Speculators will make hay from great Australian economic crash while workers pay the price – By Steve KEEN- By RT


Steve Keen
Steve Keen is an Australian economist and author. He’s professor and Head of the School of Economics, History and Politics at Kingston University in London. You can support his attempts to build a new economics https://www.patreon.com/ProfSteveKeen.
Speculators will make hay from great Australian economic crash while workers pay the price
For years, Australia has been seen as the goose which laid the golden egg for workers, migrants and investors. Ironically, as America’s casino closes, it will eventually end up as a speculator’s paradise.

The performance of the Australian stock market relative to its American equivalent since the Global Financial Crisis (GFC) shows the difference between a country where Quantitative Easing (QE) – the buying of bonds by the central bank to drive bond prices up and interest rates down, and thus encourage firms to invest and financial institutions to buy shares – was practiced and one where it was not. It’s both a warning about what could happen when the Fed starts to unwind QE, and a perverse opportunity to profit when Australia’s central bank, the RBA (Reserve Bank of Australia) inevitably starts its own QE program.

Since Australia avoided the GFC, and its rate of economic growth has been twice as fast as America’s post-crisis (an average 2.7 percent per year, versus 1.3 percent for the US), you might expect Australia’s stock market to have done better than America’s. In fact, it’s performed much worse: the main Australian index, the ASX, still hasn’t returned to its mid-2000s peak, while the US S&P500 has more than doubled its pre-crash level, and it’s almost four times as high as it was in the deepest depths of 2009.

The timing of the US stock market recovery is instructive: it began in February 2009, just three months after the Federal Reserve began “QE1” (the first of three episodes of Quantitative Easing), when it promised to net buy bonds from the financial sector to the tune of $1 trillion per year ($80 billion per month).

Trouble ahead

With the Fed buying a trillion bucks worth of bonds every year, thus giving the financial sector one trillion in cash per year in place of its interest-earning bonds, the only place the financial sector could stash that dough in search of a return was the stock market. This was the intention of the policy of course: to drive share prices higher in order to stimulate the economy. Aside from the fact it’s made the wealthier even wealthier as a direct effect of government policy, and cost far more than a direct boost to the poor would have done, it’s worked a treat: according to Robert Shiller’s “Cyclically Adjusted Price to Earnings Ratio,” it’s driven America’s stock market to its second-highest peak in history, higher than the 1929 bubble, second only to the DotCom maximum in 2000, and more than twice its long-term average.

Now the Fed is planning to both unwind QE – to sell bonds back to the financial sector in return for cash – and to push interest rates up as the economy booms, and the inflation rate finally kicks higher after a decade of low interest rates and QE.

That means that the Fed will be on the sell side for bonds, putting the finance sector on the buy side. To pay for those purchases, the finance sector will have to sell shares. Interest rates will also rise doubly, firstly from the Fed pushing its policy rate higher, secondly from the unwinding of QE driving down bond prices and therefore driving up interest rates. Anyone’s who’s in the US stock market and not worried about what that triple whammy could do to share prices is delusional.

So what’s a share market speculator to do? Well, when one casino turns bad, why not look for another one? The odds are that the next stock market casino in which the tables will be tilted by the house in favor of the gambler will be Australia’s.

Short-sighted sheep

Australia’s RBA didn’t have to rescue its economy from the crash, because prompt fiscal action by the Australian government (and re-starting the housing bubble via a bribe to entice first-home buyers into the market) stopped the private sector deleveraging that caused the crisis everywhere else. So Australia’s long boom since its last recession in 1990 was prolonged by continuing its private-debt bubble.

However, this isn’t how the RBA interpreted Australia’s success. Because its chieftains are as blissfully unaware of the importance of private debt to macroeconomics, as was Ben Bernanke (and I know this from personal interactions with them at up to the deputy governor level). Instead, Australia’s apparent success led its political and economic pundits to believe that the GFC was not in fact a global phenomenon, but a “North Atlantic Financial Crisis” due to how poorly financial systems were managed in the US and UK, versus their excellent management in Australia.

Ha! The real reason that Australia (and Canada) avoided the worst of the GFC is that they kept on drinking the Kool-Aid that caused it: private debt, and especially household mortgage debt. Whereas the other Anglo-sphere countries which had serious crises in 2007-08 (the US, UK and Ireland) have reduced their household debt levels since then, Canada and Australia have continued to lever up – Australia to the spectacular level of over 120 percent of GDP.

This additional leverage is what has kept the housing bubbles alive in both these countries well after they burst in the rest of the English-speaking world. But it’s starting to turn in both states now, especially in Australia where growth in household credit has turned negative, and house prices have already fallen more than 5 percent from their peak. When that deleveraging gathers momentum, a recession will strike and Australia’s RBA will do just what the Fed did: start QE to try to prop up the share market.

So ironically, Australian shares will likely start to do well, just as the national economy begins to tank. Such is the nature of stock markets when central banks believe keeping stock prices high is more important than keeping unemployment low, never mind wage growth.

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The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.

Ten Years After Georgia, NATO Still Pushes War – By Strategic Culture Foundation

Ten Years After Georgia, NATO Still Pushes War

On the tenth anniversary this week of the Russo-Georgian War, Russian Prime Minister Dmitry Medvedev issued a serious, albeit commonsensical, warning. He said the proposed membership of Georgia in the US-led NATO military alliance could result in a “horrible conflict”.

However, Western news media sought to portray Medvedev’s cautionary words as conveying a sinister intent. Britain’s Independent headlined: “Russia threatens [sic] ‘horrible’ conflict if Georgia joins NATO”.

Other news outlets, such as Reuters and Associated Press, did not go as far as using the word “threatens”. But their implied tone relaying Medvedev’s remarks was one of Russia flexing its muscles with intimidation towards the South Caucasus state.

That mischievous insinuation fits in with the wider Western narrative of Russia’s alleged “malign activity” and “threatening posture” towards Eastern European countries in the Baltic, Balkans and Ukraine.

Both the United States and European Union this week reiterated accusations that Russia was illegally occupying Georgian territory owing to Moscow’s support for the two breakaway republics of Abkhazia and South Ossetia which border with Georgia in the South Caucasus region.

To mark the 10th anniversary of the five-day war in August 2008, the foreign ministers from Poland, the Baltic states and Ukraine’s Kiev regime were reportedly in the Georgian capital of Tbilisi to demonstrate their solidarity over what they called “Russian aggression”.

