Tuesday, October 14, 2008

Shell 'wins' Iraq gas contract

Oil giant Shell has recently won the Big Oil race to become the first major oil company to gain access to Iraq's energy sector since the 1970s. With no competitive bidding process, the Dutch-British multinational has 'won' a $4bn contract to process and market natural gas with the South Gas Company in Basra.

The deal has been conducted in secret, leaving important information about the terms and authorship unknown. This secrecy has meant the contract was not subject to any public scrutiny or debate. Platform co-director Greg Muttitt surmised that "a country under occupation has introduced an oil policy that is favourable to western oil companies. The [US] State Department has already admitted that it has advisers working on oil policy and there is a likelihood they may have drafted the Shell contract."

However, attempts to gain control over Iraq's oil fields have not gone so well. As Corporate Watch reported last year, an oil law permitting de-facto oil privatisation was drafted under pressure from Big Oil, the US and UK governments, their consultants, and the IMF. It was presented to the Iraqi parliament in May 2007 and was expected to pass quickly. However, Iraqi and international opposition to transferring oil sovereignty to multinational oil companies has helped create a climate in which the Iraqi parliament has been able to resist the extreme pressure by US and UK governments and the has not been passed to date. So the big oil companies and governments are busy finding other avenues to the eventual prize of control over Iraq's vast oil fields.

These avenues include discussing, preparing, and now bidding for contracts such as Risk Service Contracts (RSCs). While usually offering companies less in terms of long-term control over production and revenue than the prized Production Sharing Contracts (PSCs), they can nonetheless be written to be very similar to PSCs. The 'devil' is in the detail with these complex agreements, details which have not been disclosed. What is certain is that, if secured, they will represent a radical departure from traditional Iraqi – and indeed international – oil policy

Secret U.S. mission hauls uranium from Iraq

The last major remnant of Saddam Hussein's nuclear program — a huge stockpile of concentrated natural uranium — reached a Canadian port Saturday to complete a secret U.S. operation that included a two-week airlift from Baghdad and a ship voyage crossing two oceans.

The removal of 550 metric tons of "yellowcake" — the seed material for higher-grade nuclear enrichment — was a significant step toward closing the books on Saddam's nuclear legacy. It also brought relief to U.S. and Iraqi authorities who had worried the cache would reach insurgents or smugglers crossing to Iran to aid its nuclear ambitions.

What's now left is the final and complicated push to clean up the remaining radioactive debris at the former Tuwaitha nuclear complex about 12 miles south of Baghdad — using teams that include Iraqi experts recently trained in the Chernobyl fallout zone in Ukraine.

~ more... ~


World Bank climate funds under fire

Two days before the World Bank's annual meetings, a coalition of watchdog and non-profit groups exposed World Bank lending for dirty projects and urged individual nations to refrain from supporting the World Bank's new "Climate Investment Funds."

The groups released a report today titled "Dirty is the New Clean: A Critique of the World Bank's Strategic Framework for Development and Climate Change."


The report argues that the World Bank's track record disqualifies it from managing clean technology transfer and climate adaptation funds. Instead, the groups argue, such funds should be established under the United Nations Framework Convention on Climate Change, in order to ensure they are used equitably and effectively, in accordance with the principle of common but differentiated responsibility, and that nations receiving financing are thoroughly involved in funds' design and implementation.

"The World Bank has a very troubling track record on climate change. It has repeatedly invested in dirty projects and called them 'clean,'" said Janet Redman of the Institute for Policy Studies and the lead author of the report. "It is beyond ridiculous for the World Bank to continue to claim that projects such as the Tata coal plant in India—expected to be one of the world's top 50 global warming polluters—are part of the solution to the climate crisis. The World Bank cannot be trusted to oversee climate change funding."

The groups' analysis shows that World Bank Group lending to coal, oil and gas in 2008 increased 94 percent from 2007, reaching over $3 billion. Coal lending alone increased an astonishing 256 percent.

