Jul 262014
 

http://usawatchdog.com/weekly-news-wr… There are new allegations from the U.S. State Department about Russia actually shooting into Ukraine from the Russian side of the border. The State Department says Russian artillery is shooting at Ukraine army positions, and they have been doing so for weeks. Add this to the recent downing of the Malaysian jet, and you clearly get a picture of the situation in Ukraine getting far worse no matter who actually shot down the aircraft.

There are now massive protests in the West Bank as the Hamas/Israel war rages on. Thousands of Palestinians clashed with Israeli soldiers, and at least two protesters were killed. Secretary of State John Kerry is trying to get a cease-fire, but neither side wants to stop shooting. Hamas wants its ports and borders opened, and Israel wants all of the rockets and tunnels controlled by Hamas destroyed.

There is new news in the IRS targeting scandal. We were told that emails from the IRS official going after conservative groups were lost and could not be recovered—Wrong! They got the emails and somebody is going to jail.

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Jul 262014
 

Zero Hedge

Recall what we said earlier today: the proxy war Ukraine conflict, just like that in Syria preceding it, “is all about energy.” Recall also the following chart showing Ukraine’s shale gas deposits, keeping in mind that the Dnieper-Donets basin accounts for approximately 90 per cent of Ukrainian production. Finally, recall our story from May that Joe Biden’s son, Hunter, just joined the board of the largest Ukraine gas producer Burisma Holdings. Now put it all together and you will like figure out what will happen next.

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Jul 262014
 

Zero Hedge

The middle east is burning again: first it was the fascinating ascent of the brutal Al-Qaeda spinoff ISIS, creating its own Caliphate in northern Iraq and in the process taking over a third of Syrian territory as well as all of its oil infrastructure. Then, the latest iteration of the Israel vs Gaza conflict has now claimed over 1000 lives and is dragging virtually all neighboring countries into it as well. And the cherry on top is that the Libyan “liberation” by the US has just gone full circle, as the country is is now witnessing one of its worst spasms of violence since Gadhafi’s ouster. End result: nearly two years after the deadly attack on the US embassy in Benghazi, moments ago the US once again shuttered its embassy in Libya, this time in Tripoli, evacuating more than 150 Americans to Tunisia.  This is happening just 24 hours after the US Secretary of State was literally next door in Egypt, assuring the region that peace and stability are just around the corner.

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Jul 262014
 

Zero Hedge

Shortly after our report yesterday that the Liberian man suspected of carrying the Ebola virus has died while quarantined in Nigeria, the local health ministry confirmed that he was indeed the first confirmed Ebola death in the Nigerian city of Lagos, which with a population of roughly 20 million, is the largest city in Africa and the fourth largest in the world. The victim, who worked for the Liberian government, collapsed at Lagos international airport after arriving on a flight from Monrovia via the Togolese capital Lome on Tuesday, according to the Nigerian government. And now the “red alert” scramble begins in Nigeria, with a population fo 170 million, to isolate who else the deceased may have come in contact with. And while borders have not yet been closed, health specialists have been deployed to all sea ports and international airports to identify any passengers displaying symptoms associated with Ebola.

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Jul 262014
 

Zero Hedge

While it was already reported that the black boxes of flight MH 17 were supposedly not tempered with, despite early propaganda attempts via planted YouTube clips to claim otherwise (clips which have since disappeared replaced by other propaganda), the question of what the data recovery team operating in London would find was unanswered, until earlier today when CBS reported that “unreleased data” from a black box retrieved from the wreckage of Malaysia Airlines Flight 17 in Ukraine show findings consistent with the plane’s fuselage being hit multiple times by shrapnel from a missile explosion.

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Jul 252014
 

Source: Armstrong Economics

Central_Bank_China

The Swiss National Bank and the People’s Bank of China reached a currency swap agreement this week. While this is not a huge trend changer in the near-term, it demonstrates that our forecast for China to become the largest economy and to be the next financial capital of the world when Europe and the USA blow themselves apart with defaulting socialism is on track. This agreement will allow the two central banks to buy and sell their currencies up to a limit of 150 billion renminbi, or 21 billion Swiss francs ($23.4 billion).

SwissNationalBank

The deal will also allow the Swiss central bank to invest some of its huge accumulation of foreign exchange reserves in the Chinese bond market.

The Zurich-based SNB said the agreement will further strengthen collaboration between it and its Chinese counterpart and is a “key requisite for the development of a renminbi market in Switzerland.” It could also facilitate trade and investment between the two countries, the PBOC said. This demonstrates that China is moving in the correct direction.