Georgia is continually cited – along with Ukraine – by American and European politicians as two examples that purportedly prove Russian malfeasance, and thereby justify the relentless buildup of NATO forces along Russia’s Western flank. In other words, Georgia and Ukraine are cause célèbre for NATO’s existence, and for the American and European policy of sanctions against Russia.

Indeed, both Georgia and Ukraine have been cordially invited to join the NATO alliance. The fast-track invitation was reiterated at the NATO summit in Brussels last month where the two countries were hosted as guests of honor by the 29-member bloc.

Subsequently, following the NATO summit, Russian President Vladimir Putin repeated Russia’s well-known opposition to such a further expansion of the US-led military alliance. The proposed additions of Ukraine and Georgia could potentially lead to the installation of American missiles and warplanes smack on Russia’s borders. Putin said that Russia would respond vigorously to such a move, although he did not specify what the “consequences” would entail.

Similarly, Dmitry Medvedev issued a warning this week regarding Georgia and NATO.

Nevertheless, Russia’s reasonable position of perceiving NATO’s expansion as an offensive threat is bizarrely distorted and turned on its head by Western governments and media.

By merely pointing out its grievance stemming from US-led military forces moving ever-closer to its national territory, astoundingly, Russia is portrayed in Western media as the one that is making the threats. It’s quite a feat of mental engineering.

If we listen to Medvedev’s words, he is patently not conveying any sinister intent, as Western media tried to make out.

“There is an unresolved territorial conflict… and would they bring such a country [Georgia] into the [NATO] military alliance?” said Medvedev. “Do they understand the possible implications? It could provoke a horrible conflict.” 

The Russian premier is simply stating what should be an obvious fact: namely, that NATO membership by Georgia in the midst of a territorial dispute with its pro-Russian neighbors, Abkhazia and South Ossetia, would lead to a dangerous conflict.

What Western governments and news media need to do is critically examine the whole premise of NATO’s eastwards expansion since the end of the Cold War in 1991.

That expansion violated commitments given by American leaders to Russian counterparts at the end of the Cold War, first by George Bush Senior and later Bill Clinton.

It is precisely the doubling membership of NATO based mainly on the absorption of former Soviet countries that has so alarmed Russia about military encirclement. Given the relentless anti-Russian rhetoric out of Washington and some of its European allies casting Russia as an enemy it is by no means alarmist that Moscow sees the entire trajectory over the past two decades as a strategic offensive.

Recall too that existential threats to Russia over the past two centuries have come from an eastward expansion of armies out of Europe, under Napoleon and then Nazi Germany. Given the loss of up to 30 million of its people from Nazi imperialist aggression, it is perfectly understandable that Russia today is deeply wary of any military advancement on its territory. And NATO fits that nefarious pattern.

On the specific cases of Ukraine and Georgia, NATO has been very much the instigator of conflicts there, yet it is NATO that poses now as a defender. That inversion of reality is made possible in part because of Western news media distorting historical events, just as they did again this week with regard to reporting Medvedev’s comments on NATO and Georgia.

Following the breakup of the Soviet Union, Ukraine and Georgia have been solicited by Washington, the EU and NATO, as with other former Soviet states. That soliciting has created tensions and instability, not least because that was supposed to be what American leaders said they wouldn’t do.

The conflict in Ukraine came about from American and European Union support for a coup against an elected government in February 2014. The CIA and NATO were also instrumental. The ongoing conflict in Ukraine between the NATO-backed Kiev regime and pro-Russian separatists in the Eastern self-declared republics of Donetsk and Luhansk is not due to Russian aggression; it is a result of the irresponsible and provocative intervention by Washington and its European allies.

The West accuses Russia of “annexing” Crimea, an historical part of Russia, whenever it was the West that allowed a faction of Neo-Nazi Ukrainians to annex Kiev and its government. The ongoing four-year conflict in Ukraine which has killed over 10,000 people is a direct result of NATO imperialist meddling.

On Georgia, after the Western-backed so-called Rose Revolution in 2004 which brought the mercurial Mikhail Saakashvili to power, the former Soviet Republic suddenly became a staunch proponent of NATO. Saakashvili was enthusiastically supported by Washington with weapons and finance. He also made the retaking of Abkhazia and South Ossetia into Georgian territory his big mission. The three neighboring states broke up after the fall of the Soviet Union.

Abkhazia and South Ossetia requested the Russian Federation to recognize their statehoods in March 2008, prompted by the American and European recognition of Kosovo in the Balkans as a self-declared state during the previous month in February 2008. Kosovo broke away from Serbia largely as a result of the military intervention of NATO. Again, NATO was setting the precedent, not Russia.

At Washington’s bidding, Georgian leader Saakashvili sent NATO-backed troops to attack Tskhinvali, the capital of South Ossetia on August 8, 10 years ago this week. The rapid intervention by Russian troops along with Abkhaz forces repelled the Georgian offensive. Wisely, NATO declined to push its support for Saakashvili any further. The war was over in five days, resulting in the formal recognition by Russia of Abkhazia and South Ossetia.

Today, the US and Europe continue to accuse Russia of illegally occupying Abkhazia and South Ossetia and of violating Georgia’s sovereignty.

Western media make an upside-down analogy with Ukraine. The real analogy is that both Georgia and Ukraine have been destabilized by NATO expansionism, not Russian.

But such are the lies, distortions and self-serving propaganda churned out over and over by Western media in the service of their governments and NATO, there is an appalling failure in the West to learn from history.

When Russia warns that NATO’s expansion is risking horrible conflict that is a straightforward, reasonable observation which is borne out by history. Tragically, thousands of lives have been destroyed by not heeding this warning.

And thousands more – perhaps millions – continue to be put in danger because the Western media willfully misinterpret and misrepresent Russia.

Photo: Twitter

Bunker Mentality: Start Preparing for Ecological & Economic Disaster Free of Corporate Overlords – By Robert BRIDGE – (Strategic Culture Foundation)

Bunker Mentality: Start Preparing for Ecological & Economic Disaster Free of Corporate Overlords

Let’s face it: reading stories about the ongoing destruction of planet Earth, the life-sustaining blue marble that all of us – aside from maybe Elon Musk – are permanently trapped on, has got to be one of the least-favorite topics of all time. The reasons are understandable, but no longer feasible.

