“The U.S. must show the leadership necessary to establish and protect a new order that holds the promise of convincing potential competitors that they need not aspire to a greater role or pursue a more aggressive posture to protect their legitimate interests…..We must, however, be mindful that…Russia will remain the strongest military power in Eurasia and the only power in the world with the capability of destroying the United States.”
“For America, the chief geopolitical prize is Eurasia…and America’s global primacy is directly dependent on how long and how effectively its preponderance on the Eurasian continent is sustained.”
-THE GRAND CHESSBOARD – American Primacy And It’s Geostrategic Imperatives, Zbigniew Brzezinski, page 30, Basic Books, 1997
The Laussanne negotiations between Iran and the so called P5+1 group (the United States, Russia, China, France, Britain, and Germany) have nothing to do with nuclear proliferation. They are, in fact, another attempt to weaken and isolate Russia by easing sanctions, thus allowing Iranian gas to replace Russian gas in Europe. Laussanne shows that Washington still thinks that the greatest threat to its dominance is the further economic integration of Russia and Europe, a massive two-continent free trade zone from Lisbon to Vladivostok that would eventually dwarf dwindling US GDP while decisively shifting the balance of global power to Asia. To counter that threat, the Obama administration toppled the elected government of Ukraine in a violent coup, launched a speculative attack on the ruble, forced down global oil prices, and is presently arming and training neo-Nazi extremists in the Ukrainian army. Washington has done everything in its power to undermine relations between the EU and Russia risking even nuclear war in its effort to separate the natural trading partners and to strategically situate itself in a location where it can control the flow of vital resources from East to West.
Laussanne was about strategic priorities not nukes. The Obama administration realizes that if it can’t find an alternate source of gas for Europe, then its blockade of Russia will fail and the EU-Russia alliance will grow stronger. And if the EU-Russia alliance grows stronger, then US attempts to extend its tentacles into Asia and become a major player in the world’s most prosperous region will also fail leaving Washington to face a dismal future in which the steady erosion of its power and prestige is a near certainty. This is from an article titled “Removing sanctions against Iran to have unfavorable influence on Turkey and Azerbaijan”:
“If Washington removes energy sanctions on Iran…then a new geopolitical configuration will emerge in the region. Connecting with Nabucco will be enough for Iran to fully supply Europe with gas…
Iran takes the floor with inexhaustible oil and gas reserves and as a key transit country. Iran disposes of the 10% of the reported global oil reserves and is the second country in the world after Russia with its natural gas reserves (15%). The official representatives of Iran do not hide that they strive to enter the European market of oil and gas, as in the olden days. Let’s remember that the deputy Minister of Oil in Iran, Ali Majedi, offered to revive project of Nabucco pipeline during his European tour and said that his country is ready to supply gas to Europe through it…
“Some months earlier the same Ali Majedi reported sensational news: ‘two invited European delegations’ discussed the potential routes of Iranian gas supply to Europe,” the article reads.” … It is also noted that the West quite materially reacted to the possibility of the Iranian gas to join Nabucco.” (Removing sanctions against Iran to have unfavorable influence on Turkey and Azerbaijan, Panorama)
So, is this the plan, to provide “energy security” to Europe by replacing Russian gas with Iranian gas?
It sure looks like it. But that suggests that the sanctions really had nothing to do with Iran’s fictitious nuclear weapons program but were merely used to humiliate Iran while keeping as much of its oil and gas offline until western-backed multinationals could get their greasy mitts on it.
Indeed, that’s exactly how the sanctions were used even though the nuclear issue was a transparent fake from the get go. Get a load of this from the New York Times:
“Recent assessments by American spy agencies are broadly consistent with a 2007 intelligence finding that concluded that Iran had abandoned its nuclear weapons program years earlier, according to current and former American officials. The officials said that assessment was largely reaffirmed in a 2010 National Intelligence Estimate, and that it remains the consensus view of America’s 16 intelligence agencies.” (U.S. Agencies See No Move by Iran to Build a Bomb, James Risen, New York Times, February 24, 2012)
See? The entire US intelligence establishment has been saying the same thing from the onset: No Iranian nukes. Nor has Iran ever been caught diverting nuclear fuel to other purposes. Never. Also, as nuclear weapons physicist, Gordon Prather stated many times before his death, “After almost three years of go-anywhere see-anything interview-anyone inspections, IAEA inspectors have yet to find any indication that Iran has — or ever had — a nuclear weapons program.”
The inspectors were on the ground for three freaking years. They interviewed everyone and went wherever they wanted. They searched every cave and hideaway, every nook and cranny, and they found nothing.
Get it? No nukes, not now, not ever. Period.
The case against Iran is built on propaganda, brainwashing and bullshit, in that order. But, still, that doesn’t tell us why the US is suddenly changing course. For that, we turn to an article from The Brookings Institute titled “Why the details of the Iran deal don’t matter” which sums it up quite well. Here’s a clip:
“At heart, this is a fight over what to do about Iran’s challenge to U.S. leadership in the Middle East and the threat that Iranian geopolitical ambitions pose to U.S. allies, particularly Israel and Saudi Arabia. Proponents of the deal believe that the best way for the United States to deal with the Iranian regional challenge is to seek to integrate Iran into the regional order, even while remaining wary of its ambitions. A nuclear deal is an important first step in that regard, but its details matter little because the ultimate goal is to change Iranian intentions rather destroy Iranian capability.” (Why the details of the Iran deal don’t matter, Brookings)
Notice how carefully the author avoids mentioning Israel by name although he alludes to “the threat that Iranian geopolitical ambitions pose to U.S. allies”. Does he think he’s talking to idiots?
But his point is well taken; the real issue is not “Iranian capability”, but “Iran’s challenge to U.S. leadership in the Middle East”. In other words, the nuclear issue is baloney. What Washington doesn’t like is that Iran has an independent foreign policy that conflicts with the US goal of controlling the Middle East. That’s what’s really going on. Washington wants a compliant Iran that clicks its heals and does what its told.
The problem is, the strategy hasn’t worked and now the US is embroiled in a confrontation with Moscow that is a higher priority than the Middle East project. (The split between US elites on this matter has been interesting to watch, with the Obama-Brzezinski crowd on one side and the McCain-neocon crowd on the other.) This is why the author thinks that easing sanctions and integrating Iran into the predominantly US system would be the preferable remedy for at least the short term.
Repeat: “The best way for the United States to deal with the Iranian regional challenge is to integrate Iran into the regional order.” In other words, if you can’t beat ‘em, then join ‘em. Iran is going to be given enough freedom to fulfill its role within the imperial order, that is, to provide gas to Europe in order to inflict more economic pain on Russia. Isn’t that what’s going on?
But what effect will that have on Iran-Russia relations? Will it poison the well and turn one ally against the other?
Probably not, mainly because the ties between Iran and Russia are growing stronger by the day. Check this out from the Unz Review by Philip Giraldi:
“Moscow and Tehran are moving towards a de-facto strategic partnership, which can be easily seen by the two groundbreaking announcements from earlier this week. It’s now been confirmed by the Russian government that the rumored oil-for-goods program between Russia and Iran is actually a real policy that’s already been implemented, showing that Moscow has wasted no time in trying to court the Iranian market after the proto-deal was agreed to a week earlier. Providing goods in exchange for resources is a strategic decision that creates valuable return customers in Iran, who will then be in need of maintenance and spare parts for their products. It’s also a sign of deep friendship between the two Caspian neighbors and sets the groundwork for the tentative North-South economic corridor between Russia and India via Iran.” (A Shifting Narrative on Iran, Unz Review)
But here’s the glitch: Iran can’t just turn on the spigot and start pumping gas to Europe. It doesn’t work that way. It’s going to take massive pipeline and infrastructure upgrades that could take years to develop. That means there will be plenty of hefty contracts awarded to friends of Tehran –mostly Russian and Chinese–who will perform their tasks without interfering in domestic politics. Check this out from Pepe Escobar:
“Russia and China are deeply committed to integrating Iran into their Eurasian vision. Iran may finally be admitted as a full member of the Shanghai Cooperation Organization (SCO) at the upcoming summer summit in Russia. That implies a full-fledged security/commercial/political partnership involving Russia, China, Iran and most Central Asian ’stans’.
Iran is already a founding member of the Chinese-led Asian Infrastructure Investment Bank (AIIB); that means financing for an array of New Silk Road-related projects bound to benefit the Iranian economy. AIIB funding will certainly merge with loans and other assistance for infrastructure development related to the Chinese-established Silk Road Fund…” (Russia, China, Iran: In sync, Pepe Escobar, Russia Today)
Get the picture? Eurasian integration is already done-deal and there’s nothing the US can do to stop it.
Washington needs to rethink its approach. Stop the meddling and antagonism, rebuild relations through trade and mutual trust, and accept the inevitability of imperial decline.
Asia’s star is rising just as America’s is setting. Deal with it.
“The interventions of US imperialism, with the direct collaboration of the Saudi monarchy, have plunged the entire Middle East into chaos and bloodshed—from the destruction of Iraq, to the transformation of Libya into a militia-ravaged “failed state,” to the ongoing carnage inflicted upon Syria … This predatory imperialist offensive threatens to ignite a region-wide conflagration, even as Washington deliberately ratchets up military tensions with both Russia and China. The threat of these separate conflicts coalescing into a third world war grows by the day.”
— Bill Van Auken, Obama’s criminal war against Yemen, WSWS
“Will the reactionary rulers of Saudi Arabia manage to break the legitimate hopes and enthusiastic dreams burning in the hearts of thousands of young people of the Arabian Peninsula? Never!”
— Gamal Abd al-Nasser, President of Egypt 1956 to 1970
In its ongoing effort to prevent the rise of “any popularly supported government in the region”, the US has joined Saudi Arabia’s savage war of annihilation against Yemen’s northern tribal rebels, the Houthis. The Pentagon has expedited the delivery of bombs, ammunition and guidance systems to assist the Saudi-led campaign and is providing logistical support to maximize the impact of its bombing raids. The US has also set up a “joint fusion center”, provided “aerial re-fueling platforms” and “advanced US-made weaponry” with the explicit intention of suppressing a militant group that overthrew the US-backed puppet government in the capital of Sanaa in the fall of 2014. The level of coordination between the makeshift Arab coalition (The Gulf Cooperation Council or GCC) and the US suggests that Washington is not only fully aware that food depots, water facilities, refugee camps and critical civilian infrastructure are being deliberately targeted and destroyed, but that the White House has given the green light to actions that will inevitably lead to widespread famine and social collapse. Here’s a little background from an article in The National:
“Yemen Economic Corporation, one of Yemen’s largest food storage centres, was destroyed by three coalition missile strikes in Hodeidah last Tuesday, according to the Houthi-controlled defence ministry. The corporation had enough food for the entire country. The government’s military food storage centre in Hodeidah was also targeted and destroyed on Tuesday, according to the defence ministry.
Also in Hodeidah, country’s second largest dairy plant was hit by five Saudi missiles on Wednesday, killing at least 29 people, mostly employees, and injuring dozens of others.” (Yemeni civilians struggle to get by amid conflict, The National)
This is from Channel News Asia:
DUBAI: Warships from the Saudi-led coalition have blocked a vessel carrying more than 47,000 tonnes of wheat from entering a Yemeni port, demanding United Nations guarantees that the cargo would not go to military personnel, shipping sources said on Thursday.” (Saudi-led coalition bars wheat ship from entering Yemen port – sources, Channel News Asia)
This is from WSWS:
“Airstrikes as well as fighting on the ground has knocked out electrical infrastructure, cutting off power in many urban areas and stopping the operation of crucial pumps that supply Yemen’s cities with drinking water. “We’re worried that this system will break down shortly; Aden is a dry, hot place, and without water people will really suffer,” UNICEF representative Harneis told reporters…
The no-fly zone and blockade enforced by Saudi Arabia and its coalition partners has effectively blocked the delivery of medical aid and supplies for the last two weeks, exacerbating the developing crisis.” WSWS
Live reports on the ground confirm that food depots have been bombed across the country; ” in Asr (west) hit as well as Urdhi complex (center) & Noqum (east).
This is how America fights its wars, by precipitating massive humanitarian crises that help it to achieve its political objectives. If that isn’t terrorism, then what is?
Here’s more from the Washington Post:
“As tons of desperately needed medical supplies await clearance to be flown into Yemen, aid workers warned Tuesday of an unfolding humanitarian crisis, saying at least 560 people, including dozens of children, have been killed, mostly in a Saudi-led air campaign and battles between Shiite rebels and forces loyal to the embattled president. More than 1,700 people have been wounded and another 100,000 have fled their homes as fighting intensified over the past three weeks, the World Health Organization said.” (560 dead amid fears of humanitarian collapse in Yemen, Washington Post)
The Saudis launched this latest aggression invoking the thinnest of pretexts, that it wanted to “restore the legitimate government” and protect the “Yemeni constitution and elections.” As CNN’s Ali Alahmed sardonically quipped:
“The need to protect constitutions and elections is a rather strange message from the representative of an absolute monarchy … The kingdom’s real motives seem clear if one looks at Saudi monarchy’s history of not allowing regional competition of any kind, while consistently combating efforts to build democratic governments that empower the people…
The Saudi goal is simple: Prevent the rise of any popularly supported government in the region that seeks self-determination. And the excuse of “resisting Iran’s influence,” meanwhile, appears to be nothing but sectarian bluster.” (What Saudi Arabia wants in Yemen, CNN)
While we agree with Alahmed’s basic thesis, we think the rule applies more to the United States than Saudi Arabia. After all, it’s the US that has gone from one country to the next, toppling governments, installing puppets, and spreading anarchy wherever it goes. Whatever role the Saudis might have played in Washington’s grand plan to redraw the map of the Middle East and project US tentacles into Eurasia, it is quite small by comparison. It’s the US that refuses to allow an independent government to emerge in a region that it’s committed to control. And it’s the US that is facilitating the attacks on innocent Yemenis by providing the bombs, weaponry and logistical support to the reactionary Saudi leadership. Check this out from Gregory Johnson at Buzzfeed:
“A consensus appears to be building in Riyadh, Cairo, and Islamabad toward inserting ground troops into the conflict in Yemen. One Egyptian military official told BuzzFeed News the decision had already been made. “Ground forces will enter the war,” the official said on condition of anonymity in order to discuss classified military operations.
The timing of such a move, which would be a significant escalation in the Saudi-led air campaign in Yemen, is still being discussed. But the Egyptian military source said it could happen as soon as “two or three days.” (Ground Forces Seen Joining Bloody War In Yemen, Buzzfeed)
So after two weeks of nonstop bombing, the coalition is now planning to intensify the conflict by putting boots on the ground. But that will only prolong the hostilities and plunge the country deeper into crisis. It will also increase the risk of Houthi retaliation, which appears to already be taking place. According to Al Arabiya English, fighting broke out in the Southern Saudi city of Narjan on April 11. (#BREAKING Asiri: Houthi militias are amassing close to the Saudi-Yemeni border… #BREAKING: Asiri: clashes reported near the Saudi city of Najran)
While no one expects the Houthis to invade their northern neighbor, there are some analysts who think the monarchy has taken on more than it can chew and will eventually suffer blowback from its incursion. One such critic is Sayed Hassan Nasrallah, Secretary General of the Lebanese paramilitary organization Hezbollah. In a recent interview, Nasrallah suggested that the Houthis have the means to curtail vital energy supplies, strike a blow against Saudi Arabia, and send financial markets tumbling at the same time. Here’s an excerpt from the interview:
“There is now a demand on the Yemeni leaders… who have not taken the decision to close (the strategic Strait) of Bab al-Mandeb, which they could do at any time. (It is only 20 kilometres-large, they are quite capable of it.) And they could also hit targets inside Saudi Arabia with missiles, or even enter the interior of Saudi Arabia, although they have not yet made this decision, so far … There is currently a Yemeni popular demand: “Let us go to Saudi Arabia.” Leadership thus far has not taken such a decision. I wanted to indicate this.”…
Nasrallah again: “I am absolutely certain that Saudi Arabia will undergo a major defeat. And its defeat will impact its internal situation, the royal family … and the entire region.” (“Hassan Nasrallah: The war in Yemen announces the end of the House of Saud”, The Vineyard of the Saker)
So the Houthis could close the Bab Al Mandeb straits and prevent millions of barrels of oil from getting to market? That changes the calculus entirely. How would that effect Washington’s plan to crash Russia’s economy with plunging oil prices? How would it impact global stock markets which are already jittery over the Fed’s projected rate hikes? What effect would it have on al Nusra, ISIS and other Al Qaeda-linked groups that would then seek to launch similar attacks against critical energy infrastructure as the best way to achieve their aims?
There are things the Houthis can do to discourage Saudi aggression. They can take matters into their own hands and strike where it hurts most. Washington is so convinced of its own invincibility, that no one has even thought of this. Without the slightest hesitation, the Obama troupe has embroiled a key ally in bloody conflagration that could backfire and seriously undermine US interests in the region. Saudi Arabia is the cornerstone of US power in the Middle East, but it is also its Achilles heel. By supporting the attack on the Houthis instead of seeking a political solution, Washington has strengthened Al Qaeda on the Arabian Peninsula (AQAP) which poses the greatest single threat to the monarchy. As Nasrallah notes: “they (the US and SA) protect Al Qaeda and Daesh in Yemen, and more, they drop them weapons by air. This is an achievement? This goes against the interests of Saudi Arabia.”
Indeed, it does. Al Qaeda has much greater ability to infiltrate Saudi Arabia and either launch terrorist attacks or foment popular revolution. The Houthis present no such security threat, they’re only interest is to maintain their own sovereignty, borders, and independent foreign policy. A 2003 article in the Atlantic by CIA Bureau Chief Robert Baer titled “The Fall of the House of Saud” provides a window into Riyadh’s vulnerabilities and draws the ominous conclusion that the kingdom’s days are numbered. Here’s a clip from the article:
“Saudi oil is controlled by an increasingly bankrupt, criminal, dysfunctional, and out-of-touch royal family that is hated by the people it rules and by the nations that surround its kingdom…
Signs of impending disaster are everywhere, but the House of Saud has chosen to pray that the moment of reckoning will not come soon—and the United States has chosen to look away. So nothing changes: the royal family continues to exhaust the Saudi treasury, buying more and more arms and funneling more and more “charity” money to the jihadists, all in a desperate and self-destructive effort to protect itself.
The most vulnerable point and the most spectacular target in the Saudi oil system is the Abqaiq complex—the world’s largest oil-processing facility, which sits about twenty-four miles inland from the northern end of the Gulf of Bahrain. All petroleum originating in the south is pumped to Abqaiq for processing. For the first two months after a moderate to severe attack on Abqaiq, production there would slow from an average of 6.8 million barrels a day to one million barrels, a loss equivalent to one third of America’s daily consumption of crude oil. For seven months following the attack, daily production would remain as much as four million barrels below normal—a reduction roughly equal to what all of the opec partners were able to effect during their 1973 embargo…
I served for twenty-one years with the CIA’s Directorate of Operations in the Middle East, and during all my years there I accepted on faith my government’s easy assumption that the money the House of Saud was dumping into weaponry and national security meant that the family’s armed forces and bodyguards could keep its members—and their oil—safe … I no longer believe this … sometime soon, one way or another, the House of Saud is coming down.” (The Fall of the House of Saud, Robert Baer, The Atlantic)
Neither the United States nor Saudi Arabia have any right to interfere in Yemen’s internal affairs or to install their own political puppets to head the government. That is the right of the Yemeni people. And while the current process of regime change might be messy and violent, the Houthi rebels better represent the interests of the indigenous population than anyone in Riyadh or Washington. The Saudi-US war is merely aimed at controlling the outcome so Yemen remains within the imperial grip. As Nasrallah says, “The real goal of the war is to retain control and domination of Yemen (but) the Yemeni people will not put up with this aggression and humiliation. They will fight to defend their dignity, their existence, their families, and their territory. And they will be victorious.”
This Sunday, April 19, is rightly identified as “Patriots’ Day.” In truth, April 19, 1775, should be regarded as important a date to Americans as July 4, 1776. It’s a shame that we don’t celebrate Patriots’ Day as enthusiastically as we do Independence Day. It’s even more shameful that many Americans don’t remember what happened on this day back in 1775. This was the day the “shot heard ’round the world” was fired. It was the day America’s War for Independence began.
Being warned of approaching British troops by Dr. Joseph Warren (who dispatched Paul Revere to Lexington and Concord with the news), Pastor Jonas Clark alerted his male congregants at the Church of Lexington that the British army was on its way to seize the colonists’ weapons and to arrest Sam Adams and John Hancock. Both men had taken refuge in Pastor Clark’s home with about a dozen of the pastor’s men guarding the house. Other men from the congregation (around 75-80 in number) stood with their muskets on Lexington Green when over 800 British troops appeared before them at barely the break of day.
