#1
I would go further, especially about India. Bush was the only person in Washington who thought there was a reason to open India. Everyone else looked at him like he had lost his mind. His timing was also perfect, in that the Indians right then had the best government they had ever had.
The importance of busting up the Khan nuclear proliferation ring was also a huge victory. Little will ever be said about the US sinking two Nork ships carrying nuclear materials, however.
For its part, unlike Vietnam, Bush let the military do what it wanted to, and it did it well, except for time tabling recovery too quickly at one point. Another error was not giving Afghanistan as thorough a reconstruction as Iraq.
Bush also did a lot to turn Pakistan from being nothing but a terrorist training ground, to more of a unified state. A Sisyphean and unappreciated effort if there ever was one. Decades more work to cleaning up that viper's nest.
He directed Rumsfeld to modernize the US military, which was bitterly opposed by many top military leaders, and only grudgingly got acceptance by winning the day in Iraq. The Navy modernization still remains.
Last but not least, he is still quietly pushing very hard to stave off as much of the economic collapse as he can, and to mitigate what cannot be saved.
#1
For those not around in the old days when in South Africa a white apartheid political system was in place, but the had a blood determination separating whites from blacks. The apartheid bureaucracy devised complex (and often arbitrary) criteria at the time that the Population Registration Act was implemented to determine who was 'Colored'. Minor officials would administer tests to determine if someone should be categorized either 'Colored' or Black, or if another person should be categorized either 'Colored' or White. Different members of the same family found themselves in different race groups.
Of course this was roundly denounced by the western liberal and leftist communities who sought and got a embargo established against the racist South African government.
Today, however, the same leftest and liberals [which is now redundant] use the same type of 'measure' to determine whether a person is white or black. Leftist Apartheid is now in play.
...on the other hand,
Bill Clinton claimed to be the first black president of the 20th Century, which is working out as it appears Obama is becoming the Bill Clinton president of the 21st Century.
#3
He's black based on our own country's history. Our South used the 'one-drop' rule for a long time. Barack Obama is as black as Tiger Woods.
The author of this piece is swimming uphill. It's a fine, academic argument, one that can be made in the nicer parlors and dinner tables, but our country traditionally hasn't labeled multi-racial people as such.
Posted by: Steve White ||
11/30/2008 11:18 Comments ||
Top||
#4
Unless the one-drop rule still applies, our president-elect is not black.
We call him that -- he calls himself that -- because we use dated language and logic
No - you called him that - and he called himself that - because it played well as a campaign weapon.
#5
Never known of any actually black Americans. Compare "African-Americans" side-to-side with actual Africans and they all all are merely shades of brown in comparison. See Colin Powell together with Bush -- they're about the same hue. And yet he's supposedly "black".
But I'm not sure what this "There exist hardly any actual black people in America" supposedly leads to. Obama is just as black as Jesse Jackson or Rice and much more black than Powell.
But it also played well to call Condi Rice or Powell "black", I guess.
Posted by: S. ||
11/30/2008 11:48 Comments ||
Top||
#6
Who cares. He's an ultra-leftist and he's about to screw up the country a whole lot more.
#7
I predicted that after the inauguration we'd start hearing whispering campaigns deniably originating from the like of Jesse Jackson et al, claiming that Obama isn't "black enough" to "get" the America Black Experience. (Accept no substitutes for "authentic black leadership!") I wasn't expecting anything this early.
Posted by: James ||
11/30/2008 15:44 Comments ||
Top||
#9
ION FREEREPUBLIC > RUSSIAN COMMUNISTS: CRISIS [US-Global Financial/Banking] WILL HELP US REGAIN POWER.
Unless I've missed something, the RELABELING/REDEFINITION OF COMMUNISM AS "LIMITED FASCISM/LIMITED LEFIST-SOCIALISM" and related has nothing to do it.