In the realm of politics, replete with its cast of colorful culprits, the possibility of radical change always hovers just over the horizon, which gives the subject much of its universal appeal. Stories devoted to environmental issues, on the other hand, inundate the reader with a dizzying array of mind-boggling statistics that are not only incredibly depressing, they seem impossible to do anything about.

For example, take what I consider to be the most depressing story in recent memory – the so-called ‘Great Pacific Garbage Patch,’ a swirling garbage dump trapped in a vortex between Hawaii and California, estimated to be twice the size of Texas. How is anyone expected to wrap their brain around that modern monument to our collective stupidity over their morning cup of coffee? Somehow we always expected the oceans, due to their sheer size and vastness, to remain beyond the reach of mankind’s destructive tendencies. Yet the story of the slowly dying oceans and its vibrant sea life – despite some truly fantastic schemes to reverse the trend – proves not just how wrongheaded that belief is, it belies the destructive nature of our hedonistic and materialistic lifestyles.

This leads to yet another reason so many people shy away from apocalyptic stories of environmental degradation: their own collusion in the ongoing tale of planetary destruction, which is part and parcel of our inquisitive lifestyles. Whether we want to admit it or not, we are all deeply indebted consumers of the corporate cornucopia. The majority of us spend a disproportionate amount of our time earning a living just to feed the monkey of our worldly desires, which our corporate overlords happily provide in superabundance – at excessive interest rates, I might add.

In fact, when our situation is viewed critically and objectively, human beings now live like astronauts, totally cut off from the natural world, yet, at the same time, connected by a fragile umbilical cord to the corporate world. Such a scenario must give any thinking person tremendous pause, for it highlights our dangerous level of dependency on external economic forces – namely, the corporate world – to sustain us. Here is where the idea of ‘environmental destruction’ should really pique our interest.

It is not so difficult to conduct a thought experiment that involves the ramifications of a massive economic downturn, or some unexpected natural disaster (on the scale of Hurricane Katrina, for example, multiplied by 10,000) of such magnitude that corporations are no longer able or willing to provide for our most basic daily needs. It may be exceedingly difficult to imagine such a grim scenario, especially since we now take it for granted that grocery stores will always remain open for business and stocked full of goodies, but the majority of us would quickly perish in the event that some unexpected crisis brought the global economy down on our heads. Such a nightmare may be easier to imagine when it is considered that just 10 companies control the entire global food supply, while most people have no means or knowledge of tilling the land for their food supplies.

Perhaps it is on this point that the topic of ‘environmental destruction’ can become not only sexy, like the exciting world of politics, but vital for mankind’s continued existence. It’s time to stop acting like children and face an ugly truth: our current materialistic lifestyles are not sustainable in the long-term, and probably not in the short term either. Our incredible level ofwastefulness, compounded by Earth’s finite resources, guarantees that the planet’s 7 billion people are living on borrowed time. Exactly what ‘short-term’ means, however, is a question none of us can really answer. It may mean the day after tomorrow or another 500 years. Again, nobody can say. But given the upsurge of interest, for example, in “doomsday prepping” among people of average means (a topic that even the high-brow Financial Times reported on), to the construction of sprawling underground bunkers for the elite, there is a growing consensus among many people that it is time to start taking back some control of our lives.

Currently, I am living in Russia, where the difference between Russians and Americans when it comes to preparing for the ‘unknown’ could not be greater. While Americans spend untold hours per week mowing their lawns, pulling weeds and trimming the hedges, Russians are toiling at their ‘dachas’ (in Russia, it is common for people to own an apartment in the city and a piece of land in the countryside), growing fruit and vegetables in greenhouses, and collecting mushrooms in the forest (picking mushrooms is a veritable art form, where it can literally mean the difference between life and death to choose the correct variety among dozens of species). Every Russian I have met in the countryside also have their own private source of water from painstakingly dug wells on their land. This is no small consideration when it is remembered that corporations are gradually buying up, in addition to our food supplies, the rights to our water supplies as well.

The entire notion of ‘prepping’ in Russia is completely nonexistent since the knowledge of working the land, which became absolutely critical during the severe food shortages of the communist years, has been a traditional part of Russian life since the country’s inception. Although Russians, like any other people, would suffer grave hardships in the event of a severe economic downturn, many of them would still be able to feed themselves due to their time-tested ‘survival’ skills. I am not sure the same could be said of their American and European counterparts.

There is a memorable scene in the 2009 post-apocalyptic US film, The Road, where a father and son, forced to trek across a devastated American landscape following some sort of unspeakable disaster, stumble upon a discarded underground bunker that is loaded with food, allowing them to survive the next leg of their impossible journey.

It is film I would highly recommend every person watch to get a sense of what an unexpected turn of environmental and economic events could mean for them and their loved ones.

Since corporations not only greatly control to what extent the environment will remain viable for our survival, but also the keys to the corporate cornucopia, there is no better time than the present to consider what would happen if or when, to put the matter bluntly, the shit hits the fan.

Trump’s Talk of Isolating Iran Speaks More to US Global Isolation – By Finian CUNNINGHAM (Strategic Culture Foundation)

Trump’s Talk of Isolating Iran Speaks More to US Global Isolation

The Trump administration re-imposed tough sanctions on Iran this week, but the move risks further isolating Washington, not Tehran, in the eyes of the world.

President Donald Trump issued a statement to accompany the sweeping sanctions reinstated by Washington. “The Iranian regime faces a choice,” he said. “Either change its threatening, destabilizing behavior and reintegrate with the global economy, or continue down a path of economic isolation.”

Ironically, the same words uttered by Trump could apply more so to the United States.

This increasingly unhinged US regime needs to back off its “threatening, destabilizing behavior” and begin to respect multilateral rules like other nations. Otherwise, the US and its unilateral bullying is leading to its “continuing down the path of economic isolation”.

Trump also warned this week that, “Anybody doing business with Iran won’t be doing business with the US”. Careful what you wish for Donald! That very warning over Iran could end up much worse for your country.

The American president is in danger of recklessly overplaying his hand. His truculent demands that the rest of the world join in US efforts to isolate Iran economically are likely to backfire badly.

In particular, Trump is reinforcing the historic direction underway by Russia, China and others to shift their international trading relations away from relying on the US dollar as reserve currency. Without that privileged status as reserve currency, the US dollar would tank, and so would the entire American economy, based as it is on endless, unaccountable printing of greenbacks.