According to eyewitnesses, British soldiers opened fire on the militiamen without warning (the British command to disperse and the British opening salvo of gunfire were simultaneous), immediately killing eight of Pastor Clark’s parishioners. In self defense, the Minutemen took cover and returned fire. These were the first shots of the Revolutionary War. Again, this took place on Lexington Green, which was located in the shadow of the church-house where those men worshipped each Sunday. The men that were guarding Adams and Hancock escorted them out of harm’s way shortly before the troops arrived. Without a doubt, the heroic efforts of Pastor Clark and his brave Minutemen at the Church of Lexington saved the lives of Sam Adams and John Hancock. And eight of those brave men gave their lives protecting two men who became two of America’s greatest Founding Fathers. But, mind you, Jonas Clark and his men are as important to the story of America’s independence as any of our Founding Fathers.
According to Pastor Clark, these are the names of the eight men who died on Lexington Green on that fateful April morning: Robert Munroe, Jonas Parker, Samuel Hadley, Jonathan Harrington, Jr., Isaac Muzzy, Caleb Harrington, and John Brown, all of Lexington, and one Mr. Porter of Woburn.
By the time the British troops arrived at the Concord Bridge, hundreds of colonists had amassed a defense of the bridge. A horrific battle took place, and the British troops were routed and soon retreated back to Boston. America’s War for Independence had begun.
Yes, ladies and gentlemen, these two elements of American history are lost to the vast majority of historians today: 1) it was attempted gun confiscation by the British troops that ignited America’s War for Independence, and 2) it was a pastor and his flock that mostly comprised the “Minutemen” who fired the shots that started our great Revolution.
With that thought in mind, I want to devote today’s column to honoring the brave preachers of Colonial America–these “children of the Pilgrims,” as one Colonial pastor’s descendent put it.
It really wasn’t that long ago. However, with the way America’s clergymen act today, one would think that preachers such as James Caldwell, John Peter Muhlenberg, Joab Houghton, and Jonas Clark never existed. But they did exist; and without them, this country we call the United States of America would not exist.
Caldwell was a Presbyterian; Muhlenberg was a Lutheran; Houghton was a Baptist; and no one really seems to know what denomination (if any) Jonas Clark claimed. But these men had one thing in common (besides their faith in Jesus Christ): they were all ardent patriots who participated in America’s War for Independence; and in the case of Jonas Clark, actually ignited it.
James Caldwell was called “The Rebel High Priest” or “The Fighting Chaplain.” Caldwell is most famous for the “Give ’em Watts!” story.
During the Springfield (New Jersey) engagement, the colonial militia ran out of wadding for their muskets. Quickly, Caldwell galloped to the Presbyterian church, and returning with an armload of hymnals, threw them to the ground, and hollered, “Now, boys, give ’em Watts!” He was referring to the famous hymn writer, Isaac Watts, of course.
The British hated Caldwell so much, they murdered his wife, Hannah, in her own home, as she sat with her children on her bed. Later, a fellow American was bribed by the British to assassinate Pastor Caldwell–which is exactly what he did. Americans loyal to the Crown burned both his house and church. No less than three cities and two public schools in the State of New Jersey bear his name today.
John Peter Muhlenberg
John Peter Muhlenberg was pastor of a Lutheran church in Woodstock, Virginia, when hostilities erupted between Great Britain and the American colonies. When news of Bunker Hill reached Virginia, Muhlenberg preached a sermon from Ecclesiastes chapter three to his congregation. He reminded his parishioners that there was a time to preach and a time to fight. He said that, for him, the time to preach was past and it was time to fight. He then threw off his vestments and stood before his congregants in the uniform of a Virginia colonel.
Muhlenberg was later promoted to brigadier-general in the Continental Army, and later, major general. He participated in the battles of Brandywine, Germantown, Monmouth, and Yorktown. He went on to serve in both the US House of Representatives and US Senate.
Joab Houghton was in the Hopewell (New Jersey) Baptist Meeting House at worship when he received the first information regarding the battles at Lexington and Concord. His great-grandson gives the following eloquent description of the way he treated the tidings:
“[M]ounting the great stone block in front of the meeting-house, he beckoned the people to stop. Men and women paused to hear, curious to know what so unusual a sequel to the service of the day could mean. At the first, words a silence, stern as death, fell over all. The Sabbath quiet of the hour and of the place was deepened into a terrible solemnity. He told them all the story of the cowardly murder at Lexington by the royal troops; the heroic vengeance following hard upon it; the retreat of Percy; the gathering of the children of the Pilgrims round the beleaguered hills of Boston; then pausing, and looking over the silent throng, he said slowly, ‘Men of New Jersey, the red coats are murdering our brethren of New England! Who follows me to Boston?’ And every man in that audience stepped out of line, and answered, ‘I!’ There was not a coward or a traitor in old Hopewell Baptist Meeting-House that day.” (Cathcart, William. Baptists and the American Revolution. Philadelphia: S.A. George, 1876, rev. 1976. Print.)
As I said at the beginning of this column, Jonas Clark was pastor of the Church of Lexington, Massachusetts, on April 19, 1775, the day that British troops marched on Concord with orders to arrest Sam Adams and John Hancock and to seize a cache of firearms. It was Pastor Clark’s male congregants who were the first ones to face-off against the British troops as they marched through Lexington. When you hear the story of the Minutemen at the Battle of Lexington, remember those Minutemen were Pastor Jonas Clark and the men of his congregation.
On the one-year anniversary of the Battle of Lexington, Clark preached a sermon based upon his eyewitness testimony of the event. He called his sermon, “The Fate of Blood-Thirsty Oppressors and God’s Tender Care of His Distressed People.” His sermon has been republished by Nordskog Publishing under the title, “The Battle of Lexington, A Sermon and Eyewitness Narrative, Jonas Clark, Pastor, Church of Lexington.” You can find the book here:
In the Introduction to the book, Gerald Nordskog writes this about Pastor Clark:
“As the pastor of the church at Lexington, he typically gave four sermons a week, written out and orally presented–nearly 2200 sermons in his lifetime. His preaching was vigorous in style, animated in manner, instructive in matter, and delivered with uncommon energy and zeal, with an agreeable and powerful voice. His sermons were rarely less than an hour, often more.”
Nordskog then quotes the Rev. William Ware, who wrote the following a little less than one hundred years after the Battle of Lexington:
“It can be regarded only as a singularly happy circumstance that, as Lexington was to be the place where resistance to the power of England was first to occur, and the great act of a declaration of war first to be made by the act of the people in the blood to be there shed, making the place forever famous in history, the minister of Lexington should have been a man of the principles, character, courage, and energy of Mr. Clark.
“It can be regarded he was eminently a man produced by the times–more than equal to them; rather a guide and leader. All his previous life, his preaching, his intercourse and conversation among the people had been but a continued and most effectual preparation for the noble stand taken by his people on the morning of the 19th of April, 1775. The militia on the Common that morning were the same who filled the pews of the meetinghouse on the Sunday morning before, and the same who hung upon the rear of the retreating enemy in the forenoon and throughout the day. They were only carrying the preaching of the many previous years into practice.
“It would not be beyond the truth to assert that there was no person at that time and in that vicinity–not only no clergyman but no other person of whatever calling or profession, who took a firmer stand for the liberties of the country, or was more ready to perform the duties and endure the sacrifices of a patriot, than the minister of Lexington.
“When the struggle actually commenced, the people were ready for it, thoroughly acquainted with the reasons on which the duty of resistance was founded, and prepared to discharge the duty at every hazard. No population within the compass of the Colonies were better prepared for the events of the 19th of April, than the people of Lexington; no people to whom the events of that day could more safely have been entrusted; none more worthy of the duties that fell to their lot; or who better deserved the honours which have followed the faithful performance of them. No single individual probably did so much to educate the people up to that point of intelligence, firmness, and courage, as their honoured and beloved pastor.”
Of course, Clark, Houghton, Muhlenberg, and Caldwell, were not the only ones to participate in America’s fight for independence. There were Episcopalian ministers such as Dr. Samuel Provost of New York, Dr. John Croes of New Jersey, and Robert Smith of South Carolina. Presbyterian ministers such as Adam Boyd of North Carolina and James Armstrong of Maryland, along with many others, also took part.
So many Baptist preachers participated in America’s War for Independence that, at the conclusion of the war, President George Washington wrote a personal letter to the Baptist people saying, “I recollect with satisfaction that the religious societies of which you are a member have been, throughout America, uniformly and almost unanimously, the firm friends to civil liberty, and the preserving promoters of our glorious Revolution.” It also explains how Thomas Jefferson could write to a Baptist congregation and say, “We have acted together from the origin to the end of a memorable Revolution.” (McDaniel, George White. The People Called Baptists. The Sunday School Board of the Southern Baptist Convention, 1918. Print.)
And although not every pastor was able to actively participate in our fight for independence, so many pastors throughout Colonial America preached the principles of liberty and independence from their pulpits that the Crown created a moniker for them: The Black Regiment (referring to the long, black robes that so many colonial clergymen wore in the pulpit). Without question, the courageous preaching and example of Colonial America’s patriot-pastors provided the colonists with the inspiration and resolve to resist the tyranny of the Crown and win America’s freedom and independence.
I invite readers to visit my Liberty Church Project website. We are currently engaged in the noble endeavor of helping to resurrect the patriot-pulpit throughout the United States. Perhaps we could help you. Here is the website:
This is the fighting heritage of America’s pastors and preachers. So, what has happened? What has happened to that fighting spirit that once existed, almost universally, throughout America’s Christian denominations? How have preachers become so timid, so shy, and so cowardly that they will stand apathetic and mute as America faces the destruction of its liberties? Where are the preachers to explain, expound, and extrapolate the principles of liberty from Holy Writ? Where are the pastors to preach the truth about Romans chapter 13?
Readers should know that my constitutional attorney son, Tim, and I have co-authored a blockbuster book dealing with Romans 13. The book is entitled, “Romans 13: The True Meaning of Submission.” It can be ordered at:
Plus, I also delivered four messages dealing with Romans 13. The message series is entitled, “The True Meaning of Romans 13.” These four video messages have been recorded on one DVD and may be ordered at:
I am absolutely convinced that one of the biggest reasons America is in the sad condition it is in today is because the sermons most Americans frequently hear from modern pulpits refuse to deal with the salient issues of the day and, therefore, our Christian people are mostly uneducated and ignorant of the great Biblical truths relating to liberty and Natural Law. This milquetoast preaching, along with a totally false “obey-the-government-no-
America cut its spiritual teeth on the powerful preaching and exemplary examples of men such as James Caldwell, John Peter Muhlenberg, Joab Houghton, and, yes, Jonas Clark. That most churches do not have pastors such as these is the main reason America is in the miserable condition it is in today.
Then again, for the most part, our churches have the kind of pastors they want, don’t they? I wonder just how many churches today would even tolerate the kind of sermons Jonas Clark delivered. So, ask yourself, dear Christian friend: if you claim to be a patriot, why do you stay in a church that lacks a patriot-pastor? We have the kind of government we vote for and the kind of church we attend and give to. Think about it.
At any rate, this Sunday, April 19, marks one of the most significant dates in American history. And it is significant, in great part, because of the courage and sacrifice of a pastor and church congregation. I wonder how many pastors across the country will even mention it from the pulpit this Sunday. I wonder how many people in the congregation will miss it if they don’t.
Regular readers of this Corporatocracy series should have a firm grasp on the concept of Corporatism. However, the uninitiated might presume that a corporation is merely a vehicle for protecting the owners of the enterprise from the liability risks of conducting business. Much attention has been devoted to the economic conditions and aspects when examining the corporate structure. But modest effort is found in business journals that discuss the social consequences of consolidating the entire hierarchy of political favoritism, access to capital and protection from competition that is at the heart of the corporatist model.
Corporatism as Theory and Practice by Joseph R. Stromberg offers a historic perspective.
“Corporatism and corporations are not yet the same subject. The key word is “yet.” If there is a relationship, it is historical. Very briefly, corporations — legally privileged from birth, pampered by courts, subsidized by Congress, with a social “in” with the most important state personnel — were likely, as ideal engines for accumulating capital, to produce unbalanced economic outcomes, mass discontent, and political unrest. Combine those engines with inherited dysfunctional institutions such as fractional-reserve banking, eminent domain, primitive military accumulation (e.g., the Indian wars), governmental distribution of resources, a venal party system, and a mighty executive, and you have a recipe for crisis. American elites recognized the danger fairly early. By trial and error they put together “corporate syndicalism” (Williams), “political capitalism” (Kolko), corporatism (varii), or “interest-group liberalism” (Lowi). It remained to be seen who (business or state?) would dominate the partnership. Hoover himself reflected in 1922 on the danger of “a syndicalist nation on a gigantic scale.”
Out of such a context the 21th century version of corporatism maintains little effort to satisfy mass discontent of the populace, because the will to achieve an independent livelihood has been stamped out so wholly by the merged state/corporate system. Viewing this alliance as a partnership vying for dominance is a false outlook. In this new millennium, the globalist economy is under total control by a financial dictate that makes laws, writes regulations, enforces compliance, bankrupts companies not in the club, subsidizes crony ventures, and imposes access to capital as a reward for playing ball.
This is not Capitalism, it is demented Corporatocracy.
Don Quijones writes in Crunch Time for the Global Corporatocracy about the closed door negotiations for the Trans Pacific Partnership (TPP), the US-EU trade deal (TIPP) and TISA.
“The hyper-secret Trade in Services Act (TiSA), which seeks to bind together the U.S., the EU and 22 other Western-aligned nations under a new system of laws and regulations covering telecoms, water, gas, electricity, transport, financial and legal services, software design, electronic data, tourism, healthcare and a whole lot more, is infinitely worse. The treaty’s text is designed to be almost impossible to repeal, and is to be “considered confidential” for at least five years after being signed.”
Basically, the nature of all these destructive trade agreements is reducible to “The fact that we now live in a world dominated by highly undemocratic and unaccountable supranational organizations (the IMF, World Bank, WTO, EU…) is no mere accident.”
Corporatism 101 is not taught in school or even debated in the mass media. It falls to online publications like Naked Capitalism to feature another persuasive argument by Mr. Quijones, which concludes.
“The rise of investor-state dispute settlements and the broad application of arbitration procedures are the ultimate victory in the global corporatocracy’s decades-long coup d’état. If allowed to take universal effect, the system will impose above you, me, and our governments a rigid framework of international corporate law designed to exclusively protect the interests of corporations, relieving them of all financial risk and social and environmental responsibility. From then on, every investment they make will effectively be backstopped by our governments (and by extension, you and me); it will be too-big-to-fail writ on an unimaginable scale.”
It seems that all the attention provided in business news is diverted away from the totality of integration under the auspices of a pseudo and hostile legal framework that only deepen the aggregate control over the social, political, economic and global functions, is silent by design.
So when Suarez-Villa, Luis, publishes in Globalization and Technocapitalism: the political economy of corporate power and technological domination, page 203, we all should take notice.
“It should not surprise, therefore, that a major objective of the fast neo-imperialism is to establish corporatocratic governance whenever and wherever campaigns of conquest happen to be carried out. Fast militarism thereby comes into the scene, whenever aggression is executive. Military conquest for its own sake is pointless, and the fast neo-imperialism has no real reason for being, unless the imposition of corporatocracy is part of the end game of conquest.”
The re-establishment of a neo-feudalism is not a function of privatization, when market forces are unleashed from the choke hold that keeps real competition at bay. Allowing businesses to vie for consumer favor is healthy under a free market economy. Today, there are few examples where the corporatocracy allows for free trading in goods and services.
This is the important lesson that techno corporatism refuses to accept. As the bondage economy expands, the serfs become expendable. Since the consumer economy is shifting into a financial speculation arena, the elites see little reason for continued subsistence of the bottom feeders, since they are not needed to till their estates.
Knowing this object lesson is the actual answer to the Corporatism 101 studies.
Maybe Bruce E. Levine PhD should be teaching class. Get Up, Stand Up: Uniting Populists, Energizing the Defeated, and Battling the Corporate Elite, argues that “individuals must recover self-respect, and a people must regain collective confidence that they can succeed at eliminating top-down controls. Get Up, Stand Up describes how we can recover dignity, confidence, and the energy to do battle.”
It all starts with a required understanding that the Corporatocracy economy is inherently destructive to individual liberty. If people are unable to learn this fact, life on earth will sink into oblivion.
Today many intellectuals and modern theologians slavishly follow after whatever passes for current trends in scientific and evolutionary theory, thus they believe the Genesis account ex nihilo, the supernatural, the fall, miracles, the Resurrection of Christ, hell, angels, demons and possession are out dated concepts. Despite this, in 1967 Mortimer J. Adler, the guiding genius behind The Encyclopedia Britannica and Great Books of the Western World, predicted that belief in a spiritual reality would not only return but be considered orthodox science. His prediction has come true, for today, Eastern-oriented occult pantheism (evolutionary New Age cosmic humanism (1) and esoteric neo-pagan materialism (evolutionary secular humanism) have nearly merged, making it difficult to distinguish one from the other.
Over the past three hundred years, the Western Christian tradition has slowly but steadily been eclipsed, first by scientific evolutionary materialism, now by Eastern-oriented scientific cosmic humanism which has infused and spiritualized the former, transforming it into an agency for the transmission of the naturalistic structure of the evolving universe of matter and psychic energy and other revelations from fallen angels and evil spirits. This legion of disembodied beings call themselves everything from Transcended Masters to Maitreya, Semjase, the Council of Nine, Space Brothers and ancient Ennead of Egypt together with evil spirits going by such names as god, christ and jesus. All of this has led Martin Lloyd-Jones to declare:
“The modern world, and especially the history of the present century, can only be understood in terms of the unusual activity of the devil and the “principalities and powers” of darkness…In a world of collapsing institutions, moral chaos, and increasing violence, never was it more important to trace the hand of the “prince of the power of the air.” If we cannot discern the chief cause of our ills, how can we hope to cure them?” The Christian Warfare
In the space of a few short decades occult New Age spirituality (2) has made profound inroads. Its upsurge manifests itself in the form of everything from obsession with the paranormal, channeling cults, ghost-hunting, necromancy, light-bearers, spirit guides (3), goddess worship, shamanism, transcendental meditation and visualization (4), ‘new’ contemplative or centering prayer (5), the enneagram (6), labyrinth walking (7), yoga (8), Wicca (9), revitalized Norse paganism, transformational festivals (10), vampires (11), Ouija boards (12), poltergeists (13), the proliferation of ‘new’ religions and Lucifer as the Angel of Light:
“Medium and psychic Sylvia Browne admits there are dark entities that choose from the beginning to be this way, but she denies the devil. According to Browne, God sent Lucifer down to watch over people when God saw they had chosen “the dark side.” According to Browne, “Lucifer is neither dark nor fallen. He wasn’t rejected by God or banished from the light.” (The Dark Side: Beyond Good and Evil, Marcia Montenegro, Christian Answers for the New Age)
The hugely popular “new” contemplative or centering prayer (5) is a hybrid drawn from prayer practices of the Christian contemplative heritage fused with Eastern mysticism. The hybrid version,
“…originated in St Joseph’s Abbey, a Trappist monastery in Spencer, Massachusetts. During the twenty years (1961-1981) when Keating was abbot, St Joseph’s held dialogues with Buddhist and Hindu representatives, and a Zen master gave a week-long retreat to the monks. A former Trappist monk who had become a Transcendental Meditation teacher also gave a session to the monks. ….Centering prayer is essentially a form of self-hypnosis. It makes use of a “mantra,” a word repeated over and over to focus the mind while striving by one’s will to go deep within oneself. The effects are a hypnotic-like state…” (The Danger of Centering Prayer, Rev. John D. Dreher, Catholic Education Resource Center)
In the foreword to Philip St. Romains book, “Kundalini Energy and Christian Spirituality,” Keating acknowledges that kundalini energy is the focus of the “new” Christian contemplative prayer. He states:
“Since this energy [kundalini] is also at work today in numerous persons who are devoting themselves to contemplative prayer, this book is an important contribution to the renewal of the Christian contemplative tradition. It will be a great consolation to those who have experienced physical symptoms arising from the awakening of kundalini in the course of their spiritual journey … Most spiritual disciplines world-wide insist on some kind of serious discipline before techniques of awakening kundalini are communicated. In Christian tradition … the regular practice of the stages of Christian prayer … contemplation are the essential disciplines…” (Kundalini Energy (Serpent Power) Same as Contemplative Silence, lighthousetrailsresearch)
Psychical researcher J.D. Pearce-Higgins, vice chairman of the Churches Fellowship for Psychical and Spiritual Studies (Great Britain) writes of the hazards of Ouija board (11) use and automatic writing:
“These apparently simple methods of attempting contact…are extremely dangerous. (People will become) obsessed or possessed by some…damaging spirit who has got control of them and won’t let go. They are compelled to go on with automatic writing—at all hours of day and night (and) may begin to hear…voices telling them to do stupid and filthy things; they are no longer master in the house of their own minds and souls.” (ibid, pp. 129-130)
From England to Australia and New Zealand, from South America to E. Europe, Canada and the United States, occult spirituality is quickly becoming the West’s dominant orthodoxy, leading America’s mainstream media to report:
“Neopaganism Growing Quickly: Numbers Roughly Double Every 18 Months in United States, Canada, and Europe.” (Denver Post, June 26, 2008; How Evil Works, David Kupelian, p. 115)
“Sorcery Sells, and the Young are Buying” Atlanta Journal-Constitution, June 10, 2007 (ibid)
“Wicca is Believed to be One of the Fastest-Growing Religions Among High School and College Students” National Public Radio, May 13, 2004 (ibid)
In his book, “America’s Schools: The Battleground for Freedom,” Allen Quist warns:
“New Age religion is now aggressively being taught in our nation’s public schools.” A model curriculum has been developed that “is clearly centered on pantheism.” “Much of what passes for environmental education and multiculturalism is really indoctrination in pantheistic/New Age theology. The ACLU and other similar organizations have no objections to (pantheistic indoctrination). It is only Christianity that these organizations object to.” (p. 51)
Today millions of Westerners are risking everything to seek the occult world and its’ alluring power. In “One or Two?” Dr. Peter Jones, Director of truthXchange and Adjunct Professor of New Testament at Westminster Seminary California writes that a wide variety of occult spirituality is now available.