* INTERESTING > last nite's HISTORY CHANNEL program on "SPUTNIK" >= late 1950's Bigwig Amer Politician describes COMMUNISTS AS "RED FASCISTS" [Nazis]. OTHER > THE "SPUTNIK SCARE" IN EISENHOWER-ERA AMERICA INDUCED HUBERT HUMPHREY TO PROCLAIM THAT ITS MORE IMPORTANT POST-SPUTNIK FOR AMERICA TO HAVE AN EFFECTIVE BALANCE OF POWER IN THE WORLD VEE THE SOVIETS/USSR, as "SPUTNIK LAUNCH INFERRED TO MANY US PERTS THAT THE SOVIETS HAD DEV LR ICBMS, THAN FOR AMER TO HAVE A BALANCED BUDGET???
Thus was born the Cold War US-USSR MISSLE RACE, DR. STRANGELOVE, + US GOVT. DEFICIT SPENDING/BUDGETING [Curr US-Global Crisis]???
Manmohan Singh promises to inflict costs upon Pakistan. But diplomatic obfuscation, writes G Parthasarathy, has already let Islamabad off the hook. And politics has defanged Indias capacity to undertake covert, seek and destroy ops across the border
The carnage in Mumbai inevitably raises the query yet again about whether India is a soft state. Mumbai and its law and order machinery are not new to terrorist attacks, starting with the bombings of 1993 that were masterminded by Dawood Ibrahim and his Inter-Services Intelligence (ISI) sponsors. Yet the trial process of those accused of that heinous crime still drags on, and the mastermind lives in comfort in a spacious villa in Karachi, travelling around the world on Pakistani passports.
With at least one of the Pakistani perpetrators of the past weeks terrorist attacks in custody, there is going to be no difficulty in establishing the involvement of the Lashkar-e-Tayyeba, now functioning under the name of the Jamat-ud-Dawa. Its leader, Hafiz Mohammed Saeed, had openly boasted of how he had organised the attack on Delhis Red Fort in January 2001.
Yet, instead of taking note of his actions, the Indian Government chose to invite Pakistans then Chief Executive Pervez Musharraf for a summit meeting in Agra a few months later. This was a farcical event that preceded an attack on Indias Parliament by yet another Pakistani jihadi group, the Jaish-e-Mohammed.
The Mumbai attack has particular international significance because Pakistan-based terrorists have targeted not only Indians but also nationals of the United States, United Kingdom and Israel. Hafiz Saeed has often come out with proclamations that Christians, Jews and Hindus are enemies of Islam. After boasting that his followers had hoisted the flag of Islam at the Red Fort, Saeed proclaimed he would ensure that the green banner of Islam would fly over New Delhi, Washington and Jerusalem.
He has claimed Pakistani sovereignty over not only Kashmir but also Hyderabad Deccan and Junagadh in Gujarat, and vowed to liberate the Muslims of India. Hence, he has chosen to name the new front that claimed credit for the Mumbai outrage as the Deccan Mujahideen.
New Delhi has an opportunity to corner Pakistan. Media coverage across the world has focused attention on how foreign tourists have been systematically and meticulously targeted. The attack on the Jewish Centre in Mumbai is going to enrage public opinion in Israel, which has many supporters in the United States.
But this effort has necessarily to be tempered with realism, particularly in countries like the United Kingdom. They depend on the ISI for their presence in Afghanistan and to deal with terrorism perpetrated by Pakistani immigrants.
The United States was undoubtedly helpful in exposing the ISI role in the attack on the Indian Embassy in Kabul. But one wonders if a Barack Obama Administration will extend the same measure of cooperation in addressing terrorism directed against India. After all, the Bill Clinton Administration did precious little despite substantial evidence of ISI involvement in the 1993 bomb blasts in Mumbai. It is important to move expeditiously on this issue while President George W Bush is still in office.
To a large extent, India will have to use its own resources to make it clear to Pakistan that supporting jihadi terrorist outfits on its soil will have its consequences. While Prime Minister Manmohan Singh spoke of external linkages and warned that neighbouring countries that perpetrated such acts would have to bear the costs, he has left himself with hardly any leverage to inflict costs on Pakistan.
