Friday, October 17, 2008

FEMA Camp Footage (Concentrations Camps in USA)





To watch YouTube Video Click on link below:



http://www.youtube.com/watch?v=0P-hvPJPTi4

Preparation for Christ's Coming


[FROM THE REVIEW OF FEBRUARY 17, 1853.]


Dear Brethren and Sisters: Do we believe with all the heart that Christ is soon coming and that we are now having the last message of mercy that is ever to be given to a guilty world? Is our example what it should be? Do we, by our lives and holy conversation, show to those around us that we are looking for the glorious appearing of our Lord and Saviour Jesus Christ, who shall change these vile bodies and fashion them like unto His glorious body? I fear that we do not believe and realize these things as we should. Those who believe the important truths that we profess, should act out their faith. There is too much seeking after amusements and things to take the attention in this world; the mind is left to run too much upon dress, and the tongue is engaged too often in light and trifling conversation, which gives the lie to our profession, for our conversation is not in heaven, whence we look for the Saviour.


Angels are watching over and guarding us; we often grieve these angels by indulging in trifling conversation, jesting, and joking, and also by sinking down into a careless, stupid state. Although we may now and then make an effort for the victory and obtain it, yet if we do not keep it, but sink down into the same careless, indifferent state, unable to endure temptations and resist the enemy, we do not endure the trial of our faith that is more precious than gold. We are not suffering for Christ's sake, and glorying in tribulation.


There is a great lack of Christian fortitude and serving God from principle. We should not seek to please and gratify self, but to honor and glorify God, and in all we do and say to have an eye single to His glory. If we would let our hearts be impressed with the following important words, and ever bear them in mind, we should not so easily fall into temptation and our words would be few and well chosen: "He was wounded for our transgressions, He was bruised for our iniquities: the chastisement of our peace was upon Him; and with His stripes we are healed." "Every idle word that men shall speak, they shall give account thereof in the day of judgment." "Thou God seest me."


We could not think of these important words, and call to mind the sufferings of Jesus that we poor sinners might receive pardon and be redeemed unto God by His most precious blood, without feeling a holy restraint upon us and an earnest desire to suffer for Him who suffered and endured so much for us. If we dwell on these things, dear self, with its dignity, will be humbled, and its place will be occupied by a childlike simplicity which will bear reproof from others and will not be easily provoked. A self-willed spirit will not then come in to rule the soul.


The true Christian's joys and consolation must and will be in heaven. The longing souls of those who have tasted of the powers of the world to come and have feasted on heavenly joys, will not be satisfied with things of earth. Such will find enough to do in their leisure moments. Their souls will be drawn out after God. Where the treasure is, there will the heart be, holding sweet communion with the God they love and worship. Their amusement will be in contemplating their treasure--the Holy City, the earth made new, their eternal home. And while they dwell upon those things which are lofty, pure, and holy, heaven will be brought near, and they will feel the power of the Holy Spirit, and this will tend to wean them more and more from the world and cause their consolation and chief joy to be in the things of heaven, their sweet home. The power of attraction to God and heaven will then be so great that nothing can draw their minds from the great object of securing the soul's salvation and honoring and glorifying God.

As I realize how much has been done for us to keep us right, I am led to exclaim, Oh, what love, what wondrous love, hath the Son of God for us poor sinners! Should we be stupid and careless while everything is being done for our salvation that can be done? All heaven is interested for us. We should be alive and awake to honor, glorify, and adore the high and lofty One. Our hearts should flow out in love and gratitude to Him who has been so full of love and compassion to us. With our lives we should honor Him, and with pure and holy conversation show that we are born from above, that this world is not our home, but that we are pilgrims and strangers here, traveling to a better country.


Many who profess the name of Christ and claim to be looking for His speedy coming, know not what it is to suffer for Christ's sake. Their hearts are not subdued by grace, and they are not dead to self, as is often shown in various ways. At the same time they are talking of having trials. But the principal cause of their trials is an unsubdued heart, which makes self so sensitive that it is often crossed. If such could realize what it is to be a humble follower of Christ, a true Christian, they would begin to work in good earnest and begin right. They would first die to self, then be instant in prayer, and check every passion of the heart. Give up your self-confidence and self-sufficiency, brethren, and follow the meek Pattern. Ever keep Jesus in your mind that He is your example and you must tread in His footsteps. Look unto Jesus, the author and finisher of our faith, who for the joy that was set before Him endured the cross, despising the shame. He endured the contradiction of sinners against Himself. He for our sins was once the meek, slain lamb, wounded, bruised, smitten, and afflicted.

Let us, then, cheerfully suffer something for Jesus' sake, crucify self daily, and be partakers of Christ's sufferings here, that we may be made partakers with Him of His glory, and be crowned with glory, honor, immortality, and eternal life.


Early Writings, E.G. W., pp.111-114.

The Alfred E. Smith (Guess who's coming to) Dinner


Republican presidential candidate Sen. John McCain, R-Ariz., and Democratic presidential candidate Sen. Barack Obama, D-Ill., shake hands as they arrive at the Alfred E. Smith Dinner at the Waldorf Astoria Hotel in New York, Thursday, Oct. 16, 2008. At center is Cardinal Edward Egan. (AP Photo/Carolyn Kaster)



Watch "The Video" of the festivites by clicking link below:



God Intervenes in Armageddon


A noise shall come even to the ends of the earth; for the Lord hath a controversy with the nations, he will plead with all flesh; he will give them that are wicked to the sword, saith the Lord. Jer. 25:31. For six thousand years the great controversy has been in progress; the Son of God and His heavenly messengers have been in conflict with the power of the evil one, to warn, enlighten, and save the children of men. Now all have made their decisions; the wicked have fully united with Satan in his warfare against God. The time has come for God to vindicate the authority of His downtrodden law. Now the controversy is not alone with Satan, but with men. "The Lord hath a controversy with the nations"; "He will give them that are wicked to the sword."


The mark of deliverance has been set upon those "that sigh and that cry for all the abominations that be done." Now the angel of death goes forth, represented in Ezekiel's vision by the men with the slaughtering weapons, to whom the command is given: "Slay utterly old and young, both maids, and little children, and women: but come not near any man upon whom is the mark; and begin at my sanctuary." Says the prophet: "They began at the ancient men which were before the house." Ezekiel 9:1-6. The work of destruction begins among those who have professed to be the spiritual guardians of the people. The false watchmen are the first to fall. There are none to pity or to spare. Men, women, maidens, and little children perish together.


"The Lord cometh out of his place to punish the inhabitants of the earth for their iniquity: the earth also shall disclose her blood, and shall no more cover her slain." Isaiah 26:21. . . . In the mad strife of their own fierce passions, and by the awful outpouring of God's unmingled wrath, fall the wicked inhabitants of the earth--priests, rulers, and people, rich and poor, high and low. "And the slain of the Lord shall be at that day from one end of the earth even unto the other end of the earth: they shall not be lamented, neither gathered, nor buried." Jeremiah 25:33.



Maranatha, E. G. W., p.296.

Thursday, October 16, 2008

Countdown To The Apocalypse


11And I beheld another beast coming up out of the earth; and he had two horns like a lamb, and he spake as a dragon.

12And he exerciseth all the power of the first beast before him, and causeth the earth and them which dwell therein to worship the first beast, whose deadly wound was healed.

13And he doeth great wonders, so that he maketh fire come down from heaven on the earth in the sight of men,

14And deceiveth them that dwell on the earth by the means of those miracles which he had power to do in the sight of the beast; saying to them that dwell on the earth, that they should make an image to the beast, which had the wound by a sword, and did live.

15And he had power to give life unto the image of the beast, that the image of the beast should both speak, and cause that as many as would not worship the image of the beast should be killed.

16And he causeth all, both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads:

17And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.

18Here is wisdom. Let him that hath understanding count the number of the beast: for it is the number of a man; and his number is Six hundred threescore and six.



Revelation 13: 11-18.



After analyzing all the current events, I come to the conclusion that this is the beginning of the end.
  • First there was the failure of Nationwide, the large mortgage lender.