The World Bank claimed major increases in fiscal year 2008 in its renewable energy and energy efficiency lending, but the vast majority of that comes from environmentally and socially destructive large hydropower projects and energy efficiency. Lending for "new" renewables—wind, solar, biomass, geothermal, and hydropower projects that produce up to 10 MW per facility—only increased from $421 million to $476 million from last fiscal year, representing a 13 percent increase, not the 87 percent that the World Bank claims.

"The World Bank provided political and financial support to Exxon and the Chadian government for the Chad-Cameroon oil pipeline. Precisely as we warned the World Bank years ago, its support for this pipeline established a new petrol dictatorship in Africa. The World Bank is now withdrawing from the project, but who is left to deal with the monster that it created? Our people are worse off and the local environment is ravaged. We are outraged by the suggestion that this same World Bank is now planning to administer climate change funds," said Samuel Nguiffo of Friends of the Earth Cameroon.

Under the UN Framework Convention on Climate Change, to which the U.S. is a party, industrialized countries most responsible for global warming are obligated to finance clean technology and adaptation to climate impacts in developing countries.

"Developing countries have clearly articulated at multiple UN climate negotiations that financing for climate change mitigation and adaptation should be fully accountable to the UN Framework Convention on Climate Change. It is simply wrong for the World Bank—an undemocratic, unaccountable institution—to have any role in controlling climate financing," said Karen Orenstein of Friends of the Earth-U.S.

The groups are:




Two page factsheet on World Bank's "Climate Investment Funds": http://www.ips-dc.org/reports/#770

New "Dirty is the New Clean" report on World Bank's climate framework: www.ips-dc.org/reports-list.php#780

Two-page World Bank and Climate factsheet: http://www.foe.org/Climate_Investment_Funds/WorldBank-ClimateOverview.pdf

~ Friends of the Earth International ~


Waiting for the Barbarians

By Constantine Cavafy (1864-1933), translated by Edmund Keeley
What are we waiting for, assembled in the forum?
The barbarians are due here today.
Why isn't anything happening in the senate?
Why do the senators sit there without legislating?
Because the barbarians are coming today.
What laws can the senators make now?
Once the barbarians are here, they'll do the legislating.
Why did our emperor get up so early,
and why is he sitting at the city's main gate
on his throne, in state, wearing the crown?
Because the barbarians are coming today
and the emperor is waiting to receive their leader.
He has even prepared a scroll to give him,
replete with titles, with imposing names.
Why have our two consuls and praetors come out today
wearing their embroidered, their scarlet togas?
Why have they put on bracelets with so many amethysts,
and rings sparkling with magnificent emeralds?
Why are they carrying elegant canes
beautifully worked in silver and gold?
Because the barbarians are coming today
and things like that dazzle the barbarians.
Why don't our distinguished orators come forward as usual
to make their speeches, say what they have to say?
Because the barbarians are coming today
and they're bored by rhetoric and public speaking.
Why this sudden restlessness, this confusion?
(How serious people's faces have become.)
Why are the streets and squares emptying so rapidly,
everyone going home so lost in thought?
Because night has fallen and the barbarians have not come.
And some who have just returned from the border say
there are no barbarians any longer.
And now, what's going to happen to us without barbarians?
They were, those people, a kind of solution.
~ source ~

A message from the Federation of Light

Blossom's most recent book "The Bridge" documents the messages channelled to her by the Cosmic Beings known as The Federation of Light. In her most recent encounters with them they have announced that one of their craft will appear in our skies on October 14th 2008 for a period of three days in such a way as to prove to us the existence of other life forms in the Universe. The Federation of Light stress that they come in LOVE to help us and our planet move to a new Higher Vibration of Love. They have asked Blossom to get this message out to as many people as possible -
Attached is the message from The Federation of Light as channelled through Blossom.

We wish it to be understood that on the 14th day of your month of October in the year 2008 a craft of great size shall be visible within your skies. It shall be in the south of your hemisphere and it shall scan over many of your states.
We give to you the name of Alabama.

It has been decided that we shall remain within your atmosphere for the minimum of three of your twenty four hour periods.

During this time there will be much commotion upon your earth plane. Your highest authorities will be intruding into 'our' atmospherics that surround our ship. This 'security field' is necessary for us, as there shall take place a 'farce' from those in your world who shall try to deny that we come in LOVE.