Russia, China and India are understood to be not willing to comply with Washington’s high-handed demands that they cut business ties with Iran.

Both China and India – Iran’s biggest export markets for its oil industry – have said they are not going to defer to Trump’s sanctions.

The resistance to American diktat is inevitably leading to the rest of the world coming up with new financing mechanisms for conducting trade. That, in turn, is hastening the demise of the US dollar’s international status.

Even the European Union this week pushed back against Trump’s policy to unduly antagonize Iran by trashing the international nuclear accord.

“We are determined to protect European economic operators engaged in legitimate business with Iran,” said the EU’s foreign policy chief, Federica Mogherini, in a statement co-signed by the foreign ministers of Britain, France and Germany.

The 28-member EU is introducing a Blocking Statute which will afford legal protection to its commercial ties with Iran from so-called “secondary sanctions” planned by the Trump administration to hit nations continuing to do business with Tehran.

Washington’s sanctions reimposed this week are aimed at cutting off Iran’s ability to conduct international trade using US dollar payments. But if other nations hold firm to commercial ties with Iran, they will circumvent the American restrictions by necessarily using bilateral currency deals transacted with euro, renminbi, rupee or ruble.

This is a transition already underway due to several overlapping factors, including the growing strategic importance of Russia-China bilateral relations, China’s global economic vision of its One Belt One Road initiative, Eurasian economic integration, and the increasing importance of the BRICS (Brazil, Russia, India, China, South Africa) in shaping a multipolar world.

The BRICS represent some 40 per cent of the world economy, and the grouping is signing up new associate nations, such as Turkey and Iran.

That inevitably means the once mighty dominance of the US dollar governing international trade is waning. Its days are numbered. Trump’s bullying towards Iran, and towards others through unilateral wielding of sanctions, is only hastening the global direction of dropping the American dollar as the world reserve currency.

A nation’s currency is all about its ability to command respect or trust from other nations. Washington, under Trump, is fast squandering those values.

President Trump’s policy towards Iran has no legitimate foundation. It is a blatant attempt to destabilize that nation for regime change in contravention of international law and the UN Charter. The rest of the world can see through Washington’s vile mask and its pompous rhetoric. What they see is a thuggish regime that selfishly and arbitrarily makes up its own rules as it goes along.

American power is as unscrupulous as it is riven with hypocrisy. Accusing Iran of “malign behavior” in the Middle East makes Washington sound ridiculous given its record in recent years of destroying whole nations and millions of innocent lives from illegal wars. As well as sponsoring terrorist jihadists to do its dirty work.

Trump’s walking away from the UN-backed international nuclear accord with Iran back in May, which has paved the way for the reimposition of US sanctions, is typical of Washington’s repudiation of multilateral norms for its own unilateral gratification. All signatories to the 2015 nuclear accord, including the EU, Russia and China, have expressed their support for the deal.

UN monitors have confirmed in nearly a dozen reports that Iran has complied fully with the terms of the agreement to restrict its development of nuclear weapons. Honoring its side of the bargain, Iran is fully entitled to sanctions relief mandated by the nuclear accord.

American dishonoring of the deal is solely based on its baseless and pejorative claims alleging Iranian “malign activity”. This is the same faulty American propagandistic mentality that accuses Russia of “election meddling” or China of “military expansionism”.

But what’s even more contemptible is the utter lack of principle even in the Trump administration’s own flawed claims about Iran. While denouncing Iran as an international pariah, Trump has also incongruously offered to negotiate with the Iranian leadership.

Speaking just as the renewed sanctions were coming into force, Trump’s national security advisor John Bolton, told Fox News: “They [Iran’s leaders] could take up the president’s offer to negotiate with them, to give up their ballistic missile and nuclear weapons programs fully and really verifiably.”

Where’s the principle in Trump’s logic? If the “Iranian regime” is the “world biggest sponsor of terrorism”, as the Trump administration dubiously claims, thereby justifying its abrogation of the nuclear accord, then how is it ethically acceptable to offer talks to such a supposed pariah?

Clearly, the Trump administration has no principled objection to talking with the Iranians. Just like it has no principled objection to the nuclear agreement itself. Bolton’s assertion that Iran must “give up its ballistic missile program” is an add-on demand that was never covered by the original nuclear negotiations. Bolton’s second claim that Iran “must give up its nuclear weapons program fully and verifiably” is simply a baseless assertion, that is, American propaganda.

Every other party to the nuclear accord, and the competent UN technical monitors, have confirmed that Iran has been in full compliance for the past three years.

Trump’s evident bad faith and lies towards Iran and his outrageous dictate to the international community on how it conducts sovereign business are ensuring that Washington will become further isolated as a rogue state, which is viewed as being beyond the pale of international norms and diplomacy. US global standing is in free fall, soon to be followed by the status of the dollar.

The Trump administration’s attempt at playing hardball over Iran is like the spoilt brat picking up the ball, stomping his feet and threatening the others that he is going away. In the case of the US, the others are saying, “Go ahead, good riddance.”

Trump’s Sanctions Admit the End of US Military Dominance – By Tom LUONGO – (Strategic Culture Foundation)

Trump’s Sanctions Admit the End of US Military Dominance
Tom LUONGO | 08.08.2018 | FEATURED STORY

On March 1st Russian President Vladimir Putin changed the geopolitical game. During his speech he unveiled new weapons which instantly made obsolete much of the U.S military’s physical arsenal.

And the panic in Washington was palpable.

Since that speech everything geopolitical has accelerated. The US government under Trump has shifted its strategies in response to this. No longer were we threatening North Korea with military invasion.

No, Trump sat down with Kim Jong-un to negotiate peace.

On Russia, Iran, China, Turkey, Venezuela and even Europe Trump’s war rhetoric has intensified. Trump is only talking about economic sanctions and tariffs, however, leveraging the dollar as his primary weapon to bring countries to heel.

There’s no hint of US invasion, no matter how much John Bolton whispers in his ear or Bibi Netanyahu bangs his shoe on the table.

Why?

Because US military dominance has always been enforced not by technology but by logistics. Those bases, while expensive, are also the real strength of the US military. They are a financial albatross which the ‘Axis of Resistance’ is using to win a war of attrition against US hegemony.