There is something for everyone:
“A Course in Miracles, Alchemy, American Indian Quest, Ancient Mythology, Arkashic Record, Aryuvedic Medicine, Astrology, Bahai’i Unity, Buddhism, Buddhist/Christian Dialogue, Chakras, Channeling, Christian Monastic Mysticism, Crystals, Divination, Dream work, Druidism, Eastern Meditation, Eckankar (soul travel), Ecofeminism, Enneagram, EST, Feng Shui, Gnosticism (ancient and modern), Goddess worship, Hare Krishna, Hermeticism, Higher Self, Hinduism, Holism, Human Potential Movement, Hypnosis, I Ching, Iridology, Jungian Transpersonal Psychology, Kabbalah, Karma, Mandalas, Mantras, Mind-altering drugs, Parapsychology, Past Life Regressions, Reiki, Re-incarnation, Religious syncretism, Rolfing, Sacred Technologies, Santeria, Scientology, Shamanism, Sufism, T’ai Chi, Tantrism, Tarot Cards, Teilhardism, Therapeutic Touch, Tikkun, Transcendental Meditation, Ufology, Urantia Book, Visualization, Wicca, Yoga, Zen.” (pp. 40-41)
It is well documented that perversions, murder, possession and other evils, including human sacrifice, occur in Western witchcraft, Satanism and Eastern mysticism (e.g., tantric yoga) as well as pagan and pantheist occult religion in general. In his “Occultism, Witchcraft and Cultural Fashions,” the noted cultural anthropologist Mircea Eliade of the University of Chicago refers to the interconnections between European witchcraft and Hindu Tantric yoga. He argues that “even a rapid perusal of the Hindu and Tibetan documents” reveals the connection:
“As a matter of fact, all the features associated with European witches are—with the exception of Satan and the Sabbath—claimed also by Indo-Tibetan yogis and magicians. They too are supposed to fly through the air, render themselves invisible, kill at a distance, master demons and ghosts, and so on. Moreover, some of(them) boast that they break all the religious taboos and social rules; that they practice human sacrifice, cannibalism, and all manner of orgies, including incestuous intercourse, and that they eat excrement, nauseating animals, and devour human corpses. In other words, they proudly claim all the crimes and horrible ceremonies cited ad nauseum in the western European witch trials.” (Psychic Forces, Chapter 22, “The Occult History of Parapsychology,” Clifford Wilson and John Weldon, pp. 341-49)
The very popular Tantra Kundalini yoga is based on the occultic chakra system which teaches that a universal evolutionary energy (Kundalini Shakti, the Supreme Power; serpent power) coiled at the base of the spine flows through human beings and through all of creation, uniting everything above and everything below, thus acknowledging divinity in all things and all people. Through strenuous yoga and other occult techniques outlined in ancient and modern texts, Kundalini Shakti uncoils and rises through seven “chakras” or power centers within the human body. During so-called kundalini arousal, which may last for months or even years, protracted insanity and/or demonization must be endured. In the words of power yogi Muktananda:
“I was assailed by all sorts of perverse and defiling emotions….my breathing (became) disturbed…my abdomen would swell with air…my mind was sick with fear (my)thoughts became confused, meaningless. My limbs and body got hotter and hotter….Then I felt a searing pain…I wanted to run away, but my legs were locked tight in the lotus posture…..Then…a moonlike sphere…came floating in (it) struck against my eyes and…passed inside me…I was terrified (but) still locked in the lotus posture(with) my head forced down and glued to the ground….I started to make a sound like a camel, which alternated with the roaring of a tiger (I went) completely insane(and jumped and hopped) like a frog (while) my limbs (shook) violently. (Later) I learned that this was a Hatha Yoga process effected by the Goddess Kundalini in order for Her to move up through the spinal column into the sahasrana (upper psychic center.)” (Play of Consciousness, Swami Muktananda, pp. 75-81, 84-85, 88-89)
With continued practice, surrender, and preparation, one day the kundalini current will reach full voltage and there will no longer be ‘anybody home’ but an unholy spirit residing in an empty shell of a body:
“The moment of power transfer had come….Muktananda (adept of Nityananda) was about to make the timeless journey….of the power yogi (the Siddha), but it required the catalytic power of the master guru, Nityananda…who was God to Muktananda, therefore worthy of worship as the supreme Deity. The voyage of consciousness, prized by the ancients, would split Muktananda into fragments…Sometimes (his) body would writhe and twist like a snake’s while a hissing sound would come from inside (him).” Finally it happened—explosion, the point of no return where Muktananda “as an individual would be obliterated. Superconscious states would take control of him, and his consciousness would be kicked out to more and more remote levels.” “In place of the former person was the walking void, the Unself, the hollow shell filled with the soul of the universe…” (Riders of the Cosmic Circuit, Tal Brooke, pp. 36-45)
Like “new” contemplative prayer and other occultisms, yoga does not liberate; it enslaves and binds. It does not enlighten but brings confusion and insanity. It makes people immune to redemption through Christ,
“Yoga does not open the door for the Holy Spirit, but for spiritist spirits.” (Occult ABC: Exposing Occult Practices and Ideologies, Kurt E. Koch, p. 259)
Occult (Demonic) Bondage
According to Dr. Kurt Koch (1913-1987), a noted German theologian and minister with extensive personal experience in counseling and delivering thousands of people held in occult bondage, modern theologians who follow current scientific trends would be shocked by how many of the so-called scientists and intellectuals they slavishly follow have turned to occultism and spiritism (sorcery) and become demonized as a result. Be they scientist or otherwise, all who trespass into Satan’s domain by committing sins of sorcery will be harassed by the powers of darkness, irrespective of whether they take the step consciously or unconsciously. Every sin of sorcery (occultism) cuts a person off from the Holy God and opens the door to demonic bondage. Any person who serves the devil (occult), will receive the devil’s wages (Exod. 7:11-12; Lev. 19: 26, 32; Zech. 12:2; Mal. 3:5; Acts 8:16; Acts 16:16; 1 Sam. 28; 2 Chron. 10:13-14; Isaiah 2:6; 8:19; Jer. 27:9, 10; Gal. 5:20; 2 Tim. 3:8; Rev. 21:8; Rev. 22:15). Thus when a person abandons the Holy Triune God through sins of sorcery, he abandons his inner person (mind, will, conscience) at the same time as seen in relation to psychological disturbances having the following predominant characteristics:
(1) Warped, distorted character: hard-edged egoism; uncongenial, dark nature.
(2) Extreme passions: hard-edged egoism, abnormal sexuality (sodomy, lesbianism, sadomasochism, bestiality, pedophilia, pederasty, zoophiles); violent temper, belligerence; tendencies to addiction; meanness and kleptomania; compulsive lying.
(3) Emotional disturbances; compulsive thoughts of murder and suicide, anxiety states.
(4) Possession with destructive urges, fits of mania; tendency to violent acts and crime
(6) Bigoted attitude against Christ and God; conscious atheism; simulated piety; indifference to God’s word and to prayer; blasphemous thoughts; religious delusions.
The ultimate goal of fallen angels and evil spirits is degradation and desecration of mans’ inner person, the spiritual part of him created in the image of the Holy God. So what are systematically defaced and desecrated are the mind, will, conscience and sense of good and evil.
Demonic Darkness: America’s Invisible Wave of Evil
Carl A. Raschke is Professor of Religious Studies at the University of Denver specializing in Continental philosophy and the philosophy and theory of religion. He is also America’s leading authority on subcultures of demonic darkness. In his fully-documented work, “Painted Black” he puts together a terrifying puzzle to reveal the chilling facts and cases behind an invisible wave of evil working through the minds of children and adults and subsequently sweeping over and across our nation outwardly manifest in an alarming epidemic of violence and madness that Western therapeutic science explains away as hallucinations, genetic influences and chemical disturbances. Such a posture, said Raschke, hinges on the most incredible delusion that the “symbol of the Devil does not at all mean what the symbol of the Devil has always meant…” (Painted Black, p.404).
According to Rashcke, demonic bondage does not always manifest itself in a will to do evil:
“Many of today’s young satanists (are characterized) by a metaphysics of exhaustion and despair. A culture of despair becomes ever easier pickings for the…child pornographers (and the) professional (satanic) terrorists themselves. Satanism has already yielded a climate of fear in middle-class quarters where fear had never flourished before.” (p. 406)
A culture of “exhaustion and despair” also welcomes demonized perverse ‘sex-educators’ (14) and professional satanic terrorists like the 9/11 murderers and ISIS.
Where occult bondage manifests itself in a will to do evil it is seen in the recent Dark Knight movie murders (15) and in the following chilling account:
“In a chilling 911 call, Texas teen Jake Evans spent 20 minutes calmly recounting how he shot and killed his mother and sister, calling himself “evil.” (Texas Teen Tells 911 It Was Weird to Kill His Mother and Sister, abcnews, Oct. 5, 2012)
“It’s weird,” an even-voiced Evans told the 911 dispatcher. “I wasn’t even really angry with them. It just kind of happened. I’ve been kind of planning on killing for a while now.” “I’ll never forget this. My sister, she came down the stairs and she was screaming and I was telling her that I’m sorry but to just hold still–that, you know, I was just going to make it go away,” he said. “But she just kept on freaking out, but finally she fell down, and I got her in the head about, probably, three times.” “Just to let you know, I hate the feeling of killing someone. I’m going to be messed up,” he told the operator.” “I’m really worried about nightmares and stuff like that. Are there any type of medications for that and stuff?”
America’s secularized culture is a spiritual vacuum into which innumerable dark psychic forces have flooded. Most of the present destructive generation is sick, lawless, narcissistic, and undisciplined. America, the dying leader of the world, bleeds from thousands of self-inflicted wounds as she marches toward her own destruction to the beat of unseen drummers.
The clearest answer to the evil conditions of our times is found in the Bible. We are living in the Last Days. The final pages of history are now being read. Our time,
“…can only be understood aright in the light of the prophetic word. Satan is mobilizing all his forces for an all-out attack. The demonic world has entered the final lap….To fail, therefore, to take our stand at the foot of the cross, to fail to build our house upon the Rock, is to be swept away by the turmoil of the End-Times. We are living in days of a demonic nature!” (Demonology Past and Present, Kurt E. Koch, p. 37)
- The Difference of Man and the Difference It Makes, Adler, p. 294
- The New Age. What is it? Marcia Montenegro, Christian Answers for the New Age
- SPIRIT CONTACT: WHO IS ON THE OTHER SIDE? ibid
- OUT OF YOUR MIND: MEDITATION AND VISUALIZATION, ibid
- Centering Prayer, Matt Slick, CARM; The Danger of Centering Prayer, Rev. John D. Dreher, Catholic Education Resource Center; Contemplating Contemplative Prayer: Is It Really Prayer? Montenegro
- The enneagram gps: gnostic path to self, Montenegro; National Pastor’s Convention Using Occultic Enneagram, lighthousetrailsresearch.com, Dec. 12, 2006
- THE LABYRINTH: A WALK BY FAITH? Montenegro
- Christian yoga: an oxymoron? Marcia Montenegro
- WITCHCRAFT, WICCA AND NEOPAGANISM, ibid
- Transformational Festivals, The Freedom Report
- THE VAMPYRE UNDERGROUND, Montenegro
- THE OUIJA BOARD — JUST A GAME???, ibid
- Poltergeists—An Evaluation of a Demonic Phenomenon, inplainsite.org
- The Little Black Book http://www.article8.net/downloads/LittleBlackBook.pdf
- James Holmes Charged With 24 Counts of Murder in Dark Knight Rises Massacre, usmagazine.com
In last month’s Anti-Empire Report I brought you the latest adventure of US State Department Spokesperson Jen Psaki trying to defend the indefensible. She said then: “As a matter of longstanding policy, the United States does not support political transitions by non-constitutional means,” which prompted me to inform my readers: “If you know how to contact Ms. Psaki, tell her to have a look at my list of more than 50 governments the United States has attempted to overthrow since the end of the Second World War.”
On March 13 her regular attack on all things Russian included this exchange with Associated Presswriter Matthew Lee:
Lee: On this issue, did you get any more about this request to the Vietnamese on Cam Ranh Bay and not allowing the Russians to – and not wanting them to allow – you not wanting them to refuel Russian planes there?
Psaki: Well, just to be clear – and maybe I wasn’t as clear yesterday, so let me try to do this again – it’s – our concern is about activities they might conduct in the region, and the question is: Why are they in the region? It’s not about specifically refueling or telling the Vietnamese not to allow them to refuel. [emphasis added]
Lee: So there hasn’t been a request to stop refueling them, or there has?
Psaki: It’s more about concerns. It’s not as much about Vietnam as much as it – as it is about concerns about what activities they would be in the region for.
Lee: Okay. Well, you – I mean, there are U.S. planes flying over there all the time.
Psaki: Sure, there are.
Lee: So you don’t want Russian planes flying there, but it’s okay for U.S. planes to fly there? I mean, I just – it gets to the point where you – the suggestion is that everything the Russians are doing all the time everywhere is somehow nefarious and designed to provoke. But you can’t – but you don’t seem to be able to understand or accept that American planes flying all over the place, including in that area, is annoying to the Chinese, for one, but also for the Russians. But the suggestion is always that the American flights are good and beneficial and don’t cause tension, and that other people’s flights do cause tension. So can you explain what the basis is for your concern that the Russian flights there in the Southeast Asia area are – raise tensions?
Psaki: There just aren’t more details I can go into.
Cold War 2.0, part II
On Saturday, the Obama administration released a series of satellite images that it said showed the Russian army had joined the rebels in a full-scale assault to surround troops in the area around the city. Russia has denied that it is a party to the conflict, and it was impossible to verify the three grainy black-and-white satellite images posted to Twitter by the U.S. ambassador to Ukraine, Geoffrey Pyatt.
According to the United States, the images, commissioned from the private Digital Globe satellite company, showed artillery systems and multiple-rocket launchers Thursday in the area near Debaltseve.
“We are confident these are Russian military, not separatist, systems,” Pyatt tweeted. (Washington Post, February 15, 2015)
When the time comes to list the ways in which the United States gradually sunk into the quicksand, slowly metamorphosing into a Third-World state, Washington’s campaign of 2014-15 to convince the world that Russia had repeatedly invaded Ukraine will deserve to be near the top of the list. Numerous examples like the above can be given. If I were still the jingoistic nationalist I was raised to be I think I would feel somewhat embarrassed now by the blatant obviousness of it all.
For a short visual history of the decline and fall of the American Empire, see the video “Imperial Decay” by Class War Films (8:50 minutes).
During Cold War 1.0 the American media loved to poke fun at the Soviet media for failing to match the glorious standards of the Western press. One of the most common putdowns was about the two main Russian newspapers – Pravda (meaning “truth” in Russian) and Izvestia (meaning “news”). We were told, endlessly, that there was “no truth in Pravda and no news in Izvestia.”
As cynical as I’ve been for years about the American mainstream media’s treatment of ODE (Officially Designated Enemies), current news coverage of Russia exceeds my worst expectations. I’m astonished every day at the obvious disregard of any kind of objectivity or fairness concerning Russia. Perhaps the most important example of this bias is the failure to remind their audience that the US and NATO have surrounded Russia – with Washington’s coup in Ukraine as the latest example – and that Moscow, for some odd reason, feels threatened by this. (Look for the map online of NATO bases and Russia, with a caption like: “Why did you place your country in the middle of our bases?”)
Cold War 2.0, part III
Following the murder of Russian opposition leader, and former Deputy Prime Minister, Boris Nemtsov in Moscow on February 27, the West had a field day. Ranging from strong innuendo to outright accusation of murder, the Western media and politicians did not miss an opportunity to treat Vladimir Putin as a football practice dummy.
The European Parliament adopted a resolution urging an international investigation into Nemtsov’s death and suggested that the Organization for Security and Cooperation in Europe, the European Council, and the United Nations could play a role in the probe.
US Senators John McCain and Lindsey Graham introduced a Senate Resolution condemning the Nemtsov murder. The Resolution also called on President Obama and the international community to pursue an independent investigation into the murder and redouble efforts to advance free speech, human rights, and the rule of law in Russia. In addition, it urged Obama to continue to sanction human rights violators in the Russian Federation and to increase US support to human rights activists in Russia.
So it went … all over the West.
Meanwhile, in the same time period in Ukraine, outside of the pro-Russian area in the southeast, the following was reported:
- January 29: Former Chairman of the local government of the Kharkov region, Alexey Kolesnik, hanged himself.
- February 24: Stanislav Melnik, a member of the opposition party (Partia Regionov), shot himself.
- February 25: The Mayor of Melitopol, Sergey Valter, hanged himself a few hours before his trial.
- February 26: Alexander Bordiuga, deputy director of the Melitopol police, was found dead in his garage.
- February 26: Alexander Peklushenko, former member of the Ukrainian parliament, and former mayor of Zaporizhi, was found shot to death.
- February 28: Mikhail Chechetov, former member of parliament, member of the opposition party (Partia Regionov), “fell” from the window of his 17th floor apartment in Kiev.
- March 14: The 32-year-old prosecutor in Odessa, Sergey Melnichuk, “fell” to his death from the 9th floor.
The Partia Regionov directly accused the Ukrainian government in the deaths of their party members and appealed to the West to react to these events. “We appeal to the European Union, PACE [Parliamentary Assembly of the Council of Europe], and European and international human rights organizations to immediately react to the situation in Ukraine, and give a legal assessment of the criminal actions of the Ukrainian government, which cynically murders its political opponents.”
We cannot conclude from the above that the Ukrainian government was responsible for all, or even any, of these deaths. But neither can we conclude that the Russian government was responsible for the death of Boris Nemtsov, the American media and politicians notwithstanding. A search of the mammoth Nexus news database found no mention of any of the Ukrainian deceased except for the last one above, Sergey Melnichuk, but this clearly is not the same person. It thus appears that none of the deaths on the above list was ascribed to the Western-allied Ukrainian government.
Where are the demands for international investigations of any of the deaths? In the United States or in Europe? Where is Senator McCain?
Torture via sanctions
Discussions on constraining Iran’s nuclear program have been going on for well over a year between Iran and the P5+1 (the five nuclear powers of the United Nations Security Council plus Germany), led by the United States. Throughout this period a significant stumbling block to reaching an agreement has been the pronouncements of Yukiya Amano, director general of the International Atomic Energy Agency (IAEA). The IAEA is the United Nations’ nuclear watchdog, and its inspections are considered a key safeguard against countries using civilian nuclear energy technology to produce weapons. Amano has consistently accused Iran of failing to reply fully and substantially to queries about “possible military dimensions” of present and past nuclear activities, or failing to provide sufficient access to nuclear facilities.
Failure by Iran to comply fully with IAEA demands undermine Tehran’s efforts to win the lifting of crippling UN, US and other sanctions, which currently prohibit foreign companies from doing business with Iran and deny access to the global financial system. Media coverage of the negotiations regularly emphasize Amano’s claims of Iran’s insufficient responses to IAEA’s demands. It is thus worth inquiring just who is this man Amano.