Climate of Hope

This animated documentary takes viewers on a tour through the science of climate change, the nuclear fuel chain, and the remarkable energy revolution that is under way.

Produced in 2007 by Scott Ludlam and Jose Garcia for the Anti-Nuclear Alliance of Western Australia.

Climate of Hope is a 30 minute documentary created to demystify climate change and nuclear energy. While the threat of climate change is now widely accepted in the community, the potential for nuclear power stations in Australia has raised questions about the best strategy for our country to move to a low-carbon economy.

~ Engage Media ~

Clamshell history

The Clamshell Alliance was the model for a movement that forced the nuclear industry to shelve its plans for new nuclear plants for 30 years. Some say its success was just a matter of the right people, time, place and issue. Others say the key to success was Clamshell's structure — highly organized, but extremely democratic and decentralized to the point of anarchy. What can not be debated is that the Clamshell Alliance fulfilled Albert Einstein's plea to take the issue of atomic energy to the village square.Petitions, town referendums, workshops, lectures, brochures all helped people realize this was important. And music, buttons, posters and massive, nonviolent citizens' occupations of the Seabrook, NH, nuclear plant site gave color and drama to that debate. Taking its name from the clam beds in the marshes where the Seabrook, NH, nuclear power plant was to be built, the Clamshell Alliance lasted from 1976 until the mid-1980s. But its legacy lives on, in new movements for social justice , and in the lives of people who joined together under the Clamshell and other antinuclear banners to demand 'successfully' "No Nukes!"

Too important an issue for the experts
The Clamshell Alliance was formed in July 1976 by New Hampshire energy activists shortly after a construction permit was issued for twin 1150-megawatt reactors on the marshes of Seabrook, NH, and within sight of the heavily-populated beach resort community of Hampton, NH.

Inspired by successful antinuclear citizen protests in Germany and Western Massachusetts, the Clamshell was grounded in the belief that nuclear energy is too important an issue to be left to the scientists, utilities, lawyers and government. Through public education and nonviolent civil disobedience, petitions and picket lines, rallies and site occupations, the Clamshell Alliance put a spotlight on the issue of nuclear power.

Two Clamshell occupations of the Seabrook, NH, site in August, 1976 resulted in almost 200 arrests and generated headlines. Hundreds of people around New England organized local, autonomous groups. They carried out local events, but also helped plan Clamshell actions, making decisions through highly coordinated communications.

The Clamshell defended local democracy (repeated votes of Seabrook residents against construction of the plant had been ignored). It renewed a commitment to non-violent tactics of the 1960s civil rights movement. It pulled strength (and members) from feminist, anti-Vietnam war, Native American rights, labor, environmental and back-to-the-land movements, while quietly side-stepping the sectarian approaches of the 'hard left.'

Structurally, the Clamshell promoted inclusiveness and equality, giving equal weight to every voice and eschewing appointed or elected leaders. It adopted — and eventually struggled with — consensus decision-making. It adopted a stance of complee openness with government and law enforcement officials as well as all its supporters.

Perhaps most important, the Clamshell Alliance served as an example that ordinary people had the right, the ability, and the responsibility to challenge and change the direction of energy policy in the United States.

The turning tide
April 30, 1977, more than 1800 people from 30 states walked onto the site; 1414 were arrested and held for 13 days in six New Hampshire national guard armories. The incarceration garnered international media attention and energized the occupiers to go home and work harder.

Around the nation anti-nuclear alliances organized, naming themselves the Palmetto in South Carolina, the Oystershell in Maryland, the Abalone in California, the Sunflower in Kansas, and so on. All of these groups were rooted in the same non-violent direct action discipline, affinity group organization and consensus decision-making process as the Clamshell. Without them, the nuclear industry would not have been stopped.

In a complicated and controversial move, plans for another citizens' occupation of Seabrook were changed to an on-site anti-nuclear rally, attended by 20,000 people June 24, 1978. Several hundred of those participants continued on to Washington D.C., where they occupied the sidewalks in front of the Nuclear Regulatory Commission.