Article source: http://www.blacklistednews.com/De-Dollarization_Spreads%3A_Swiss_%26amp%3B_Chinese_Central_Banks_Enter_Swap_Agreement/36845/0/38/38/Y/M.html

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Jul 252014
 

Source: Ellen Brown

One thing to be said for the women now heading the Federal Reserve and the IMF: compared to some of their predecessors, they are refreshingly honest. The Wall Street Journal reportedon July 2nd:

Two of the world’s most powerful women of finance sat down for a lengthy discussion Wednesday on the future of monetary policy in a post-crisis world: U.S. Federal Reserve Chairwoman Janet Yellen and International Monetary Fund Managing Director Christine Lagarde. Before a veritable who’s-who in international economics packing the IMF’s largest conference hall, the two covered all the hottest topics in debate among the world’s central bankers, financiers and economists.

Among those hot topics was the runaway shadow banking system, defined by Investopedia as “The financial intermediaries involved in facilitating the creation of credit across the global financial system, but whose members are not subject to regulatory oversight. The shadow banking system also refers to unregulated activities by regulated institutions.” Examples given include hedge funds, derivatives and credit default swaps.

Conventional banks also engage in “shadow banking.” One way is by using their cash cushion as collateral in the repo market, where they can borrow to invest in the stock market and other speculative ventures. As explained by Bill Frezza in a January 2013 Huffington Post article titled “Too-Big-To-Fail Banks Gamble With Bernanke Bucks”:

If you think [the cash cushion from excess deposits] makes the banks less vulnerable to shock, think again. Much of this balance sheet cash has been hypothecated in the repo market, laundered through the off-the-books shadow banking system. This allows the proprietary trading desks at these “banks” to use that cash as collateral to take out loans to gamble with. In a process called hyper-hypothecation this pledged collateral gets pyramided, creating a ticking time bomb ready to go kablooey when the next panic comes around.

Addressing the ticking time bomb of the shadow banking system, here is what two of the world’s most powerful women had to say:

MS. LAGARDE: . . . You’ve beautifully demonstrated the efforts that have been undertaken . . . in terms of the universe that you have under your jurisdiction. But this universe . . . has generated the creation of parallel universes. And . . . with the toolbox with all the attributes that you have — what can you do about the shadow banking at large? . . .

MS. YELLEN: So I think you’re pointing to something that is an enormous challenge. And we simply have to expect that when we draw regulatory boundaries and supervise intensely within them, that there is the prospect that activities will move outside those boundaries and we won’t be able to detect them. And if we can, we won’t be — we won’t have adequate regulatory tools. And that is going to be a huge challenge to which I don’t have a great answer.

Limited to her tools, there probably is no great answer. All the king’s horses and all the king’s men could not rein in the growth of the shadow banking system, despite the 828-page Dodd-Frank Act. Instead, the derivatives pyramid has continued to explode under its watch, to a notional value now estimated to be as high as $2 quadrillion.

At one time, manipulating interest rates was the Fed’s stock in trade for managing the money supply; but that tool too has lost its cutting edge. Rates are now at zero, as low as they can go – unless they go negative, meaning the bank charges the depositor interest rather than the reverse. That desperate idea is actually being discussed. Meanwhile, rates are unlikely to be raised any time soon. On July 23rd, Bloomberg reported that the Fed could keep rates at zero through 2015.

One reason rates are unlikely to be raised is that they would make the interest tab on the burgeoning federal debt something taxpayers could not support. Higher rates could also implode the monster derivatives scheme. Michael Snyder observes that the biggest banks have written over $400 trillion in interest rate derivatives contracts, betting that interest rates will not shoot up. If they do, it will be the equivalent of an insurance company writing trillions of dollars in life insurance contracts and having all the insureds die at once. The banks would quickly become insolvent. Worse, our deposits would get confiscated to recapitalize them, under the new “bail in” scheme approved by Janet Yellen as one of the Fed’s more promising tools (called “resolution planning” in Fed-speak).

As Max Keiser observes, “You can’t taper a Ponzi scheme.” You can only turn off the tap and let it collapse, or watch the parasite consume its food source and perish of its own accord.

Collapse or Metamorphosis?

The question being hotly debated in the blogosphere is, “What then?”  Will economies collapse globally? Will life as we know it be a thing of the past?

Not likely, argues John Michael Greer in a March 2014 article called “American Delusionalism, or Why History Matters.” If history is any indication, governments will simply, once again, change the rules.