  • Soon, Bear Stearns had liquidity problems during the sub prime mortgage crisis.


  • Then there was the bankruptcy of Fannie Mae, and Freddie Mac, the two major home lenders.


  • Afterwards, the demise of Lehman Bros. and Merril Lynch, two major investors in the NY Stock Exchange; Soon afterwards it was AIG, the huge international insurance conglomerate that had to be bailed out by the Federal Government.


  • Then a triage remedy was suggested by the White House, The Treasury, and the Federal Reserve: They suggested a $700 Billion bail-out (emergency cash injection) plan to resuscitate the failing economy.


  • Last week, the latest salvo to affect the long held tradition of the free-enterprise system that we have all come to accept as the American way of life. A plan to invest in major banks to ensure that they continue to thrive in the face of the current "global" credit crunch, was suggested by President Bush and his financial advisers (Paulson and Bernake). They followed up this week by pumping $250 BILLION into U.S. banks.1

  • Washington Mutual and Wachovia also became insolvent and were promptly bought-out.

  • Presently, Bank of America (The Jesuits own fifty one percent of Bank of America, the Vatican owns stock in hundreds of banks all over the world)2, and Citibank are among the few banks that are prospering and expanding under the current economic turmoil.


All these abrupt changes and major adjustments to the American economy, are indications that the restrictive laws that will deprive God's remnant people can not be too far behind.



The financial turmoil is leading us toward the beginning of the end.



The days in which we live are solemn and important. The Spirit of God is gradually but surely being withdrawn from the earth. Plagues and judgments are already falling upon the despisers of the grace of God. The calamities by land and sea, the unsettled state of society, the alarms of war, are portentous. They forecast approaching events of the greatest magnitude. The agencies of evil are combining their forces, and consolidating. They are strengthening for the last great crisis. Great changes are soon to take place in our world, and the final movements will be rapid ones.--Testimonies, vol. 9, p. 11.



We will not be able to buy or sell. God's faithful few will be deprived of sustenance; We will not be able to hold a job, have a bank account, or shop for food. We will only survive with the protection of God's mercy, and the help of His Holy angels. We will live by faith as Elijah once did.



Can we see how the framework for such a "global" embargo is being put in place right before our eyes? This global economic collapse may be the event that starts the end-times prophesied.



May the Lord allow us all to watch and pray, and remain true to His will.



Arsenio.



Maranatha,



The King is coming!




Footnotes:



1 http://www.reuters.com/article/marketsNews/idUSN1348071120081013


2 http://www.theforbiddenknowledge.com/hardtruth/jesuit_vatican_tyranny.htm



Note: Bolds, Italics, and Highlights, added for emphasis.

The Next Banking Bomb?


CBS News Investigates:

Credit Derivatives Comprise $54.6 Trillion Of Risk Among Few Banks Left Standing


October 10, 2008



(CBS) CBS News Investigative Unit’s Kim Lengle wrote this story for CBSNews.com.

--------------------------------------------------------------------------------
“This bill will, in my judgment, raise the likelihood of future massive taxpayer bailouts. …if you want to gamble, go to Las Vegas. If you want to trade in derivatives, God bless you.”

That was North Dakota Senator Byron Dorgan’s statement on the floor of the Senate - not this week or last, or even during the last six months as Wall Street collapsed - but back in 1999.

Four years later in a letter to shareholders, billionaire investor Warren Buffett followed with his own warning, calling derivatives “weapons of financial mass destruction” controlled by “madmen.”

While financial experts were concerned with the housing bubble and mortgage-backed securities, Dorgan and Buffett were focused on what many now believe may be the next big shoe to drop - the credit derivatives market, better known as credit default swaps.

What worries financial insiders most is the $54.6 trillion of risky credit derivatives concentrated among the few banks left standing.

Credit default swaps (CDS) are the cornerstone of the credit derivatives market accounting for more than 98 percent of all credit derivatives. They are difficult to understand, ignored by regulators and poorly reported on balance sheets. In simplest terms, CDS are insurance policies on things like bonds, loans and corporate debt. But there are two big differences: the seller of a CDS doesn’t need to have the money to cover losses if the security defaults, and the buyer doesn’t need to own the asset it wants to protect.

It’s as if hundreds of people could buy insurance policies on houses they didn’t own yet still collect the full value if it burns down.

The danger comes when the company defaults and the seller - because he’s not required to - doesn’t have the money to pay out on the default.

Investment firms that traded various derivatives, such as CDS, collected an average of $2 billion in fees each quarter over the past two years. And traders who spoke to CBS News said these transactions were the largest cash cows on Wall Street, even more profitable than mortgages. The newfangled transactions were seen as easy money and many traders had the attitude that when it blows up, it’s someone else’s problem.

Today, the same commercial banking heavyweights thought to be the most safe, JPMorgan, Citigroup Inc. and Bank of America, hold 92 percent of all the disclosed credit derivative contracts, according to the Office of the Comptroller of the Currency.

But that number is merely an estimate because the overwhelming majority of these contracts are unregulated - private, mostly undisclosed and difficult to measure.

“There is no question we are at the edge of the cliff and someone is going to fall off,” said Weil, Gotshal & Manges Senior Partner Harvey Miller who is currently overseeing the Lehman Brothers bankruptcy.

Back in 1999 when the legislation was being debated Senator Dorgan opposed the consolidation of commercial and investment banks. In fact, he sponsored two amendments to prohibit these new mega-banks from …investing in derivatives.

Today, Dorgan apparently feels the same way. He was one of 25 senators who voted no on the recent $700 billion bailout.

“No one knows where [the credit derivatives] are, whose balance sheets they may threaten, or how much additional risk they pose to financial firms. Yet, I was told this plan could not require regulation and transparency of these financial markets because there was opposition in Congress and the White House,” Dorgan said in a statement explaining why he didn’t vote for the bailout.

With banks already suffering losses from the subprime fiasco, many now believe they face chain reaction failures from the credit derivatives market.

“If the market keeps going in the direction it’s been going, you’re going to have lots of defaults which are dangerous things,” said Miller.

Some economic analysts predict even more panic over next few months. As more corporations default and banks find out they can’t make good on their contracts, a new round of losses for funds and financial firms could result and make the recent losses in mortgage-backed securities seem miniscule by comparison.


By Kim Lengle


Monday, October 13, 2008

US, bankers rework bailout plan; stocks surge


Neel Kashkari, Interim Assistant Treasury Secretary for Financial Stability, speaks about implementation of the Emergency Economic Stability Act during an event for the Institute of International Bankers, Monday, Oct. 13, 2008, in Washington. (AP Photo/Haraz N. Ghanbari)

By Martin Crutsinger
AP Economics Writer /


WASHINGTON—The Bush administration rushed to revamp the largest U.S. bailout plan in history Monday, working with executives of the nation's biggest banks to shift and shape new pieces and get desperately needed credit flowing. Stocks soared around the world in response to dramatic efforts here and overseas -- and the possibility of even bolder American action.

Scrambling to catch up with events, Treasury Secretary Henry Paulson, Federal Reserve Chairman Ben Bernanke and the bankers were modeling many parts of their revamped program after strong initiatives in Europe, where governments put $2.3 trillion on the line Monday in guarantees and other emergency measures to save banks there.

Elements being considered for the overhauled U.S. program included not only the details for purchasing banks' bad assets -- the major feature of the $700 billion bailout bill that sped through Congress -- but also direct government purchases of stock in banks, an idea that Paulson surfaced only last week.

Another initiative under consideration: providing government guarantees for the short-term loans banks make to each other, a vital credit avenue that has come under severe stress as fears have mounted over the hundreds of billions of dollars of losses that began with the meltdown of the subprime mortgage market in the United States more than a year ago.

Major stock markets around the world surged higher after last week's market disaster as traders began to hear of Europe's actions and the possibility of further steps in the United States.

On Wall Street, a record 936-point increase in the Dow Jones industrials far surpassed the previous one-day mark of 499 points, set in the waning days of the dot-com boom in 2000. But the surge came after the staggering losses of the worst week ever, and economists said more rough days can be expected. European markets rallied following Asia's lead in response to the widespread government initiatives.