That was the last large Clamshell action, but the organization continued into the late-1980s. It attempted to block delivery of the Seabrook reactor's core vessel, supported acts of civil disobedience by small groups of people and developed creative and grassroots strategies for blocking a state-funded Seabrook bailout. A national non-violent civil disobedience action on Wall Street in 1979 was organized by former Clamshell members and led to the arrest of more than 1,000 people.

The nuclear industry subsequently shelved its U.S. nuclear plans indefinitely. No new construction permits were issued after 1978 and many of the projects underway in the mid-1970s were abandoned or blocked from opening. The nuclear power plant at Seabrook finally went online in 1990, half the size originally proposed. Even so, the Clamshell's impact, both on the nuclear industry and those who participated, still resonates today.

~ To the Village Square - Nukes, Clams and Democracy ~


In addition to the role the Clamshell played in helping launch the US anti-nuclear power movement, The Clam helped invent the late 20th century US model of decentralized, affinity-group-and-spokescouncil-based, feminist-inspired, nonviolent direct action since utilized by the anti-nuclear weapons, counter-war-in-central america, disability rights, anti-apartheid, HIV-AIDS awareness, lestransbigay, counter-corporate-globalization, and peace movements.

~ Peacework Magazine ~


Lava flows reveal clues to magnetic field reversals

Ancient lava flows are guiding a better understanding of what generates and controls the Earth's magnetic field — and what may drive it to occasionally reverse direction.

The main magnetic field, generated by turbulent currents within the deep mass of molten iron of the Earth's outer core, periodically flips its direction, such that a compass needle would point south rather than north. Such polarity reversals have occurred hundreds of times at irregular intervals throughout the planet's history — most recently about 780,000 years ago — but scientists are still trying to understand how and why.

A new study of ancient volcanic rocks, reported in the Sept. 26 issue of the journal Science, shows that a second magnetic field source may help determine how and whether the main field reverses direction. This second field, which may originate in the shallow core just below the rocky mantle layer of the Earth, becomes important when the main north-south field weakens, as it does prior to reversing, says Brad Singer, a geology professor at the University of Wisconsin-Madison.

Singer teamed up with paleomagnetist Kenneth Hoffman, who has been researching field reversals for over 30 years, to analyze ancient lava flows from Tahiti and western Germany in order to study past patterns of the Earth's magnetic field. The magnetism of iron-rich minerals in molten lava orients along the prevailing field, then becomes locked into place as the lava cools and hardens.

"When the lava flows erupt and cool in the Earth's magnetic field, they acquire a memory of the magnetic field at that time," says Singer. "It's very difficult to destroy that in a lava flow once it's formed. You then have a recording of what the paleofield direction was like on Earth."

Hoffman, of both California Polytechnic State University at San Luis Obispo and UW-Madison, and Singer are focusing on rocks that contain evidence of times that the main north-south field has weakened, which is one sign that the polarity may flip direction. By carefully determining the ages of these lava flows, they have mapped out the shallow core field during multiple "reversal attempts" when the main field has weakened during the past million years.

~ more... ~


Study pushes back origin of AIDS pandemic to 1908

Researchers think the growth of cities -- and high-risk behavior associated with urban life -- may have helped the virus to flourish. There is no cure for AIDS, which is most commonly transmitted through sexual contact.

Prior estimates put the origin of HIV at 1930. But Michael Worobey of the University of Arizona in Tucson now believes HIV began infecting humans between 1884 and 1924.

The research is based on 48-year-old gene fragments dug from a wax-embedded lymph node from a woman in Kinshasa in the Democratic Republic of Congo, formerly Zaire.

The 1960 sample is the second-oldest genetic sequence of HIV-1 group M, the main strain of the virus responsible for the AIDS pandemic.

The oldest sequence came from a 1959 blood sample given by a man in Kinshasa, formerly known as Leopoldville.

"Once you have two you can line them up and compare them," Worobey said in a telephone interview.

"Once you do that, you see these two sequences are very different. That means the virus had already been there for a long time even by 1959 or 1960."


Putting the two samples together with dozens of other previously known HIV-1 genetic sequences, the researchers constructed family trees for this strain of HIV.

