It's amazing what one day of prophetically related news can bring. Today seems to have it all:
The shock is already before our eyes as Turkey, India, and South Africa hit the brakes, forced to defend their currencies as global liquidity drains away.
The World Bank warns that withdrawal of stimulus by the U.S. Federal Reserve could throw a “curved ball” at the international system. “If market reactions to tapering are precipitous, developing countries could see flows decline by as much as 80% for several months,” it said. They may need capital controls to navigate the storm.
William Browder from Hermitage says that is exactly where the crisis is leading, and it will be sobering for investors to learn that their money is locked up – already the case in Cyprus, and starting in Egypt. The chain-reaction becomes self-fulfilling. “People will start asking themselves which country is next,” he said.
Roughly US$4-trillion (pounds 2.4-trillion) of foreign funds swept into emerging markets after the Lehman crisis, mostly by then “momentum money” late to the party.
The IMF says US$470-billion is directly linked to money printing by the Fed. “We don’t know how much of this is going to come out again, or how quickly,” said an IMF official.
One country after another is now having to tighten into weakness. The longer this goes on, the greater the risk that it will morph into a global deflationary shock.
China is marching to its own tune with a closed capital account and US$3.8-trillion reserves, but it too is sending a powerful deflationary impulse worldwide. Last year it added US$5-trillion in new plant – as much as the US and Europe combined – flooding the global economy with yet more excess capacity.
The currencies of Turkey, South Africa, Brazil and India have all been hit in this latest sell-off due to Chinese growth fears and the flow of cash back to the U.S. with the Federal Reserve "tapering" its bond purchases.
"Rusal is perhaps the ultimate rouble devaluation play," analysts at the French lender said in a research note. For every 1 percent drop in the ruble against the dollar, they see it erasing $50 million from its operating cash costs.
Investors are lining up to short the Russian ruble as the sell-off in emerging markets pushes the currency to historic lows. But several analysts see an upside to the rout, seeing it as "easy money" for the government's coffers.
The dollar has appreciated over 7 percent against the ruble since the start of the year. At 1.00 p.m. London time Thursday, the ruble stood at $35.18 – close to levels not matched since the height of the global financial crisis in 2009, when the dollar peaked at $36.34 against the ruble.
Republicans said Thursday the Obama administration should take action over an apparent Russian violation of the treaty banning testing of medium-range missiles.
Republicans on the House Armed Services Committee issued a statement slamming the administration for ignoring the Russian treaty violation and not acting.
“If the Administration wishfully waves away blatant infractions on current agreements, how are we supposed to trust future pacts?” Armed Services Committee Chairman Buck McKeon (R-Calif.) and three GOP subcommittee chairs asked in a statement.
“Since 2012, Congress has pushed the Administration to take Russian cheating on nuclear treaties seriously,” the committee members said. “We have been ignored, as has Russia’s material breach of the central arms control treaty of the nuclear era. Treaties are meaningless unless both sides sign in good faith.”
The New York Times reported Thursday the United States informed its NATO allies this month that Russia had tested a new ground-launched cruise missile, in violation of the 1987 treaty signed by President Reagan and Soviet leader Mikhail Gorbachev.
The plans of the last decade for a North American Union (NAU) led by Robert Pastor, director of the Center for North American Studies at American University (AU) in Washington D.C. have accelerated in recent months under different cover. Pastor died on January 8, but not without having done serious damage to American sovereignty. Through his work toward regionalization of Canada, Mexico, and the United States via NAFTA-style trade agreements, such as those repackaged as the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), he helped set the stage for the “need” for those trade agreements now being fast-tracked by the Obama administration.
Analysts note that while statists who press for a regional, then a world, government owe much to Pastor’s leadership, it is an idea not likely to lose much momentum with his death.
In fact, Canada and Mexico, two of the three nations to have been integrated via the NAU, are now targeted as two of 12 nations to be included in the TPP. As has noted, the Trans-Pacific Partnership has been designed to follow the EU example of relentless widening and deepening, constantly eroding national sovereignty, while building “transnational governance” that is not restrained by the checks and balances of national constitutions.
Secretary of State John Kerry said no less in a meeting between himself, Canadian Foreign Minister John Baird, and Mexican Foreign Secretary José Antonio Meade Kuribreña. A January 17, 2014 press release of the event announced the collaboration of the three leaders for the purpose of furthering integration of the three nations. “The second lesson that we can learn from the past couple of decades is that globalization isn’t slowing down any time soon.”
