Monday, February 8, 2016

Patrick Smith interviews Ray McGovern — A veteran CIA agent spills the goods on the Deep State and our foreign policy nightmares

You prolly want to read this. Some bombshells.

“Intelligent people know that the empire is on the downhill”: A veteran CIA agent spills the goods on the Deep State and our foreign policy nightmares
Patrick Smith, Salon’s foreign affairs columnist and former foreign correspondent or the International Herald Tribune and The New Yorker, interviews Ray McGovern, twenty-seven year CIA veteran turned dissident.

Sunday, February 7, 2016

Ann Jones — American Capitalism Has Failed Us: We're Overworked, Underemployed and More Powerless than Ever Before

Comparing America to the Nordic model. Guess which wins big?

Sputnik — Obama Eager to Slow Russian Campaign in Syria 'By Any Means Possible'

Washington's true intentions with regard to Syria have long been a hot topic, with many saying that the Obama administration is still determined to pursue a regime change in the war-torn Arab country despite the fact that it has toned down its "Assad must go" rhetoric.
International relations expert Rob Prince shares this sentiment. He believes that Washington wants President Bashar al-Assad out of the picture "so that the oil fields and pipeline corridors could be secured by the western oil giants and protected by new US military bases sprinkled across the country."
In the expert's opinion, this has been Washington's "basic game plan since Day 1."

Not just this "expert." Pepe Escobar has been tracing this out for some time.

Obama Eager to Slow Russian Campaign in Syria 'By Any Means Possible'

Eric Tymoigne — Money and Banking – Part 5

Next up in the series.
Previous posts studied the balance sheet of the fed, definitions and relation to the balance sheet of the fed, and monetary-policy implementation. In this post, I will answer some FAQs about monetary policy and central banking. Each of them can be read independently.
New Economic Perspectives
Money and Banking – Part 5
Eric Tymoigne | Associate Professor of Economics at Lewis and Clark College, Portland, Oregon; and Research Associate at the Levy Economics Institute of Bard College

Prediction Markets update

Election Betting Odds


Predict It

Iowa Electronic Markets

IRS computer glitch a problem.Throws economy into peril. Stock market could be looking at fresh lows

The IRS computer glitch that occurred 10 days ago is a problem. Tax refunds are not going out. Spending has dropped down sharply versus last year. It had been up, modestly, but now it's fallen off and it's not obvious that the economy can handle any gov't spending pullback now when people are really on the defensive. Data from the Daily Treasury Statement does not show tax refunds picking up very much. Stock market could be looking at fresh lows.

Gene Epstein on oil price

Oil bulls, take heart. The last leg of the bear market that began in mid-2014 is probably in sight, as marginal producers fall by the wayside. Supply cutbacks should bring a rebound in the price of crude by the second half of 2016.

But before a rebound, West Texas Intermediate crude will probably continue to fall, perhaps as low as $20 a barrel, before vaulting to the mid-$50s by year end.…
Across the Curve
$20 Oil
Gene Epstein, Barron's

James Hamilton — Negative interest rates

Knock-on effects.

Negative interest rates
James Hamilton


The International Monetary Fund in January published a report which calls on European countries to accept the majority of refugees and to temporarily employ and pay them with less than the guaranteed minimum wage.
The IMF in its report recommended the implementation of short-term differentiation between asylum seekers and EU citizens through “temporary” and limited deviations from the minimum wage for refugees.…
South Front
Published at AlterMainstreamInfo, translated by Mario Andrijasevic exclusively for SouthFront

Edward Lozansky — Looming War: Who Is to Blame?

The film about nuclear war with Russia recently shown on the BBC, which is considered to be a serious and not an entertainment channel, suggests that such a war is no longer unthinkable but a real possibility. What was even more frightening was that the people in the film who made a fateful decision to start an Armageddon were not actors, but high level albeit retired politicians.

The film was timed to the release of the latest Pentagon analysis where Russia topped the list of threats to U.S. national security, followed by China, North Korea, Iran and finally, terrorism.…
Getting the sheeple ready.

Russia Insider
Looming War: Who Is to Blame?
Edward Lozansky

Moon of Alabama — Why Kerry Blames The Opposition For The Continuing Bombing In Syria

MOA finds it unlikely that the US will allow Turkey and Saudi Arabia to drag it into a war with Russia it doesn't want in support of Al Qaeda. 