He is after all on record as saying that the dialogue process with Pakistan was irreversible and even shed copious tears insisting that Pakistan, like India, was a victim of terrorism. During his entire tenure in office, the aggressive manner in which Pakistans links with terrorism directed against India used to be exposed was discarded.
Instead, senior Government officials spoke of groups like the Lashkar-e-Tayyeba being freelance terrorists. During the recent Home Secretaries dialogue, the Pakistani side refused to acknowledge Dawood Ibrahim lives in Pakistan. Do note that the role of the Mumbai don in the recent attacks cannot be precluded.
Saeed is well funded, runs Islamic educational institutions and has cadre in Arab Gulf countries. Politically he has been close to former Prime Minister Nawaz Sharifs family. Following American pressure, the Lashkar was declared an international terrorist organisation by the United Nations, requiring its assets to be seized and its cadre forbidden from foreign travel.
General Musharraf and the ISI responded by getting the Lashkar to function under the name of its parent organisation, the Jamat-ud-Dawa. Subsequent American efforts to get the Jamat too declared an international terrorist organisation failed in the face of Chinese and Pakistani opposition.
It would be naive to assume that Pakistan will accept any evidence India provides to act against the Lashkar. It, therefore, defies comprehension precisely what Manmohan Singh wishes to achieve by inviting the ISI chief to give him evidence of Lashkar involvement. The ISI chief (or his representative) will promise to look into the facts and then return to Pakistan and change the situation on the ground, enabling him to refute Indian evidence and stall progress.
The proper course would have been to publicise and make the evidence available to countries whose citizens have been targeted or killed in the Mumbai carnage. This would compel powerful countries like the United States, United Kingdom, Japan and Italy to demand action by Pakistan.
In these circumstances, the strategy adopted by Manmohan Singh will only result in the Mumbai outrage being forgotten, like past instances of terrorist violence perpetrated by the ISI. Those brave men who laid down their lives defending our country during the operations in Mumbai would have died in vain, because of the diplomatic ineptitude and naiveté of our rulers.
Sadly, the Prime Minister has shown a remarkable lack of realism. He has let Pakistan off the hook. By equating India and Pakistan, Manmohan Singh appeared to forget that terrorism in India was perpetrated by groups from Pakistan with ISI support, whereas terrorism in Pakistan was the product of differences between the ISI and the Government on the one hand and jihadi groups used by the ISI against India and Afghanistan in the past.
The strategy to raise costs for Pakistan can hardly be successful by mere diplomatic obfuscation. An iron will and measures other than diplomatic are also required, including targeted strikes at Lashkar centres and leadership if the Prime Ministers stated objective is to be achieved and not frustrated by Pakistani stalling and doublespeak.
The terrorist carnage in Mumbai has exposed deficiencies in both the Coast Guard and Customs, whose officials need to be hauled up for inefficiency and worse. While it is all too easy to blame the intelligence agencies, the fact remains that their efficiency has been impaired by political interference or inaction.
It is no secret that the Intelligence Bureau (IB) spends a huge amount of resources collecting information on opposition parties and politicians to ingratiate its officers with the ruling dispensation. Every Government in India has misused the IB for internal political snooping.
The Research and Analysis Wing (RAW), responsible for external intelligence, has been effectively defanged by successive Prime Ministers having illusions that they will go down in history and get a Nobel Prize for making friends with Pakistan. The net result off such illusions and delusions is that New Delhis capabilities to inflict costs on errant neighbours, through covert action, are virtually non-existent.
Finally, our ill-paid and ill-equipped police forces have inevitably been affected by the corruption, criminalisation and communalisation that have afflicted our body politic. We can thwart terrorist plots only when these issues are addressed.
But when the Prime Minister fails to announce tough action against separatists and instead threatens and demoralises security forces with talk of zero tolerance for human rights violations during a visit to Jammu & Kashmir, his actions can hardly inspire confidence either with security forces or intelligence agencies. Even more than Mumbai, that is Indias tragedy.
Posted by: john frum ||
11/30/2008 08:50 ||
Comments ||
Link ||
[0 views]
Top|| File under:
#1
<i>But one wonders if a Barack Obama Administration will extend the same
measure of cooperation in addressing terrorism directed against India.