"Those old sequences helped calibrate the molecular clock, which is essentially the rate at which mutations accumulate in HIV," Worobey said.

"Once you have that rate, you can work backward and make a guess of when the ancestor of the whole pandemic strain of the AIDS virus originated. It is that ancestor we are dating to 1908 plus or minus about 20 years."

~ more... ~


The origin of AIDS

All of the attempts to date the origin of AIDS prior to 1960 are essentially propoganda inspired by funding from the U.S. National Institutes of Health.

Edward Haslam's reaction to AIDS, an avatar of colonialism ...

These quasi-scientific efforts are an attempt to lead the trail of responsibility away from a secret US government laboratory located in New Orleans that used radiation in the early 1960s to mutate monkey viruses in hopes of developing a vaccine to counter a cancer-causing virus that was discovered in the polio vaccine.

The recent attempts to date HIV-1 to the 1920s, and now the 1880s, are mathematical regressions models which show how long it would take nature to accomplish what a linear particle accelerator accomplished in a single afternoon. They are not based on any real physical evidence and are completely contrary to the trail of evidence collected by the world's most respected laboratories. That's why the Pasteur Institute called it "new" around 1990 after they found the virus in a 1976 French citizen who received a blood transfusion in Haiti.

Worobey's unnamed associate is Dr. Hahn, who discovered HIV-1 in 1984 chimpanzee cells from Coulson laboratory, but she was unaware that Coulson had been infecting his chimpanzees with HIV-1 since 1981.

The mathematical regression is done at Los Alamos national laboratories by a computer expert trained in weather models.

Anyone looking for more information about this, may please contact me. I don't think you are getting the real story here. And I think people who follow AIDS in Africa have the right to know.

For more details read the book DR. MARY'S MONKEY.

~ Afrik.com ~

Not enough money in the world: The real monster in the meltdown closet

The result of all this has been the construction of a gargantuan house of cards, based on next to nothing, and left alone in the shadow of building "perfect storm" of greed, deregulation and political corruption.

That storm has now struck. The house of cards has fallen down, and revealed a hole of derivatives-based debt that could not be filled, literally, by all the money in the world, much less by the mere trillions that national governments are frantically throwing at it today.

Yes, "mere" trillions.
As Will Hutton explains in the Observer:

...the dark heart of the global financial system [is] the $55 trillion market in credit derivatives and, in particular, credit default swaps, the mechanisms routinely used to insure banks against losses on risky investments. This is a market more than twice the size of the combined GDP of the US, Japan and the EU. Until it is cleaned up and the toxic threat it poses is removed, the pandemic will continue. Even nationalised banks, and the countries standing behind them, could be overwhelmed by the scale of the losses now emerging.

Try to imagine that: a $55 trillion market now at risk of complete destruction. Even the derivative debt owed by individual institutions stands at nation-wrecking levels. For example, a single bank in Britain, Barclays again, holds more than $2.4 trillion in credit default swaps, the tradable "insurance" mechanism against securities default. This is more than the entire GDP of Great Britain. If all this paper goes bad, there are not enough assets in the entire country to pay it off. And that's just one bank, in one country.

Hutton gives the details:

This market in credit derivatives has grown explosively over the last decade largely in response to the $10 trillion market in securitised assets - the packaging up of income from a huge variety of sources (office rents, port charges, mortgage payments, sport stadiums) and its subsequent sale as a 'security' to be traded between banks.

Plainly, these securities are risky, so the markets invented a system of insurance. A buyer of a securitised bond can purchase what is in effect an insurance contract that will protect him or her against default - a credit default swap (CDS). But unlike the comprehensive insurance contract on your car which you have with one insurance company, these credit default contracts can be freely bought and sold. Complex mathematical models are continually assessing the risk and comparing it to market prices. If the risk falls, the CDSs are cheap; if the risk rises - because, say, a credit rating agency declares the issuing company is less solid - the price rises. Hedge funds speculate in them wildly.