And now, Putin’s new weapons rendered them obsolete in a moment’s time. Once fully deployed there will be no going back to the old world order.

So, that’s why Trump talked to North Korea yesterday and why he will talk with Iran tomorrow.

The End of Leverage

With his latest escalation — “Anyone doing business with Iran will not do business with the US” – Trump is waving the White Flag on using the military to enforce his vision of world order.

This is the Nuclear Option of Financial Warfare. Going nuclear is a losing strategy because you have to back it up.

In the same way Trump threatened fire and brimstone on North Korea, but ultimately went to Singapore.

So, what’s he going to do? Sanction Apple for selling an iPhone in Tehran?

Because that’s what’s implied in that statement.

The cost of compliance to these sanctions will cripple banks and businesses the world over. We saw a preview of it in April when Trump tried to cut Rusal from the aluminum market.

In that same tweet, though, he revealed his hand, finally, that he wants world peace.

But, like the Beauty Queens he used to manage, Trump says a lot of things people want to hear, but does he really know how to go about bringing that dream to reality.

Financial warfare is just as devastating as physical warfare. And a peace won through subjugation via the sword or the futures contract is still a false one. It wasn’t won through respect and acquiescence to all parties’ needs, it was done through the worst kind of bullying.

It will have blowback.

At this point it is hard to tell whether Trump understands this or not.

Of course, this erratic behavior is exactly his plan. It is the Art of the Deal on the geopolitical stage.

But, the Art of the Deal requires leverage and Trump has only financial leverage.

And financial leverage can only erode over time. Every transaction made in another currency, every bank that survives being sanctioned by the US erodes that leverage a little more.

By going nuclear Trump has told the entire world he will destroy it to save it.

And if he’s serious it means today everyone with three brain cells to rub together is making alternate plans.

What looks invincible today, the dollar, is obsolete tomorrow. Currencies are fungible. They are easily cross-shopped in the end.

What most geopolitical commentators choose to forget in their strategic calculations is that the post-WWII institutional order has been maintained by the interplay between US financial dominance via the IMF, the BIS and the World Bank and the military logistical archipelago of bases and carrier strike groups circling the globe.

Nicolas Maduro in Venezuela is trying to rebuild his country without resorting to the extortion rackets of the global banking system via the Petro and Sovereign Bolivar. The jury is out whether he’ll be successful. If he is, expect the US to put more sanctions on Venezuela. But, since there are no dollars in country, what would be the point?

Again, you can’t force someone to use your currency.

Trump realizes the military portion of this system is aligned all wrong. It’s wasteful and it has destroyed the US back home. He wants it to end.

But, at the same time, he wants America to win in all deals and retain financial dominance through the energy trade. So, destroy Venezuela, Iran and stymie Russia to allow the US to keep control of the oil and gas trade via the petrodollar.

Moreover, I agree The problem is no one else in Washington D.C., Tel Aviv, New York, the City of London or Brussels has.

So, how does he make everyone happy while tearing down the parts of the world order he doesn’t like while using its remnants to shore up those he does?

By backing every demand Israel makes on Iran, that’s how. He placates the neocons in D.C. and Tel Aviv this way. But, he’s not fooling anyone really.

They are still convinced he’s not on their side and use independent means to put more pressure on Russia and him. They want control of the Congress after the mid-terms and need the narratives to hold through November.

Case in point, the recent announcement that the British government will demand extradition of the mythical Russian agents who poisoned the Skripals earlier in the year. There’s no proof, but the British Deep State continues on, to distract from reality.

The cries of treason for Donald Trump meeting with Vladimir Putin. The new sanctions bill introduced by Senator Lindsay Graham, said to throw everything at Putin to make him know the US is serious.

Like Putin hasn’t gotten that idea yet?

Trump is still being targeted for impeachment by shutting down dissent domestically (Alex Jones, Ron Paul) while he attempts to pursue a somewhat independent foreign policy.

And that’s why he has to go nuclear in his use of sanctions because Trump, despite all appearances, is not interested in any more Americans dying overseas for the dreams of the Empire. And he knows that’s what will happen if any military option is on the table with Iran.

There is little hope of the kind of makeover of US and European leadership Mr. Crooke feels is necessary to change the dynamic between the US and its geopolitical rivals. So, Trump will pursue this sanctions strategy to the bitter end.

Because, Iran, like Venezuela, Russia and China will not negotiate with someone who has nothing to offer except the back of his hand.

The ‘Magnitsky Trio’ Pushes For War With Russia By Pressing For New ‘Crushing’ Sanctions – By Tom Luongo(Gold, Goats ‘N Guns) (SOTT)

From left, Sens. Ben Cardin, D-Md., John McCain, R-Ariz., and Lindsey Graham, R-S.C.

From left, Sens. Ben Cardin, D-Md., John McCain, R-Ariz., and Lindsey Graham, R-S.C.

If half of what I have come to understand about the Curious Case of Bill Browder is true, then the “Magnitsky Trio” of Senators John McCain, Lindsay Graham and Ben Cardin are guilty of espionage, at a minimum.

Why? Because they know that Browder’s story about Sergei Magnitsky is a lie. And that means that when you tie in the Trump Dossier, Christopher Steele, Fusion GPS, the Skripal poisoning and the rest of this mess, these men are consorting with foreign governments and agencies against the sitting President.

As Lee Stranahan pointed out recently on Fault Lines, Cardin invited Browder to testify to Congress in 2017 to push through last year’s sanctions bill, a more stringent version of the expiring Magnitsky Act of 2011, which has since been used to ratchet up pressure on Russia.

Cardin knew there were problems with Browder’s story about Magnitsky’s death and yet brought him into Congress to testify to secure the vote.

That’s suborning perjury, as Lee points out.

Just the holes in Browder’s story about Magnitsky’s death are alone enough to warrant a perjury charge on him. If you haven’t read Luck Komisar’s detailed breakdown of Browder’s dealings then you owe it to yourself to do so.

I’d read it a few times, because it’s about as murky as The Swamp gets. And, still my eyes glaze over.

The Magnitsky Act and its sequel have been used to support aggressive policy actions by the U.S. against Russia and destroy the relationship between the world’s most prominent militaries and nuclear powers.

The new bill is said to want to put ‘crushing sanctions’ on Russia to make ‘Putin feel the heat.’ In effect, what this bill wants to do is force President Trump to enforce sanctions against the entire Russian state for attempting to do business anywhere in the world.