In 2009 Japanese diplomat Yukiya Amano became the head of the IAEA. What the Western media routinely fail to remind its audience is that a US embassy cable of October 2009 (released by Wikileaks in 2010) said Amano “took pains to emphasize his support for U.S. strategic objectives for the Agency. Amano reminded the [American] ambassador on several occasions that … he was solidly in the U.S. court on every key strategic decision, from high-level personnel appointments to the handling of Iran’s alleged nuclear weapons program.”
Even if Iran makes a superior effort to satisfy IAEA and Washington’s demands on all issues, it would remain questionable to what extent and how rapidly the sanctions would be removed, particularly under a Republican-controlled Congress. Iran specialist and author Gareth Porter recently wrote that “the United States and its allies have made no effort to hide the fact that they intend to maintain the ‘sanctions architecture’ in place for many years after the implementation of the agreement has begun. Last November, administration officials explained that US sanctions would only be removed after the International Atomic Energy Agency had verified that ‘Tehran is abiding by the terms of a deal over an extended period of time’ in order to ‘maintain leverage on Iran to honour the accord’.”
To appreciate the extraordinary degree of pressure and extortion the United States can impose upon another country we should consider the case of Libya in the decade-plus following the destruction of PanAm Flight 103 in 1988 over Scotland. To force Libya to “accept responsibility” for the crime, Washington imposed heavy sanctions on the Gaddafi regime, including a ban on international flights to Libya and payment of billions of dollars to the families of the victims. Libya eventually did “accept responsibility” for the crime, although it was innocent. As difficult as this may be to believe, it’s true. Read my account of it here.
Even after Libya accepted responsibility it still took years for the US to wipe out the sanctions, and it’s not clear that at the time of Gaddafi’s death in 2011 all of them had been removed. Once a nation becomes an Officially Designated Enemy of the empire the methods of torture can be exquisite and endless. Cuba is presently negotiating the end of US sanctions against Havana. They will need to be extremely careful.
“Like others of his ilk – such as David Horowitz and Christopher Hitchens – he learned too much in college and too little since.” Sam Smith
I’ve never been too impressed by what college a person went to, or even if they attended college at all. Gore Vidal did not attend any college; neither did H. L. Mencken; nor did Edward Snowden, who has demonstrated a highly articulate and educated mind. Among the many other notables who skipped a college education are George Bernard Shaw, Ernest Hemingway, and Johann Wolfgang von Goethe.
Then we have graduates from Ivy League colleges like George W. Bush, Barack Obama, and Tom Cotton. I don’t have to present the case for Bush’s less-than educated mind; we’re all only too familiar with its beauty. But Obama has matched Georgie Boy for stupidity and inanity time and time again. My favorite, which he’s used on at least five occasions, is his reply to questions about why his administration has not prosecuted Bush, Cheney, et al for torture and other war crimes: “I prefer to look forward rather than backwards”. Picture a defendant before a judge asking to be found innocent on such grounds. It simply makes laws, law enforcement, crime, justice, and facts irrelevant. Picture Chelsea Manning and other whistle blowers using this argument. Picture the reaction to this by Barack Obama, who has become the leading persecutor of whistleblowers in American history.
Is there anyone left who still thinks that Barack Obama is some kind of improvement intellectually over George W. Bush? Probably two types still think so: (1) Those to whom color matters a lot; (2) Those who are very impressed by the ability to put together grammatically correct sentences.
And now we have Mr. Cotton, Senator from Arkansas and graduate of Harvard undergraduate and law schools. He’ll be entertaining us for years to come with gems like his remark on “Face the Nation” (March 15): “Moreover, we have to stand up to Iran’s attempts to drive for regional dominance. They already control Tehran and, increasingly, they control Damascus and Beirut and Baghdad. And now, Sana’a as well.”
Heavens, Iran controls Tehran! Who knew? Next thing we’ll hear is that Russia controls Moscow! Sarah Palin, move over. Our boy Cotton is ready for Saturday Night Live.
- Washington Post, February 15, 2015, “Amid doubts, truce in Ukraine appears to take hold”
- RT, March 12, 2015, “EU lawmakers demand international investigation into Nemtsov’s death”
- John McCain website, Press Release, “Senators John Mccain And Lindsey Graham Introduce Resolution Condemning Murder Of Russian Opposition Leader Boris Nemtsov”
- Research for this section was done by a person who was raised in the Soviet Union and now lives in the United States.
- Middle East Eye, March 27, 2015, “Sanctions and the fate of the nuclear talks”
Entrepreneurs’ versus the corporatists’ mode of business culture are separated by a vastly different view of enterprise. The former deems his work as innovative, creative and beneficial to customers. The later see the corporate organization as an institution end of itself. Competition makes the business pioneer sharp and driven, while any competitor is targeted for demise within the corporative culture. Buyouts of ventures that show promise may be a payoff reward for the struggling enterpriser, but the corporatist CEO sees the absorption of new technology as a twofold gain. Acquiring the means to create or advance market share and stamping out any future competitive threats.
This corporatist culture actually has merged with the definitive enforcement partner; namely, the state. The morphing of anti-trust safeguards into a system of crony alliance protection is the current standard for the globalist economy. The implication is that a company needs to pay to play and become “Free Trade” proponents to even remain in business.
Thomas E. Woods Jr. cites a prime example of the contemporary corporate-government fascism that controls the global economy, with the example of Government Electric. In The Cultural Costs of Corporatism: How Government-Business Collusion Denigrates the Entrepreneur and Rewards the Sycophant, the formula is set.
The best case study in political entrepreneurship may be General Electric. CEO Jeffrey Immelt pretty clearly laid out his approach in a letter to stockholders in the depths of the 2008–9 recession, and just days after the inauguration of Barack Obama, who promised to “remake America.”
“The global economy, and capitalism, will be “reset” in several ways. The interaction between government and business will change forever. In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner. . . . Successful companies won’t just “hunker down”; they will seek out the new opportunities in a reset world.”
Later in the letter, Immelt stated more directly that GE saw the government as its best potential customer:
“GE’s broad technical portfolio positions us as a natural partner as the role of government increases in the current crisis. Over the past decade, we have positioned GE to lead in the “big themes.” These include emerging market growth, clean energy, and sustainable healthcare. . . .
Governments will invest to stimulate their economies, solve societal problems, and create jobs. GE’s broad portfolio and expertise position us as a natural partner. Tackling important problems together will require teamwork and respect between business, government, and society. We know how to do this and intend to play an important part in solving these essential challenges.”
If success is measured by the amount of retained money or return on assets and especially how little taxes are paid, the GE mold is frightening. Corporatism: The Real World of Corporate Favoritism reports.
“General Electric’s annual SEC 10-K filing for 2011 (filed February 24, 2012) reveals that the company paid at most 2.3% of its $81.2 billion in U.S. pretax profits in federal income taxes over the last 10 years.
Indeed, General Electric, the nation’s largest corporation, paid no federal corporate taxes in the United States in 2010, according to a report in The New York Times.”
The book, Rescuing Capitalism from Corporatism by John David Rose documents the long record of GE’s criminal price fixing going back to 1911 anti-trust violations. By any reasonable criteria, over a century of predatory pricing and monopolist market domination is a definite cultural deficiency.
Corp Watch contributor Charlie Cray lists a series of General Electric transgression topics and examples. Some of the more relevant items are:
Defense Contracting Fraud
Violations of Securities Laws
History of GE Labor Relations
Environment and product safety
Anti-competitive and consumer protection
Unlawful Debt Collection Practices
It would be difficult to explain away such a pattern of conduct as merely the side effects of becoming a prevailing behemoth. More to the point, the mentality that allows and encourages such behavior is a fundamental component that invigorates transgressions against ethical business practices. The net effects upon society, encourages the corporatist mindset to consolidate their state sponsor cronyism.
It seems unnecessary to dispute the negative consequences of “too big to fail” after the 2008 collapse. However, the concept of The Economic System of Corporatism offers this assessment.
“Coupled with the anti-market sentiments of the medieval culture there was the notion that the rulers of the state had a vital role in promoting social justice. Thus corporatism was formulated as a system that emphasized the positive role of the state in guaranteeing social justice and suppressing the moral and social chaos of the population pursuing their own individual self-interests. And above all else, as a political economic philosophy corporatism was flexible. It could tolerate private enterprise within limits and justify major projects of the state. Corporatism has sometimes been labeled as a Third Way or a mixed economy, a synthesis of capitalism and socialism, but it is in fact a separate, distinctive political economic system.”
Yes, once again, let’s called this synthesis by its true name; fascism. Just how well has the government achieved this utopian and fantasy notion that government is in the business of dispensing social justice?
At the heart of the corporatist mindset is control of markets and elimination of competitors. Government survives on deceiving the public and transnational corporations thrive on working their partnership relations with official authorities.
GE may be one of the most obvious offenders; nonetheless, the formulation of politics picking winners and losers based upon bribes and favoritism is a dreadful system. Preference for an actual free market based upon a decentralized merchant economy is the only alternative to globalism, which is enslaving the world.
The corporatist culture fuels the despotism, which society is so willing to accept. Voting how to spend your money is one of the few options a consumer has. Business collaborators with government crooks feed the abuses that GE perfects so well. This confederation in crime naturally harms ordinary citizens.
What would happen if we Americans suddenly decided to withdraw all of our troops currently scattered all over the world and to actually bring them back to within our own US borders where they belong? What would happen if we actually closed down all of America’s extensive and pricy (over one thousand and counting) military bases and black-site operations all around the globe? We may never know. “Why?” you might ask. Because it is never gonna happen, that’s why.
Despite all of the incredibly huge amounts of money, energy, pain and grief that all these bases and black-site operations are costing us American taxpayers daily right now, the subject of closing even a few of these bases and black-site operations (or at least to stop opening up new ones!) isn’t even up for debate.
There are so many other topics that we are happily debating in America right now — but not this one.
Americans are currently debating such crap topics as how best to save rich people from having to pay taxes; whether cops should be allowed to kill minority and/or poor people at will; why torture is a good thing; how we can most easily give large corporations our life savings and pensions; whether or not our kids should get measles vaccines; and exactly how soon “we” can bomb the crap out of Russia. But one of the most important subjects for debate in America today is not even on the menu right now.
A raging debate on how to return America to its grand old isolationist tradition should be the major topic in every newspaper headline and TV news show in America right now. But, sadly, it is not.
And there are many other life-threatening topics for debate here in America that we should be discussing too (but are not) such as, “Is it really in our best interest to support chaos in the Middle East or be Israeli neo-colonialists’ catspaws?” Or whether corporations really are people, or “Why is election-malfeasance in America is still running amuck?” Or if we really want to be committing climate-change suicide? Or why America now has the same distribution of wealth between the upper classes and the rest of us that it had back in 1910 and that the difference in income between America’s top 1% and the rest of us is further apart now than any other time in history including the Roman Empire, Charles Dickens’ London and Marie Antoinette’s France.
According to economist Thomas Piketty, “Income inequality has exploded in the United States.”
And why the freak is America a member of NATO, the most war-mongering organization in the entire world outside of the US Department of “Defense”?
And — really? Here’s a headline that will warm all those Scrooge-like corporate hearts: “Pentagon preparing for mass civil breakdown“Social science is being militarized to develop ‘operational tools’ to target peaceful activists and non-violent protest movements. Should we not be discussing that too?
And then there’s that good old “New World Order” thingie popping up again, and it no longer even includes America on the list of those giving the New Orders — because the global overlord dudes who are currently drawing up the list to re-order our world seem to have us Americans in mind only to play the minor roles of vassals and serfs.
But none of these other topics are up for debate in America either.
According to journalist Juan Cole, the top five favorite planks for the Republican party platform in 2016 are gonna be torture, war-mongering, bank corruption, tax evasion for the uber-rich and how best to steal elections. Why aren’t we discussing that either?
Frankly, there seems to be no debate in America today on almost any topic that should be of primary concern to We the People who are paying for all this crap. But I digress. Let’s get back on topic, the topic of closing over a thousand US military bases and black-site operations all across the globe.
Of course I myself am obviously an advocate for closing all U.S. bases and black-site operations on foreign soil and bringing all of our troops home where they belong. So. Let’s debate.
Debaters in favor of keeping America’s foreign empire strong and all these bases and black-site operations open might come up with a list of arguments such as:
1. “They” will come here and terrorize us if we let down our guard.
2. We will then have little or no access to raw materials and natural resources. Our economy will shrink.
3. We need the war industry because it produces jobs.
4. We must bring freedom and democracy to the world and stop tyrannies.
These four points are all laughably easy to refute — except for perhaps point number three. Here are my counter-arguments:
1. In the many decades since the end of WW II, America has systematically created more enemies than one can shake a stick at due to its brutal policy of foreign military interference abroad. People all over the world used to love America. But this is no longer true. Obviously. These foreign bases and black-site operations are not keeping America safe. Just look at 9/11. Just look at the Great Recession of 2008. I rest my case.
2. Hey, we can always get access to foreign natural resources by actually paying for them. Now there’s a unique idea. It’s called Capitalism!
Right now, our military mainly serves the purpose of acting as thugs and extortionists for corporations, allowing corporations to go into foreign countries at will and steal their natural resources. Our nation’s finest young men and women are being forced to serve as mega-corporations’ personal security forces and Mafia crews. Hell, let these corporations pay for their own damn security thugs. Why should we taxpayers do the job? We are never the ones who make money off of this deal. Au contraire. We get to pay through the nose for it.
Why should we American taxpayers keep paying out trillions of dollars so that the best and brightest of our young generation can die violent and lonely deaths and leave widows and orphans behind them — in order to “Keep Corporations Strong”? It’s like Vietnam all over again.
3. Yes, the war industry does produce jobs. But working for the Yankee Dollar is a high-risk employment, is morally repugnant and the benefits are few. How about, instead, that we hire all those soldiers to work in the solar industry or to repair our shabby infrastructure? Or train them to become doctors or teachers. Just think of the money we’d save!
4. America doesn’t bring democracy to the world. “We” mostly bring dictators and ruffians and torturers and election fraud. And “we” are currently supporting monsters like ISIS and those neo-Nazis in Ukraine. It’s all about the money. The American dream has become a nightmare if you live overseas (and will probably become more of a nightmare here too if we continue to keep the same vampires and doofuses in charge).
That’s my argument and I’m sticking with it.
Hey, I may be wrong here about proposing that we immediately bring all of “our” weapons and troops home. Or I may be right. Who knows. But shouldn’t we at least be having this debate?
“I want to appeal to the Ukrainian people, to the mothers, the fathers, the sisters and the grandparents. Stop sending your sons and brothers to this pointless, merciless slaughter. The interests of the Ukrainian government are not your interests. I beg of you: Come to your senses. You do not have to water Donbass fields with Ukrainian blood. It’s not worth it.”
— Alexander Zakharchenko, Prime Minister of the Donetsk People’s Republic
Washington needs a war in Ukraine to achieve its strategic objectives. This point cannot be overstated.
The US wants to push NATO to Russia’s western border. It wants a land-bridge to Asia to spread US military bases across the continent. It wants to control the pipeline corridors from Russia to Europe to monitor Moscow’s revenues and to ensure that gas continues to be denominated in dollars. And it wants a weaker, unstable Russia that is more prone to regime change, fragmentation and, ultimately, foreign control. These objectives cannot be achieved peacefully, indeed, if the fighting stopped tomorrow, the sanctions would be lifted shortly after, and the Russian economy would begin to recover. How would that benefit Washington?
It wouldn’t. It would undermine Washington’s broader plan to integrate China and Russia into the prevailing economic system, the dollar system. Powerbrokers in the US realize that the present system must either expand or collapse. Either China and Russia are brought to heel and persuaded to accept a subordinate role in the US-led global order or Washington’s tenure as global hegemon will come to an end.
This is why hostilities in East Ukraine have escalated and will continue to escalate. This is why the U.S. Congress approved a bill for tougher sanctions on Russia’s energy sector and lethal aid for Ukraine’s military. This is why Washington has sent military trainers to Ukraine and is preparing to provide $3 billion in “anti-armor missiles, reconnaissance drones, armored Humvees, and radars that can determine the location of enemy rocket and artillery fire.” All of Washington’s actions are designed with one purpose in mind, to intensify the fighting and escalate the conflict. The heavy losses sustained by Ukraine’s inexperienced army and the terrible suffering of the civilians in Lugansk and Donetsk are of no interest to US war-planners. Their job is to make sure that peace is avoided at all cost because peace would derail US plans to pivot to Asia and remain the world’s only superpower. Here’s an except from an article in the WSWS:
“The ultimate aim of the US and its allies is to reduce Russia to an impoverished and semi-colonial status. Such a strategy, historically associated with Carter administration National Security Advisor Zbigniew Brzezinski, is again being openly promoted.
In a speech last year at the Wilson Center, Brzezinski called on Washington to provide Kiev with “weapons designed particularly to permit the Ukrainians to engage in effective urban warfare of resistance.” In line with the policies now recommended in the report by the Brookings Institution and other think tanks calling for US arms to the Kiev regime, Brzezinski called for providing “anti-tank weapons…weapons capable for use in urban short-range fighting.”
While the strategy outlined by Brzezinski is politically criminal—trapping Russia in an ethnic urban war in Ukraine that would threaten the deaths of millions, if not billions of people—it is fully aligned with the policies he has promoted against Russia for decades.” (“The US arming of Ukraine and the danger of World War III“, World Socialist Web Site)
Non-lethal military aid will inevitably lead to lethal military aid, sophisticated weaponry, no-fly zones, covert assistance, foreign contractors, Special ops, and boots on the ground. We’ve seen it all before. There is no popular opposition to the war in the US, no thriving antiwar movement that can shut down cities, order a general strike or disrupt the status quo. So there’s no way to stop the persistent drive to war. The media and the political class have given Obama carte blanche, the authority to prosecute the conflict as he sees fit. That increases the probability of a broader war by this summer following the spring thaw.
While the possibility of a nuclear conflagration cannot be excluded, it won’t effect US plans for the near future. No one thinks that Putin will launch a nuclear war to protect the Donbass, so the deterrent value of the weapons is lost.
And Washington isn’t worried about the costs either. Despite botched military interventions in Afghanistan, Iraq, Libya and half a dozen other countries around the world; US stocks are still soaring, foreign investment in US Treasuries is at record levels,, the US economy is growing at a faster pace than any of its global competitors, and the dollar has risen an eye-watering 13 percent against a basket of foreign currencies since last June. America has paid nothing for decimating vast swathes of the planet and killing more than a million people. Why would they stop now?
They won’t, which is why the fighting in Ukraine is going to escalate. Check this out from the WSWS:
“On Monday, the New York Times announced that the Obama administration is moving to directly arm the Ukrainian army and the fascistic militias supporting the NATO-backed regime in Kiev, after its recent setbacks in the offensive against pro-Russian separatist forces in east Ukraine.
The article cites a joint report issued Monday by the Brookings Institution, the Atlantic Council, and the Chicago Council on Global Affairs and delivered to President Obama, advising the White House and NATO on the best way to escalate the war in Ukraine….
According to the Times, US officials are rapidly shifting to support the report’s proposals. NATO military commander in Europe General Philip M. Breedlove, Defense Secretary Chuck Hagel, US Secretary of State John Kerry, and Chairman of the Joint Chiefs of Staff General Martin Dempsey all supported discussions on directly arming Kiev. National Security Advisor Susan Rice is reconsidering her opposition to arming Kiev, paving the way for Obama’s approval.” (“Washington moves toward arming Ukrainian regime“, World Socialist Web Site)
See what’s going on? The die is already cast. There will be a war with Russia because that’s what the political establishment wants. It’s that simple. And while previous provocations failed to lure Putin into the Ukrainian cauldron, this new surge of violence–a spring offensive– is bound to do the trick. Putin is not going to sit on his hands while proxies armed with US weapons and US logistical support pound the Donbass to Fallujah-type rubble. He’ll do what any responsible leader would do. He’ll protect his people. That means war. (See the vast damage that Obama’s proxy war has done to E. Ukraine here: “An overview of the socio – humanitarian situation on the territory of Donetsk People’s Republic as a consequence of military action from 17 to 23 January 2015“)
Asymmetrical Warfare: Falling Oil Prices
Keep in mind, that the Russian economy has already been battered by economic sanctions, oil price manipulation, and a vicious attack of the ruble. Until this week, the mainstream media dismissed the idea that the Saudis were deliberately pushing down oil prices to hurt Russia. They said the Saudis were merely trying to retain “market share” by maintaining current production levels and letting prices fall naturally. But it was all bunkum as the New York Times finally admitted on Tuesday in an article titled: “Saudi Oil Is Seen as Lever to Pry Russian Support From Syria’s Assad”. Here’s a clip from the article:
“Saudi Arabia has been trying to pressure President Vladimir V. Putin of Russia to abandon his support for President Bashar al-Assad of Syria, using its dominance of the global oil markets at a time when the Russian government is reeling from the effects of plummeting oil prices…
Saudi officials say — and they have told the United States — that they think they have some leverage over Mr. Putin because of their ability to reduce the supply of oil and possibly drive up prices….Any weakening of Russian support for Mr. Assad could be one of the first signs that the recent tumult in the oil market is having an impact on global statecraft…..