"These are tough times for our economies, yet we can be confident that we can work our way through these challenges and America will continue to work closely with the other nations to coordinate our response to this global financial crisis," President Bush said following a meeting with Italian Premier Silvio Berlusconi at the White House.

Over the weekend, Paulson had called the heads of the five biggest U.S. banks to come to Washington for face-to-face talks about the rescue plan, according to people briefed on the matter.

Goldman Sachs CEO Lloyd Blankfein, Morgan Stanley CEO John Mack, Citigroup CEO Vikram Pandit, JPMorgan Chase & Co. CEO Jamie Dimon and Bank of America Corp. CEO Kenneth Lewis were all asked to attend, and there was a possibility that CEOs from some major regional banks would also participate.

Democrats in Congress, while supportive of Paulson's desire to expand the program, complained that not enough strings were being attached, such as restricting excessive compensation for Wall Street executives who raked in millions of dollars in bonuses by pursuing risky investment strategies that have now helped push the U.S. financial system to the brink.

The government should purchase only stock in financial firms that agree to cut dividends paid to shareholders, adhere to strict limits on executive compensation and curb their use of exotic investment strategies, Sen. Charles Schumer, D-N.Y., chairman of the Joint Economic Committee, said Monday.

Separately, House Republicans and Democrats pushed for fresh action to stimulate the faltering economy.

Democrats scheduled hearings to consider a postelection stimulus package that could cost as much as $150 billion. Republicans called for more tax cuts and energy exploration.

In a campaign speech in Ohio, Democrat Barack Obama proposed a 90-day moratorium on home foreclosures at some banks and a two-year tax break for businesses that create new jobs. Republican John McCain promised a change in direction from the Bush administration's economic policies.

As for the Europeans, governments there said they were putting $2.3 trillion on the line, based on pledges from Britain, Germany, France, Spain, Austria and Portugal in recent days. To assist the European banks, the Federal Reserve here announced Monday that it was taking actions to assure enough U.S. dollars were available to meet demand.

"The government cannot just leave people on their own to be buffeted about," said British Prime Minister Gordon Brown.

The $700 billion bailout bill was passed by Congress on Oct. 3. In the past 10 days, the administration has hurried to get it implemented even as officials have struggled to nail down the broad outlines of how the package will work.

The administration on Monday announced the selection of a team of interim managers, picked an outside firm to help run the program and selected a prominent New York law firm to draw up guidelines for how the stock purchase program will work. Officials also announced that Bernanke had agreed to serve as chairman of the oversight board Congress mandated.

Assistant Treasury Secretary Neel Kashkari, who was tapped by Paulson to be interim head of the program a week ago, said that the firm of Simpson Thatcher & Bartlett LLP had been chosen to work on guidelines on stock purchases while the investment consultancy of Ennis Knupp & Associates had been picked to help supervise the selection of the program's private asset managers.

"We are moving quickly -- but methodically -- and I am confident we are building the foundation for a strong, decisive and effective program," Kashkari said in a speech to the Institute of International Bankers.

He said seven policy teams had been set up at Treasury to focus on different aspects of the program while five veteran government officials had been chosen as interim heads of key areas including Tom Bloom, currently the chief financial officer at the Office of the Comptroller of the Currency, to serve as the chief financial officer for the rescue program.

Kashkari said that 70 companies had made bids to become the master custodian firm and that a final selection of the winning firm would be announced by Tuesday. More than 100 companies had submitted bids to become one of the five to 10 firms that will operate the program to buy and manage the bad assets from financial firms, and those selections will quickly follow, Kashkari said.

------

AP writers Emily Flynn Vencat in London, Tim Paradis in New York and Julie Hirschfeld Davis and Devlin Barrett in Washington contributed to this story.

© Copyright 2008 Associated Press.


Treasury to Invest in `Healthy' Banks, Kashkari Says (Update4)


By Rebecca Christie and Robert Schmidt

Oct. 13 (Bloomberg) -- Neel Kashkari, the U.S. Treasury official overseeing the $700 billion rescue of the financial system, said government equity injections will be aimed at ``healthy'' firms.

``We are designing a standardized program to purchase equity in a broad array of financial institutions,'' Kashkari, who heads the department's Troubled Asset Relief Program, said in a speech in Washington. ``The equity purchase program will be voluntary and designed with attractive terms to encourage participation from healthy institutions.''

U.S. officials are hurrying to address frozen credit markets that led France, Germany, Spain, the Netherlands and Austria to agree to commit $1.8 trillion to guarantee interbank loans and take equity stakes in banks. Buying shares of financial institutions has become the latest focus of Treasury Secretary Henry Paulson's rescue plan.

``While the U.S. tends to shy away from nationalizing or even partially nationalizing its financial institutions, it would appear that it has no choice but to follow suit,'' Win Thin, a senior currency analyst with Brown Brothers Harriman & Co. in New York, said in a research note today.

Paulson and Federal Reserve officials met today with executives from financial companies to discuss the government plan to restore confidence in credit markets, the Treasury said. The Standard & Poor's 500 Index soared 11.6 percent, the biggest rally in seven decades.

`Multiple Directions'

Kashkari said the Treasury will ``attack'' bad debt clogging financial markets from ``multiple directions.'' His remarks gave the first detailed progress report on the operations of the financial rescue plan since President George W. Bush signed it into law on Oct. 3.

Three firms are finalists to be the Treasury's ``master custodian,'' to be announced in 24 hours to serve as the prime contractor, Kashkari said. The Treasury has tapped law firm Simpson Thacher & Bartlett LLP and investment consultants Chicago-based Ennis Knupp & Associates for roles in the program. More selections are expected in coming days, he said.

``We are working around the clock to make it happen,'' Kashkari told the Institute of International Bankers.

Kashkari, 35, is a former Goldman Sachs vice president who has been one of Paulson's key aides on housing issues since July 2006. He currently serves as an assistant secretary for international economic issues, although his responsibilities have been delegated to another assistant secretary, Clay Lowery, while Kashkari works on the program, called TARP.

Bernanke's Oversight

Paulson has said Kashkari will serve as the interim head of the program while the Treasury searches for a permanent executive. In the speech, Kashkari said Fed Chairman Ben S. Bernanke will lead TARP's oversight board. That panel, which met for the first time last week, also includes Paulson and the heads of the Securities and Exchange Commission, the Federal Housing Finance Agency and the Department of Housing and Urban Development.

In addition to the stock-buying effort, other components of TARP include a whole loan purchase program, a mortgage-backed securities purchase program and an insurance program for those securities.

He outlined three possible scenarios: ``One, an auction purchase of troubled assets; two, a broad equity or direct purchase program; and three, a case of an intervention to prevent the impending failure of a systemically significant institution,'' he said.

Kashkari said the Treasury plans to use its broad powers under the new law. ``Treasury worked hard with Congress to build in this flexibility because the one constant throughout the credit crisis has been its unpredictability,'' he said.

Debt Guarantees

Kashkari did not mention debt guarantees in his speech. Paulson's team also is speeding up consideration of guaranteeing debt issued by banks after a similar move by European policy makers, according to a U.S. official briefed on the matter.

Executive compensation restrictions, required by Congress for participating firms, will take different forms depending on how financial institutions use the program, Kashkari said.

Oversight and compliance efforts already have started, Kashkari said. The Treasury is working with the Government Accountability Office and looking for a special inspector general, as required by the law.

Firms that bid on TARP program jobs will have to disclose and address their potential conflicts of interest, Kashkari said. The Treasury will conduct an independent evaluation before making its financial decision, he said.

Conflicts of Interest

``Taking aggressive steps to manage potential conflicts of interest is essential because firms with the relevant financial expertise may also hold assets that become eligible for sale into the TARP,'' Kashkari said.

The Treasury has received hundreds of applications from firms seeking to be the asset managers for securities and whole loans. For both categories, the Treasury expects to make a selection within the next few days, Kashkari said. Two accounting firms will be selected in coming weeks, he said.