The new financial penalties would target political figures, oligarchs, family members and others that “facilitate illicit and corrupt activities” on behalf of Putin.

It would also impose new sanctions on transactions tied to investments in state-owned energy projects, transactions tied to new Russian debt, and people with the capacity or ability to support or carry out a “malicious” cyber act.

In addition, if it wasn’t clear enough already, that he’s no friend of the President, Graham is trying to tie the President’s hands on NATO withdrawal, requiring a two-thirds majority.

Now, why would Graham be worried about that, unless it was something the President was seriously considering? This is similar to last year’s sanctions bill requiring a similar majority for the President to end the original sanctions placed on Russia in 2014 over the reunification with Crimea.

And behind it all stands Bill Browder.

Because it has been Browder’s one-man campaign to influence members of Congress, the EU and public opinion the world over against Putin and Russia for the past 10 years over Magnitsky’s death.

Browder’s story is the only one we see in the news. And it’s never questioned, even though it has. He continually moves to block films and articles critical of him from seeing distribution.

Browder is the epicenter around which the insane push for war with Russia revolves as everyone involved in the attempt to take over Russia in 1999 continues to try and cover their collective posteriors posterities.

And it is Browder, along with Republic National Bank chief Edmond Safra, who were involved together in the pillaging of Russia in the 1990’s. Browder’s firm hired Magintsky as an accountant (because that’s what he was) to assist in the money laundering Heritage Capital was involved in.

The attempted take over of Russia failed because Yeltsin saw the setup which led him to appoint Putin as his Deputy Prime Minister.

Martin Armstrong talked about this recently and it is featured prominently in the film about him, The Forecaster, which I also recommend you watch.

There was $7 billion that was wired through Bank of New York which involved money stolen from the IMF loans to Russia. The attempt to takeover Russia by blackmail was set in motion. As soon as that wire was done, that is when Republic National Bank ran to the Department of Justice to say it was money-laundering. I believe this started the crisis and Yeltsin was blackmailed to step down and appoint Boris A. Berezovsky as the head of Russia.

Clearly, Republic National Bank was involved with the US government for they were sending also skids of $100 bills to Russia. It was written up and called the Money Plane. Yeltsin then turned to Putin realizing that he had been set up. This is how Putin became the First Deputy Prime Minister of Russia on August 9th, 1999 until August 16th, 1999 when he became the 33rd Prime Minister and heir apparent of Yeltsin.

So, now why, all of a sudden, do we need even stronger sanctions on Russia, ones that would create untold dislocation in financial markets around the world?

Comment: A must watch video:

Look at the timeline today and see what’s happening.

  1. Earlier this year Special Counsel Robert Mueller indicts 13 people associated with Internet Research Agency (IRA), a Russian troll farm, for influencing the 2016 election.
  2. Then Mueller indicts twelve members of Russian intelligence to sabotage the upcoming summit between Trump and Putin while the Russia Hacked Muh Election narrative was flagging.
  3. Three days later President Trump met with Vladimir Putin in Helsinki. There a Putin let the world know that he would assist Robert Mueller’s investigation if in return the U.S. would assist Russia in returning Bill Browder, who was tried and convicted in absentia for tax evasion.
  4. All of a sudden Browder’s story is all over the alternative press. Browder is all over U.S. television.
  5. Earlier this week Facebook comes out, after horrific earnings, to tell everyone that IRA was still at it, though being ever so sneaky, trying to influence the mid-terms by engaging Democrats and anti-Trumpers to organize.
    1. In that release, Facebook let it be known it was working with the political arm of NATO, The Atlantic Council, to ferret out these dastardly Russian agents.

And now we have a brand-new shiny sanctions bill intended to keep any rapprochement between the U.S. and Russia from occurring.

Why is that? What’s got them so scared of relations with Russia improving?

Maybe, just maybe, because Putin has all of these people dead to rights and he’s informed Trump of what the real story behind all of this is.

That at its core is a group of very bad people who attempted to steal trillions but only got away with billions and still have their sights set on destroying Russia for their own needs.

And Lindsay Graham is their mouthpiece. (all puns intended)

That all of U.S. foreign policy is built on a lie.

That our relationship with Russia was purposefully trashed for the most venal of reasons, for people like Bill Browder to not only steal billions but then have the chutzpah to steal the $230 million he would have paid in taxes on those stolen billions.

And the only way to ensure none of those lies are exposed is for Trump to be unable to change any of it by forcing him to openly side with the Russian President over members of his own political party.

The proposed sanctions by the Graham bill are so insane that even the Treasury department thinks they are a bad idea. But, at this point there is nothing Graham won’t do for his owners.

Because they are desperate they will push for open warfare with Russia to push Putin from power, which is not possible. All of this is nothing more than a sad attempt to hold onto power long enough to oust Trump from the White House and keep things as horrible as they currently are.

Because no one gives up power willingly. And the more they are proven to be frauds the more they will scream for war.

Comment: See also:

Syrian Authorities Discover Cache of Western, Israeli Weapons in Homs – Report – By SPUTNIK

 

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The Syrian army has on multiple occasions stumbled upon caches of weapons and ammunition made in western countries and Israel while performing sweeping operations in provinces, liberated from terrorist and militant groups.

While performing a mop up operation in the northern part of Homs, Syrian authorities discovered a weapons cache, which contained various weaponry and ammunition, Syrian news agency Sana reported. According to the media outlet, the cache was left behind by “terrorists” and contained 14.5mm machine guns, sniper modifications of FAL rifles produced in unspecified western countries, assault rifles, Israeli-made grenades and different types of ammunition.

READ MORE: WATCH as Syrian Army Uncovers Massive Haul of Western-Made Weapons for Rebels

This is not the first time Syrian authorities have found caches full of foreign-made weapons left behind by terrorists and militants. In July the Syrian Army reportedly found RPG launchers, shells, gasmasks, minesweepers, mortars, heavy machine gun emplacements and TOW launchers produced in the US among the weapons that fighters in Daraa province handed over under a reconciliation agreement. These weapons were reportedly supplied by the US to the Free Syrian Army.