In fact, the rules of money and banking have changed every 20 or 30 years for the past three centuries, in an ongoing trial-and-error experiment in evolving a financial system, and an ongoing battle over whose interests it will serve. To present that timeline in full will take another article, but in a nutshell we have gone from precious metal coins, to government-issued paper scrip, to privately-issued banknotes, to checkbook money, to gold-backed Federal Reserve Notes, to unbacked Federal Reserve Notes, to the “near money” created by the shadow banking system. Money has evolved from being “stored” in the form of a physical commodity, to paper representations of value, to computer bits storing information about credits and debits.

The rules have been changed before and can be changed again. Depressions, credit crises and financial collapse are not acts of God but are induced by mechanical flaws or corruption in the financial system. Credit may stop flowing, but the workers, materials and markets are still there. The system just needs a reboot.

Hopefully the next program that gets run will last more than 20 or 30 years. Ideally, we might mimic the ancient Mesopotamians, the oldest and most long-lasting civilization in history, and devise an economic system that lasts for millennia. How they did it, along with some other promising models, will be the subject of another article. For more on this, see The Public Bank Solution.

About Those Derivatives

How to kill the derivatives cancer without killing the patient? Without presuming to have more insight into that question than the head of the Fed or the IMF, I will just list some promising suggestions from a variety of experts in the field (explored in more depth in my earlier article here):

  • Eliminate the superpriority granted to derivatives in the 2005 Bankruptcy Reform Act, the highly favorable protective legislation that has allowed the derivatives bubble to mushroom.
  • Restore the Glass-Steagall Act separating depository banking from investment banking.
  • Break up the giant derivatives banks.
  • Alternatively, nationalize the too-big-to-fail banks.
  • Make derivatives illegal and unwind them by netting them out, declaring them null and void.
  • Impose a financial transactions tax on Wall Street trading.
  • To protect the deposits of citizens and local governments, establish postal savings banks and state-owned banks on the model of the Bank of North Dakota, the only state to completely escape the 2008 banking crisis.

These alternatives are all viable possibilities. Our financial leaders, in conjunction with our political leaders, have continually re-created the web of money and credit that knits our economy together. But they have often taken only their own interests and those of the wealthiest citizens into account, not those of the general public. It is up to us to educate ourselves about money and banking, and to demand a system that is accountable to the people and serves our long-term interests.

___________________________

Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books, including the best-selling Web of Debt. In The Public Bank Solution, her latest book, she explores successful public banking models historically and globally. Her 200+ blog articles are at EllenBrown.com.

Article source: http://www.blacklistednews.com/You_Can%E2%80%99t_Taper_a_Ponzi_Scheme%3A_Time_to_Reboot/36846/0/38/38/Y/M.html

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Jul 252014
 

Source: Homeland Review

Residents of Boston do not need shotguns or rifles, according to Boston Police Commissioner William Evans.

Boston’s top cop made that statement Wednesday on Boston Public Radio in response to Massachusetts state senator Stan Rosenberg’s position that there are already “sufficient controls” on long guns at the federal level, giving no need for new state laws that grant police additional powers to deny ownership to citizens.

According to WGBH, Evans responded:

I don’t agree with that. Having long guns–rifles and shotguns–especially here in the city of Boston. I think we should have, as the local authority, some say in the matter. [And] the federal [government] doesn’t really allow us to have the discretion that we want in these particular cases.

…For the most part, nobody in the city needs a shotgun. Nobody needs a rifle.

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Article source: http://www.blacklistednews.com/Boston_Police_Say_Residents_Do_Not_%27Need%27_to_Own_Shotguns%2C_Rifles/36847/0/38/38/Y/M.html

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Jul 252014
 

Source: Vice

Vice takes an unprecedented look into the shadowy industry of Private Military Companies. For the past two decades these private companies, like Black Water, Aegis and G4S have silently consumed military operations around the world, doing everything from back end logistics, protection of government VIP’s and diplomats to actual combat duties. In this documentary we explore the origins of this industry, their rise in the war on terror and their future operations around the world.

Article source: http://www.blacklistednews.com/Superpower_for_Hire%3A_Rise_of_the_Private_Military/36848/0/38/38/Y/M.html

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Jul 252014
 

Zero Hedge

Update: It has been confirmed that the Liberian man who died in quarantine, did in fact have Ebola. Cue panic mitigation.

While the state of Sierra Leone is scrambling to locate the missing woman who is “on the loose” in the capital Freetown with a documented case of Ebola, we can at least close the book on the other developing story we reported yesterday involving a person who collapse in the international airport of Nigeria’s megacity, Lagos, and who was being tested for Ebola. The man has died.

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