Recall this all began with Zbig selling Jimmy Carter on sending "freedom fighters" to Afghanistan to destabilize the USSR. It morphed into a monster that turned around and bit the US in the ass and is now destabilizing Europe in addition to MENA. It is far from over, and Russia has now drawn some red lines to put a stop to the insanity. Now the West is drying in its beer over Russian successes.

Vesti — Ryabkov: Washington Is Preparing A "Global Strike"

Washington continues to prepare a global strike, according to Deputy Foreign Minister of the Russian Federation Sergei Ryabkov to RIA Novosti . He noted that a continuation of negotiations on further nuclear reductions are impossible for this reason. 
Fort Russ
Ryabkov: Washington Is Preparing A "Global Strike"
Vesti (original in Russian)
Translated by Ollie Richardson for Fort Russ

Jacques Sapir — Russia and Global Finance

The shaping of economic reactions by globalized finance
The result of these different factors is well known. The ruble has taken quite a beating since late summer 2014. But, this has not been the direct driver for the recession Russia is experiencing. The real driver was the reaction of the Central Bank. And here we could argue well that the Central Bank policy was self-destructing. A large part of the current recession has been created by Central Bank actions and definitely not by Western sanctions or oil prices fall. We are then to precisely figure the Central Bank reaction to the inflationary bout induced by the fall of the rouble we discussed above. The Central Bank of Russia is committed to an “inflation targeting” policy[8]. Wise or unwise[9], and we don’t think it is wise as much is to be said about the so-called “inflation targeting” policy[10], it’s a fact. The CBR will then increase its interest rates every time inflationary pressures are seen coming.
But the story doesn’t end here. If the ruble depreciation is taking a fast dive, the Central Bank will increase much its rates to “crush” speculation, as it has be seen in December 2014 when the CBR raised its primary rates to 17%. Here again it was a blatant mistake, but here again it’s a fact. High interest rates have never prevented speculation on any currency in the world[11]. It was too true for the ruble.
But the dramatic increase of interest rates had a very negative impact on the economy. To sum up a drop in oil prices is creating a very adverse financial environment for households and enterprises alike. Household are reducing (or more precisely containing) their debts linked to consumption and enterprises are reducing investments. This parallel reduction in investment and consumption had and still is having a very negative influence on economic activity.

It’s obvious than introducing some forms of capital controls could have done a better job. It is to be known that even the IMF now recommends capital controls in some specific situations[12] as it is now well acknowledged that strong exchange rates fluctuations could be extremely disruptive for the economy[13]. Some Russian authors have advocated such a move[14], and the debate is still going on[15]
The introduction of such a system could allow Russia to develop a strong industrial sector to provide both the internal market and the export market too without interference from the globalized finance. This was the strategy adopted by a number of East-Asian countries[16], but also by France between 1945 and 1975[17]. Such a development doesn’t imply to stop developing the commodity sector. Actually, the oil and gaz sector could become major consumer of Russian manufactured goods and help to develop a high-tech sector.
The main issue here is more how to ensure the development of manufactured goods without compromising the production of commodities. It is not just a problem of developing new productions but also one of changing the whole structure of Russian industry as a significant number of new enterprises are to be created to develop these new productions, and their development is challenging an industry used to rely on large integrated groups.
It is true to say that the Russian government has put a priority on the development of a modern manufacturing sector for years. But, when the Ukrainian crisis began to shape international relations Russia has not broken with its traditional model. To some extent the crisis in international relations has the direct effect to make the change of model both an absolute necessity. But, in the same time, this crisis was making it a very hard undertaking. So far Russia is still caught in the middle of a kind of new “transition”, but time is running short.…
These excerpts focus on the central bank. The post analyzes the Russian economy and financial system in greater depth, showing that the issue is really not economic but financial, with finance bound up in global finance to the detriment of Russia, and by implication other countries other than the Atlanticists that control global finance under the dollar system.

Sapir is one of the few people in the West I have encountered to recognize that the Central Bank of Russia is the chief problem. The heterodox wing of Russian economists knows this and has been lobbying for a change in policy. This crisis presents a perfect opportunity for restructuring but that requires domestic financing. The Central Bank of Russia is being an obstacle instead of facilitating restructuring as the issuer of the ruble.

This analysis reveals the pressing need to get MMT materials translated into other languages and more widely distributed.