Saudi Arabia’s leverage depends on how seriously Moscow views its declining oil revenue. “If they are hurting so bad that they need the oil deal right away, the Saudis are in a good position to make them pay a geopolitical price as well,” said F. Gregory Gause III, a Middle East specialist at Texas A&M’s Bush School of Government and Public Service (“Saudi Oil Is Seen as Lever to Pry Russian Support From Syria’s Assad“, New York Times)
The Saudis “think they have some leverage over Mr. Putin because of their ability” to manipulate prices?
That says it all, doesn’t it?
What’s interesting about this article is the way it conflicts with previous pieces in the Times. For example, just two weeks ago, in an article titled “Who Will Rule the Oil Market?” the author failed to see any political motive behind the Saudi’s action. According to the narrative, the Saudis were just afraid that “they would lose market share permanently” if they cut production and kept prices high. Now the Times has done a 180 and joined the so called conspiracy nuts who said that prices were manipulated for political reasons. In fact, the sudden price plunge had nothing to do with deflationary pressures, supply-demand dynamics, or any other mumbo-jumbo market forces. It was 100 percent politics.
The attack on the ruble was also politically motivated, although the details are much more sketchy. There’s an interesting interview with Alistair Crooke that’s worth a read for those who are curious about how the Pentagon’s “full spectrum dominance” applies to financial warfare. According to Crooke:
“…with Ukraine, we have entered a new era: We have a substantial, geostrategic conflict taking place, but it’s effectively a geo-financial war between the US and Russia. We have the collapse in the oil prices; we have the currency wars; we have the contrived “shorting” — selling short — of the ruble. We have a geo-financial war, and what we are seeing as a consequence of this geo-financial war is that first of all, it has brought about a close alliance between Russia and China.
China understands that Russia constitutes the first domino; if Russia is to fall, China will be next. These two states are together moving to create a parallel financial system, disentangled from the Western financial system. ……
For some time, the international order was structured around the United Nations and the corpus of international law, but more and more the West has tended to bypass the UN as an institution designed to maintain the international order, and instead relies on economic sanctions to pressure some countries. We have a dollar-based financial system, and through instrumentalizing America’s position as controller of all dollar transactions, the US has been able to bypass the old tools of diplomacy and the UN — in order to further its aims.
But increasingly, this monopoly over the reserve currency has become the unilateral tool of the United States — displacing multilateral action at the UN. The US claims jurisdiction over any dollar-denominated transaction that takes place anywhere in the world. And most business and trading transactions in the world are denominated in dollars. This essentially constitutes the financialization of the global order: The International Order depends more on control by the US Treasury and Federal Reserve than on the UN as before.” (“Turkey might become hostage to ISIL just like Pakistan did“, Today’s Zaman)
Financial warfare, asymmetrical warfare, Forth Generation warfare, space warfare, information warfare, nuclear warfare, laser, chemical, and biological warfare. The US has expanded its arsenal well beyond the traditional range of conventional weaponry. The goal, of course, is to preserve the post-1991 world order (The dissolution up of the Soviet Union) and maintain full spectrum dominance. The emergence of a multi-polar world order spearheaded by Moscow poses the greatest single threat to Washington’s plans for continued domination. The first significant clash between these two competing world views will likely take place sometime this summer in East Ukraine. God help us.
NOTE: The Novorussia Armed Forces (NAF) currently have 8,000 Ukrainian regulars surrounded in Debaltsevo, East Ukraine. This is a very big deal although the media has been (predictably) keeping the story out of the headlines.
Evacuation corridors have been opened to allow civilians to leave the area. Fighting could break out at anytime. At present, it looks like a good part of the Kiev’s Nazi army could be destroyed in one fell swoop. This is why Merkel and Hollande have taken an emergency flight to Moscow to talk with Putin. They are not interested in peace. They merely want to save their proxy army from annihilation.
I expect Putin may intervene on behalf of the Ukrainian soldiers, but I think commander Zakharchenko will resist. If he lets these troops go now, what assurance does he have that they won’t be back in a month or so with high-powered weaponry provided by our war-mongering congress and White House?
Tell me; what choice does Zakharchenko really have? If his comrades are killed in future combat because he let Kiev’s army escape, who can he blame but himself?
There are no good choices.
Check here for updates: Ukraine SITREP: *Extremely* dangerous situation in Debaltsevo
Dr. Mehmet Oz, who is a renowned cardiothoracic surgeon, author and host of a successful TV show, has involved himself in some, um, questionable cures for what ails you. According to a Fox News report, a recent study showed that “Half of Dr. Oz’s health advice is bad.” Die-hard Oz fans will more than likely ignore the study results and continue tuning into his TV show for advice from him and the panel of doctors that appear regularly, even knowing that Oz and the other doctors often recommend products straight out of Quacksville.
Our idols would never steer us wrong, would they? I mean, Oz wouldn’t allow his fans to purchase remedies that have little basis in fact or that many in the scientific community agree are bogus. Test the “cures” and you will find that, in some cases, what they recommended is on par with the sort of thing you’ll find in a witches brew – bat wings, spider legs and crow bones.
From the Fox News report:
The researchers found that about half of the suggestions offered by these shows either contradicted what other scientific studies had found or had no verifiable evidence at all to stand behind them, and that potential conflicts of interest were seldom mentioned.
The study looked at 40 random episodes from each show—instead of simply, as Belluz points out, “cherrypicking the worst offenders”—to get the fairest assessment. In general, each episode offered up about a dozen health recommendations, so the researchers were able to cull 479 health tidbits from Dr.
Oz’s show and 445 from The Doctors. Most of the shows’ suggestions involved dispensing general medical advice, followed by non-weight-loss dietary tips; the Doctors professionals tended to repeat the mantra of seeking out a health care provider.
But while the benefits of many of the claims were talked about in a general way, specific benefits and magnitude of those benefits, possible drawbacks, and costs were virtually ignored, the study found.
The researchers’ conclusion? “Consumers should be skeptical,” and we should ask ourselves “whether we should expect medical talk shows to provide more than entertainment.” (Dr. Oz’s “magic bean” recently lost the study that supported it.) (Fox News’ link. Emphasis added.)
This is not the first time I’ve reported on Dr. Oz. In early 2011, I wrote a piece to alert the Church that SBC pastor and best-selling author Rick Warren had elicited the help of three doctors to write a plan (Warren is all about plans) to promote health and fitness for his church located in Lake Forest CA. What struck me was that all three doctors hold New Age/New Thought beliefs. Moreover, the trio is involved in what some deem questionable medical practices. One of the docs Warren asked to help with his endeavor to lose much needed weight and start his journey to better health was Dr. Mehmet Oz. The end result was The Daniel Plan.
I noted back in 2011 in my piece titled “Rick Warren Introduces the ‘Devil Plan’” that:
Oprah Winfrey’s “favorite doctor” is a Muslim and has been influenced by the mysticism of Sufi Muslims. Moreover, he is keen on the ideas of cultist mystic Emanuel Swedenborg:
“As I came into contact with Swedenborg’s many writing I began to understand Swedenborg’s profound insights and how they applied directly to my life.”
Swedenborg believed he could pass between the life to come and the present. What is more he claimed he had conversations with spirits of the dearly departed as well as angelic beings:
“[T]he spirit world was comprised of a number of concentric spheres, each with its own density and inhabitants. There is no such thing as hell or eternal punishment. Those spirits who find themselves in a hellish place after death can evolve toward a higher spiritual plane.
“In spite of it being granted to him ‘to be constantly and uninterruptedly in company with spirits and angels,’ Swedenborg did issue a caution in regard to receiving counsel from just any spirit that might manifest with an alleged personal message. “When spirits begin to speak,” he wrote in Miscellaneous Theological Works (1996), “care should be taken not to believe them, for nearly everything they say is made up by them.…They love to feign. Whatever be the topic spoken of, they think they know it, and if man listens and believes, they insist, and in various ways deceive and seduce.” (Source)
Dr. Oz is a practitioner of Transcendental Meditation:
“When I meditate, I go to that place where truth lives. I can see what reality really is, and it is so much easier to form good relationships then.”
Do a Google search on Dr. Oz and you’ll find posts from people complaining that he’s irresponsible because he promotes things which have no scientific evidence to support them. Until something is proven, doctors should not promote it as it could endanger lives. One example of an unscientific practice he promotes is Reiki, which New Agers believe to be a “guided Universal Life Force Energy.” Dr. Oz’s wife is a Reiki Master. “Reiki,” he said, “is my favorite treatment that could change the future of medicine forever.” He also pontificated:
“I think [Reiki] may be ultimately the most important alternative medicine treatment of all. And we are embarking on this whole new vista of opportunities, it broadens dramatically the spectrum of where we might be able to go in our bodies, and this is the area of energy medicine.”(Source)
It is rather curious that Rick Warren would team up with a man whose fame he owes in part to New Age High Priestess Oprah Winfrey. Dr. Oz’s worldview more closely aligns to New Age Spirituality than to historic orthodox Christianity. (Source)
It is unlikely that those who are not Christians will recognize the danger in some of the beliefs held by Dr. Oz. However, the serious Christian should find his fondness for the world of the occult deeply troubling. Even though Paul makes it perfectly clear in 2 Corinthians 6:1 that believers must not be unevenly yoked with unbelievers, Pastor Warren wasn’t the least bit concerned about partnering with a Sufi Muslim. Without question Muslims reject the God of the Bible, thus they’re unbelievers. Yet he chose Dr. Oz and two other doctors, both of whom are steeped in Eastern mysticism, to collaborate on a “biblical” health and fitness plan. Sadly, because of Warren’s foolhardiness many undiscerning Christians think there’s no problem purchasing the products and participating in the pagan practices pushed on the public by the three mystics.
In November 2014, adoring fans learned that their beloved Mehmet admitted to a congressional committee that the “Magic” diet bean that he promoted had no scientific backing. The reason he gave for defrauding the public? “[H]e’s in the business of hope “to get folks to … rethink their future…” (Source)
People, especially evangelicals, need to rethink taking any sort of advice from this man. Likewise, folks should rethink taking advice from popular pastors who stray from preaching the true gospel of Christ from their pulpits and instead put all their energy into clever plans to make their congregations feel better, look better, and “be all that you can be.”
Is it God’s will for His people to live “Your Best Life Now”? A growing number of professing Christians like to think so. But nothing could be further from the truth. Anyone who takes time to read/study the Bible will quickly learn that God’s will for His people, as long as He allows us to remain here on Earth, is to…… suffer. (Philippians 1:29; 2 Timothy 3:12; 1 Peter 4:15-19; Acts 14:22) This could mean mental, physical, emotional, and spiritual. (Corinthians 4:8) But, “we know that for those who love God all things work together for good, for those who are called according to his purpose.” (Romans 8:28) And by the way, Christians are not meant to be alone in our suffering. The Lord’s intention is for the church to provide a safe harbor for those who are suffering, a place where we can go and have our needs met, where we can find comfort, peace and rest for our souls.
I’ll close with one of many warnings the Apostle Paul passed on to the early Church, a warning that the man who has taken on the task of shepherding Saddleback Church’s sheep has failed to take seriously.
Take no part in the unfruitful works of darkness, but instead expose them. (Ephesians 5:11)
Rick Warren and Dr. Oz on Fame and Fitness—video
Rick Warren Publically Called To Repentance For Statements About Uniting With Catholics—Amy Spreeman
The Low Information Evangelical Part 1 Part 2—By Marsha West
If This Doesn’t Make You Mad…
Why is the Fed threatening to raise interest rates when the economy is still in the doldrums? Is it because they want to avoid further asset-price inflation, prevent the economy from overheating, or is it something else altogether? Take a look at the chart below and you’ll see why the Fed might want to raise rates prematurely. It all has to do with the sharp decline in petrodollars that are no longer recycling into US financial assets. This is from Reuters:
“Energy-exporting countries are set to pull their ‘petrodollars’ out of world markets this year for the first time in almost two decades, according to a study by BNP Paribas. Driven by this year’s drop in oil prices, the shift is likely to cause global market liquidity to fall, the study showed…
This decline follows years of windfalls for oil exporters such as Russia, Angola, Saudi Arabia and Nigeria. Much of that money found its way into financial markets, helping to boost asset prices and keep the cost of borrowing down, through so-called petrodollar recycling.
This year, however, the oil producers will effectively import capital amounting to $7.6 billion. By comparison, they exported $60 billion in 2013 and $248 billion in 2012, according to the following graphic based on BNP Paribas calculations:
‘At its peak, about $500 billion a year was being recycled back into financial markets. This will be the first year in a long time that energy exporters will be sucking capital out,’ said David Spegel, global head of emerging market sovereign and corporate Research at BNP.
In other words, oil exporters are now pulling liquidity out of financial markets rather than putting money in. That could result in higher borrowing costs for governments, companies, and ultimately, consumers as money becomes scarcer.” (Petrodollars leave world markets for first time in 18 years – BNP, Reuters)
Can you see what’s going on?
Now that petrodollar funding has dried up, the Fed needs to find an alternate source of capital to keep the markets bubbly and to shore up the greenback. That’s why the Fed has been talking up the dollar (“jawboning”) and promising to raise rates even though the economy is still pushing up daisies. According to the Fed’s favorite mouthpiece, Jon Hilsenrath:
“Federal Reserve officials are on track to start raising short-term interest rates later this year, even though long-term rates are going in the other direction amid new investor worries about weak global growth, falling oil prices and slowing consumer price inflation…
Many Fed officials have signaled they expect to start lifting their benchmark short-term rate from near zero around the middle of the year. Recent developments in the economy and markets have caused some trepidation among Fed officials and, if sustained, could cause them to delay acting. However several have indicated recently they still expect to move this year and are withholding judgment on delay.” (Fed Officials on Track to Raise Short-Term Rates Later in the Year, Jon Hilsenrath, Wall Street Journal)
And we’re hearing the same from Reuters: “The Federal Reserve is still on track for a potential mid-year interest-rate increase, a top Fed official said on Friday, citing strong U.S. economic momentum and a falling unemployment rate.”
Notice the sudden change in tone from dovish to hawkish? Expect that to intensify in the months ahead as the major media tries to spin the data in a way that serves the Fed’s broader objectives. Like this article in Bloomberg titled, “Yellen Signals She Won’t Babysit Markets in Turmoil”:
“Janet Yellen is leaving the Greenspan ‘put”’behind as she charts the first interest-rate increase since 2006 amid growing financial-market volatility.
The Federal Reserve chair has signaled she wants to place the economic outlook at the center of policy making, while looking past short-term market fluctuations. To succeed, she must wean investors from the notion, which gained currency under predecessor Alan Greenspan, that the Fed will bail them out if their bets go bad — just as a put option protects against a drop in stock prices.
“The succession of Fed puts over the years has led to a wide range of distortions in financial markets,” said Lawrence Goodman, president of the Center for Financial Stability, a monetary research group in New York. “There have been swollen asset values followed by sharp declines. This is a very good time for the Fed to move away.
“Let me be clear, there is no Fed equity market put,” William C. Dudley, president of the New York Fed, the central bank’s watchdog on financial markets, said in a Dec. 1 speech in New York.” (She’s No Greenspan: Yellen Signals She Won’t Babysit Markets in Turmoil)
“There’s no Fed equity put”?
That’s ridiculous. Then how does one explain the way the Fed has launched additional rounds of QE every time stocks have started to sputter? And how does one explain the Fed’s $4 trillion balance sheet all of which was spent on financial assets?
Let’s face it, Central bank intervention has been the only game in town. It’s not just the main driver of stocks. It’s the only driver of stocks. Everyone knows that. Yellen is going to do everything in her power to keep stocks in the stratosphere just like her predecessors, Greenspan and Bernanke. The only that’s going to change, is her approach.
As for the economy, well, just a glance of the headlines tells the whole story. Like this gem from CNBC last week:
“U.S. consumer prices recorded their biggest decline in six years in December and underlying inflation pressures were benign,…The Labor Department said on Friday its Consumer Price Index fell 0.4 percent last month, the largest drop since December 2008, after sliding 0.3 percent in November. In the 12 months through December, CPI increased 0.8 percent…
Darkening prospects for the global economy could also complicate matters for the U.S. central bank.
Inflation is running below the Fed’s 2 percent target, despite a strengthening labor market and overall economy.” (Consumer Price Index drops 0.4% in December, in line with estimates, CNBC)
Think about that for a minute: Consumer prices just logged their biggest drop since the freaking slump of 2008 and, yet, the Fed is still babbling about raising rates.
Talk about lunacy. Not only has the Fed not reached its inflation target of 2%, but it’s abandoned the project altogether. Why? Why has the Fed suddenly stopped trying to boost inflation when the yields on benchmark 10-year US Treasuries have just plunged to record lows (1.70%) and are blinking red? In other words, the bond market is signaling slow growth and zero inflation for as far as the eye can see, but the Fed wants to raise rates and slash growth even more?? It doesn’t make any sense, unless of course, Yellen has something else up her sleeve. Which she does.
Now get a load of this shocker on retail sales in last week’s news. This is from Bloomberg:
“The optimism surrounding the outlook for U.S. consumers was taken down a notch as retail sales slumped in December by the most in almost a year, prompting some economists to lower spending and growth forecasts.
The 0.9 percent decline in purchases …. extended beyond any single group as receipts fell in nine of 13 major retail categories.
Treasury yields and stocks fell as a deepening commodities rout and the drop in sales spurred concern global growth is slowing…
…average hourly earnings falling 0.2 percent in December from the month before in the first drop since late 2012. That limits the amount of spending consumers can undertake without dipping into savings or racking up debt.” (U.S. Retail Sales Down Sharply, Likely Cuts to Growth Forecasts Ahead, Bloomberg)
Remember when everyone thought that low oil prices were going to save the economy? It hasn’t worked out that way though, has it? Nor will it. Falling oil prices usually indicate recession, crisis or deflation. Take your pick. They’re usually not a sign of green shoots, escape velocity, or sunny uplands.
And did you catch that part about falling wages? How do you expand a consumer-dependent economy, when workers are seeing their wages shrivel every month? In case, you haven’t seen the abysmal stagnation of wages in graph-form, here’s a chart from American Progress:
Negative real wage growth means the amount of slack in the market is still considerable.
So while stock prices have doubled or tripled in the last 6 years, wages have basically been flatlining. That’s a pretty crummy distribution system, don’t you think. Unless you’re in the 1 percent of course, then everything is just hunky dory.
But at least Yellen can find some comfort in the fact that unemployment continues to improve. In fact, just two weeks ago unemployment dropped to an impressive 5.4%, the lowest since 2007. So if we forget about the fact that wages are stagnating, that management has nabbed all the productivity-gains for the last 40 years, and that another 451,000 workers dropped off the radar altogether in December, then everything looks pretty rosy. But, of course, it’s all just a bunch of baloney. Take a look at this from Zero Hedge:
“Another month, another attempt by the BLS to mask the collapse in the US labor force with a seasonally-adjusted surge in waiter, bartender and other low-paying jobs. Case in point… the labor participation rate just slid once more, dropping to 62.7%, or the lowest print since December 1977. This happened because the number of Americans not in the labor forced soared by 451,000 in December, far outpacing the 111,000 jobs added according to the Household Survey, and is the primary reason why the number of uenmployed Americans dropped by 383,000.
So, yeah, unemployment looks great until you pick through the data and see it’s all a big fraud. Unemployment is only falling because more and more people are throwing in the towel and giving up entirely.
Finally, there’s the rapidly-expanding mess in the oil patch where the news on layoffs and cut backs gets worse by the day. This is from Wolf Richter at Naked Capitalism:
“Layoffs are cascading through the oil and gas sector. On Tuesday, the Dallas Fed projected that in Texas alone, 140,000 jobs could be eliminated. Halliburton said that it was axing an undisclosed number of people in Houston. Suncor Energy, Canada’s largest oil producer, will dump 1,000 workers in its tar-sands projects. Helmerich & Payne is idling rigs and cutting jobs. Smaller companies are slashing projects and jobs at an even faster pace. And now Slumberger, the world’s biggest oilfield-services company, will cut 9,000 jobs.” (Money dries up for oil and gas, layoffs spread, write-offs start, Wolf Richter, Naked Capitalism)
And then there’s this tidbit from Pam Martens at Wall Street on Parade:
“In a December 15 article by Patrick Jenkins in the Financial Times, readers learned that data from Barclays indicated that “energy bonds now make up nearly 16 per cent of the $1.3 trillion junk bond market — more than three times their proportion 10 years ago,” and “Nearly 45 per cent of this year’s non-investment grade syndicated loans have been in oil and gas.” Raising further alarms, AllianceBernstein has released research suggesting that the deals were not fully subscribed by investors with the potential that “as much as half of the outstanding financing from the past couple of years may be stuck on banks’ books.” (The perfect storm for Wall Street banks, Russ and Pam Martens, Wall Street on Parade)
How do you like that? So nearly half the toxic energy-related gunk that was bundled up into dodgy junk bonds (and is likely to default in the near future) is sitting on bank balance sheets. Does that sound like a potential trigger for another financial crisis or what?
