Bordering on the juvenile, the self-defeating U.S. sanctions targeting Russian individuals (which as Zerohedge has speculated may ultimately include the freezing of their Netflix accounts) typifies the unproductive and clumsy manner in which the Obama administration has navigated the crisis of its own making in Ukraine. As was made clear last week Washington has no intention of curbing its aggression and insane foreign meddling; The Washington Post reported that the U.S. secretly attempted to create a social media site in Cuba to stir unrest.
U.S. prestige and influence is now so diminished that its strategic leverage has been reduced to drawing irresolute 'red lines' and sanction threatening. Operating in a parallel universe from the one in which private entities and individuals relate to each other quite well through free commerce, heads of state insist on playing war games. Unable to resist the lure of government apparatus to assert their power, they care not a whit about the humanity they claim to be acting for or the destructive chain reactions to their hubris and stupidity. There has been a call from Moscow to kick McDonalds out of Russia, where the fast-food retailer has 400 stores.
Although the U.S. is flexing its muscles threatening expanded sanctions, it is Moscow that holds the economic cards not Washington. Someone should explain to Mr. Obama and his advisors that the United States dollar is not the world's reserve currency by dictum. Rather, the privilege of reserve status derives from the world's willingness to confer it. By threatening sanctions against a major energy exporter as Russia, the U.S. endangers the petrodollar. Europe is enmeshed with Russian hydrocarbons and there is no practical manner in which that will change in the near future. The continent is decades away from any notion of energy independence and in the interim should Mr. Putin choose to demand payment for Russian energy products in currencies other than the dollar, the U.S. currency will tumble. The West's attempt to economically isolate it will only accelerate Russia's move toward alliance with BRIC nations and along with it, the degradation of the dollar.
The fictional narrative that Washington and the corporate press have advanced regarding Russia's response to events in Ukraine entirely whitewashes U.S. aggression dating back to the 1990's, with President Clinton's decision to expand NATO eastward. The neocon thinking that has dominated White House and State Department strategy ever since escalated the antagonism of Russia to its inevitable breaking point. Since the departure of Gorbachev the United States has used NATO to create east European puppets comprised of members of the former Soviet bloc. Imagine the U.S. reaction if in the midst of the toppling of Canada's government a leaked telephone conversation revealed that the Kremlin was plotting the composition of a new government in Ottawa. Western neocons would be using Putin's very rationale for his actions in Ukraine for advocating moving U.S. troops across the Canadian border.
As it vilifies Vladimir Putin at every opportunity the U.S. has turned threats, deadlines and arrogance into an embarrassing diplomatic lounge act. In a letter to The Washington Post Henry Kissinger remarked that "the demonizing of Vladimir Putin is not a policy; it is an alibi for the absence of one."
Take the time to view Putin's press conference on Ukraine as well as his speech to the Russian Parliament. Forty percent of his comments were propaganda, a refreshing reduction from the level that has been discharged from the U.S. President and his Secretary of State. Moreover, Mr. Putin is an adult (a thug perhaps -- but a grownup) His calm demeanor and lack of direct threats stand in sharp contrast to the U.S. president's tiresome confrontational theatrics.
More often than not when you hear a politician citing "violations of international law" it is merely a self-serving invocation of a murky postulate. "International law" is more cliché than reality and each side typically accuses the other of having violated the very same laws. The platitude falls nicely on the ear though and most will simply bob their heads, never asking; "And which specific laws are you referencing?"
From Paul Craig Roberts, whose commentaries are included here often: Two Steps Forward, One Step Back
While the NATO Alliance is figuring prominently in the headlines, it is the no less nefarious U.S. Pacific pact with Japan that is currently the biggest potential powder keg: The U.S. has set itself up for military engagement with China
This is the Ukrainian parliament at work. For the life of me I cannot understand why Americans find such images off-putting. I think it's wonderful and would encourage this type of behavior in both the U.S. House and Senate. Ideally members would never pass any new laws or regulations; instead they would spend their entire time beating each other to a pulp, call it a day and either head home or to a hospital:
When schoolteachers devise business plans...Healthy young people have overwhelmingly declined to sign up for Obamacare, thus savaging the financial footing of the scheme at its inception. Young people in good health comprise the most cash-flow positive component of an insured pool and critical to Obamacare maintaining any pretense of viability. As he gallops around the country and makes media appearances trying to convince them it's a good deal, President Obama tells his young audiences that they're eligible to sign up even if they have a pre-existing condition.