Their purpose was a market solution to make securitisation less risky; in fact, they make it more risky, as we are now witnessing. The collapse of Lehman Brothers - the refusal to bail it out has had cataclysmic consequences - means that it can no longer honour $110bn of bonds, nor $440bn of CDSs it had written. On Friday, the dud contracts were auctioned, with buyers paying a paltry eight cents for every dollar. Put another way, there is now a $414bn hole which somebody holding these contracts has to honour. And if your head is spinning now, add the three bust Icelandic banks. They can no longer honour more than $50bn of bonds, nor a mind-boggling $200bn of CDSs....

While every bank tries to pass the toxic parcel on to somebody else, the system has to find the money. So will compensation for the near valueless contracts and thus now uninsured debt ultimately be made - and by whom? And because nobody knows - not the regulators, banks or governments - who owns the swaps and whether they are credit-worthy, nobody can answer the question. Maybe holders of insurance policies will get the cash due to them, but will that weaken somebody else? The result - panic.

This is the ultra-dangerous downward vortex in which the system is locked. It is why share prices are plummeting. As recession deepens, there will be defaults on securitised bonds and the potential collapse of more banks outside the G7 ring-fence. Nobody knows what proportion of the $55 trillion of credit default contracts that have actually been written will be honoured and who might bear losses running into trillions of dollars.

This is the beast in the dark that is haunting the feckless leaders of the developed world: $55 trillion of unaccountable debt, and no way of knowing how much of it is even now being flushed down the toilet, taking the global economy with it.

The massive interventions we are seeing might stabilize the markets temporarily, or at least arrest their free fall long enough to come up with some kind of massive restructuring of the global financial system. Or they might not. For it is by no means certain that the wisdom, and the political courage, to come up with a more viable system can be found among the world's political leaders -- all of whom,
as we noted here the other day, have risen within the present system and, to one degree or another, owe their own power and privilege to the "malefactors of great wealth" and the extremist cult of market fundamentalism. There is no indication anywhere that the circle of collusion and corruption between governments and Big Money has even lessened, much less been broken, by the economic catastrophe. All of the various bailout plans and "coordinated actions" still have as their chief aim the preservation of the malefactors in their current state of wealth, privilege and domination.

~ more... ~


This just in: Greed is not good

Leaving aside for the moment any threats of world war, the only good news I see in our current economic crisis that at least we're eighty years down the road from when Franklin Roosevelt broke the psychological barrier previously preventing brainwashed Americans from owning a government that actually helped them, as opposed to allowing themselves to be owned by a government of oligarchs who were helping themselves.  This time, if people are hungry because there's no money, and cold because heating oil costs so much, and weathered because they've been tossed out of their homes, and frightened because they've got no job and no healthcare coverage - if we arrive at that state, watch what's left of the psychological barriers crumble like George Bush's job approval ratings or John McCain's lofty principles about running a high-minded campaign.  Watch desperate Americans embrace socialism as if they were the lost children of Chairman Mao waking up from a long nightmare of capitalist errancy. 

What we're witnessing now is the complete and utter repudiation of Reaganism-Bushism, of course, but it runs even deeper than that.  Not just the hyper-kleptocratic version of the American economic system is being left in shreds, but even its more moderate baseline version - the Eisenhower model of nice, gray-suited capitalism - is now also on the chopping block.  Even that form of capitalism - quaintly tame by today's standards of astonishing rapaciousness - was never sustainable, and part of what we've been seeing this last decade is all the ruses by which we had greedily squeezed out more than our fair share of the pie now angrily biting back.  The wars, the environmental rape, the exploitation of nice little brown people all around the world (and, after all, isn't that why Jesus made them?), the borrowing against our children's future, the tax avoidance free-riding, the credit card economy, the exporting of jobs to explode profits, the gluttony of 300 pound Americans and their SUVs and the giant screens on which they watch 'reality TV' (a nice euphemism for humiliating degradation) - these are all screaming out to us simultaneously today, in an excruciating cacophonous harmony from Hell, that THIS MUST END NOW. 

And, boy, did we ever have it coming.  I just want to go on record and say to any historians from the 26th century who might be reading this:  "Yes, it does say 'American' on my birth certificate, but I want you to know I wasn't  part of this!  I did my best and kept shouting out about our national stupidities.  And I always voted for the Green Party!" 