And, no, I am not trying to ignore the fact that third quarter GDP came in at a whopping 5 percent which vastly exceeded all the analysts estimates. But let’s put that into perspective. According to economist Dean Baker, the growth spurt was mainly “an anomaly” …”driven by extraordinary jump in military spending and a big fall in the size of the trade deficit that is unlikely to be repeated.” Here’s more from Baker:
“As usual, just about everything we’ve heard about the economy is wrong. To start, the 5.0 percent growth number must be understood against a darker backdrop: The economy actually shrank at a 2.1 percent annual rate in the first quarter. If we take the first three quarters of the year together, the average growth rate was a more modest 2.5 percent.” (Don’t Believe What You Hear About the US Economy, Dean Baker, CEPR)
So, the economy is growing at a crummy 2.5 percent, but Yellen wants to raise rates. Why? Does she want to shave that number to 2 percent or 1.5 percent? Is that it? She wants to go backwards?
Of course not. The real reason the Fed wants to raise rates, is to attract foreign capital to US markets in order to keep stocks soaring, keep borrowing costs low, and reinforce the dollar’s role as the world’s reserve currency. That’s what’s really going on. The petrodollars are drying up, so US markets need a new source of funding. Direct foreign investment, that’s the ticket, Ducky. All the Fed needs to do is boost rates by, let’s say, 0.5 percent and “Cha-ching”, here comes the capital. Works like a charm every time, just ask former Treasury Secretary Robert Rubin whose strong dollar policy sent stock prices into orbit while widening the nation’s current account deficit by many orders of magnitude. (We never said the plan didn’t have its downside.)
The Fed’s sinister plan to raise interest rates (sometime by mid-2015) will push the dollar’s exchange rate higher thus triggering capital flight in the emerging markets which are already struggling with plunging commodities prices and an excruciating slowdown. The investment flows from the EMs to US financial assets and Treasuries will offset the loss of petrodollar revenue while expanding Wall Street’s ginormous stock market bubble. As for the emerging markets, well, they’re going to take it in the shorts bigtime as one would expect. Here’s a clip from an article by Ambrose-Evans Pritchard that lays it out in black and white:
“The US Federal Reserve has pulled the trigger. Emerging markets must now brace for their ordeal by fire. They have collectively borrowed $5.7 trillion in US dollars, a currency they cannot print and do not control. This hard-currency debt has tripled in a decade, split between $3.1 trillion in bank loans and $2.6 trillion in bonds. It is comparable in scale and ratio-terms to any of the biggest cross-border lending sprees of the past two centuries…
Officials from the Bank for International Settlements say privately that developing countries may be just as vulnerable to a dollar shock as they were in the Fed tightening cycle of the late 1990s, which culminated in Russia’s default and the East Asia Crisis. The difference this time is that emerging markets have grown to be half the world economy. Their aggregate debt levels have reached a record 175pc of GDP, up 30 percentage points since 2009…”
This time the threat does not come from insolvent states. They have learned the lesson of the late 1990s. Few have dollar debts. But their companies and banks most certainly do, some 70pc of GDP in Russia, for example. This amounts to much the same thing in macro-economic terms. ” (Fed calls time on $5.7 trillion of emerging market dollar debt, Ambrose-Evans Pritchard, Telegraph)
The Fed has been through this drill so many times before they could do it in their sleep. (” U.S. interest-rate hikes in 1980s and 1990s played a role in financial crises across Latin America and East Asia.” Foreign Policy Magazine) They’ve learned how to profit off every crisis, particularly the one’s that they themselves create, which is just about all of them. In this case, most of the loans to foreign businesses and banks were denominated in dollars. So, now that the dollar is soaring, (“The dollar’s value has risen about 15 percent relative to the euro and the yen just since the summer.” NPR) the debts are going to balloon accordingly (in real terms) which is going to push a lot of businesses off a cliff forcing sovereigns to step in and provide emergency bailouts.
Did someone say “looming financial crisis”?
Indeed. Bernanke’s “easy money” has inflated bubbles across the planet. Now these bubbles are about to burst due to the strong dollar and anticipated higher rates. At the same time, the policy-switch will send hundreds of billions of foreign capital flooding into US markets pushing stocks and bonds through the roof while generating mega-profits for JPM, G-Sax and the rest of the Wall Street gang. All according to plan.
Naturally, the stronger dollar will weigh heavily on employment and exports as foreign imports become cheaper and more attractive to US consumers. That will reduce hiring at home. Also the current account deficit will widen significantly, meaning that the US will again be consuming much more than it produces. (This took place under Rubin, too.) But here’s what’s interesting about that: According to the Bureau of Economic Analysis: “Our current account deficit has narrowed sharply since the crisis…The U.S. current account deficit now stands at 2.5 percent of GDP, down from more than 6 percent in the fourth quarter of 2005.” (BEA)
Great. In other words, Obama’s obsessive fiscal belt-tightening lowered the deficits enough so that Wall Street can “party on” for the foreseeable future, ignoring the gigantic bubbles they’re inflating or the emerging market economies that are about to be decimated in this latest dollar swindle.
If that doesn’t make you mad, I don’t know what will.
Is Putin Creating A New World Order?
“If undercharging for energy products occurs deliberately, it also effects those who introduce these limitations. Problems will arise and grow, worsening the situation not only for Russia but also for our partners.” – Russian President Vladimir Putin
It’s hard to know which country is going to suffer the most from falling oil prices. Up to now, of course, Russia, Iran and Venezuela have taken the biggest hit, but that will probably change as time goes on. What the Obama administration should be worried about is the second-order effects that will eventually show up in terms of higher unemployment, market volatility, and wobbly bank balance sheets. That’s where the real damage is going to crop up because that’s where red ink and bad loans can metastasize into a full-blown financial crisis. Check out this blurb from Nick Cunningham at Oilprice.com and you’ll see what I mean:
“According to an assessment from the Federal Reserve Bank of Dallas, an estimated 250,000 jobs across eight U.S. states could be lost in 2015 if oil prices don’t rise. More than 50 percent of those job losses would occur in Texas, which leads the nation in oil production.
There are some early signs that a slowdown in drilling could spread to the manufacturing sector in Texas… One executive at a metal manufacturing company said in the survey, “the drop in crude oil prices is going to make things ugly… quickly.” Another company that manufactures machinery told the Dallas Fed, “Low oil prices will drive reductions in U.S. drilling rigs, which will in turn reduce the market for our products.”
The sentiment was similar for a chemical manufacturer, who said “lower oil prices will adversely impact margins. Energy volatility will cause our customers to keep inventories tight.”
States like Texas, North Dakota, Oklahoma, and Louisiana have seen their economies boom over the last few years as oil production surged. But the sector is now deflating, leaving gashes in employment rolls and state budgets.” (Low Prices Lead To Layoffs In The Oil Patch, Nick Cunningham, Oilprice.com)
Of course industries lay-off workers all the time and it doesn’t always lead to a financial crisis. But unemployment is just one part of the picture, lower personal consumption is another. Take a look:
“Falling oil prices are a bigger drag on economic growth than the incremental “savings” received by the consumer…..Another way to show this graphically is to look at the annual changes in Personal Consumption Expenditures (PCE) in aggregate as compared to the subsection of PCE spent on energy and related products. This is shown in the chart below.
Lower Energy Prices To Lower PCE (Personal Consumption Expenditures):
(The Gasoline Price Myth, Lance Roberts, oilprice.com)
See? So despite what you might have read in the MSM, lower gas prices do not translate into greater personal consumption or more robust growth. Quiet the contrary, they tend to intensify deflationary pressures and reduce activity which is a damper on growth.
Then there’s the knock-on effects that crashing prices and layoffs have on other industries like mining, manufacturing and chemical production. Here’s more from Oil Price:
“Oil and gas production makeup a hefty chunk of the “mining and manufacturing” component of the employment rolls. Since 2000, when the oil price boom gained traction, Texas has comprised more than 40% of all jobs in the country according to first quarter data from the Dallas Federal Reserve…
The majority of the jobs “created” since the financial crisis have been lower wage paying jobs in retail, healthcare and other service sectors of the economy. Conversely, the jobs created within the energy space are some of the highest wage paying opportunities available in engineering, technology, accounting, legal, etc. In fact, each job created in energy related areas has had a “ripple effect” of creating 2.8 jobs elsewhere in the economy from piping to coatings, trucking and transportation, restaurants and retail….
The obvious ramification of the plunge in oil prices is that eventually the loss of revenue will lead to cuts in production, declines in capital expenditure plans (which comprise almost 1/4th of all capex expenditures in the S&P 500), freezes and/or reductions in employment, and declines in revenue and profitability…
Simply put, lower oil and gasoline prices may have a bigger detraction on the economy than the “savings” provided to consumers.” (The Gasoline Price Myth, Lance Roberts, oilprice.com)
None of this sounds very reassuring, does it? And yet, all we hear from the media is how the economy is going to reach “escape velocity” on the back of cheap oil. Nonsense. This is just more “green shoots” baloney wrapped in public relations hype. The fact is, the economy needs the good-paying jobs more than it needs low-priced energy. But now that prices are tumbling, those jobs are going to disappear which is going to be a drag on growth. Now check out these headlines I picked up on Google News that help to show what’s going on off the radar:
“Texas is in danger of a recession”, CNN Money.
“Texas Could Be Headed for an Oil-Fueled Recession, JP Morgan Economist Says”, Wall Street Journal “Good Times From Texas to North Dakota May Turn Bad on Oil-Price Drop”, Bloomberg
“Low Oil Prices in the New Year Are Screwing Petrostates”, Vice News
“Top US Oil States Are Taking A Hit From Plunging Crude Prices”, Business Insider
Get the picture? If oil prices continue to fall, unemployment is going to spike, activity is going to slow, and the economy is going tank. And the damage won’t be limited to the US either. Get a load of this from the UK Telegraph:
“A third of Britain’s listed oil and gas companies are in danger of running out of working capital and even going bankrupt amid a slump in the value of crude, according to new research.
Financial risk management group Company Watch believes that 70pc of the UK’s publicly listed oil exploration and production companies are now unprofitable, racking up significant losses in the region of £1.8bn.
Such is the extent of the financial pressure now bearing down on highly leveraged drillers in the UK that Company Watch estimates that a third of the 126 quoted oil and gas companies on AIM and the London Stock Exchange are generating no revenues.
The findings are the latest warning to hit the oil and gas industry since a slump in the price of crude accelerated in November when the Organisation of Petroleum Exporting Countries (Opec) decided to keep its output levels unchanged. The decision has caused carnage in oil markets with a barrel of Brent crude falling 45pc since June to around $60 per barrel.” (Third of listed UK oil and gas drillers face bankruptcy, Telegraph)
“Carnage in oil markets,” you say?
Indeed. Many of the oil-drilling newcomers set up shop to take advantage of the low rates and easy money available in the bond market. Now that prices have crashed, investors are avoiding energy-related junk bonds like the plague which is making it impossible for the smaller companies to roll over their debt or attract fresh capital. When these companies start to default en masse, as they certainly will if prices don’t rebound, the blowback will be felt on bank balance sheets across the country creating the possibility of another financial meltdown. (Now we ARE talking about a financial crisis.)
The basic problem is that the banks have bundled a lot of their dodgy debt into financially-engineered products like Collateralized Loan Obligations (CLOs) and Collateralized Debt Obligations (CDOs) that will inevitably fail when borrowers are no longer able to service the loans. The rot can be concealed for a while, but eventually, if prices don’t recover, a significant number of these companies are going to go under which will push the perennially-undercapitalized banking system to the brink once again. That’s why Washington’s plan to push down oil prices (to hurt the Russian economy) might have made sense on a short-term basis (to shock Putin into submission) but as a long-term strategy, it’s nuts. And what’s even crazier, is that Obama has decided to double-down on the same wacky plan even though Putin hasn’t given an inch. Check this out from Reuters on Monday:
“The Obama administration has opened a new front in the global battle for oil market share, effectively clearing the way for the shipment of as much as a million barrels per day of ultra-light U.S. crude to the rest of the world…
The Department of Commerce on Tuesday ended a year-long silence on a contentious, four-decade ban on oil exports, saying it had begun approving a backlog of requests to sell processed light oil abroad.
The action comes at a critical juncture for the global oil market. World prices have halved to less than $60 a barrel since the summer as top exporter Saudi Arabia, once a staunch defender of $100 oil, refused to cut production in the face of surging U.S. shale output and tempered global demand…
With global oil markets in flux, it is far from clear how much U.S. condensate will find a market overseas.”
(Analysis – U.S. opening of oil export tap widens battle for global market, Reuters)
Does that make sense to you, dear reader? Why would Obama suddenly opt to change the rules of the game when he knows it will increase supply and push prices down even further? Why would he do that? Certainly, he doesn’t want to inflict more pain on domestic producers, does he?
Let’s let Obama answer the question for himself. Here’s a clip from an NPR interview with the president just last week. About halfway through the interview, NPR’s Steve Inskeep asks Obama: “Are you just lucky that the price of oil went down and therefore their currency collapsed or …is it something that you did?
Barack Obama: If you’ll recall, their (Russia) economy was already contracting and capital was fleeing even before oil collapsed. And part of our rationale in this process was that the only thing keeping that economy afloat was the price of oil. And if, in fact, we were steady in applying sanction pressure, which we have been, that over time it would make the economy of Russia sufficiently vulnerable that if and when there were disruptions with respect to the price of oil — which, inevitably, there are going to be sometime, if not this year then next year or the year after — that they’d have enormous difficulty managing it.” (Transcript: President Obama’s Full NPR Interview)
Am I mistaken or did Obama just admit that he wanted “disruptions” in the “price of oil” because he figured Putin would have “enormous difficulty managing it”?
Isn’t that the same as saying that it was all part of Washington’s plan; that plunging prices were just the icing on the cake for their asymmetrical attack on the Russian economy? It sure sounds like it. And that would also explain why Obama decided to allow domestic producers to dump more oil on the market even though it’s going to send prices lower. Apparently, none of that matters as long as the policy hurts Russia.
So maybe the US-Saudi oil collusion theory isn’t so far fetched after all. Maybe Salon’s Patrick L. Smith was right when he said:
“Less than a week after the Minsk Protocol was signed, Kerry made a little-noted trip to Jeddah to see King Abdullah at his summer residence. When it was reported at all, this was put across as part of Kerry’s campaign to secure Arab support in the fight against the Islamic State.
Stop right there. That is not all there was to the visit, my trustworthy sources tell me. The other half of the visit had to do with Washington’s unabated desire to ruin the Russian economy. To do this, Kerry told the Saudis 1) to raise production and 2) to cut its crude price. Keep in mind these pertinent numbers: The Saudis produce a barrel of oil for less than $30 as break-even in the national budget; the Russians need $105.
Shortly after Kerry’s visit, the Saudis began increasing production, sure enough — by more than 100,000 barrels daily during the rest of September, more apparently to come…
Think about this. Winter is coming, there are serious production outages now in Iraq, Nigeria, Venezuela and Libya, other OPEC members are screaming for relief, and the Saudis make back-to-back moves certain to push falling prices still lower? You do the math, with Kerry’s unreported itinerary in mind, and to help you along I offer this from an extremely well-positioned source in the commodities markets: “There are very big hands pushing oil into global supply now,” this source wrote in an e-mail note the other day.” (“What Really Happened in Beijing: Putin, Obama, Xi And The Back Story The Media Won’t Tell You”, Patrick L. Smith, Salon)
Vladimir Putin: Public Enemy Number 1
Let’s cut to the chase: All these oil shenanigans are really aimed at just one man: Vladimir Putin. There are a number of reasons why Washington wants to get rid of Putin, the first of which is that the Russian president has become an obstacle to US plans to pivot to Asia. That’s the main issue. As long as Putin is calling the shots, there’s going to be growing resistance to NATO’s push eastward and Washington’s military expansion across Central Asia which could undermine US plans to encircle China and remain the world’s only superpower. Here’s an excerpt from Zbigniew Brzezinski’s The Grand Chessboard which helps to explain the importance Eurasia is in terms of Washington’s global ambitions:
“..how America ‘manages’ Eurasia is critical. A power that dominates Eurasia would control two of the world’s three most advanced and economically productive regions. A mere glance at the map also suggests that control over Eurasia would almost automatically entail Africa’s subordination, rendering the Western Hemisphere and Oceania (Australia) geopolitically peripheral to the world’s central continent. About 75 per cent of the world’s people live in Eurasia, and most of the world’s physical wealth is there as well, both in its enterprises and underneath its soil. Eurasia accounts for about three-fourths of the world’s known energy resources.” (p.31) (Zbigniew Brzezinski, The Grand Chessboard: American Primacy And It’s Geostrategic Imperatives, Key Quotes From Zbigniew Brzezinksi’s Seminal Book)
Get it? Prevailing in Asia is the administration’s top priority, which is why the US is rapidly moving its military assets into place. Check this out from the World Socialist Web Site:
“Under Obama’s “pivot to Asia,” the Pacific Command will account for more than 60 percent of all US military forces, up from 50 percent under the Bush administration. This includes new US basing arrangements in the Philippines, Singapore and Australia, as well as renewed close military ties to New Zealand, and ongoing US military exercises in Thailand, Malaysia, Indonesia and Taiwan….(as well as) large troop deployments in Japan and South Korea, including nuclear-armed units.” (The global scale of US militarism, Patrick Martin, World Socialist Web Site)
The “Big Shift” is already underway, which is why obstacles have to be removed and Putin’s got to go.
Second, Putin has made himself a general nuisance vis a vis US strategic objectives in Syria, Iran and Ukraine. In Syria, Putin has thrown his support behind Assad who the US wants to topple in order to redraw the map of the Middle East and build gas pipelines from Qatar to Turkey to access the lucrative EU market.
Third, Putin has strengthened a number of coalitions and alliances –the BRICS bank, the Eurasian Economic Union, and the Shanghai Cooperation Organization–all of which pose a challenge to US dominance in the region as well as a viable alternative to neoliberal financial institutions like the IMF and World Bank. Going back to Brzezinski’s “chessboard” once again, we see that the US should not feel threatened by any one nation, but should be constantly on-the-lookout for “regional coalitions” which could derail its plans to rule the world. Here’s Brzezinski again:
“…the three grand imperatives of imperial geostrategy are to prevent collusion and maintain security dependence among the vassals, to keep tributaries pliant and protected, and to keep the barbarians from coming together.” (p.40)
“Henceforth, the United States may have to determine how to cope with regional coalitions that seek to push America out of Eurasia, thereby threatening America’s status as a global power.” (p.55) (Zbigniew Brzezinski, The Grand Chessboard: American Primacy And It’s Geostrategic Imperatives, Key Quotes From Zbigniew Brzezinksi’s Seminal Book)
As a founding member and primary backer of these organizations, (and initiator of giant energy deals with China, India and Turkey) Putin has become Washington’s biggest headache and a logical target for regime change.
Finally, Putin is doing whatever he can to circumvent dollar-denominated business and financial transactions. The move away from the buck is a direct attack on the US’s greatest source of power, the ability to control the de facto international currency and to require that other nation’s stockpile dollars for their energy purchases which are then recycled into US financial assets, stocks bonds and US Treasuries. This petrodollar-recycling scam allows the US to run gigantic current account deficits without raising interest rates or reducing government spending. Putin’s anti-dollar policies could diminish the greenback’s role as reserve currency and put an end to a system that institutionalizes looting.
This is why Putin is Public Enemy Number 1. It’s because he’s blocking the US pivot to Asia, strengthening anti-Washington coalitions, sabotaging US foreign policy objectives in the Middle East, creating institutions that rival the IMF and World Bank, transacting massive energy deals with critical US allies, increasing membership in an integrated, single-market Eurasian Economic Union, and attacking the structural foundation upon which the entire US empire rests, the dollar.
Naturally, Washington’s powerbrokers are worried about these developments, just as they are worried about the new world order which is gradually taking shape under Putin’s guidance. But, so far, they haven’t been able to do anything about it. The administration’s regime change schemers and fantasists have shown time-and-again that they’re no match for Bad Vlad who has beaten them at every turn.
Did the U.S. and the Saudis Conspire to Push Down Oil Prices?