Mr. Obama's only real job experience prior to becoming a politician was teaching law -- he has apparently never taken a business or marketing course. In promoting guaranteed insurability for young people with illnesses (who will pay below market premiums) he is targeting the most long-term unprofitable policy holders -- precisely the wrong customer for any presumed feasibility his health-care program alleges. Mr. Obama is at the same time inadvertently stressing a dis-incentive for healthy people to sign up. Why pay premiums while you're healthy and don't need medical care when coverage is always guaranteed to be available to you for below market premium payments if and when you get sick?
College is the new high school...It is not hyperbole to state that high school students of prior generations were better educated than today's college population. With roughly 50% of recent graduates employed in jobs that do not require a college degree there is a tendency to attribute the enormous waste of time and money (i.e. indebtedness) that a college education has become to the poor job market that awaits graduates. There is another dimension to this fiasco however that is far more disturbing; the product stinks. Presenting -- boobus americanus on Campus
Accomplished politicians are usually afflicted with a form self-delusion so potent that their ethical deviance is unrecognizable to their vapid souls (see: Does Our System Select for Incompetent Sociopaths?). Diane Feinstein has defended the NSA's spying on Americans at every turn yet finds it totally unacceptable that it should happen to her: Ron Paul: If Spying on Senate is So Bad, Why is it OK For Them To Spy On Us?
The vilification of the 'one percent' casts far too wide a net, providing cover for America's true pillagers -- the 0.01 percent employed at the highest levels of banking who are exempt from criminal law and the chief executives of public companies lacking virile independent boards: Where Does the Real Problem Reside? Two Charts Showing the 0.01% vs. the 1%
"It turns out that wealth inequality isn’t about the 1 percent v. the 99 percent at all. It’s about the 0.1 percent v. the 99.9 percent (or, really, the 0.01 percent vs. the 99.99 percent, if you like). Long-story-short is that this group, comprised mostly of bankers and CEOs, is riding the stock market to pick up extraordinary investment income. And it’s this investment income, rather than ordinary earned income, that’s creating this extraordinary wealth gap."
A retiring veteran SEC trial lawyer made some pointed comments about the agency in a farewell address this month. "Floundering, unfocused, ineffective" is how James Kidney describes the federal securities police. Lamenting the SEC's dysfunction and rampant non-enforcement of major criminality, Kidney says his superiors were fearful of bringing cases against powerful firms (where they hoped to land jobs) spending time and resources instead on cases having "no significant impact and the conduct is of minimal or no harm to the investing public." Some highlights from the full speech:
"[It is] an agency that polices the broken windows on the street level and rarely goes to the penthouse floors. On the rare occasions when enforcement does go to the penthouse, good manners are paramount. Tough enforcement -- risky enforcement -- is subject to extensive negotiation and weakening."
"For the powerful, we are at most a tollbooth on the bankster turnpike.' We are a cost, not a serious expense."
"[T}he SEC now goes after defendants in China, India and, for all I know, Moldavia and other obscure nations. My question: Are we so sure that our own domestic corporations and audit firms are law abiding that we can spend vast quantities of staff time and taxpayer money worrying about firms in other countries because a handful of ADRs are sold on U.S. markets?
The 60 Minutes piece on HF Trading was at best a recycled four year old story. Then again, you didn't really expect a mainstream media source to do a serious hard hitting journalistic piece on the U.S. banking industry, did you? 60 Minutes Sanitizes Its Report on High Frequency Trading
Silver and gold...
Although gold remains this year's best performing asset, it is under the usual capping pressure for the moment. Its price is going to explode. Pinpointing the launch date is a guess but the timing will prove rather unimportant. Gold and silver are going multiples higher in price and the right mining stocks -- exponentially higher still. I've stated on numerous occasions that if you fail to comprehend the artificial suppression of the gold and silver price it will be difficult to remain invested. The entire point of the price manipulation is to discourage you. For a better understanding of the how's and why's of this scandal there is no better source than the GATA archives.
All the best,