Russia and Global Finance
Jacques Sapir

Jeffrey Sachs — Hillary Is the Candidate of the War Machine

There's no doubt that Hillary is the candidate of Wall Street. Even more dangerous, though, is that she is the candidate of the military-industrial complex. The idea that she is bad on the corporate issues but good on national security has it wrong. Her so-called foreign policy "experience" has been to support every war demanded by the US deep security state run by the military and the CIA.…
It is often believed that the Republicans are the neocons and the Democrats act as restraints on the warmongering. This is not correct. Both parties are divided between neocon hawks and cautious realists who don't want the US in unending war. Hillary is a staunch neocon whose record of favoring American war adventures explains much of our current security danger.
Jeff gets one right when it counts.
It is hard to know the roots of this record of disaster. Is it chronically bad judgment? Is it her preternatural faith in the lying machine of the CIA? Is it a repeated attempt to show that as a Democrat she would be more hawkish than the Republicans? Is it to satisfy her hardline campaign financiers? Who knows? Maybe it's all of the above. But whatever the reasons, hers is a record of disaster. Perhaps more than any other person, Hillary can lay claim to having stoked the violence that stretches from West Africa to Central Asia and that threatens US security.

The Huffington Post
Hillary Is the Candidate of the War Machine
Jeffrey Sachs

Professor Sachs serves as the Director of The Earth Institute, Quetelet Professor of Sustainable Development, and Professor of Health Policy and Management at Columbia University. He is Special Advisor to United Nations Secretary-General Ban Ki-moon on the Sustainable Development Goals, and previously advised both UN Secretary-General Ban Ki-moon and UN Secretary-General Kofi Annan on the Millennium Development Goals. He is a Distinguished Fellow of the International Institute of Applied Systems Analysis in Laxenburg, Austria. Sachs is Director of the UN Sustainable Development Solutions Network under the auspices of UN Secretary-General Ban Ki-moon. Sachs is co-founder and Chief Strategist of Millennium Promise Alliance, and is director of the Millennium Villages Project. Sachs is also one of the Secretary-General’s MDG Advocates, and a Commissioner of the ITU/UNESCO Broadband Commission for Development.

Robert Oak — Unemployment Report Starts the Year By Breaking the 5% Unemployment Rate Barrier, Big Deal

Parsing the unemployment report with graphs. On digging deeper, things are not as rosy for workers as the headline unemployment rate of 4.9% makes them sound.

Economic Populist
Unemployment Report Starts the Year By Breaking the 5% Unemployment Rate Barrier, Big Deal
Robert Oak

Don Quijones — German Judges Pooh-Pooh Obama’s Sacred US-EU Trade Pact

This past week saw the ceremonious signing of the Trans-Pacific Partnership (TPP) in Auckland, an event whose prime purpose was to convince the world that a trade agreement that most people have not even heard of and which has so far been approved by only one (Malaysia) out of 12 elected parliaments is already done and dusted.
Even the Sidney Morning Herald concedes that it was a giant PR exercise:

"It masks the fact that for Australia and most TPP countries, the public debate and parliamentary process to pass implementing legislation, leading to final ratification of the deal, is just the beginning, and it will be a rocky road."
The road will be particularly rocky in the U.S. where the treaty’s safe passage through Congress and the Senate is far from guaranteed. Indeed, the trade agreement has become so toxic with the voting public that not a single presidential contender dares to endorse it. Even the former US Trade Representative, and now Senator, Rob Portman, has come out against TPP, albeit for the wrong reasons, most tellingly the fact that he, too, is up for reelection this autumn.
However, the biggest blow to the global corporatocracy’s bloated designs did not come from the U.S. It came from Germany, where the German Association of Judges (DRB, an association that also includes prosecutors) just issued adamning indictment on the EU’s proposal to establish an “international investment court (ICC)” for the TPP’s sister treaty, the Transatlantic Trade and Investment Partnership (TTIP)…
Wolf Street
German Judges Pooh-Pooh Obama’s Sacred US-EU Trade Pact
Don Quijones