Toward that end, leaders of the three nations will meet at the North American Leaders Summit on February 19 in Toluca, Mexico. It signals what Corsi calls the kick-off of the ‘post-NAFTA’ era. The meeting between President Obama, Mexican President Enrique Peña Nieto, and Canadian Prime Minister Stephen Harper is almost a copy of one that took place a decade ago in 2005 in Waco, Texas. At the earlier meeting, President Bush, Mexican President Vicente Fox, and Canadian Prime Minister Paul Martin met to establish the Security and Prosperity Partnership, fostered by Pastor.
[This comes from Jan. 8, but is worth reading in the context of today's news...Additionally, one can't help but wonder if we are seeing the evolution of the world into 10 regions - soon to be called the "10 kings" ?]
In fact, we’ve been writing about this a lot lately because it’s obvious. Now that Obamacarehas been implemented, next on the agenda is “immigration reform,” which is another step toward full “North American” integration.
The mainstream media is useless in this regard. Not a single major outlet that we can tell stayed on the story of Mexico’s legislative creation of a single-payer health system. Maybe it was major news in Mexico, but not in the US.
So many secrets; and we are supposed to learn only a little: Those who promoteinternationalism and have the clout are inexorably building one trans-regional union after another. There are African unions, Asian unions and Mercosur in South America.
Want to merge a region? Merge the industrial interests and the sociopolitical structure will follow.
Thank goodness for the Internet, which lets us understand finally how all this works. But in the short term, knowledge doesn’t slow the momentum.
The fundamentals also favour a resurgence in North American trade. Mr Alcocer talks of a “rejuvenated” region benefiting from cheap and abundant energy, a young workforce, and costs that are increasingly competitive with those in China.
The aim, though quietly stated, is to develop a “Factory North America” to rival “Factory Asia”.
In the longer term, two further things favour North America; demography and energy. Two-fifths of Mexicans are under 20. Between 2000 and 2030, BCG expects Mexico’s labour force to grow by 58% and the United States’ by 18%, as China’s shrinks by 3%.
And Mr Alcocer says the shale-gas revolution, the development of Canada’s oil sands, and a constitutional change in December allowing private firms to invest in Mexican energy, could give the industries employing those people secure supplies of low-cost energy for the foreseeable future.
… A more seamless North America should help reduce the differences between living standards around the region, which would benefit all three countries—not least because a richer Mexico would mean fewer problems of illegal immigration, violence and corruption in the neighbourhood.
Can it be any clearer than this? The whole article is merely a pumping-up of the benefits to be had from “closer” (and closer still) industrial relations.
Directed history – that’s the phrase that comes to mind. Create a treaty to force trade in a certain direction and then use the results to make the argument for a “closer union.”
Notice the code words in this Economist article: “Factory North America,” and “Rejuvenated region.” Who exactly is rejoicing over all this? What businesses asked for NAFTA? And what businesspeople are now requesting “Factory North America”?
Presumably the same people who are campaigning for “immigration reform,” which is merely shorthand for free passage of US and Mexican citizens from one country to the other.
With the creation of the North American Free Trade Agreement, the process of creating continent-wide government began anew, but this time on the other side of the Atlantic. Having had so much success in building a regional government in Europe using free trade as a pretext, the globalists, who have always had international — and eventually global — government as their overarching goal, decided to recycle the formula in the New World.
NAFTA was sold to Congress and the American public as a “free trade agreement.” But instead of creating conditions for free trade (borders transparent to the flow of goods, services, and people), NAFTA set up a complex bureaucracy tasked with managing and controlling North American trade and with adjudicating trade disputes. In other words, NAFTA was not a “free trade” but rather a “managed trade” agreement, in complete conformity with the creed of socialists of every hue that the free market cannot be trusted, and that all mercantile activity must be closely monitored and managed by allegedly benevolent bureaucrats who can determine, better than market forces, how much of a given good to produce, at what price, and up to what standards.
Moreover, NAFTA, by imposing such a managed trade regime across international boundaries, was not merely an “accord” but also a first layer of regional international government where none had existed before.
Thousands of Israeli Jewish hardliners gathered at the Western Wall imploring God to throw a wrench in a peace plan proposed by US Secretary of State John Kerry, which would see a Palestinian capital in Jerusalem and other territorial compromises.