“Saudi oil policy… has been subject to a great deal of wild and inaccurate conjecture in recent weeks. We do not seek to politicize oil… For us it’s a question of supply and demand, it’s purely business.” – Ali al Naimi, Saudi Oil Minister
“There is no conspiracy, there is no targeting of anyone. This is a market and it goes up and down.” – Suhail Bin Mohammed al-Mazroui, United Arab Emirates’ petroleum minister
“We all see the lowering of oil prices. There’s lots of talk about what’s causing it. Could it be an agreement between the U.S. and Saudi Arabia to punish Iran and affect the economies of Russia and Venezuela? It could.” – Russian President Vladimir Putin
Are falling oil prices part of a US-Saudi plan to inflict economic damage on Russia, Iran and Venezuela?
Venezuelan President Nicolas Maduro seems to think so. In a recent interview that appeared in Reuters, Maduro said he thought the United States and Saudi Arabia wanted to drive down oil prices “to harm Russia.”
Bolivian President Evo Morales agrees with Maduro and told journalists at RT that: “The reduction in oil prices was provoked by the US as an attack on the economies of Venezuela and Russia. In the face of such economic and political attacks, the nations must be united.”
Iranian President Hassan Rouhani said the same thing,with a slightly different twist: “The main reason for (the oil price plunge) is a political conspiracy by certain countries against the interests of the region and the Islamic world … Iran and people of the region will not forget such … treachery against the interests of the Muslim world.”
US-Saudi “treachery”? Is that what’s really driving down oil prices?
Not according to Saudi Arabia’s Petroleum Minister Ali al-Naimi. Al-Naimi has repeatedly denied claims that the kingdom is involved in a conspiracy. He says the tumbling prices are the result of “A lack of cooperation by non-OPEC production nations, along with the spread of misinformation and speculator’s greed.” In other words, everyone else is to blame except the country that has historically kept prices high by controlling output. That’s a bit of a stretch, don’t you think? Especially since–according to the Financial Times — OPEC’s de facto leader has abandoned the cartel’s “traditional strategy” and announced that it won’t cut production even if prices drop to $20 per barrel.
Why? Why would the Saudis suddenly abandon a strategy that allowed them to rake in twice as much dough as they are today? Don’t they like money anymore?
And why would al-Naimi be so eager to crash prices, send Middle East stock markets into freefall, increase the kingdom’s budget deficits to a record-high 5 percent of GDP, and create widespread financial instability? Is grabbing “market share” really that important or is there something else going on here below the surface?
The Guardian’s Larry Elliot thinks the US and Saudi Arabia are engaged a conspiracy to push down oil prices. He points to a September meeting between John Kerry and Saudi King Abdullah where a deal was made to boost production in order to hurt Iran and Russia. Here’s a clip from the article titled “Stakes are high as US plays the oil card against Iran and Russia”:
“…with the help of its Saudi ally, Washington is trying to drive down the oil price by ﬂooding an already weak market with crude. As the Russians and the Iranians are heavily dependent on oil exports, the assumption is that they will become easier to deal with…
John Kerry, the US secretary of state, allegedly struck a deal with King Abdullah in September under which the Saudis would sell crude at below the prevailing market price. That would help explain why the price has been falling at a time when, given the turmoil in Iraq and Syria caused by Islamic State, it would normally have been rising.
The Saudis did something similar in the mid-1980s. Then, the geopolitical motivation for a move that sent the oil price to below $10 a barrel was to destabilize Saddam Hussein’s regime. This time, according to Middle East specialists, the Saudis want to put pressure on Iran and to force Moscow to weaken its support for the Assad regime in Syria… (Stakes are high as US plays the oil card against Iran and Russia, Guardian)
That’s the gist of Elliot’s theory, but is he right?
Vladimir Putin isn’t so sure. Unlike Morales, Maduro and Rouhani, the Russian president has been reluctant to blame falling prices on US-Saudi collusion. In an article in Itar-Tass, Putin opined:
“There’s a lot of talk around” in what concerns the causes for the slide of oil prices, he said at a major annual news conference. “Some people say there is conspiracy between Saudi Arabia and the US in order to punish Iran or to depress the Russian economy or to exert impact on Venezuela.”
“It might be really so or might be different, or there might be the struggle of traditional producers of crude oil and shale oil,” Putin said. “Given the current situation on the market the production of shale oil and gas has practically reached the level of zero operating costs.” (Putin says oil market price conspiracy between Saudi Arabia and US not ruled out, Itar-Tass)
As always, Putin takes the most moderate position, that is, that Washington and the Saudis may be in cahoots, but that droopy prices might simply be a sign of over-supply and weakening demand. In other words, there could be a plot, but then again, maybe not. Putin is a man who avoids passing judgment without sufficient evidence.
The same can’t be said of the Washington Post. In a recent article, WP journalist Chris Mooney dismisses anyone who thinks oil prices are the result of US-Saudi collaboration as “kooky conspiracy theorists”. According to Mooney:
“The reasons for the sudden (price) swing are not particularly glamorous: They involve factors like supply and demand, oil companies having invested heavily in exploration several years ago to produce a glut of oil that has now hit the market — and then, perhaps, the “lack of cohesion” among the diverse members of OPEC.” (Why there are so many kooky conspiracy theories about oil, Washington Post)
Oddly enough, Mooney disproves his own theory a few paragraphs later in the same piece when he says:
“Oil producers really do coordinate. And then, there’s OPEC, which is widely referred to in the press as a “cartel,” and which states up front that its mission is to “coordinate and unify the petroleum policies” of its 12 member countries…. Again, there’s that veneer of plausibility to the idea of some grand oil related strategy.” (WP)
Let me get this straight: One the one hand Mooney agrees that OPEC is a cartel that “coordinates and unify the petroleum policies”, then on the other, he says that market fundamentals are at work. Can you see the disconnect? Cartels obstruct normal supply-demand dynamics by fixing prices, which Mooney seems to breezily ignore.
Also, he scoffs at the idea of “some grand oil related strategy” as if these cartel nations were philanthropic organizations operating in the service of humanity. Right. Someone needs to clue Mooney in on the fact that OPEC is not the Peace Corps. They are monopolizing amalgam of cutthroat extortionists whose only interest is maximizing profits while increasing their own political power. Surely, we can all agree on that fact.
What’s really wrong with Mooney’s article, is that he misses the point entirely. The debate is NOT between so-called “conspiracy theorists” and those who think market forces alone explain the falling prices. It’s between the people who think that the Saudis decision to flood the market is driven by politics rather than a desire to grab “market share.” That’s where people disagree. No denies that there’s manipulation; they merely disagree about the motive. This glaring fact seems to escape Mooney who is on a mission to discredit conspiracy theorists at all cost. Here’s more:
(There’s) “a long tradition of conspiracy theorists who have surmised that the world’s great oil powers — whether countries or mega-corporations — are secretly pulling strings to shape world events.”…
“A lot of conspiracy theories take as their premise that there’s a small group of people who are plotting to control something, to control the government, the banking system, or the main energy source, and they are doing this to the disadvantage of everybody else,” says University of California-Davis historian Kathy Olmsted, author of “Real Enemies: Conspiracy Theories and American Democracy, World War I to 9/11″. (Washington Post)
Got that? Now find me one person who doesn’t think the world is run by a small group of rich, powerful people who operate in their own best interests? Here’s more from the same article:
(Oil) “It’s the perfect lever for shifting world events. If you were a mad secret society with world-dominating aspirations and lots of power, how would you tweak the world to create cascading outcomes that could topple governments and enrich some at the expense of others? It’s hard to see a better lever than the price of oil, given its integral role in the world economy.” (WP)
“A mad secret society”? Has Mooney noticed that — in the last decade and a half — the US has only invaded nations that have huge natural resources (mainly oil and natural gas) or the geography for critical pipeline routes? There’s nothing particularly secret about it, is there?
The United States is not a “mad secret society with world-dominating aspirations”. It’s a empire with blatantly obvious “world-dominating aspirations” run by political puppets who do the work of wealthy elites and corporations. Any sentient being who’s bright enough to browse the daily headlines can figure that one out.
Mooney’s grand finale:
“So in sum, with a surprising and dramatic event like this year’s oil price decline, it would be shocking if it did not generate conspiracy theories. Humans believe them all too easily. And they’re a lot more colorful than a more technical (and accurate) story about supply and demand.” (WP)
Ah, yes. Now I see. Those darn “humans”. They’re so weak-minded they’ll believe anything you tell them, which is why they need someone as smart as Mooney tell them how the world really works.
Have you ever read such nonsense in your life? On top of that, he gets the whole story wrong. This isn’t about market fundamentals. It’s about manipulation. Are the Saudis manipulating supply to grab market share or for political reasons? THAT’S THE QUESTION. The fact that they ARE manipulating supply is not challenged by anyone including the uber-conservative Financial Times that deliberately pointed out that the Saudis had abandoned their traditional role of cutting supply to support prices. That’s what a “swing state” does; it manipulates supply keep prices higher than they would be if market forces were allowed to operate unimpeded.
So what is the motive driving the policy; that’s what we want to know?
Certainly there’s a strong case to be made for market share. No one denies that. If the Saudis keep prices at rock bottom for a prolonged period of time, then a high percentage of the producers (that can’t survive at prices below $70 per barrel) will default leaving OPEC with greater market share and more control over pricing.
So market share is certainly a factor. But is it the only factor?
Is it so far fetched to think that the United States–which in the last year has imposed harsh economic sanctions on Russia, made every effort to sabotage the South Stream pipeline, and toppled the government in Kiev so it could control the flow of Russian gas to countries in the EU–would coerce the Saudis into flooding the market with oil in order to decimate the Russian economy, savage the ruble, and create favorable conditions for regime change in Moscow? Is that so hard to believe?
Apparently New York Times columnist Thomas Freidman doesn’t think so. Here’s how he summed it up in a piece last month: “Is it just my imagination or is there a global oil war underway pitting the United States and Saudi Arabia on one side against Russia and Iran on the other?”
It sounds like Freidman has joined the conspiracy throng, doesn’t it? And he’s not alone either. This is from Alex Lantier at the World Socialist Web Site:
“While there are a host of global economic factors underlying the fall in oil prices, it is unquestionable that a major role in the commodity’s staggering plunge is Washington’s collaboration with OPEC and the Saudi monarchs in Riyadh to boost production and increase the glut on world oil markets.
As Obama traveled to Saudi Arabia after the outbreak of the Ukraine crisis last March, the Guardian wrote, “Angered by the Soviet invasion of Afghanistan in 1979, the Saudis turned on the oil taps, driving down the global price of crude until it reached $20 a barrel (in today’s prices) in the mid-1980s… [Today] the Saudis might be up for such a move—which would also boost global growth—in order to punish Putin over his support for the Assad regime in Syria. Has Washington floated this idea with Riyadh? It would be a surprise if it hasn’t.” (Alex Lantier,Imperialism and the ruble crisis, World Socialist Web Site)
And here’s an intriguing clip from an article at Reuters that suggests the Obama administration is behind the present Saudi policy:
“U.S. Secretary of State John Kerry sidestepped the issue (of a US-Saudi plot) after a trip to Saudi Arabia in September. Asked if past discussions with Riyadh had touched on Russia’s need for oil above $100 to balance its budget, he smiled and said: “They (Saudis) are very, very well aware of their ability to have an impact on global oil prices.” (Saudi oil policy uncertainty unleashes the conspiracy theorists, Reuters)
Of course, they’re in bed together. Saudi Arabia is a US client. It’s not autonomous or sovereign in any meaningful way. It’s a US protectorate, a satellite, a colony. They do what they’re told. Period. True, the relationship is complex, but let’s not be ridiculous. The Saudis are not calling the shots. The idea is absurd. Do you really think that Washington would let Riyadh fiddle prices in a way that destroyed critical US domestic energy industries, ravaged the junk bond market, and generated widespread financial instability without uttering a peep of protest on the matter?
Dream on! If the US was unhappy with the Saudis, we’d all know about it in short-order because it would be raining Daisy Cutters from the Persian Gulf to the Red Sea, which is the way that Washington normally expresses its displeasure on such matters. The fact that Obama has not even alluded to the shocking plunge in prices just proves that the policy coincides with Washington’s broader geopolitical strategy.
And let’s not forget that the Saudis have used oil as a political weapon before, many times before. Indeed, wreaking havoc is nothing new for our good buddies the Saudis. Check this out from Oil Price website:
“In 1973, Egyptian President Anwar Sadat convinced Saudi King Faisal to cut production and raise prices, then to go as far as embargoing oil exports, all with the goal of punishing the United States for supporting Israel against the Arab states. It worked. The “oil price shock” quadrupled prices.
It happened again in 1986, when Saudi Arabia-led OPEC allowed prices to drop precipitously, and then in 1990, when the Saudis sent prices plummeting as a way of taking out Russia, which was seen as a threat to their oil supremacy. In 1998, they succeeded. When the oil price was halved from $25 to $12, Russia defaulted on its debt.
The Saudis and other OPEC members have, of course, used the oil price for the obverse effect, that is, suppressing production to keep prices artificially high and member states swimming in “petrodollars”. In 2008, oil peaked at $147 a barrel.” (Did The Saudis And The US Collude In Dropping Oil Prices?, Oil Price)
1973, 1986, 1990, 1998 and 2008.
So, according to the author, the Saudis have manipulated oil prices at least five times in the past to achieve their foreign policy objectives. But, if that’s the case, then why does the media ridicule people who think the Saudis might be engaged in a similar strategy today?
Could it be that the media is trying to shape public opinion on the issue and, by doing so, actually contribute to the plunge in oil prices?
Bingo. Alert readers have probably noticed that the oil story has been splashed across the headlines for weeks even though the basic facts have not changed in the least. It’s all a rehash of the same tedious story reprinted over and over again. But, why? Why does the public need to have the same “Saudis refuse to cut production” story driven into their consciousness day after day like they’re part of some great collective brainwashing experiment? Could it be that every time the message is repeated, oil sells off, and prices go down? Is that it?
Precisely. For example, last week a refinery was attacked in Libya which pushed oil prices up almost immediately. Just hours later, however, another “Saudis refuse to cut production” story conveniently popped up in all the major US media which pushed prices in the direction the USG wants them to go, er, I mean, back down again.
This is how the media helps to reinforce government policy, by crafting a message that helps to push down prices and, thus, hurt “evil” Putin. (This is called “jawboning”) Keep in mind, that OPEC doesn’t meet again until June, 2015, so there’s nothing new to report on production levels. But that doesn’t mean we’re not going to get regular updates on the “Saudis refuse to cut production” story. Oh, no. The media is going to keep beating that drum until Putin cries “Uncle” and submits to US directives. Either that, or the bond market is going to blow up and take the whole damn global financial system along with it. One way or another, something’s got to give.
Bottom line: Falling oil prices and the plunging ruble are not some kind of free market accident brought on by oversupply and weak demand. That’s baloney. They’re part of a broader geopolitical strategy to strangle the Russian economy, topple Putin, and establish US hegemony across the Asian landmass. It’s all part of Washington’s plan to maintain its top-spot as the world’s only superpower even though its economy is in irreversible decline.
US-Saudi Subterfuge Send Stocks and Credit Reeling…
U.S. powerbrokers have put the country at risk of another financial crisis to intensify their economic war on Moscow and to move ahead with their plan to “pivot to Asia”.
Here’s what’s happening: Washington has persuaded the Saudis to flood the market with oil to push down prices, decimate Russia’s economy, and reduce Moscow’s resistance to further NATO encirclement and the spreading of US military bases across Central Asia. The US-Saudi scheme has slashed oil prices by nearly a half since they hit their peak in June. The sharp decline in prices has burst the bubble in high-yield debt which has increased the turbulence in the credit markets while pushing global equities into a tailspin. Even so, the roiled markets and spreading contagion have not deterred Washington from pursuing its reckless plan, a plan which uses Riyadh’s stooge-regime to prosecute Washington’s global resource war. Here’s a brief summary from an article by F. William Engdahl titled “The Secret Stupid Saudi-US Deal on Syria”:
“The details are emerging of a new secret and quite stupid Saudi-US deal on Syria and the so-called IS. It involves oil and gas control of the entire region and the weakening of Russia and Iran by Saudi Arabian flooding the world market with cheap oil. Details were concluded in the September meeting by US Secretary of State John Kerry and the Saudi King…
..the kingdom of Saudi Arabia, has been flooding the market with deep discounted oil, triggering a price war within OPEC… The Saudis are targeting sales to Asia for the discounts and in particular, its major Asian customer, China where it is reportedly offering its crude for a mere $50 to $60 a barrel rather than the earlier price of around $100. That Saudi financial discounting operation in turn is by all appearance being coordinated with a US Treasury financial warfare operation, via its Office of Terrorism and Financial Intelligence, in cooperation with a handful of inside players on Wall Street who control oil derivatives trading. The result is a market panic that is gaining momentum daily. China is quite happy to buy the cheap oil, but her close allies, Russia and Iran, are being hit severely…
According to Rashid Abanmy, President of the Riyadh-based Saudi Arabia Oil Policies and Strategic Expectations Center, the dramatic price collapse is being deliberately caused by the Saudis, OPEC’s largest producer. The public reason claimed is to gain new markets in a global market of weakening oil demand. The real reason, according to Abanmy, is to put pressure on Iran on her nuclear program, and on Russia to end her support for Bashar al-Assad in Syria….More than 50% of Russian state revenue comes from its export sales of oil and gas. The US-Saudi oil price manipulation is aimed at destabilizing several strong opponents of US globalist policies. Targets include Iran and Syria, both allies of Russia in opposing a US sole Superpower. The principal target, however, is Putin’s Russia, the single greatest threat today to that Superpower hegemony. (The Secret Stupid Saudi-US Deal on Syria, F. William Engdahl, BFP)
The US must achieve its objectives in Central Asia or forfeit its top-spot as the world’s only superpower. This is why US policymakers have embarked on such a risky venture. There’s simply no other way to sustain the status quo which allows the US to impose its own coercive dollar system on the world, a system in which the US exchanges paper currency produced-at-will by the Central Bank for valuable raw materials, manufactured products and hard labor. Washington is prepared to defend this extortionist petrodollar recycling system to the end, even if it means nuclear war.
How Flooding the Market Adds to Instability
The destructive and destabilizing knock-on effects of this lunatic plan are visible everywhere. Plummeting oil prices are making it harder for energy companies to get the funding they need to roll over their debt or maintain current operations. Companies borrow based on the size of their reserves, but when prices tumble by nearly 50 percent–as they have in the last six months– the value of those reserves falls sharply which cuts off access to the market leaving CEO’s with the dismal prospect of either selling assets at firesale prices or facing default. If the problem could be contained within the sector, there’d be no reason for concern. But what worries Wall Street is that a surge in energy company failures could ripple through the financial system and wallop the banks. Despite six years of zero rates and monetary easing, the nation’s biggest banks are still perilously undercapitalized, which means that a wave of unexpected bankruptcies could be all it takes to collapse the weaker institutions and tip the system back into crisis. Here’s an excerpt from a post at Automatic Earth titled “Will Oil Kill the Zombies?”:
“If prices fall any further, it would seem that most of the entire shale edifice must of necessity crumble to the ground. And that will cause an absolute earthquake in the financial world, because someone supplied the loans the whole thing leans on. An enormous amount of investors have been chasing high yield, including many institutional investors, and they’re about to get burned something bad….. if oil keeps going the way it has lately, the Fed may instead have to think about bailing out the big Wall Street banks once again.” (Will Oil Kill the Zombies?, Raúl Ilargi Meijer, Automatic Earth)
The problem with falling oil prices is not just mounting deflation or droopy profits; it’s the fact that every part of the industry–exploration, development and production — is propped atop a mountain of red ink (junk bonds). When that debt can no longer be serviced or increased, then the primary lenders (counterparties and financial institutions) sustain heavy losses which domino through the entire system. Take a look at this from Marketwatch:
“There’s ‘no question’ that for energy companies with a riskier debt profile the high-yield debt market “is essentially shut down at this stage,” and there are signs that further pain could hit the sector, ” senior fixed-income strategist at U.S. Bank Wealth Management, Dan Heckman told Marketwatch. “We are getting to the point that it is becoming very concerning.” (Marketwatch)
When energy companies lose access to the market and are unable to borrow at low rates, it’s only a matter of time before they trundle off to extinction.
On Friday, the International Energy Agency (IEA) renewed pressure on prices by lowering its estimate for global demand for oil in 2015. The announcement immediately sent stocks into a nosedive. The Dow Jones Industrial Average (DJIA) lost 315 points by the end of the day, while, according to Bloomberg, more than “$1 trillion was erased from the value of global equities in the week”.