After all, the Bill Clinton Administration did precious little despite
substantial evidence of ISI involvement in the 1993 bomb blasts in
Mumbai.</i>
Apparently the only ones the upcoming 'Clinton 3' administration' is comforting are the markets and the bankers.
#2
The Research and Analysis Wing (RAW), responsible for external intelligence, has been effectively defanged by successive Prime Ministers having illusions that they will go down in history and get a Nobel Prize for making friends with Pakistan.
One PM, IK Gujral, reportedly handed over a list of RAW assets in Karachi (all soon killed) and disbanded the RAW unit responsible for black operations. This was part of his "Gujral Doctrine" which promised brotherly love to smaller neighbors.
Posted by: john frum ||
11/30/2008 11:56 Comments ||
Top||
Barely a couple of weeks ago my stepsister, Shalaka, got married at the Taj hotel in Mumbai. Last Wednesday night my stepfather, Ajit, called to pay the bill. When he arrived home 10 minutes later he realised he had left his mobile phone charger behind, so he called Mandira, the Taj banquet manager.
"I can't speak now, sir," she said. "We're under attack."
Ajit lives in a building next door to Mumbai's other big hotel, the Oberoi. Within a few moments, he heard gunshots from there too.
In the 48 hours that followed, his neighbourhood was sealed off and his building came under attack. In the windows of the Oberoi he saw deserted rooms, half-drawn curtains, fires, brown smoke and gunmen moving from floor to floor.
By Friday, he knew that three chefs who had worked at his daughter's wedding and the family of the Taj's general manager were dead. Friends of his sisters had also been killed. As terrorist attacks went -- and Mumbai has known several in the past few years -- it didn't come much closer to home than this.
My stepfather's reaction came in the form of a text message the next day. It read: "Pardon Afzal [Muhammad Afzal, accused of attacking the Indian parliament in 2001], hang Sadhvi [a woman accused of participating in the only act of Hindu terrorism in a Muslim neighbourhood], Ban the Bajrang Dal [a Hindu extremist organisation], talk to Simi [a Muslim student organisation of which the Indian mujaheddin, responsible for a string of attacks in Indian cities, is said to be a part], restrict the Amarnath pilgrimage [a Hindu pilgrimage that led to upheavals in the Kashmir valley last summer] fund the Haj. Wow! Truly, my India is great! Fwd 2all Hindus."
This message, steeped in irony, read like a roll call of the issues and violence that have divided Hindu and Muslim India over the past year. Almost a call to arms, it contained the great, twofold rage that has grown in Hindu India: the feeling that Islamic terrorism seeks to destroy the vigorous "new India" and the suspicion that the state is either unable or unwilling to defend itself -- for cynical reasons, such as shoring up the Muslim vote for the government.
The attacks on Mumbai -- a city that, in its prosperity, its hybridity and openness to the world, stands as a symbol of the new and energised India -- confirmed to many what they had long feared.
Within hours of the attacks, groups gathered in the streets of Mumbai, chanting "Bharat Mata ki Jai" (Victory to Mother India) and singing "Vande Mataram" (Bow to you Mother), a patriotic song that Muslims had objected to as the choice for the national anthem because it implied obeisance to gods other than Allah.
Many British commentators have asked in surprise why India is being targeted. There is no confusion among Indians themselves. When the terrorists say on their websites that they seek to break up India and reclaim it for Islam, they speak a language many Hindu Indians understand. And India has proved to be the softest of soft targets.
More than 4,000 Indians have died in terrorist attacks -- the country is the second biggest victim of terror after Iraq and virtually every one of its big cities has faced a terrorist attack. Yet the government has no centralised terrorist database, its intelligence is abysmal and there is little evidence that the state knows who it is fighting.
In dragging its feet, the Indian state does nobody a greater disservice than Indian Muslims. When there are no real suspects, arrests or trials, everyone becomes a suspect. Already an underclass, with low literacy rates, low incomes and poor representation in government jobs, Indian Muslims are increasingly alienated. There is also great pressure on them.