Saturday, February 6, 2016

teleSUR — Nearly 2 Million Ecuadoreans Lifted out of Poverty in 6 Years

Ecuador's multidimensional poverty rate was reduced to 35 percent in December 2015 from 51.5 percent in December of 2009. Ecuador's National Institute of Statistics and Censuses reported Friday that the country's multidimensional poverty rate dropped 16.5 percent between 2009 and 2015, translating into 1.9 million Ecuadoreans who no longer live in poverty. “Socioeconomic poverty will be fundamentally solved through changes in the relations of power … through political processes,” said Ecuadorean President Rafael Correa. The reduction of both urban and rural poverty has been one of the major objectives of the Correa government since his arrival to the presidency in 2007. The country is working to eliminate extreme poverty completely, having already successfully done so in the capital region.
Nearly 2 Million Ecuadoreans Lifted out of Poverty in 6 Years

Joe Lauria — Risking World War III in Syria

After Saudi-backed Syrian rebels balked at peace talks and the Russian-backed Syrian army cut off Turkish supply lines to jihadists and other Syrian rebels, the U.S. and its Mideast Sunni “allies” appear poised to invade Syria and force “regime change” even at the risk of fighting Russia, a gamble with nuclear war, writes Joe Lauria
Banking on Putin to back down. Russia is probably not going to launch WWIII over Syria, which would involve mutually insured destruction. But ….
Consortium News
Risking World War III in Syria
Joe Lauria

For a finer grain strategic analysis see:

ISW — Institute for the Study of War
Assad Regime Gains In Aleppo Alter Balance Of Power In Northern Syria
Chris Kozak

Giovanni Federico and Antonio Tena-Junguito — World trade, 1800-2015

Parallels are often drawn between the Great Recession of the past decade and the economic turmoil of the interwar period. In terms of global trade, these comparisons are based on obsolete and incomplete data. This column re-estimates world trade since the beginning of the 19th century using a new database that includes fewer developed countries. The effect of the Great Recession on trade growth is sizeable but fairly small compared with the joint effect of the two world wars and the Great Depression. However, the effects will become more and more comparable if the current trade stagnation continues.
World trade, 1800-2015
Giovanni Federico, Professor of Economic History, University of Pisa. and Antonio Tena-Junguito, Associate professor in the Department of Social Science, Universidad Carlos III de Madrid

Stephen F. Cohen — The Obama Administration Has Just Recklessly Escalated Its Military Confrontation With Russia

The Pentagon’s announcement that it will quadruple US-NATO military forces in countries on or near Russia’s borders pushes the new Cold War toward actual war, possibly even a nuclear one.
The Nation
The Obama Administration Has Just Recklessly Escalated Its Military Confrontation With Russia
Stephen F. Cohen | Professor Emeritus of Russian Studies and Politics at New York University and Princeton University

See also

Russia really has only one option — massive thermonuclear retaliation against all NATO countries and Japan that would annihilate them (us) in the event of attack as a strategy of deterrence.

South Front
Russia rules out nuclear arms talks with US

Ollie Richardson — US Vice-President Biden’s Son Continues to Buy Gas Assets in Ukraine

Entrepreneur Hunter Biden has acquired equity securities of a company in the country which his father, Vice-President of USA Joe Biden, called the most corrupt in the world.
Joe, tell us it isn't so.

This is what snared Harvard economics professor Andrei Shleifer in a corruption case that cost Harvard millions to settle.
Neither Harvard nor Shleifer have admitted guilt in the matter. But a federal court ruled in 2004 that Harvard had breached its contract with the U.S., and that Shleifer and an associate were liable for conspiracy to defraud the government.

Last August, Harvard paid $26.5 million to settle the lawsuit, in addition to $2 million that Shleifer paid himself.

Sputnik International — Putting Russia on the Map: Stratfor CEO's Analysis

In an attempt to draw up a strategic portrait of Russia and to understand President Putin’s "long-term intentions in Europe,” former US chief intelligence officer and founder and CEO of the private intelligence corporation Stratfor, George Friedman, has created ten maps designed to illustrate “Russia’s difficult position since the Soviet Union collapsed.”
However, his research has produced some completely unexpected results.
“Many people think of maps in terms of their basic purpose: showing a country’s geography and topography. But maps can speak to all dimensions — political, military, and economic,” Friedman writes in his article for the New York-based magazine Business Insider.
“In fact, they are the first place to start thinking about a country’s strategy, which can reveal factors that are otherwise not obvious.”….