The world is awash in cheap petroleum which is wreaking havoc on domestic shale producers that need prices of roughly $70 per barrel to break-even. With West Texas Intermediate (WTI) presently headed south of 60 bucks–and no bottom in sight–these smaller producers are sure to get clobbered. Pension funds, private equity, banks, and other investors who gambled on these dodgy energy-related junk bonds are going to get their heads handed to them in the months ahead.
The troubles in the oil patch are mainly attributable to the Fed’s easy money policies. By dropping rates to zero and flooding the markets with liquidity, the Fed made it possible for every Tom, Dick and Harry to borrow in the bond market regardless of the quality of the debt. No one figured that the bottom would drop out leaving an entire sector high and dry. Everyone thought the all-powerful Fed could print its way out of any mess. After last week’s bloodbath, however, they’re not nearly as confident. Here’s how Bloomberg sums it up:
“The danger of stimulus-induced bubbles is starting to play out in the market for energy-company debt….Since early 2010, energy producers have raised $550 billion of new bonds and loans as the Federal Reserve held borrowing costs near zero, according to Deutsche Bank AG. With oil prices plunging, investors are questioning the ability of some issuers to meet their debt obligations…
The Fed’s decision to keep benchmark interest rates at record lows for six years has encouraged investors to funnel cash into speculative-grade securities to generate returns, raising concern that risks were being overlooked. A report from Moody’s Investors Service this week found that investor protections in corporate debt are at an all-time low, while average yields on junk bonds were recently lower than what investment-grade companies were paying before the credit crisis.” (Fed Bubble Bursts in $550 Billion of Energy Debt: Credit Markets, Bloomberg)
The Fed’s role in this debacle couldn’t be clearer. Investors piled into these dodgy debt-instruments because they thought Bernanke had their back and would intervene at the first sign of trouble. Now that the bubble has burst and the losses are piling up, the Fed is nowhere to be seen.
In the last week, falling oil prices have started to impact the credit markets where investors are ditching debt on anything that looks at all shaky. The signs of contagion are already apparent and likely to get worse. Investors fear that if they don’t hit the “sell” button now, they won’t be able to find a buyer later. In other words, liquidity is drying up fast which is accelerating the rate of decline. Naturally, this has affected US Treasuries which are still seen as “risk free”. As investors increasingly load up on USTs, long-term yields have been pounded into the ground like a tentpeg. As of Friday, the benchmark 10-year Treasury checked in at a miniscule 2.08 percent, the kind of reading one would expect in the middle of a Depression.
The Saudi-led insurgency has reversed the direction of the market, put global stocks into a nosedive and triggered a panic in the credit markets. And while the financial system edges closer to a full-blown crisis every day, policymakers in Washington have remained resolutely silent on the issue, never uttering as much as a peep of protest for a Saudi policy that can only be described as a deliberate act of financial terrorism.
Why is that? Why have Obama and Co. kept their mouths shut while oil prices have plunged, domestic industries have been demolished, and stocks have gone off a cliff? Could it be that they’re actually in cahoots with the Saudis and that it’s all a big game designed to annihilate enemies of the glorious New World Order?
It certainly looks that way.
Shale Leads The Way…
Crude oil prices dipped lower on Wednesday pushing down yields on US Treasuries and sending stocks down sharply. The 30-year UST slipped to a Depression era 2.83 percent while all three major US indices plunged into the red. The Dow Jones Industrial Average (DJIA) led the retreat losing a hefty 268 points before the session ended. The proximate cause of Wednesday’s bloodbath was news that OPEC had reduced its estimate of how much oil it would need to produce in 2015 to meet weakening global demand. According to USA Today:
“OPEC lowered its projection for 2015 production to 28.9 million barrels a day, or about 300,000 fewer than previously forecast, and a 12-year low…. That’s about 1.15 million barrels a day less than the cartel pumped last month, when OPEC left unchanged its 30 million barrel daily production quota…
The steep decline in crude price raises fears that small exploration and production companies could go out of business if the prices fall too low. And that, in turn, could cause turmoil among those who are lending to them: Junk-bond purchasers and smaller banks.” (USA Today)
Lower oil prices do not necessarily boost consumption or strengthen growth. Quite the contrary. Weaker demand is a sign that deflationary pressures are building and stagnation is becoming more entrenched. Also, the 42 percent price-drop in benchmark U.S. crude since its peak in June, is pushing highly-leveraged energy companies closer to the brink. If these companies cannot roll over their debts, (due to the lower prices) then many will default which will negatively impact the broader market. Here’s a brief summary from analyst Wolf Richter:
“The price of oil has plunged …and junk bonds in the US energy sector are getting hammered, after a phenomenal boom that peaked this year. Energy companies sold $50 billion in junk bonds through October, 14% of all junk bonds issued! But junk-rated energy companies trying to raise new money to service old debt or to fund costly fracking or off-shore drilling operations are suddenly hitting resistance.
And the erstwhile booming leveraged loans, the ugly sisters of junk bonds, are causing the Fed to have conniptions. Even Fed Chair Yellen singled them out because they involve banks and represent risks to the financial system. Regulators are investigating them and are trying to curtail them through “macroprudential” means, such as cracking down on banks, rather than through monetary means, such as raising rates. And what the Fed has been worrying about is already happening in the energy sector: leveraged loans are getting mauled. And it’s just the beginning…
“If oil can stabilize, the scope for contagion is limited,” Edward Marrinan, macro credit strategist at RBS Securities, told Bloomberg. “But if we see a further fall in prices, there will have to be a reaction in the broader market as problems will spill out and more segments of the high-yield space will feel the pain.”…Unless a miracle happens that will goose the price of oil pronto, there will be defaults, and they will reverberate beyond the oil patch.” (Oil and Gas Bloodbath Spreads to Junk Bonds, Leveraged Loans. Defaults Next, Wolf Ricter, Wolf Street)
The Fed’s low rates and QE pushed down yields on corporate debt as investors gorged on junk thinking the Fed “had their back”. That made it easier for fly-by-night energy companies to borrow tons of money at historic low rates even though their business model might have been pretty shaky. Now that oil is cratering, investors are getting skittish which has pushed up rates making it harder for companies to refinance their debtload. That means a number of these companies going to go bust, which will create losses for the investors and pension funds that bought their debt in the form of financially-engineered products. The question is, is there enough of this financially-engineered gunk piled up on bank balance sheets to start the dominoes tumbling through the system like they did in 2008?
That question was partially answered on Wednesday following OPEC’s dismal forecast which roiled stocks and send yields on risk-free US Treasuries into a nosedive. Investors ditched their stocks in a mad dash for the exits thinking that the worst is yet to come. USTs provide a haven for nervous investors looking for a safe place to hunker down while the storm passes.
Economist Jack Rasmus has an excellent piece at Counterpunch which explains why investors are so jittery. Here’s a clip from his article titled “The Economic Consequences of Global Oil Deflation”:
“Oil deflation may lead to widespread bankruptcies and defaults for various non-financial companies, which will in turn precipitate financial instability events in banks tied to those companies. The collapse of financial assets associated with oil could also have a further ‘chain effect’ on other forms of financial assets, thus spreading the financial instability to other credit markets.” (The Economic Consequences of Global Oil Deflation, Jack Rasmus, CounterPunch)
Falling oil prices typically drag other commodities prices down with them. This, in turn, hurts emerging markets that depend heavily on the sale of raw materials. Already these fragile economies are showing signs of stress from rising inflation and capital flight. In a country like Japan, however, one might think the effect would be positive since the lower yen has made imported oil more expensive. But that’s not the case. Falling oil prices increase deflationary pressures forcing the Bank of Japan to implement more extreme measures to reverse the trend and try to stimulate growth. What new and destabilizing policy will Japan’s Central Bank employ in its effort to dig its way out of recession? And the same question can be asked of Europe too, which has already endured three bouts of recession in the last five years. Here’s Rasmus again on oil deflation and global financial instability:
“Oil is not only a physical commodity bought, sold and traded on global markets; it has also become an important financial asset since the USA and the world began liberalized trading of oil commodity futures…
Just as declines in oil spills over to declines of other physical commodities…price deflation can also ‘spill over’ to other financial assets, causing their decline as well, in a ‘chain like’ effect.
That chain like effect is not dissimilar to what happened with the housing crash in 2006-08. At that time the deep contraction in the global housing sector ( a physical asset) not only ‘spilled over’ to other sectors of the real economy, but to mortgage bonds…and derivatives based upon those bonds, also crashed. The effect was to ‘spill over’ to other forms of financial assets that set off a chain reaction of financial asset deflation.
The same ‘financial asset chain effect’ could arise if oil prices continued to decline below USD$60 a barrel. That would represent a nearly 50 percent deflation in oil prices that could potentially set in motion a more generalized global financial instability event, possibly associated with a collapse of the corporate junk bond market in the USA that has fueled much of USA shale production.” (CounterPunch)
This is precisely the scenario we think will unfold in the months ahead. What Rasmus is talking about is “contagion”, the lethal spill-over from one asset class to another due to deteriorating conditions in the financial markets and too much leverage. When debts can no longer be serviced, defaults follow sucking liquidity from the system which leads to a sudden (and excruciating) repricing event. Rasmus believes that a sharp cutback in Shale gas and oil production could ignite a crash in junk bonds that will pave the way for more bank closures. Here’s what he says:
“The shake out in Shale that is coming will not occur smoothly. It will mean widespread business defaults in the sector. And since much of the drilling has been financed with risky high yield corporate ‘junk’ bonds, the shale shake out could translate into a financial crash of the US corporate junk bond market, which is now very over-extended, leading to regional bank busts in turn.” (CP)
The financial markets are a big bubble just waiting to burst. If Shale doesn’t do the trick, then something else will. It’s just a matter of time.
Rasmus also believes that the current oil-glut is politically motivated. Washington’s powerbrokers persuaded the Saudis to flood the market with petroleum to push down prices and crush oil-dependent Moscow. The US wants a weak and divided Russia that will comply with US plans to increase its military bases in Central Asia and allow NATO to be deployed to its western borders. Here’s Rasmus again:
“Saudi Arabia and its neocon friends in the USA are targeting both Iran and Russia with their new policy of driving down the price of oil. The impact of oil deflation is already severely affecting the Russian and Iranian economies. In other words, this policy of promoting global oil price deflation finds favor with significant political interests in the USA, who want to generate a deeper disruption of Russian and Iranian economies for reasons of global political objectives. It will not be the first time that oil is used as a global political weapon, nor the last.” (CP)
Washington’s strategy is seriously risky. There’s a good chance the plan could backfire and send stocks into freefall wiping out trillions in a flash. Then all the Fed’s work would amount to nothing.
Karma’s a bitch.
Putin Gobsmacks Obama and Euro-Leaders with Surprise Gas Deal…
On Monday, Russian President Vladimir Putin clinched a groundbreaking deal with Turkish President Recep Tayyip Erdoğan that will strengthen economic ties between the two nations and make Turkey the major hub for Russian gas in the region. Under the terms of the agreement, Russia will pump additional natural gas to locations in central Turkey and to a “hub at the Turkish-Greek border” which will eventually provide Putin with backdoor access to the lucrative EU market, although Turkey will serve as the critical intermediary. The move creates a de facto Russo-Turkey alliance that could shift the regional balance of power decisively in Moscow’s favor, thus creating another formidable hurtle for Washington’s “pivot to Asia” strategy. While the media is characterizing the change in plans (Putin has abandoned the South Stream pipeline project that would have transported gas to southern Europe) as a “diplomatic defeat” for Russia, the opposite appears to be the case. Putin has once again outmaneuvered the US on both the energy and geopolitical fronts adding to his long list of policy triumphs. Here’s a brief summary from Andrew Korybko at Sputnik News:
“Russia has abandoned the troubled South Stream project and will now be building its replacement with Turkey. This monumental decision signals that Ankara has made its choice to reject Euro-Atlanticsm and embrace Eurasian integration.
In what may possibly be the biggest move towards multipolarity thus far,..Turkey, has done away with its former Euro-Atlantic ambitions. A year ago, none of this would have been foreseeable, but the absolute failure of the US’ Mideast policy and the EU’s energy one made this stunning reversal possible in under a year. Turkey is still anticipated to have some privileged relations with the West, but the entire nature of the relationship has forever changed as the country officially engages in pragmatic multipolarity.
Turkey’s leadership made a major move by sealing such a colossal deal with Russia in such a sensitive political environment, and the old friendship can never be restored…The reverberations are truly global.” (“Cold Turkey: Ankara Buckles Against Western Pressure, Turns to Russia”, Sputnik News)
Korybko seems to be alone in grasping the magnitude of what happened in Ankara on Monday, although –judging by the Obama administration’s silence on the topic–the gravity of the transaction is beginning to sink in. Grandmaster Vlad’s latest move has caught US powerbrokers flat-footed and left them speechless. This is a scenario that no one had anticipated and, if it’s not handled correctly, could turn out to be a real nightmare. Here’s more on Monday’s press conference from Russia Today:
“Putin said that Russia is ready to build a new pipeline to meet Turkey’s growing gas demand, which may include a special hub on the Turkish-Greek border for customers in southern Europe.
For now, the supply of Russian gas to Turkey will be raised by 3 billion cubic meters via the already operating Blue Stream pipeline…Moscow will also reduce the gas price for Turkish customers by 6 percent from January 1, 2015, Putin said.
“We are ready to further reduce gas prices along with the implementation of our joint large-scale projects,” he added.” (“Putin: Russia forced to withdraw from S. Stream project due to EU stance”, RT)
How can this happen? How can Putin waltz into Ankara, scribble his name on a few sheets of paper, and abscond with a key US ally right under Washington’s nose? Isn’t there anyone at the White House who’s smart enough to anticipate a scenario like this or have they all been replaced with warmongering ding-dongs like Susan Rice and Samantha Powers?
The Obama administration has been doing everything in its power to control the flow of gas from east to west and to undermine Russian-EU economic integration. Now it looks like the nimble Putin has found a way to avoid the economic sanctions, (Turkey rejected sanctions on Russia) avoid US coercion and blackmail (which was used on Bulgaria, Hungary, and Serbia), and avoid Washington’s endless belligerence and hostility, and achieve his objectives at the same time. But– then again– isn’t that what you’d expect from a level-headed martial arts pro like Putin?
“I won’t beat you,” says Bad Vlad. “I’ll let you to beat yourself.”
And, so he has. Just ask the befuddled Obama who has yet to prevail in any of his encounters with Putin.
But why the silence? Why hasn’t the White House issued a statement about the big Russian-Turkey gas deal that everyone’s talking about?
I’ll tell you why. It’s because they don’t know what the hell just hit them, that’s why. They were completely blindsided by the announcement and can’t quite figure out what it means for the issues that are on the very top of their foreign policy agenda, like the pivot to Asia, or the wars in Syria and Ukraine, or the much-ballyhooed gas pipeline from Qatar to the EU, that was supposed to transit– you guessed it– Turkey. Is that plan still in the works or has the Putin-Erdogan alliance put the kibosh on that gem too? Let’s face it, Putin has really knocked it out of the park this time. Team Obama is clearly out of its league and has no idea of what’s going on. If Turkey turns eastward and joins the growing Russian bloc, US policymakers are going to have to scrap the better part of their strategic plans for the coming century and go back to Square 1. What a headache.
There’s a good article in Wednesday’s New York Times that summarizes Washington’s ambivalence towards South Stream perfectly. Here’s an excerpt:
“Moscow has long presented the project, proposed in 2007, as making good business sense because it would provide a new route for Russian gas to reach Europe. Washington and Brussels have opposed the project on the grounds that it was a vehicle for cementing Russian influence over southern Europe and for bypassing Ukraine, whose price disputes with Gazprom twice interrupted supplies to Europe in recent years.”
Putin’s Surprise Call to Scrap South Stream Gas Pipeline Leaves Europe Reeling”, New York Times)
This has been the argument from the get-go, that selling gas to people in the EU somehow strengthens Putin’s maniacal grip on the continent. What a joke. Would you, dear reader, be willing turn off the heat, tear up your energy bill, and freeze to death in the dark to prove to your gas company that you’re not willing to capitulate to their tyrannical rule?
Of course not, because the idea is ridiculous. Just like blocking South Stream is ridiculous. Putin is selling gas, not tyranny. He doesn’t want people clicking their heels and goosestepping to work. That’s just propaganda from the people in the oil industry who lost the competition for supplying fuel to the EU. Call it sour grapes if you want, because that’s what it is. Their pipeline failed, (Nabucco) and Putin’s won. End of story. It’s called capitalism. Deal with it.
And here’s another thing: The countries that South Stream would have served, do not have a back-up supplier to meet their growing gas needs. So by following Washington’s lead, they’ve basically shot themselves in the foot. Analysts figure that any replacement for Russian gas will probably be 30 percent more expensive then they would have paid Gazprom.
Hurrah for the US! Hurrah for stupidity!
The US has been determined to sabotage South Stream from the very beginning, mainly because Washington wants its corporations and banks to control the flow of gas to the EU market through privately-owned pipelines in Ukraine. That way they can rake in bigger profits for their moneybags shareholders. Without going into too much detail about the various methods the US has used to torpedo the project, there’s one story that’s worth a look. This is from Zero Hedge:
“…two months before the Ukraine government was overthrown the prime minister of Bulgaria, Plamen Oresharski, ordered a halt to work on the South Stream on the recommendation of the EU. The decision was announced after his talks with US senators.
“At this time there is a request from the European Commission, after which we’ve suspended the current works, I ordered it,” Oresharski told journalists after meeting with John McCain, Chris Murphy and Ron Johnson during their visit to Bulgaria on Sunday. “Further proceedings will be decided after additional consultations with Brussels.”
At the time McCain, commenting on the situation, said that “Bulgaria should solve the South Stream problems in collaboration with European colleagues,” adding that in the current situation they would want “less Russian involvement” in the project.
“America has decided that it wants to put itself in a position where it excludes anybody it doesn’t like from countries where it thinks it might have an interest, and there is no economic rationality in this at all,” (said)Ben Aris, editor of Business New Europe told RT.” (“Europe Gives Bulgaria A Bank System Lifeline As Battle Over “South Stream” Pipeline Heats Up”, Zero Hedge)
Let me get this straight: Madman McCain strolls into town and immediately starts ordering people around telling them he wants “less Russian involvement”, and that’s enough to bring South Stream to a screeching halt? Is that what you’re telling me?
Yep. Sure sounds like it.
Does that help you see what’s really going here? This isn’t about Putin. It’s about gas, and who’s going to profit from that gas, and in whose currency that gas will be denominated. That’s what it’s about. The rest of the nonsense about “Russian involvement” or terrorism or human rights or national sovereignty is just gibberish. The people who run this country (like McCain), don’t care about that kind of stuff. What they care about is money; money and power. That’s it.
So what are they going to do now? How are the big powerboys in Washington going to express their rage over this new threat created by Putin and Erdogan?
It doesn’t take a genius to figure that one out, after all, we’ve seen it a million times before.
They’re going to go after Erdogan hammer and tongs. That’s what they always do, isn’t it?
The only reason they haven’t started in already is because they’re getting their propaganda ducks in a row, which usually takes a day or two. But as soon as that’s taken care of, they’ll start dismantling old Recep one excruciating headline at a time. Erdogan is going to be the new Hitler and the greatest threat to humanity the world has ever seen. You can bet on it.
Whistleblower Sibel Edmonds thinks that Washington has had-it-in for Erdogan a long time now, dating back to a dust up he had with the CIA a few years back. In any event, she gives a pretty good account of what we can expect now that Erdogan is on Washington’s enemies list. Here’s a clip from her post at Boiling Frogs:
“We all know what happens to those puppets when they end up in a rift with the CIA. Don’t we? The rift always brings expiration. Once a puppet is considered expired, then lo and behold, all of a sudden, the reversal branding and marketing begins: All old skeletons are dug out of the deep closets and leaked to the media. His previously overlooked human rights violations are looked at and scrutinized under a microscope. The terrorist card is brought into the equation. And the list goes on…
… All Empire-installed puppets and regimes must commit to the Empire’s commandments….Thou shall not violate the Imperial commandments. Because if you do, thou shall be disgraced, exposed, uninstalled, and may even be given death. All you have to do is look at the past century’s history. See what happens when an installed puppet gets too confident and inflicted with hubris, and ignores one or more commandments. This is when they are reborn as dictators, despots, torturers, and yes, terrorists. This is when their backyards get dug up to find a few grams of weapons of mass destruction.”…
No matter how we look at it Erdogan’s days are numbered … Anyone who ever dares to be this reckless will be punished and made an example for all other installed-puppets…” (“Turkish PM Erdogan: The Speedy Transformation of an Imperial Puppet”, BFP)
So there it is. That’s what you can expect by the end of the week when the media starts their full-throttle demonizing of Erdogan, the man who dared to act independently and put the interests of his own people above those of the Washington mob bosses. As anyone who’s followed US foreign policy for the last 60 years will tell you; that’s a big no-no.