Nobody wants to listen to genuine grievances about poverty, illiteracy and unemployment in the face of a real threat to the country. Many Hindus want Muslims to come clean on the issue of the jihad and to make clear whose side they're on.
Far from responding positively to this pressure, some Indian Muslims are simply beginning to see their grievances as part of a global conflict between Muslim and non-Muslim.
India's position in this is unique. It has the largest Muslim minority population in the world (13.4% of the population, or about 150m) but unlike Muslims in western Europe, they are not immigrants.
They have been part of India for centuries.
This is why all Indians -- Muslims and Hindu alike -- know that the deepening divide threatens the country's existence.
Many years ago, a divide like this re-energised the Hindu nationalist BJP. Today who knows who it might throw up? The hour of men like Narendra Modi, who oversaw a pogrom of Indian Muslims in Gujarat in 2002, might have come at last.
Aatish Taseer is the author of Stranger to History: A Son's Journey through Islamic Lands, to be published in March by Canongate.
#2
I'm surprised that no one has made the simple formula.
When Muslims are above a percentage of a nation's population, they start to cause trouble. So what is that percentage? And is it graduated?
For example, at 3%, they start demanding the right to have their own schools. At 5%, they start demanding the right for Sharia courts for their community.
At 7% they insist that punishing the bad behavior of Muslims is persecution, and that they are being victimized. At 8%, they demand maximum government services while contributing nothing, and start engaging in lawfare.
At 10%, again for example, they start to demand that non-Muslims come under Muslim restrictions, out of "fairness", yet systematically start to persecute and attack other religions and peoples. etc.
Earlier this week, for example, Pakistan President Assif Ali Zardari announced his readiness to settle the dispute with India over Kashmir, promising an end to a conflict that has led to four wars and countless terrorist campaigns over the past 50 years. This plus the desire to disband ISI's Political Wing probably precipitated this assault.
On Wednesday, terror organizations that do not wish the Kashmir problem to be solved offered their opinion of such a shift.
The attacks in Bombay likely were carried out by Hindi-speaking Islamists with possible links to elements within the Pakistani intelligence community who have built their careers and personal fortunes around the Kashmir issue. These elements are serving notice that they would resist Zardari's dramatic departure from a long-established policy of enmity against India.
Continued on Page 49
Posted by: Frozen Al ||
11/30/2008 00:00 ||
Comments ||
Link ||
[0 views]
Top|| File under:
#1
Taheri's opinion piece in the Telegraph is much better as he lays out the islamic justifications for terror, torture, etc.
#2
I'm a liberal by the standards of the Burg and this to me smells of agenda peddling.
I'll point out the main error of his position.
What matters is results from interogations - I agree 100%.
Some interogation techniques are counter productive - I agree, but which in what circumstances.
His error is to assume his opinion about what is moral and what is effective constitutes evidence, and never mind proof. But then that pretty much defines a Liberal.
Seafarious is right: it's food for thought. There is one major point in this that rings true: that for some captured opponents, at least, getting into their heads, understanding how they think, and then using that as leverage to get information will work better than waterboarding or outright torture.
I don't claim any expertise whatsoever in this. I don't claim to know when one should use what methods. I have the same discomfort about borderline tactics and rough handling of prisoners that any other sensible person has. Mr. Alexander lays out a cogent case. If there is someone here who can point out the problems with his thesis, than by all means, fisk away.
Posted by: Steve White ||
11/30/2008 11:26 Comments ||
Top||
#8
And I am shocked! SHOCKED I SAY! To find out that he's selling a book.....
Seems to me that different prisoners might require different methods. For some waterboarding will turn the trick (and save lives...) while with others a 'softer' approach might be more effective. The trick is the know which is which.