READ MORE: Syrian Army Reportedly Finds NATO, Israeli-Made Weapons in Daesh Arsenal (VIDEO)

Among the weapons handed over in May by terrorists from towns south of Damascus Syrian authorities found models produced in Israel. The Syrian Army also found NATO and Israeli-made weapons in former Daesh* depos discovered in the Deir ez-Zor Governorate.

A STORM IS COMING TO IDLIB; ZIONIST JIHADISTS KILL LAURELED SYRIAN SCIENTIST; HAMA TERRORISTS BOMBED TO OBLIVION – By Ziad Fadel

MISYAAF, HAMA PROVINCE:   Dr. ‘Azeez Isbir, seen in this photo at a conference for scientists, was killed by an embedded MOSSAD agent with the Turkish-supported Free Syrian Army.  The Zionist cockroach ordered the IED which was placed in a car that was remotely triggered.  It is reported to SyrPer that the FSA officer insisted on detonating the IED himself in order to “kill a Christian”. Dr.  ‘Azeez will be remembered forever for his formidable contributions to Syrian missile technology as Director of the Center for Scientific Research, an institution which will enable our army to vanquish the Zionist grubs in the war to liberate all Palestine.  His missile designs are found not only in Syria, but, in Lebanon with Hizbollah and the Ansaar Allaah Movement in Yemen.  May he rest in peace.

Another photo of the martyred Dr. ‘Azeez Isbir courtesy of SANA.

______________________________________________

LATAKIA:

الجيش يحبط هجوما لـ

AL-SARRAAF:  The Nusra group of criminals launched an attack on a small Syrian Army fortified checkpoint this morning in the early hours close to Al-Rubay’ah on the Turk border.  The attack was a miserable failure.  Eyewitness accounts show that 17 rodents were dropped, either killed or wounded and that the rest crawled back to their lairs in Turk-Occupied Syria.

____________________________________________

HAMA-IDLIB:

http://wikimapia.org/#lang=en&lat=35.319607&lon=36.653910&z=14&m=b

Syrian Army artillery savaged the bulldozer-built fortifications belonging to units of the Jaysh Al-‘Izza and the Turkestaan Party.  The revetments were completely destroyed, ironically, by the same kinds of rockets and bombs they were meant to prevent.  The area targeted was in the North of Hama at Lihaayaa and Al-Lataamina 35 kms north of Hama City, close to the Idlib Provincial border.  The SAA was positioned north of Hilfaayaa and Miharda.

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WILE E. COYOTE MOMENT: (Thanks, John Esq.)

https://twitter.com/Zionocracy/status/1026651167110127617/video/1

Israel’s policies in Gaza are genocidal – By Haidar Eid. (MONDOWEISS)

The 1948 Genocide Convention clearly states that one instance of genocide is “the deliberate infliction of conditions of life calculated to bring about the physical destruction of a people in whole or in part.” No matter whether this happens at a fast rate, or in “slow motion.” That is what has been done to Gaza since the imposition of the blockade by Israel, and the subsequent massacres which led to the death of more than 4000 Palestinians in three successive genocidal wars.

Palestinians of Gaza live an ongoing, illegal, crippling Israeli siege that has shattered all spheres of life, prompting the former UN Special Rapporteur for Human Rights, Richard Falk, to describe it as “a prelude to genocide”. In 2009, the UN Fact-Finding Mission on the Gaza Conflict, headed by the highly respected South African judge, Richard Goldstone, found Israel guilty of “war crimes and possible crimes against humanity,” as did major international human rights organizations, such as Amnesty International and Human Rights Watch. The Goldstone report, for example, concludes that Israel’s war on Gaza was “designed to punish, humiliate and terrorize a civilian population, radically diminish its local economic capacity both to work and to provide for itself, and to force upon it an ever increasing sense of dependency and vulnerability.”

The same scenario was repeated in 2012, and a worse one in 2014 only because Israel feels that it can carry on its war crimes with full impunity. And last week Israel has decided to tighten the siege by closing the only commercial crossing, even to increase its attacks by targeting peaceful protesters demanding the implementation of UN resolutions, and an end to this deadly, hermetic siege.

In her visit to Gaza, Professor Sara Roy, an expert on Gaza, describes the Strip as “a land ripped apart and scarred, the lives of its people blighted. Gaza is decaying under the weight of continued devastation, unable to function normally…” Professor Roy concludes that “[T]he decline and disablement of Gaza’s economy and society have been deliberate, the result of state policy–consciously planned, implemented and enforced… And just as Gaza’s demise has been consciously orchestrated, so have the obstacles preventing its recovery.” In addition to Israel’s daily attacks and air strikes, Gazans also suffer from the contamination of water, air and soil, since the sewage system is unable to function due to power cuts necessitated by lack of fuel to the main generators of the Gaza power grid. Medical conditions due to injuries from internationally prohibited butterfly bullets and other illegal Israeli weapons as well as from water contamination cannot be treated because of the siege. In addition to the ban on building materials, Israel also prevents many other necessities from being imported: lights bulbs, candles, matches, books, refrigerators, shoes, clothing, mattresses, sheets, blankets, tea, coffee, sausages, flour, cows, pasta, cigarettes, fuel, pencils, pens, paper… etc. In Gaza, people are wondering whether the current Israeli government, the most fascist in the county’s history, might even discuss a ban on Oxygen! Add to this the punitive measure taken by the PA, and the drastic cuts endorsed by UNRWA, not to mention the constant closure of the Rafah crossing–the only exit Gaza has to the external world– leading to one of the highest unemployment rates and poverty on the face of earth.

In fact, the conclusion Gazans have reached is that Israel is intent on destroying Gaza because world official bodies and leaders choose to say and do absolutely nothing. The brazen refusal of Israel to cooperate with the decision of the International Community to re-construct Gaza, for which several billions of dollars were pledged in Sharm El-Sheikh, should not be tolerated. Israel’s attacks have damaged or completely destroyed many public buildings and have according to the UN’s own Office for the Coordination of Humanitarian Affairs reports severely damaged or completely destroyed some thousands of family dwellings, schools, universities and factories. Many other Palestinians who have spent the past several winters and summers in tents and caravans have also been promised the means to rebuild homes and schools, though to date nothing has been done to alleviate their suffering.