Police say around 2,000 people attended the gathering in Jerusalem’s Old City, where participants called on God to strike fear in the hearts of those who might cause harm to the land of Israel.
Housing Minister Uri Ariel and other members of the far-right Jewish Home party, which forms part of Prime Minister Benjamin Netanyahu's coalition but fiercely opposes a two-state solution, were in attendance.
In a not-so-veiled reference to Kerry’s role in peace negotiations, Ariel said "thousands of people came to pray for the people of Israel, to strengthen the government and the one who stands at its head, that he may be able to stand firm against the different pressures coming from the other side of the ocean," Israeli National News reported.
Since initiating the latest round of talks in July, Kerry has been working to push Israelis and Palestinians toward a framework agreement in the run-up to an agreed April deadline.
Kerry, who is set to visit Israel for the 11th time in under a year, has enraged hardliner Israelis with a peace plan that reportedly includes an Israeli withdrawal from the West Bank and a future Palestinian state with East Jerusalem as its capital.
Although certain settlements will not be included in the withdrawal, Palestinians will be compensated with Israeli territory.
Moshe Cohen, of the Beit El settlement, who was one of the Western Wall event's organizers, told AFP:"Kerry's plan endangers us since he wants to separate between the Jewish people and the Land of Israel."
A video of Dr. Yusuf al-Qaradawi calling on the U.S. government to wage jihad for Allah in Syria, is currently making the rounds on Arabic media and Facebook, to mockery and dismay.
Then, while working himself up because the U.S is only providing weapons to the jihadis in Syria, as opposed to directly intervening, Qaradawi declares in frustration: “We want America to take a manly stand—a stand for Allah!”
Needless to say, all Muslim Brotherhood opponents in the region are pointing to this as yet more proof that Qaradawi and the Brotherhood are mercenaries who interpret jihad any which way, so long as it helps them consolidate power: otherwise, how can “infidel” America take “a stand for Allah” by waging jihad on fellow Muslims?
It should further be noted that the classic formulation of the Arabic wordjihad, as in “fight,” appears in the Koran with the addition fi sabil Allah, that is, “fight in the cause of Allah.”
In other words, calling on the U.S. to strike Syria’s Bashar Assad—and calling it “a stand for Allah”—is essentially synonymous with calling on the U.S. to fight “in the cause of Allah.”
But there is a more pertinent observation, from an American perspective: By openly asking U.S. leadership to wage jihad in the cause of Allah, is Qaradawi, as many in the Mideast are saying, losing his mind in desperation, or could it be that he unwittingly let out a “Freudian slip”: namely, that he knows U.S. leadership, hand in hand with the global Islamist movement, is “taking a stand for Allah” throughout the Middle East in the context of “liberating” it. (As documented here, Muslim countries that the U.S. has invaded and “liberated”—Afghanistan, Iraq, Libya, and ongoing Syria—have all become much more radicalized and hostile to non-Muslims, chief among them Christians.)
Members of the Chinese military are looking to use an electromagnetic pulse as part of a “one-two punch” to knock out – literally within seconds – all defensive electronics not only on Taiwan but also on U.S. warships that could defend the island.
The avian flu virus, which up until last year infected poultry exclusively, has now mutated and crossed over to humans.
What’s even scarier is the fact that the Chinese have been unable to contain the novel H7N9 strain of the virus and health officials the world over are getting ready for the worst. It’s spreading and we now have confirmation that the virus has begun appearing in other countries.
On Thursday, billions of Chinese will be on the move to celebrate the Lunar New Year, creating ripe conditions for the spread of the influenza virus from those already infected. And many of those celebrations will include chickens, the primary carriers of H7N9. In addition, with the Winter Olympics, one of the world’s largest sporting events, just two weeks away, the virus could find the ideal conditions for breaking out.
And that means the next plane could bring a pandemic to the U.S. or anywhere else around the world. “The bottom line is the health security of the U.S. is only as strong as the health security of every country around the world,” says Dr. Thomas Frieden, director of the U.S. Centers for Disease Control.
“We are all connected by the food we eat, the water the drink and the air we breathe.”
But that’s not the worst of it. Last year the World Health Organization warned that H7N9 is one of the most lethal influenza strains ever identified.