#10
I think when we take options off the table and the enemy knows it then that is wrong. Each enemy combatant is an individual at the end of the and one must take the approach necessary to ween info. If that means giving them a sub sandwich and coffee to get info - then do it. If that means pulling out the waterboard - then do it. I don't think there is a one size fits all approach to gaining info, and therefore I disagree w/him in parts. However, I disagree w/anyone saying that we have to take certain options off the table. His plug at the end for Obama lost me - probably a big reason this got put into print - besides openly lambasting his senior leadership. His talk about foreign fighters coming to iraq after abu ghraib is non-sense - those assholes were there way before abu g. The beginning of his article talks about local sunni insurgents, I agree to a point, but then again understanding the motivations of the tribe was always the key. I agree in a sense that a lot of our sr leaders never grasped that, I was frustrated often w/the ignorance some of our field grades and flag officers showed to pegging this concept. I remember one of my CO's (thankfully now retired) openly disdainful of the iraqi cultural training package prior to us going there. I remember thinking, I can't wait to see this guy dealing w/the local strongmen. He'll set back relations 10 yrs. Bottomline is - anyway you can get them to playball, do so.
Posted by: Clererong Oppressor of the Algonquins aka Broadhead6 ||
11/30/2008 11:59 Comments ||
Top||
#11
Steve, I agree food for thought if tyhe same shit hadn't been recycled through the MSM since 2005. The guy is obviously selling a book so I question his motivations. So I searched on a couple of his highlights and there are alomst word-for-word of other published articles. Check it out yourself.
#12
This article is something of a red herring. There were several strands in the Sunni "insurgency" (ex-Saddam, holy warriors, Sunnis insulted by individual Americans, etc), and each needed a different interrogation method.
The fact that some had legitimate grievences and could be "bargained with" to turn on Al Qaeda is something our generals were aware of, and is the origin of the Sons of Iraq.
On the other hand, some "insurgents" were nothing but a bunch of serial killers masquerading as defenders of Islam. These guys can't be bargained with.
A "one size fits all" approach will not work in Iraq or anyplace else.
Posted by: Frozen Al ||
11/30/2008 14:26 Comments ||
Top||
#13
This phrase got me, "showing cultural understanding". How the hell do you show "cultural understanding" to people whose only reason for being is to murder and torture? I know one person who is still tortured by what he saw over there and it wasn't anything US troops did.
Posted by: Deacon Blues ||
11/30/2008 18:04 Comments ||
Top||
#1
A "field" of cylinders built on the sea bed over a 1km by 1.5km area, and the height of a two-storey house, with a flow of just three knots, could generate enough power for around 100,000 homes.
I guess they don't teach economics at university any more. Every square meter is an added cost, triply so underwater. Here is what a 100MW combined power and heat plant looks like.
Posted by: ed ||
11/30/2008 7:57 Comments ||
Top||
#2
Once again, it helps explain an old Dream/Vision of mine as per offshore [future?]Guam.
#3
Just slightly off topic - I was showing my apartment to some folks about a month ago. Four of them pull up in a BMW 325i that might have been two years old. We do the walkthrough, they think the place is wonderful, etc.
Then they ask me if I take Section 8 voucher. Four able-bodied fuckin' people asked me this question (for the Boston area locals, yes, they were from Dorchester). I politely said no and showed them the door.
Not that I'm holding my breath, but adequate oversight into this program would make me pretty happy.
#4
Fix? Like the same government bureaucrats who haven't figured out that by liquidating pirates you end piracy. Oh, there's got to be another way /sarcasm off.
It drives me nuts to remember how many people I worked with at a local loan company here in SC who had NO income other than SSA and were driving new and fully tricked-out Escalades.
Mike
Posted by: Mike Kozlowski ||
11/30/2008 11:07 Comments ||
Top||
#6
"NO legal income other than SSA"
Fixed it.
Posted by: Mullah Richard ||
11/30/2008 13:09 Comments ||
Top||
#7
Ima do #2 auditoring on deh skool lunch programs. It makes me sad. It's not even so much the tax rip-off, it's the lessons passed along to yoofs there-in involved.....
#8
Tried to tell my LLL bro-in-law about this the other night but he blames Bush and doesn't want to hear any other side of the story. You start asking 'em about Bawney Fwank and they go ballistic. I got shushed for being a bad, bad, right-wing conservative.