Paulson has tapped an interim leadership team for the rescue program while permanent staff are recruited, Kashkari said, naming five of the new hires.

Reuben Jeffery, undersecretary of State for economic affairs, will be the TARP's chief investment officer. Jeffery spent 18 years at Goldman Sachs.

Jonathan Fiechter, deputy director of the International Monetary Fund's monetary and capital markets director, will be interim chief risk officer for the new program.

Donald Hammond, a former Treasury career official who is now deputy director of the Fed's payments division, will be interim chief compliance officer.

Thomas Bloom, on loan from the Office of the Comptroller of the Currency, will be interim chief financial officer.

Donna Gambrell, head of the Treasury's Community Development Financial Institutions Fund, will lead the program's efforts to preserve homeownership.

To contact the reporter on this story: Rebecca Christie in Washington at Rchristie4@bloomberg.net.

Last Updated: October 13, 2008 16:29 EDT


A £516 trillion derivatives 'time-bomb'


Not for nothing did US billionaire Warren Buffett call them the real 'weapons of mass destruction'



By Margareta Pagano and Simon EvansSunday, 12 October 2008


Related Articles
Council salaries hit by bank collapses
Carnage: Seven days that shook the world
Is Gordon Brown cashing in on the markets crisis?
Goodwin offers to resign to enable RBS to attract £10bn
Welcome to Iceland: Despite the crunch, it's still worth a visit
Tim Lott: Don't blame all this on the greedy City types
John Rentoul: The week Gordon met his ERM
Nicholas Foulkes: The names have changed, but it feels like Britain in the Seventies all over again
Alan Watkins: Brown's control of the crisis is illusory
A 'Green New Deal' can save the world's economy, says UN
Treasury: we are ready to take majority stakes in failing banks
Which over-inflated market will be hit next?
Walker drops Woolworths to buys bits of Iceland
Lawyers head to Iceland to get cash back
£1bn of private-equity deals put back as debt market freezes over
Economic View: What will it take for the markets to see we have the weapons to resist disaster?
Margareta Pagano: These bankers don't deserve to keep their jobs
Credit insurance claims surge as companies suffer
Friends Provident waits in wings for HBOS stake in St James's
Rugby Estates reveals £100m equity plans to shareholders
At dawn, the banks were back from the brink
If we don't get our house in order, the bailout will backfire
How much lower can we sink? Fund managers see a glimmer of hope
Peston finds his voice and now the City's ears are burning
Are customers now off the danger list if a UK bank goes to the wall?
When credit is a dirty word, the debt must go
It's back to the future as savers become the chosen ones
Crunch point in charges saga
The homes that the credit crunch can't blow down
Julian Knight: Our watchdog can’t see straight for looking two ways at once
Up is down: The credit crunch quiz

The market is worth more than $516 trillion, (£303 trillion), roughly 10 times the value of the entire world's output: it's been called the "ticking time-bomb".
It's a market in which the lead protagonists – typically aggressive, highly educated, and now wealthy young men – have flourished in the derivatives boom. But it's a market that is set to come to a crashing halt – the Great Unwind has begun.
Last week the beginning of the end started for many hedge funds with the combination of diving market values and worried investors pulling out their cash for safer climes.
Some of the world's biggest hedge funds – SAC Capital, Lone Pine and Tiger Global – all revealed they were sitting on double-digit losses this year. September's falls wiped out any profits made in the rest of the year. Polygon, once a darling of the London hedge fund circuit, last week said it was capping the basic salaries of its managers to £100,000 each. Not bad for the average punter but some way off the tens of millions plundered by these hotshots during the good times. But few will be shedding any tears.



The complex and opaque derivatives markets in which these hedge funds played has been dubbed the world's biggest black hole because they operate outside of the grasp of governments, tax inspectors and regulators. They operate in a parallel, shadow world to the rest of the banking system. They are private contracts between two companies or institutions which can't be controlled or properly assessed. In themselves derivative contracts are not dangerous, but if one of them should go wrong – the bad 2 per cent as it's been called – then it is the domino effect which could be so enormous and scary.


Most markets have something behind them. Central banks require reserves – something that backs up the transaction. But derivatives don't have anything – because they are not real money, but paper money. It is also impossible to establish their worth – the $516 trillion number is actually only a notional one. In the mid-Nineties, Nick Leeson lost Barings £1.3bn trading in derivatives, and the bank went bust. In 1998 hedge fund LTCM's $5bn loss nearly brought down the entire system. In fragile times like this, another LTCM could have catastrophic results.
That is why everyone is now so frightened, even the traders, who are desperately trying to unwind their positions but finding it impossible because trading is so volatile and it's difficult to find counterparties. Nor have the hedge funds been in the slightest bit interested in succumbing to normal rules: of the world's thousands of hedge funds only 24 have volunteered to sign up to a code of conduct.


Few understand how this world operates. The US Federal Reserve chairman, Ben Bernanke, tapped up some of Wall Street's best for a primer on their workings when he took the job a few years ago. Britain's financial regulator, the Financial Services Authority, has long talked about the problems the markets could face on the back of derivative complexity. Unfortunately it did little to curb the products' growth.
In America the naysayers have been rather more vocal for longer. Famously, Warren Buffett, the billionaire who made his money the old-fashioned way, called them "weapons of mass destruction". In the late 1990s when confidence was roaring in the midst of the dotcom boom, a small band of politicians, uncomfortable with the ease with which banks would be allowed to play in these burgeoning markets, were painted as Luddites failing to move with the times.
Little-known Democratic senator Byron Dorgan from North Dakota was one of the most vociferous refuseniks, telling his supposedly more savvy New York peers of the dangers. "If you want to gamble, go to Las Vegas. If you want to trade in derivatives, God bless you," he said. He was ignored.


What is a Derivative?
Warren Buffett, the American investment guru, dubbed them "financial weapons of mass destruction", but for the once-great-and-good of Wall Street they were the currency that enabled banks, hedge funds and other speculators to make billions.
Anything that carries a price can spawn a derivatives market. They are financial contracts sold to pass on risk to others. The credit or bond derivatives market is one such example. It is thought that speculation in this area alone is worth more than $56 trillion (£33 trillion), although that probably underestimates the true figure since lax regulation has seen the market explode over the past two years.
At the core of this market is the credit derivative swap, effectively an insurance policy against the default in the interest payment on a corporate bond. One doesn't even need to own the bond itself. It is like Joe Public buying an insurance policy on someone else's house and pocketing the full value if it burns down.
As markets slid into crisis, and banks and corporations began to default on bond payments, many of these policies have proved worthless.
Emilio Botin, the chairman of Santander, the Spanish bank that has enjoyed phenomenal success during the credit crunch, once said: "I never invest in something I don't understand." A wise man, you may think.



Simon Evans


Source: http://www.independent.co.uk/news/business/news/a-163516-trillion-derivatives-timebomb-958699.html

IMF in global 'meltdown' warning


Strauss-Kahn said rich nations had so far failed to restore confidence


The world financial system is teetering on the "brink of systemic meltdown", the head of the International Monetary Fund (IMF) has warned in Washington.

Dominique Strauss-Kahn said rich nations had so far failed to restore confidence, but he endorsed a new action plan by the G7 group.
He also said the IMF was ready to lend to countries in dire need of capital.
The 15 eurozone leaders will meet in Paris later to try to establish a common approach to the markets crisis.
French President Nicolas Sarkozy and German Chancellor Angela Merkel said they would present a number of proposals at the summit to ease the credit freeze that has caused the collapse of several leading international banks.
But after meeting in Paris on Saturday, the two leaders said the summit would not result in a joint financial rescue fund for Europe, in the model of a $700bn rescue by the US government.
French Economy Minister Christine Lagarde said the eurozone leaders would discuss the possibility of guaranteeing interbank lending and put "meat" on the "skeleton" of a five-point plan by the G7 group of most industrialised nations to resolve the crisis.
Intensifying concerns
Mr Strauss-Kahn was speaking in Washington after talks with US President George W Bush, G7 finance ministers and the World Bank.
Earlier, G7 ministers had released the five-point plan to free up the flow of credit, back efforts by banks to raise money and revive the mortgage market.