Of the nearly 250 officially confirmed reports of human infection since last year, a quarter of those infected have died.
Those are the official numbers, but it is likely that the number of active infections could be a hundred-fold (or more) higher.
Moreover, like any flu virus, H7N9 continues to mutate and scientists recently suggested that all it would take for this particular strain to become a deadly global pandemic is an increase in its transmission rate.
It was initially thought that the virus only spread through human contact with poultry, but that theory was quickly turned on its head when a team of researchers at the University of Hong Kong confirmed that the virus had gone airborne.
If H7N9 mutates to transmission rates of other flu viruses, which is certainly a possibility, then we could well be looking at a mass global pandemic – and according to WHO the H7N9 is mutating eight (8) times faster than a typical flu virus.
To put this in perspective, the 1918 Spanish Flu infected as many as half a billion people (about a quarter of the world’s population). The mortality rate was somewhere in the area of 5% to 10%, with a final death toll of around 50 million people.
At a 25% mortality rate the H7N9 avlian flu, combined with modern transportation systems and metropolitan areas housing tens of millions of people, there is serious potential for a globally significant catastrophe.
Should this virus increase its transmission rate we could be looking at a scenario where a billion or more people contract the virus around the world.
The math is straight forward. One in four will perish.
While we’ve had pandemic scares in the recent past, this one really has researchers and global health officials spooked:
The fast mutation makes the virus’ evolutionary development very hard to predict. “We don’t know whether it will evolve into something harmless or dangerous,” He said. “Our samples are too limited. But the authorities should definitely be alarmed and get prepared for the worst-case scenario.”
As of yet, there is no available vaccine, and one novel mechanism of action for H7N9 is that as soon as it infects its host it develops rapid antiviral resistance, so traditional medicines like Tamiflu don’t work.
One infected student at a local school, or a restaurant worker, or a passenger on an airplane could take this to the next level.
And once it takes hold, there will be no stopping it.
Famed liberal Harvard Law School professor Alan Dershowitz joined other legal experts in slamming the Obama administration for targeting conservative filmmaker Dinesh D’Souza for campaign finance law violations.
“This is clearly a case of selective prosecution for one of the most common things done during elections, which is to get people to raise money for you,”Dershowitz told Newsmax. “If they went after everyone who did this, there would be no room in jails for murderers.”
D’Souza was indicted last week for making illegal political contributions in the names of others. News of his felony arrest prompted ”Schindler’s List” producer Gerald Molen to say, “I never had the thought that I had reason to think I had to look over my shoulder until now.”
The incident reminded Dershowitz of Soviet leader Joseph Stalin’s feared secret police chief, Lavrentiy Beria, who said, “Show me the man, and I’ll find you the crime.”
“This is an outrageous prosecution and is certainly a misuse of resources. It raises the question of why he is being selected for prosecution among the many, many people who commit similar crimes,” Dershowitz said. “This sounds to me like it is coming from higher places. It is hard for me to believe this did not come out of Washington or at least get the approval of those in Washington.”
Top officials from the United Nations, United States, Russia and European Union will meet on Saturday to discuss how they can help US Secretary of State John Kerry's drive for a Middle East peace deal, the EU said on Friday.
The meeting of the so-called Quartet of Middle East peace mediators will be held in Munich on the sidelines of the annual security conference there.
EU foreign policy chief Catherine Ashton said she would chair the meeting with Kerry, United Nations Secretary-General Ban Ki-moon, Russian Foreign Minister Sergei Lavrov and Quartet envoy Tony Blair, the former British prime minister.
"This meeting takes place in a moment when difficult and bold decisions need to be made. The dividends of peace for Israelis and Palestinians are enormous," Ashton said in a statement.
"I hope that together we can help those decisions to become a reality to continue working towards a negotiated peace agreement, setting an end to the conflict and fulfilling the legitimate aspirations of both parties," she said.
Kerry has toiled for six months to push Palestinians and Israelis towards an elusive peace deal to end their generations-old conflict.
A handful of diplomats remain hopeful he will defy the pessimists and secure at least a framework deal in the coming weeks to allow detailed talks to continue beyond the original nine-month deadline, which expires on April 29.
But, with both sides far apart on many core issues including borders, security, the right of return for Palestinian refugees and the future status of Jerusalem, many Palestinians and Israelis believe the talks are going nowhere.