The practice of wanton willful killing of civilians exemplified in the extra-judicial sniping of non-violent protesters at the eastern fence of the Gaza Strip is not an isolated incident. It is part and parcel of an ongoing, comprehensive policy targeting the civilian Palestinians of the Gaza strip and systematically denying them their rights to movement, work, medical care, study, livelihood and increasingly life itself. But it is also a reflection of the nature of the state of Israel.i. e., a settler-colony. Israel’s leading, anti-Zionist historian, Ilan Pappe,  sheds light  on the driving ideology behind this genocidal policy:

Zionism is, in essence, a settler colonial movement, which was interested in having as much of the land of Palestine with as few Palestinians on it as possible. As the late scholar of settler colonialism, Patrick Wolfe, has put it; the encounter between the settlers and the indigenous population triggered ‘the logic of the elimination of the native’. In some places, such as North America, annihilation was literally a genocide of the native; in Palestine it was a different kind of elimination, obtained through segregation, ethnic cleansing and enclavement

In spite of Israel’s alleged unilateral withdrawal from the Strip in 2005, it still maintains a permanent military presence in Gaza’s territorial waters and controls the movement of people and goods onto the strip by land and water in addition to movement within the strip through targeting anyone entering the “no go” zone designated by the Israeli military. Israel also continues to control Gaza’s population registry. Yet, Israel claims that it is no longer the occupying power in the Gaza strip and uses this excuse, in addition to the results of 2006 democratic elections, to intensify its policy of siege and lethal attacks on Gaza’s civilians.

And now, Israel has decided to become openly an apartheid state by legalizing racial discrimination. I have tried very hard to find out whether there are constitutions or laws in the world similar to Israel’s “new” Nation-State Basic Law which aims to establish a legal basis for Jewish supremacy and racism against indigenous Palestinians, including those living in what has become the largest open-air prison on earth; only South Africa under apartheid and America in the eras of slavery and segregation.

So, what to do?!

In a piece published in MEE, Gideon Levy asks “Israel, where is your outrage at the legislation of Apartheid?” Actually, we are not expecting a settler-colonial community to act against its own racism. The outside world has to intervene. Hence our call for #BDS. But, in Palestine, we are in urgent need of serious discussions about a program of radical political transformation, what with the disastrous failure of the existing programs, right and left, a program that divorces itself from the racist two-state solution, one that endorses a more inclusive program that guarantees the rights of all segments of the Palestinian people.

About Haidar Eid

Haidar Eid is Associate Professor of Postcolonial and Postmodern Literature at Gaza’s al-Aqsa University. He has written widely on the Arab-Israeli conflict, including articles published at Znet, Electronic Intifada, Palestine Chronicle, and Open Democracy. He has published papers on cultural Studies and literature in a number of journals, including Nebula, Journal of American Studies in Turkey, Cultural Logic, and the Journal of Comparative Literature.

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LA GUERRE EST FINIE; ISIS ANNIHILATED IN SYRIA AS TERRORISTS SEEK TO RETURN TO EUROPE – By ZIAD FADEL

With the war in Syria now a vanishing memory, the Syrian Army turns its attention to the north where rodents have recently formed a new front excluding Hay’at Tahreer Al-Shaam (HTS).  Needless to say, Jaysh Al-Islam, the Saudi funded terrorist group that fancied itself some kind of conventional army has been eradicated.  Muhammad ‘Alloosh is reportedly in Turkey or Saudi Arabia wolfing down Alka Seltzer tablets.  He has already been condemned to death and faces a noose the instant he tries to enter Syria.  This new front is primarily made up of the Noor-Al-Deen Al-Zangi group some (which is renowned for its “moderate character” as it beheaded a 12 year-old Palestinian boy in front of cameras) along with a mish-mash of other criminals.  I am told that the individual rodent who beheaded the boy is wanted by the PFLP-GC dead or alive, preferably the former.  If he is taken alive, as the great British director, Ken Russell, once wrote:  “Hell will hold no surprises for him”.

As I reported before, the Kurds are deeply suspicious of American intentions and do not have the desire to repeat historic disasters.  Ghassan Kadi’s article, listed below, is in basic agreement with this proposition.  It is fair to say that even the Kurd issue has been resolved through negotiation – a much more civilized way to resolve conflict.  However, the Syrian government is insisting on Kurdish disarmament, an issue that may encounter some stumbling blocks.

At Al-Qaseer in the Golan, ISIS has been routed from its last stronghold by the Syrian Army.  ISIS terrorists have been monitored looking for ways out of the Middle East, most heading back to Europe or, even, Bangla Desh.  With Angela Merkel in office, we can expect Germany to turn into another Afghanistan if she is given the authority to open European doors to the fleeing rodents.

I have a close relative in Syria who tells me everything is returning to normal.  While there is some fear that the terrorists holed up in Idlib might target Latakia, the Russians have relayed Turk assurances that such a scenario is not going to take place.  Of course, Erdoghan is treacherous and a member of the Muslim Brotherhood.  We cannot sit rest assured he won’t renege on his promises.

Tens of thousands of Syrian refugees are returning home.  The news is that the amnesty program is working and is taken seriously by the government.  That is, unless you have a known history of killing Syrian soldiers or security men who were taken hostage.  Those individuals, their hands bloodied, are winding up in European capitals, Canada or the United States.  Applications for refugee status are indicators of an unwillingness to return to Syria out of fear of arrest and trial.  Individuals, such as those in Lebanon are returning without any fear.

Since the Russians have taken a negative attitude toward the liberation of Idlib, we will start to concentrate on that particular issue in future posts.  I will not be reporting on SAA assaults in the East for the reason that these pockets of cockroaches are doomed either because of the elements or their own psychological depression.  The terrorists at Al-Tanf are expected to surrender the moment the U.S. pulls out before the end of the year.  Some may try to move to Jordan, but, the majority will probably melt into the general population – or so they think.  There is a suggestion by some that Jordan will pick up where the U.S. left off at Al-Tanf with Saudis picking up the tab.

NEWS AND COMMENT:

The Western tune has changed indeed.  Read how the liars lick their collective wounds:

https://foreignpolicy.com/2018/07/23/the-syrian-war-is-over-and-america-lost/

Note how articles like this one are winding up in the public domain.  This makes the NYT grimace:

http://thefederalist.com/2018/08/01/trump-ignore-failed-dc-establishment-get-u-s-troops-syria/

Ghassan Kadi discusses the Kurdish situation with Sputnik:  Thanks, Intibah:

https://sputniknews.com/analysis/201808031066917418-syria-kurds-thaw/

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