George Bush says the US will lead the response to the crisis
"Intensifying solvency concerns about a number of the largest US-based and European financial institutions have pushed the global financial system to the brink of systemic meltdown," said Mr Strauss-Kahn.
He later told a news conference: "The first co-ordination between advanced countries and the rest of the world is now on track."
The IMF chief's strong words reflect a belief that the global financial crisis can be contained, says the BBC's economics correspondent Andrew Walker in Washington.
Mr Strauss-Kahn was joined at the White House by finance ministers from the US, Canada, France, Germany, Britain, Italy and Japan, as well as World Bank President Robert Zoellick.
Following talks with the economic leaders, Mr Bush also pledged co-ordinated action, saying it was serious global crisis which demanded a serious global response.
Panic selling
The meeting came a day after Asian, European and US markets continued to panic sell despite rate cuts and cash injections by central banks, amid widespread fears of a global recession.
Late on Friday, US Treasury Secretary Henry Paulson said the US planned to invest directly in banks for the first since the 1930s, following a similar UK programme of partial bank nationalisation.

[We must] redirect the markets so that they serve the people, and not ruin them
Angela MerkelGerman Chancellor



The G7 had earlier not ruled out adopting another part of the British plan - to guarantee borrowing between banks - as they issued their plan in Washington.
The G7 also left the door open to further reductions in interest rates, which six central banks this week jointly cut by half a percentage point.
But our correspondent says there is some disappointment that the G7 plan lacks detail.
Ahead of the emergency summit of eurozone leaders, UK Prime Minister Gordon Brown will hold talks with Mr Sarkozy.
Chancellor Merkel said governments must "redirect the markets so they serve the people, and not ruin them".
The heads of the EU's four biggest economies - Britain, France, Germany and Italy - held a first crisis summit last week, but were split over the need for a common plan.
Analysts say another week of plunging stock markets has focused minds and the real test of this weekend's scramble by world leaders to shore up the international financial system will come once markets reopen again on Monday.


What will the US foreign policy be tomorrow ?



By MICHEL COLLON

When Bush goes, everyone will be hoping for a change - or fearing the worst. McCain or Obama ? What will that change for Iraq, Afghanistan, Palestine, Africa, Caucasia, Cuba and Venezuela ? And for US relationships with the big powers : Europe, Japan, Russia, China ?

This text is extracted from our book « The 7 sins of Hugo Chávez » (Chapter 11 : [The United States] Black gold and the wars of tomorrow), shortly to be published. The preceding pages explained the reason for the rise and then decline of the United States.

Bush's Failure

12/10/08 "ICH' -- - What would be the balance sheet of this global war on terror led by the Bush administration as from 11 September ? Negative. Virtually everywhere.

In Afghanistan and Iraq, the United States has launched two wars which they are unable to win and which they will never win. Bush wanted to launch a third war against Iran but, the US being seriously weakened, he has had to renounce it. The aim of this war was to have been to ensure Washington's control over oil. In five years, it has risen from 25 dollars to over 100 dollars [per barrel], with very negative consequences for the US and world economy.

In South America, the United States has lost, entirely or partially, control over almost all their colonies : Venezuela, Bolivia, Ecuador, Uruguay, Paraguay, Argentina and Brazil. All that remains to them, at the time of writing, are Peru, Chile and Colombia.

In Africa, too, resistance has made some advances. Kabila of the Congo refused to go on his knees. And when Washington tried to find somewhere to set up their new military command, AFRICOM, all countries politely refused.

Also in South Asia, there has been an increase in resistance over the whole region which has alarmed US strategists, who propose reinforcing the US's 'projection capacity' in South Asia. In their jargon, that means organizing military landings and bombardments, and supporting « coups d'etat ». But the group emphasize that, given the unpopularity of the United States in this region it will be impossible to find a country that will accept the headquarters of such a US force.

Bush's policy has aroused resistance even among their European allies. Thus, at the NATO summit in Bucharest in April, George Bush demanded further expansion of the organization, this time to integrate Ukraine and George - which was like pointing a couple of cannons at Russia. But there were firm and open refusals from Germany, France, Spain, Italy, Belgium, the Netherlands and Luxemburg, none of them wishing to make troubles with Moscow which provides them with gas. Steve Erlanger and Steven Lee Myers, two analysts close to the Pentagon, saw in this « a manifest failure of US policy in an alliance normally dominated by Washington ».

Indeed Russia's attitude is hardening. Moscow rejects the installation on the European continent of arms that the United States call an anti-missile shield :
« If part of the US nuclear potential is in Europe (...) we have to have targets in Europe .» Moreover, in May 2008, Russia tested a new, multi-head intercontinental missile « in response to unilateral and groundless acts by our partners » declared Putin. Washington however stated that the anti-missile shield was not directed against Russia, only against states like Iran. But Putin replied : « There is no Iranian missile that has a sufficient range. It is therefore evident that this news concerns us Russians too . »

Like Russia, China has also refused to back down when confronted by numerous campaigns and pressures exercised by Washington.


The US elite is divided

Ten years ago, Zbigniew Brzezinski, former national security advisor to President Carter and the leading strategist in the United States, published his book « The Great Chessboard ». More or less « How to remain the superpower dominating the world » . He explained, with the brutal frankness of someone no longer in official position, that Washington must absolutely weaken its rivals : Russia and China, but also Europe and Japan, and prevent them from allying with each other. Divide and rule.

Today, what is the balance sheet from George Bush using Brzezinski' criteria ? Has he managed to weaken the great power rivals ? We would say : fairly well as concerns Japan, fairly well (for the moment) as concerns Europe, but badly as concerns Russia and very badly as concerns China.

Globally, Bush has provoked so much resistance that United States' domination has been weakened. The business interests that had brought him to power - armaments, oil, automobiles, defence, pharmaceutical companies - have seen that Bush's wars have not brought great profits, or new areas for exploitation. In fact, they have cost more than they have gained. And the Bush administration has been shown up as being a small, restricted circle whose members thought a lot about filling their own pockets but who were incable of tactical finesse and genuine long-term vision.

Once the failure had become obvious, the divisions among the US elite, and even in the Bush administration, became exacerbated. As from 2006 the neocons had to cede territory. They had to accept replacing the War Minister, Donald Rumsfeld, by Robert Gates, a Trilateral man belonging to the Brzezinski tendency. The new minister had to some extent admitted the weakness of US militarism in a speech he gave to the cadets at the West Point Military Academy : « Don't fight unless you have to. Never fight alone. And don't fight for long. » Then the bi-partisan Baker-Hamilton Commission condemned the effort of Bush to reshape the 'Great Middle East' as being unrealistic. They advocated, on the contrary, a more tactical approach towards Syria and Iran.

Even within the secret services and the army there are a number of revolts. In December 2007, when Bush wanted to prepare an attack against Iran under the classic pretext of it having weapons of mass destruction, sixteen US intelligence services surprised everyone by publishing a report stating that Iran had suspended its military nuclear programme since at least 2003.

« The decline of the United States is inevitable »
(Zbigniew Brzezinski)

Brzezinski, in his book, proposed an agressive and machiavellian strategy to save the US Empire. But even he, did he really believe it would work ? Strange as it may seem, it appears not.

« In the long term, global politics are destined to become less and less favourable to the concentration of hegemonic power in the hands of only one state. America is thus not only the first global super power, it is very probably the last one. » (CH - p. 267)

The reason for this is the evolution of the economy : « Economic power also risks becoming dispersed. In the coming years, no country will be likely to attain some 30 per cent of the world GNP, a figure that the United States has maintained during most of the 20th century - not to mention the high point of 50 per cent that they reached in 1945. According to certain estimates, America could still hold 20 per cent of the world GNP at the end of this decade, which would then fall to 10 - 15 per cent from now to the year 2020. The figures for other powers - Europe, China, Japan - are expected to increase to reach the approximate level of the United States ... Once the decline of the American leadership has set in, the supremacy that the country now enjoys cannot be taken over by any single state. » (CH - p. 267-8)

« Once the decline of the American leadership has set in ». Brzezinski is therefore not talking about a possibility, but a certitude. He wrote that in 1997. Today it has become clear that the decline is well on its way. The world is becoming multipolar.