Posted by: Abu Uluque ||
11/30/2008 15:28 Comments ||
Top||
#9
Sounds to me like it's time to tell the LLL bro-in-law that when he gets a clue you'll see him again. Until then, he needn't bother to darken your doorstep with his shadow.
#10
As usual, IBD cuts through the crap and spells it out in simple, plain English. Ever since the house of cards that the housing market was built on starting coming down, I've been telling people to research the CRA. If there is one piece of regulation, or lack thereof as Frank and Dodd would have us believe, that can be faulted for this whole mess, the CRA deserves a large portion of the blame. It all starts there. Everything that followed is nothing but noise that fails to address the root cause. The plain reality is that the CRA was the root cause, as IBD makes clear here.
Unlike conservatives, I would argue that the problem with liberals is that they have arrived at their conclusions based not on the facts or merit of an argument, but on how that conclusion supports their ideological position. In this case, that position was that banks were deliberately discrimating against loan-seekers on the basis of race, primarily. This fulfilled their misbegotten belief that banks and other financial entities controlled by the "man" were racist institutions determined to keep minorities suppressed economically. It never occurred to them that it had nothing to do with race but everything to do with the loan-applicants projected ability to pay back the loan.
They failed to see, as they always do, that their politically correct ideology is really to blame for this mess, or at least for starting it. Just giving money away to people, which is essentially what the CRA legislated as far as home mortgages are concerned, in the naive hope that they will do the right thing with it, is a recipe for disaster.
The bank said the damage caused by the financial excesses of the last quarter century was forcing the world's authorities to take steps that had never been tried before. This gamble was likely to end in one of two extreme ways: with either a resurgence of inflation; or a downward spiral into depression, civil disorder, and possibly wars. Both outcomes will cause a rush for gold.
"They are throwing the kitchen sink at this," said Tom Fitzpatrick, the bank's chief technical strategist. "The world is not going back to normal after the magnitude of what they have done. When the dust settles this will either work, and the money they have pushed into the system will feed though into an inflation shock.
"Or it will not work because too much damage has already been done, and we will see continued financial deterioration, causing further economic deterioration, with the risk of a feedback loop. We don't think this is the more likely outcome, but as each week and month passes, there is a growing danger of vicious circle as confidence erodes," he said.
"This will lead to political instability. We are already seeing countries on the periphery of Europe under severe stress. Some leaders are now at record levels of unpopularity. There is a risk of domestic unrest, starting with strikes because people are feeling disenfranchised."
"What happens if there is a meltdown in a country like Pakistan, which is a nuclear power. People react when they have their backs to the wall. We're already seeing doubts emerge about the sovereign debts of developed AAA-rated countries, which is not something you can ignore," he said.
Gold traders are playing close attention to reports from Beijing that the China is thinking of boosting its gold reserves from 600 tonnes to nearer 4,000 tonnes to diversify away from paper currencies. "If true, this is a very material change," he said.
Mr Fitzpatrick said Britain had made a mistake selling off half its gold at the bottom of the market between 1999 to 2002. "People have started to question the value of government debt," he said.
Citigroup said the blast-off was likely to occur within two years, and possibly as soon as 2009. Gold was trading yesterday at $812 an ounce. It is well off its all-time peak of $1,030 in February but has held up much better than other commodities over the last few months -- reverting to is historical role as a safe-haven store of value and a de facto currency. Gold has tripled in value over the last seven years, vastly outperforming Wall Street and European bourses.
#1
I wonder if it ever crossed Topjobs mind that we could get both.
The crappy nation states get civil disorder due to depression and the western nations get a combination of deflation from the weak economy being offset by the inflationary actions of central banks. Disinflation?
Whatever we want to call it, for the near future, durable goods will most likely deflate and consumables will most likely inflate.
Either way, Citigroup needs to stop making headlines. Get some competent management, you clowns. Without it, your bank will only be known for credit card offers.
