock: Pandora's Box is opened (Telegraph)

•Spain's rotting corpse finally floats to surface: Spain Pegs Cajas' Possible Problem Debt at €100 billion (WSJ)

•Wal-Mart Fourth-Quarter U.S. Comparable Sales Trail Forecast (Bloomberg)

•New Property Rules Driving Rent Prices (People's Daily)

•BofA Doubles Writedown for Credit-Card Unit to $20.3 Billion (Bloomberg)

•Weber Sets Germany on Collision Course with EU (FT)

•Desperate Gaddafi Clings to Power (FT)

•Bond Market Swaps Back Bernanke's Benign Inflation View (Bloomberg)

•Sale of the Century (Newsweek)

Iran Warships Begin Suez Crossing

Submitted by Tyler Durden on 02/22/2011 08:29 -0500
Despite indications that the US would attempt to forcefully box the Iranian warships in the Red Sea, first observed here, this strategy, if that was indeed the plan, has failed, and according to Egypt's state-run MENA agency, the Suez crossing for one (very old) Iranian frigate and one (very old) supply ship has commenced. Bloomberg reports: "The ships entered the canal early today after the approval of Egypt’s Defense Ministry, the state-run Middle East News Agency cited Ahmed El Manakhly, head of traffic at the Suez Canal Authority, as saying. The crossing usually takes 10 to 12 hours, El Manakhly said." Israel is, needless to say, unhappy: "Israeli Foreign Ministry spokesman Yigal Palmor today said that Israel would consider the presence of the warships sailing through the canal to the Mediterranean Sea “a provocation” that should be “dealt with by the international community.” Palmor said he was citing previous comments by Foreign Minister Avigdor Lieberman." Yet with tensions already on edge, the possibility that this latest war of words escalates into anything more is quite remote.