But perhaps Brzezinski is an isolated pessimist ? Perhaps the neocons who inspired Bush are more 'optimist', if one can use that word ? In fact, they are not much more optimistic. In the founding text of the administration's whole policy, the Project for a New American Century (PNAC), drawn up in 1992 by Paul Wolfowitz and his friends, the whole ideology of a new militarist crusade is evident, but there is also a remark worthy of note : « At the moment, the United States has no world rival. The overall strategy of America must aim at preserving and extending this advantageous position as long as possible (...) Preserving this desirable strategic situation in which the United States finds itself at the present time requires predominant military capacities at the world level. » (CH)

« As long as possible » : here, too, there is no belief that the United States can remain the masters of the world for ever. It is a real paradox. The whole world fears the United States. But the rulers of the country themselves know that they are at the controls of the Titanic. And to save the Empire as long as possible, they are divided between two options.


Two options for saving the Empire

What will be the foreign policy of the United States in the years to come ? The choice of president will certainly give some idea. But it is not decisive. We should remember that, during the presidential campaign of 2000, George Bush had promised a much milder foreign policy and less interventionist than its precedessor ! And the other candidate, Al Gore, had proposed a bigger military budget than that of Bush. We believe that the general orientations of foreign policy are not decided by presidents but by the multinationals, in function of their requirements of the moment and their evaluation of world power relationships.

And, in fact, after the balance sheet of the Bush years that we have just described, the US elite seems quite divided about the line to follow. How to resolve this delicate situation ?

The first possible option is the military one. Bush's neocons embodied this the last few years with the Wolfowitz strategy, one of aggression and intimidation. Multiply the wars, inflate to the maximum the orders to the military-industrial complex to promote growth and the domination of the US multinationals, and also to intimidate allies and rivals.

The other option, which is defended by Brzezinski, is what he likes to call 'soft power'. Others call it 'intelligent imperialism'. In fact it aims at the same objectives, but through forms of violence that are less direct, less visible. It would count less on very expensive US military interventions and more on secret services, destabilization manoeuvres and proxy wars, as well as corruption.


Five NATO generals prepare a world government ...

The first option consists of militarizing political life still further and increasing the number of wars. Bush squared, in fact.

In January 2008, five former NATO generals presented a preparatory document for the NATO summit meeting at Bucharest. Their proposals reflect a terrifying tendency. And what gives weight to their document is that, up until recently, all of them held very high positions. General John Shalikashvili was US Chief of Staff and Commander in Chief of NATO in Europe, General Klaus Naumann ran the German army and was president of the military committe of NATO in Europe, General Henk van den Breemen was chief of the Dutch Chief of Staff and Admiral Jacques Lanxade held the same post in France, while Lord Inge ran the General Staff and was also Chief of the Defence Staff of Great Britain. This is just the big shots - and very aggressive they are too, as we shall see.

Page 6 : « [The authors] propose ways how to overcome possible rivalry with the EU and also how to enable NATO to have access to non-military instruments. » Two observations :

in fact, this rivalry is not only possible, it is completely real. In what way do they want to overcome it ?;
· what does NATO mean by having « access to non-military instruments » ?

Is it a question of having more control over civil society in western countries ?

Page 7 : « In order to start off the process, they propose establishing a directorate bringing together the United States, the European Union and NATO. Its mission would be to coordinate all operations in the Atlantic sphere. » For what objectives ?

The Five explain this on page 42 : « What the Western allies expect is the pro-active defence of their societies and their way of life maintaind over the long term. »
« Defending our way of life » has already been used as an argument by Bush senior to launch the first war against Iraq. In fact, « way of life » is a hypocritical term that means the domination of the multinationals over economic life : it is a domination that keeps half of humanity in poverty. The aim of the Five is in fact to use military means to maintain the gap between the rich and the poor. Anyone who doubts this should read, on page 92 : « The objectives of our strategy are to preserve the peace, our values, economic liberalism and stability. »

It is, therefore, to preserve the stability of the multinationals. Against what enemies ? The authors give some examples of what is not to be tolerated in the Third World. Page 52 : « We have less important examples of non-desirable aid, from Venezuela to the Cuban regime. » The world gendarme takes upon itself the right to intervene everywhere against countries that do things that the multinationals don't like.

But among the undesirables, who is the main enemy ? The answer is on page 44 :
« China is in a situation to wreak great harm on the US and the world economies, based on its enormous reserves in dollars. » And, on page 52 : « China is in a position to use finance to impose itself on Africa and acquire the capacity to utilize it on a much greater scale - if it so decides. »

So here we have, well-defined, the good and the bad. Liberalism needs NATO to impose itself on the whole world. And to carry out this economic war, what means does NATO require ?


International law and the United Nations thrown overboard

In fact, the five generals feel frustrated. On page 76 : « One of the chief problems in the current strategic conception of the Atlantic alliance is that its actions remain reactive rather than preventive, and are limited to military means. On page 91 : « An ambitious strategy must include the well-integrated use of all accessible means, political, economic, military, cultural, social, moral, spiritual and psychological. »

So there we are ! The Gang of Five wants to move beyond its military tasks and exercise control over the functioning of civil society. But will the law be respected at least by this new world government ? It is very doubtful. On pages 94-95 : « Another principle to be respected is legality. All action must be legitimate, authorized and respect international law. That can be a considerable handicap when the adversary has no respect at all for any law whatsoever, but to act differently would mean, in the end, applying the law of the jungle and undermine our own credibility. Nevertheless this principle does not prevent adapting existing international law in an international context that is constant evolution. »

In this quote, the first sentences serve as window dressing and the real content comes at the end. « Adapting » the law means, in effect, violating it, denying the principles proclaimed up until now. After Abu Ghraib, Guantánamo, torture, the assassination of heads of states, the extraordinary rendition flights and secret prisons of the CIA : are they proposing to combat these violations of the law ? No, they propose to legalize them, 'adapting' the law.

Already two wars against Iraq and the one against Yugoslavia have violated international law, the UN Charter and even NATO's own Charter. But it is precisely international legality that the Five want to get rid of. Pages 104-105 : « The approval of the United Nations may not be necessary according to Article 51 of the UN Charter (legitimate defence) and it is perhaps possible to renounce it on the basis of the Convention on Genocide. »


« Long live preventive war ! » Even if it is nuclear.

Page 96 makes for reading that is just as disturbing : « What we need is a form of dissuasion through pro-active refusal, in which the preemption is a form of imminent reaction and prevention an attempt to take back the initiative and put an end to the conflict. »

« Pro-active defence » in military jargon, means preventive war. The term is constantly repeated in the document of the Five. George W. Bush had already invoked a 'preventive war' against terrorism. As did Hitler in his time. Aggressors often take refuge in the pretext of preventing danger. In actual fact, international law explicitly forbids wars claiming to be preventive.

But our fears don't end there. On page 94 : « At first sight, the nuclear weapon might seem disproportionate, but if one takes into account the damage that it prevents, it may be reasonable. » Here the immorality of these five Gangits bursts out into the open. Nuclear war is an atrocity and humanity has constantly demanded the dismantling of weapons of mass destruction. Here it is claimed that they are justified. The hypocrisy is flagrant : « to prevent damage ». This is completely vague and, without doubt, racist. The lives of adversary peoples are not worth anything.

The truth is that these criminal generals, observing that classic bombardments are not enough to break resistance, and that wars on land are expensive and dangerous for the invaders, propose the nuclear weapon as a solution to the problem of the world hegemony of the multinationals.