Posted by: Mike N. ||
11/30/2008 0:27 Comments ||
Top||
#2
Inflation by definition is an excess of money and credit, a condition we had just before the dotcom crash and continuing into August 2007, when the first of the LIBOR seizures took place.
The most likely outcome is still the definition of inflation, except that price increases are more likely to be demand/supply events, not an actual reaction to inflation.
Everyone thinks of Weimar Germany without realizing the Fed is likely to slam on the breaks when Treasury bill rates skyrocket with a humongous interest rate increase.
I think what the Smart Guys™ are worried about is that the Fed will be unable to print enough money to cover all the bets they made in the last few years and because of that neglected fact, they are now currently in the glide path of an Honest to Goodness Come-to-Jesus moment, which will eventually include an all expenses paid trip to a federal prison for most of the perpetrators
#3
'print money'. How much of the economy is now off the paper and on the computers? Cards and automated accounting continues to displace cash in a magnitude that those who weren't around 40 years ago can't understand. A lot of the value that disappeared in the last year between mortgages and speculation has largely been accounting not printing. The use and demand for paper is largely unchanged because of that displacement. It will change if and when the banks stop authorizing individual consumer credit either based upon potential (credit cards) or actual (debit cards). From my reading, the small and medium size institutions are doing just fine to an extent that they actually did adhere to the principles and regulations put in place after the last fiasco with the Savings and Loan debacle of the 80s.
#4
There is also a strong possibility of "leveraged money" hyperinflation at the same time as "cash money" deflation.
That is, in effect, we have two currencies. Cash money is backed either with paper or real goods and services; leveraged money is *based* on leverage alone. (Like taking out a $1M loan, then using that $1M as collateral to take out a $10M loan. An irrational fantasy that cannot continue.)
By distinguishing between the two economies, the cash or "real" money economy can be protected, while at the same time the leveraged economy can fail.
Actually, the leveraged economy *must* fail.
Until the leveraged economy collapses, it consumes the vitality of the real economy to try and support itself, almost like a tumor. You have to get rid of it first, before the real economy can recover.
The way to separate the two economies is for the BEP to issue very high denomination paper currency, from $100k to $10M bills. But currency that can only be transferred with US Treasury permission and can only be used by institutions, real economy corporations, not leveraged corporations or individuals.
Such bills would be sold to real economy corporations in exchange for a percentage of their liquidity large enough to prevent them from going out of business even if all the rest of their money has been looted. It would also serve the dual purpose of providing 100%+ collateral for loans, again only with Treasury permission.
This means that no matter what happens, either by their own mistakes, or the efforts of hostile outsiders, a real economy corporation cannot go out of business.
Even if their business drops to zero sales, their operations will just be suspended, not bankrupt. So when it picks up again, they can resume full production with minimum delay.
The government might even require "unemployment in place", that employees continue to go to work and do other tasks like maintenance while being paid unemployment.
#9
This gamble was likely to end in one of two extreme ways: with either a resurgence of inflation; or a downward spiral into depression, civil disorder, and possibly wars. Both outcomes will cause a rush for gold.
I'd reached the same conclusion and for the first time in my life become a gold bull.
'Print money' is a figure of speech. It doesn't mean literally printing paper money. It means increasing the supply of money in all its forms.
BTW, a quote I heard from someone at the US Fed stuck in my mind.
It was along the lines of,
Pointing at a bank of computers in the Fed's data center, he said, "The only real money is ones and zeros in those computers."
#10
One other observation. While the Fed and other central banks can and do control the supply of money, the velocity of money is beyond their control and it appears to have slowed abruptly.
#11
Deleveraging is inevitable - thats what cause dthe crash - deleveraging the financial markets in the mortgage sector.
Same thing with the petroleim prices - no cheap loans to back insane money on futures alone, without regard to supply and demand of the actual underlying commodity.
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
The bank said the damage caused by the financial excesses of the last quarter century was forcing the world's authorities to take steps that had never been tried before. This gamble was likely to end in one of two extreme ways: with either a resurgence of inflation; or a downward spiral into depression, civil disorder, and possibly wars. Both outcomes will cause a rush for gold.