Russia, he says, is “more united than divided and derives power from the strength that comes from overcoming difficulty.”
With regards to Russia, he says it “isn’t prosperity that binds the country together, but a shared idealized vision of and loyalty toward Mother Russia. And in this sense, there is a deep chasm between both Europe and the United States (which use prosperity as a justification for loyalty) and Russia (for whom loyalty derives from the power of the state and the inherent definition of being Russian).”
“This support for the Russian nation remains powerful, despite the existence of diverse ethnic groups throughout the country,” he finally concludes.
Expecting economic pressure on Russia to result in political collapse as it would in the West is questionable. It seems to be based on wishful thinking and projection.

Rudy Panko — Iran Dumps Petrodollar, Wants Euros for All Oil Sales

Analysts say that the move is not just politically motivated: Now that sanctions have been lifted, Europe has become one of Iran's top trading partners. So why use dollars?
But the decision seems to be yet another act of defiance against dollar dominance. This week Russia became China's biggest oil partner, thanks in part to Moscow accepting payment in yuan. And last month, Iran and India announced that they intend to settle all outstanding crude oil payments in rupees, as part of a joint strategy to dump the dollar and trade instead in national currencies.…
Exorcising the ghost of Bretton Woods.

Russia Insider
Iran Dumps Petrodollar, Wants Euros for All Oil Sales
Rudy Panko

Yves Smith — Paul Craig Roberts on Michael Hudson’s Killing the Host

PCR's post at his website was also shared on Counterpunch, but now Yves has given it further exposure.

PCR: "Michael Hudson is the best economist in the world. Indeed, I could almost say that he is the only economist in the world. Almost all of the rest are neoliberals, who are not economists but shills for financial interests."

Naked Capitalism
Paul Craig Roberts on Michael Hudson’s Killing the Host
Yves Smith

Elijah J.Magnier — Russia Is Preparing the Syrian Army to Repel Any Turkish Incursion

Rebutting US Secretary of State John Kerry. This is more about documenting US support for Al Qaeda linked terrorists than the title of the post would indicate.

Fort Russ
Russia Is Preparing the Syrian Army to Repel Any Turkish Incursion
Translated by Sufyan Jan for Fort Russ
Elijah J.Magnier

The US position dissected:

Syria: NATO’s Last Desperate Options in Lost Proxy War
Tony Catalucci

See also
But the US is putting a lot of pressure on these two states, willing to keep in danger, while applying pressure on Russia and Syria through their actions. However, this turn of events may lead to a major war, if Russian forces come under fire, Russia will have enough determination to launch retaliations strikes, starting the collapse of the regimes in both in Turkey and Saudi Arabia.
Reshaping of the Middle East Has Begun
Petr Livov

Raúl Ilargi Meijer — Debt Rattle February 6, 2016

More global pessimism

The Automatic Earth
Debt Rattle February 6, 2016
Raúl Ilargi Meijer

Steve Keen — Our Dysfunctional Monetary System

Steve Keen sums it all up on one sentence:
The great tragedy of the global eco­nomic malaise is that it is caused by a short­age of some­thing that is essen­tially cost­less to pro­duce: money.
It's beyond inane, especially post Keynes and post Lerner. Not that this was unknown or overlooked before. But Keynes and Lerner elaborated economic policy based on a theory that disproves the conventional approach.

Steve Keen's Debtwatch
Our Dysfunctional Monetary System
Steve Keen | Professor and Head Of School Of Economics, History & Politics, Kingston University, London
From Routledge:
A growing inequality in income and wealth marks modern capitalism, and it negatively affects nearly every aspect of our lives, especially those of the working class. It is and will continue to be the central issue of politics in almost every nation on earth. In this book, the author explains inequality in clear, passionate, and intelligent prose: what it is, why it matters, how it affects us, what its underlying causes are, and what we might do about it. This book was written to encourage informed radical action by working people, the unemployed, and the poor, uniquely blending the author’s own experiences with his ability to make complex issues comprehensible to a mass audience. This book will be excellent for courses in a variety of disciplines, and it will be useful to activists and the general reading public.

Radical Political Economy
New book by Michael D. Yates: The Great Inequality
David M. Fields

Geoffrey Gardiner — Guest Post: POSITIVE MONEY IN ACTION

How to make Positive Money work and the implications of doing this.

New Economic Perspectives
Geoffrey Gardiner, formerly director of the Financial Services Division of Barclays Bank

Stockman: 'The end is near!"

LOL and look at the twitter handle of these barbarian nut-job idiots promoting it. This and the Citi "Death Spiral!" thing from yesterday = #YUGE amounts of bearishness out there.