Preparing peoples' minds

As can be seen, the goods that the Gang of Five wish to sell us are completely rotten and poisonous. This is the reason why they count on manipulating public opinion through long-term propaganda campaigns. On page 104 : « These measures must be accompnied by pro-active and coordinated efforts of communication through the media (,,,) Furthermore, such a media campaign can prepare peoples' minds for an armed intervention. »

« Prepare peoples' minds » ! Of course, this is nothing new. Drawing up the balance sheet of the war against Yugoslavia, which was the most successful example of organized disinformation, a NATO general admitted, after the war ended, that false information had been systematically issued while embarrassing information was eliminated or marginalized in order to « anaesthetize opinions ». He thus acted upon NATO's philosophy that « Opinion can be worked upon, like other things. » In each war, Western generals commission spin doctors to sell their war and manipulate public opinion. But this time, this is taken much further : there is to be a long-term campaign to condition opinion.

Page 129 : « Therefore NATO must develop an information strategy that serves three objectives simultaneously. It must persuade the world that NATO is a force for good. It must move before its adversaries start to disseminate their information : that is, NATO must impose its domination in public relations. It must win the hearts and minds of the inhabitants of the NATO countries (convince them that the Atlantic alliance's position is a correct one), but also the hearts and minds of the populations where the armed intervention is taking place. »

« Impose its domination in public relations .» Information is seen as a war that is won by eliminating the forces of the adversary. This is no idle accusation. The US army bombed and imprisoned Al Jazeera journalists, NATO bombed Belgrade television station (17 killed), the Pentagon has prepared plans to eliminate embarrassing information on the Internet, whose democratic character is upsetting it considerably.

A plan for world dictatorship

At the beginning of their document, the five generals announced « ways how to overcome possible rivalry with the EU » How are they going to do that ?
In effect, they use the framework of NATO to organize the submission of the EU to Washington's will :

Page 137 : « We consider that multinational forces are the key for a rapid and inexpensive modernization of NATO's force, but we stress that this is not possible unless member states accept without reserve that these forces will be at the disposal of NATO for all operations authorized by the NATO Council. » Translation : the European armies will be obliged to obey NATO decisions (currently unanimity is required).

The Five's plan would give three advantages to the United States : it would integrate European forces into their own wars ; it would share the costs among the allies ; and it would also share the unpopularity.

The antidemocratic character of the Five is shown clearly on page 139 : « We are not formulating proposals for the reform of the EU in such detail as we have for NATO for two reasons : first, a new 'smooth' treaty, that has just replaced the 'constitution' that had been condemned, has now been adopted so as to avoid consulting the populations. »

Their plan will make it impossible to carry out any opposition. Page 144 : « In order to avoid all sources of inconvenience, it could be decided that first of all an issue will be treated inside NATO and then the NATO members who are also members of the EU will undertake not to depart from the vote taken at NATO when the issue is brought up in the European bodies. » Thus, once NATO has decided, no European country will have the right to oppose its decision.

In conclusion, this plan of the Gang of Five, prepared by people who have been at the top of world military power, exposes a significant tendency among the elite. Their plan for a super world government by the three blocs (effectively dominated by the United States) would relegate all vestiges of international law to the dustbin, legitimize preventive war and nuclear weapons andorganize systematic manipulation of public opinion. The plan is nothing if not fascist.

This is one of the two options that the elite in the United States are currently considering for resolving their problems. The other is embodied by Zbigniew Brzezinski, whom we spoke about earlier.

« Intelligent imperialism »?

The US military strategists distinguish three types of war that they could launch :
high intensity wars between big powers such as the two world wars ; medium intensity wars involving also the US military directly, but against much weaker powers, as in Iraq and Yugoslavia ; low-intensity wars, in which there is not a direct US military involvement but which are organized to defeat others. They provoke conflicts between neighbouring countries, or through paramilitary and terrrorist movements.

The term 'low intensity' is misleading, as it could give the impression that there are fewer damages. In fact there are fewer only for the United States. Thus the so-called « low intensity » war that Washington launched against the Congo (through the armies of neighbouring Rwanda and Uganda, and various militias) resulted in five million deaths and it has paralyzed the development of the Congo.

Brzezinski's strategy is different from that of Bush in that it favours low-intensity wars. In no way, therefore, is it more moral, but it claims to being more intelligent.

But Brzezinski also proposes other forms of intervention. We often think of military intervention by the United States as the most visible form of aggression. But in fact they dispose of a wide range of forms of aggression.. To establish a complete typology, it would look like this, in order of ascending intensity :

corruption of local leaders ;
· blackmail of local leaders ;
· demonization media campaigns ;
· various destabilization actions ;
· embargos and commercial blockades ;
· coups d'état ;
· provoking separatist movements ;
· war by proxy ;
· bombardments ;
· territorial occupation.

As can be seen there is a wide variety of methods which, evidently, can be combined. But they are all aggressions. Of course all US governments have had recourse to all these methods, and not only certain ones. But the dosage and financing vary.

After the crimes committed by Bush, it is tempting to think that there will be a change of method. However, if Washington decides to changes its tactics they will not be more pacific but only less visible. Brzezinski, it should be remembered, was the man who financed bin Laden in Afghanistan to tie the Soviet Union down in a long and costly war and to break its alliance with the Muslim world. Brzezinski is very proud of his success and never loses an opportunity to refer to it.

If the United States decide to apply the Brezinski strategy there will certainly be fewer direct wars. And they will be carried out as often as possible in conjunction with allies. This will help to take care of their media image and the manipulation of the public. And above all the CIA will be more active : efforts will be made to replace wars carried out directly by the United States by indirect wars, making neighbouring countries fight each other, supporting 'the good war' and using all kinds of appropriate pretexts. This was the method used successfully by Clinton against Yugoslavia.

The Brzezinski method has two advantages for the United States. They would regain a more presentable image and re-establish their moral authority. And by paying less money to the military-industrial complex the US economy would reinforce its competitive position vis-à-vis Europe, China, India, etc.

In order to economize on wars the Brzezinski strategy would make more use of blackmail as well as of clandestine activities. Blackmail, especially, can be channelled through world economic organizations like the World Bank, the International Monetary Fund and the World Trade Organization. These are multilateral institutions but dominated by the United States, who can dictate their wishes for the Third World in an apparently more objective manner. But this will not be easy because the World Bank and the IMF have created such antagonism among the countries they have dealt with that the latter are looking for alternatives. The idea of a Bank of the South, launched by Chávez is making progress ...

More use would also be made of clandestine activities - in other words, the CIA. This makes it possible to get rid of obstreperous governments at a lower cost.

That is why those who support Brzezinski's strategy call themselves partisans of 'soft power' or 'intelligent imperialism'. But the danger with this soft power is that the Left will be so glad that Bush has gone that they will reduce their vigilance because - for a certain time - there will be fewer direct wars. Thus the international anti-war movement, which is going through an evident crisis, will react even less strongly when confronted by the more discreet strategies of the Empire.

At any rate, the Empire will not become more peaceful. Sooner or later it will launch more Bush-type wars. This is because the US elite in fact practise the two options alternately.


Presidents come and go, the multinationals remain

These two options, militarist or 'intelligent' are not new. And it is not a question of the opposition between republicans and democrats. These two parties do not represent 'war' or 'peace' but only different electorates, different tactics, and are always at the service of the multinationals. Hence it is not a republican but a democrat, Harry Truman, who launched the war in 1950 against Korea and China. It was not a republican, but a democrat, John Kennedy, who started the war against Vietnam in 1961.

And it is not a popular vote either, against the bourgeois vote. The US multinationals always finance both candidates, putting their eggs in both baskets. But their preferences can be judged by the amounts they contribute. At the beginning of the 1990s the multinationals invested in both candidates, but gave 59 pour cent more to Clinton and the democrats. Instead, from 1996 onwards they gave greater support to the republicans by 67 per cent. In the presidential elections of 2000 it was Bush who was massively financed. And he was declared elected in spite of the fact that the ballots had given his rival Gore the victory. On the other hand, in the presidential elections of 2008 the multinationals have changed sides again and finance Obama more than his rival McCain.

However, the same president can change his own policy. After the fall of the Soviet Union and the end of the Cold War, Bill Clinton reduced the military budget and the orders to the military-industrial complex - for a while. By so doing, he had hoped to relaunch the US economic machine in general. But, although the decision was almost unnoticed, at the end of his mandate the same Clinton made a U-turn : « The military budget of the United States must be increased by 70 per cent. » This just confirms what was said previously : the great political decisions do not depend on the character of one president or another, but on strategies decided higher up. Presidents come and go, the multinationals remain.