Yeah, it's true, I'm afraid.  We're going down in history as the stupidist and the shortest-lived of empires (even the Belgians did better than this, plus, they make great beer).  And well we should be so considered, too.  Do they have Darwin Awards for countries, like they do for individuals, who find uniquely imbecilic (though highly entertaining) ways to remove their DNA from the collective gene pool (you know, like getting really stoned and then playing your electric guitar in the swimming pool)?  They should!  And who could possibly trump America, we who gluttonously slurp up oil in order to live like global pigs, sending the proceeds to fund terrorists with ideologies from the 13th century and weapons from the 21st to attack us?  We who chant "Drill, baby, drill!" when the giant planet-wrecking asteroid of global warming is headed right for us.  (Even the real dinosaurs come off looking better than our human imitations of them, since they at least had the excuse of actually having pea-sized brains to explain why they behaved as though they had pea-sized brains.)  We whose government's insatiable spending sprees on high priority items, like wars that diminish our national security and corporate welfare for oil companies or giant agri-corporations, we fund by allowing China, our rising rival for global power, to own our debt, and therefore to own us. 

And what's that old line about the first time being tragedy and the second folly?  The most astonishing thing about the economic nightmare we're now entering is how little we learned from having already gone through this before.  We're not even talking about ancient or foreign history here, people.  You don't have to force Americans to go watch some History Channel documentary on Charlemagne to figure this one out.  It wasn't that long ago that we went through exactly the same process, ourselves, right here in gool ol' 'Muricah.  Christ, there are people still alive today who experienced it first hand.  You'd think, having found out in the 1930s precisely what happens when you let monstrously greedy people who have their hands on the levers of the global economy go on unregulated bacchanals of decadent self-aggrandizement, that we'd want to avoid that sort of thing in the future, eh?  Perhaps we'd even vow "Never again", just like we did after the Holocaust.  (But then, given the mass murderous Soviet and Chinese purges which came after Auschwitz and Treblinka, along with the genocides of Cambodia, Rwanda and now Darfur (not to mention Vietnam or Iraq), maybe that wouldn't be such a great promise to make...) 

And even if the American people couldn't make the connection between present circumstances and past analogues, am I the only knucklehead who finds the whole deregulation mania something of an odd idea just at a conceptual level?  How is it that the same people who always jump up and down in passionate support of tough crime laws, loads of jails and busy state killing machines, don't seem to apply the same logic to nice, white-collar crimes?  I mean, if you need a law to deter people from committing murder, why don't you need regulations to prevent them from committing greed?  And, wouldn't it make a lot of sense to have these laws, especially in places where the capacity exists for such tremendous harm to be done?  A murder takes a life and wrecks a couple of families.  That's horrible, and should be prevented wherever possible, and punished where not.  But would it be too much to ask that we also have laws and punishments and regulations to help prevent white-collar crimes that can wreck an entire global economic system, bringing wholesale grief to hundreds of millions of people, and no doubt producing boatloads of deaths in their wake, all in the name of satiating the greed of already fantastically wealthy people?  Indeed, we have the first of these victims on the scoreboard already.  This week a Los Angeles man who lost all his money in the stock market shot his wife, three sons and his mother-in-law before then killing himself.  Get ready for more of the same, and most of them won't be suicides, I can tell you.  They'll be homicides.  Murder by greed. 

~ more... ~


US controls bird flu vaccines over bioweapon fears

When Indonesia's health minister stopped sending bird flu viruses to a research laboratory in the U.S. for fear Washington could use them to make biological weapons, Defense Secretary Robert Gates laughed and called it „the nuttiest thing" he'd ever heard.
Yet deep inside an 87-page supplement to United States export regulations is a single sentence that bars U.S. exports of vaccines for avian bird flu and dozens of other viruses to five countries designated „state sponsors of terrorism."

The reason: Fear that they will be used for biological warfare.

Under this little-known policy, North Korea, Iran, Cuba, Syria and Sudan may not get the vaccines unless they apply for special export licenses, which would be given or refused according to the discretion and timing of the U.S. Three of those nations – Iran, Cuba and Sudan – also are subject to a ban on all human pandemic influenza vaccines as part of a general U.S. embargo.