US policy alternates its methods

So we shall talk about alternative US policies. After each important setback, there is a - temporary - return to 'soft power'.

After the defeat of Vietnam and the moral condemnation of the dictatorships installed by Washington in Latin America, the US multinationals brought the nice pastor Jimmy Carter to power, with his wonderful speeches on human rights. After the Cold War and the first war against Iraq, President Clinton tried to involve the Europeans in his wars and gave special attention to media presentation. In fact, the US bourgeoisie was in fact always hesitating between the two options to solve its problems. Or, rather, it alternated between them : a bit more stick, a bit more carrot. But its choices became increasingly difficult. Neither method really solved the problems.

Now, after the disastrous results of the Bush regime, the US bourgeoisie is hesitating between the two options. Either the headlong plunge into more wars or a tactical withdrawal, moving back in order to get a better run-up. The question is not what president they are going to choose, but rather what strategy.

At all events, it is not sure that the Brzezinski strategy is, when all's said and done, less brutal than that of Bush. It is true that in 2008 he publicly criticized the president, saying that he was stupid to want to attack Iran, because he could not win and that a war would harm the situation of Israel and affect the price of oil, hence the US economy. Certain analysts think that Brzezinski wants to domesticate Iran because he hopes to turn the country around and make it participate one day in the encirclement of Russia. This is the power that remains his bête noire, the obsession of the author of The Great Chessboard. Some think that Brzezinski wants to completely encircle and weaken Russia, if not to wage war on it, and we should not forget China, which has obviously become a major target now. If this should happen, soft power will be transformed into Apocalypse Now.


Their solutions will only exacerbate the problems

That the US bourgeoisie is divided about which line to follow stems from the fact that, in the final analysis, the United States are not so powerful as is believed, neither in the economic field, nor in the military. Each time that the rulers thought they had found the solution, it turned out, after a while, that the solution only made things worse.

For example, in the 1980s, in order to escape recession, the US multinationals fell upon Latin America and other regions of the Third World, gobbling up their raw materials, their businesses and their markets. But this neoliberal offensive so impoverished these countries, provoking economic catastrophes and hence increasing resistance that Latin America turned to the left. From 1989 Washington launched a global war to ensure its total control over oil. But oil continues to escape it. As from 2001 Bush launched his war against the so-called Evil Axis, but only succeeded in strengthening resistance in all regions of the world.

The United States seem to be very strong, but are they really so ? With all their dollars, all their technologies and all their crimes, they have lost the war in Korea (1950) and the war in Vietnam (1961-1975), they have had to withdraw from Lebanon (1982) and from Somalia (1993). They would not have won in Yugoslavia (1999) if President Milosevic had accepted a land war. They have already lost in Iraq and in Afghanistan, even if they do not yet recognize the fact. Are they not a 'paper tiger' ? In the long run, aren't people who defend their wealth and their future stronger than dollars and missiles ?

The United States spend far more on their military budget than all the other nations of the world together but that no longer succeeds in ensuring their world supremacy. One might say that they are their own victims of their fundamental contradiction : everything that they do is against the interests of the immense majority of the inhabitants of the planet, so they themselves create the force that will destroy them.

An army cannot be stronger than the economy that finances it. And the basic weakness that will prevent the US rulers from attaining their objctive is that the US economy is sawing the branch on which it is sitting. By underpaying its workers, by delocalizing part of its production, by ruining the countries of the Third World that should be its partners it is ceaselessly impoverishing those to whom it should be selling. This problem cannot be resolved by either of the two options, the militarist or the 'intelligent' one. The militarists increase the expenditure and the resistance.
The 'intelligent'option, while reducing the terror disseminated by direct warfare, also encourages resistance.

Whatever tactics are chosen the United States will continue to wage war throughout the world in order to impose their economic system and their interests. It is urgent to recreate a strong peace movement and for peoples' sovereignty.

Notes -
The links between the economy and the war are analyzed in the book Bush le cyclone : Bush le cyclone (in French and Spanish). This book is particularly concerned with the question 'Who commands Bush ?' And, therefore, the next President.

These questions will also be tackled at the next seminar organized by Investig'Action in Brussels (in French) on 8-9 November. For information : magali.investigaction@gmail.com

Other articles on the foreign policy of the United States, Russia, China, the European Union, Iraq, Afghanistan, Brzezinski, Obama (in French)


Source: http://www.informationclearinghouse.info/article20994.htm

Chapter 11 of NAFTA Remains a Threat to National Sovereignty


By: Dana Gabriel - 10 October, 2008


Watching the Canadian English leader’s debate probably didn’t have a defining moment for most people. Instead, they were treated to five party leaders saying what they thought would be best for the country, and how as prime minister, they would do a better job than the others. The dynamics of the debate were different than previous ones as it was the first time that a Canadian Green Party leader was allowed to participate. Elizabeth May held her own and injected some new ideas, bringing up some critical issues such as Chapter 11 of NAFTA. Her position is that it needs to be re-opened and fixed. Jack Layton has also vowed that an NDP government would make it a priority to fight to re-open NAFTA, including removing Chapter 11 from the agreement.

Some have described NAFTA as more of an investment agreement that holds member nations at the mercy of corporations who have been granted new rights and privileges. Chapter 11 allows foreign investors to sue the governments of the U.S., Canada, and Mexico if they feel that their profits have been restricted. It guarantees fair and equitable treatment to foreign investors. In many instances, Chapter 11 is not being used to defend trade, but as a means to challenge and override domestic laws and international treaties. To deal with disputes, NAFTA created secret trinational tribunals that meet behind closed doors. They have the power to award monetary compensation, which is paid with taxpayer’s dollars, and their decisions do not have to be fully disclosed. Some claimants have not been big corporations, but small to medium-sized companies. There has been speculation that through the Security and Prosperity Partnership, NAFTA tribunals could be expanded into a North American Union style court system. More and more, Chapter 11 is being used to challenge unfavorable laws and governmental decisions.

Since its inception, there have been fears that NAFTA could be used to further dismantle Canada’s health care system. Many believe that the agreement’s safeguards are too vague, and that any future expansions into homecare or pharmacare are not adequately protected. For years, both Liberal and Conservative governments have insisted that Medicare is protected from an American-style system.

In July, a group of 200 American investors lead by an Arizonan businessman filed papers alleging that, as a result of barriers put in place, they were unable to open more private health care clinics in the province of British Columbia. They are asking for $4 million in incurred expenditures as well as an additional $150 million in potential lost profits. This case could be settled by formal arbitration hearings under Chapter 11 and represents the first ever challenge to Canada’s health care system. There are some who question how serious of a claim this really is, but regardless, it could lead to future attacks. NAFTA’s investment rules continue to put Canada’s health care system at risk of future privatization. The next Canadian government must further enforce the Canada Health Act to prevent more challenges.

In 1996, Jean Chrétien’s Liberal government tabled a bill that banned imports of MMT, a gasoline additive. This was done as a result of studies that showed it posed a health risk. The U.S. Ethyl Corporation maker of MMT sued Canada, claiming discriminatory treatment under Chapter 11 of NAFTA. Lawyers advised the Canadian government that they might very well lose the case, so they sought a settlement prior to the ruling. Ethyl received over $13 million, which covered damages to its reputation, lost profits, and legal fees it incurred. They forced the Canadian government to repeal the bill, banning MMT imports. The government also had to issue an apology and public statement saying that the additive posed no health or environmental risks. How disturbing that a corporation practically dictated the terms of the settlement and overturned the law of a supposed sovereign nation.

NAFTA has lead to the corporate dominance of North America, and has essentially given foreign investors the power to challenge and even overturn labour, public safety, and environmental laws. It continues to undermine our democracy and breakdown national sovereignty. NAFTA was a monumental step towards continental integration. Chapter 11 of the agreement has been the source of much discontent and is a prime example of why so many believe that NAFTA must be re-negotiated.