The regulations, which cover vaccines for everything from dengue fever to the Ebola virus, have raised concern within the medical and scientific communities. Although they were quietly put in place more than a decade ago, they could now be more relevant because of recent concerns about bird flu. Officials from the U.S. Department of Health and Human Services and the Centers for Disease Control and Prevention said they were not even aware of the policies until contacted by The Associated Press last month and privately expressed alarm.

They make „no scientific sense," said Peter Palese, chairman of the microbiology department at Mount Sinai School of Medicine in New York. He said the bird flu vaccine, for example, can be used to contain outbreaks in poultry before they mutate to a form spread more easily between people.

„The more vaccines out there, the better," he said. „It's a matter of protecting ourselves, really, so the bird flu virus doesn't take hold in these countries and spread."

U.S. Commerce Assistant Secretary Christopher Wall declined to elaborate on the precise threat posed by vaccines for chickens infected with avian influenza, except to say there are „valid security concerns" that they „do not fall into the wrong hands."

„Legitimate public health and scientific research is not adversely affected by these controls," he said.

But some experts say the idea of using vaccines for bioweapons is far-fetched, and that in a health emergency, it is unclear how quickly authorities could cut through the red tape to get the vaccines distributed.

Under normal circumstances it would take at least six weeks to approve export licenses for any vaccine on the list, said Thomas Monath, who formerly headed a CIA advisory group on ways to counter biological attacks. All such decisions would follow negotiations at a „very high level" of government.

That could make it harder to contain an outbreak of bird flu among chickens in, say, North Korea, which is in the region hardest hit by the virus. Sudan and Iran already have recorded cases of the virus in poultry and Syria is surrounded by affected countries. Cuba, like all nations, is vulnerable because the disease is delivered by migratory birds.

Kumanan Wilson, whose research at the University of Toronto focuses on policymaking in areas of health protection, said it would be ironic if the bird flu virus morphed into a more dangerous form in one of those countries.

„That would pose a much graver threat to the public than the theoretical risk that the vaccine could be used for biological warfare," he said.

~ more... ~


Capitalist vs. Socialist state intervention of the economy

By Martin Saatdjian
The current financial crisis reveals the first symptoms of a major, perhaps revolutionary, socio-economic change in world affairs.  Much has been said how, after the collapse of the Berlin Wall, capitalism overshadowed socialism and "the end of history" was decreed in much of the intellectual world.  Not surprisingly, less has been mentioned that while socialism was dying in Europe, it was also blossoming in Latin America.  In 1989, events knows as "El Caracazo" referred to major protests in Venezuelan against neoliberalism and the "Washington Consensus" aimed at reducing the role of the State in the economy.  The election of Hugo Chavez in 1998 was a reaction not only to people's dislike and the failure of neoliberalism, but also due to the strong repression that followed these protests.

Today most people watch with close attention how the biggest economy on Earth is on the verge of a major crisis. However, it is not yet known what the impact will be for the American people or, more importantly, for the rest of the world.  Certainly, many questions remain unanswered - not only for those in line with the Bush administration, but especially for the U.S. working class.  It is this section of the American society that pays the price for the crisis at hand, via foreclosures and job lay-offs (which, for many, translates into losing necessary health insurance). Also, they will carry the burden of the so-called "bailout" package that the Bush administration has proposed in hopes of preventing a major economic collapse. This package fails to acknowledge that while the US working class carries the burden, they will get nothing in return.

Of course it is a different story for the speculators, corporate managers and major shareholders.  These privileged and exclusive segments of American society will benefit from the money of taxpayers, earned by their long working hours, declining wages, and worsening labor conditions- reaching an astronomical $700 billion.  This amount of money the Bush administration plans to insert into the U.S. economy is surprising.  Just to give an idea of what it amounts to: the sum of the entire economic activity for an entire year (Gross Domestic Product) of Venezuela, Colombia and Cuba combined.  The GDP of the whole African continent for the year 2007 reached $2,150 billion.[1] This means, that the Bush administration bailout plan represents roughly one third of the entire African continent's GDP.

A particular aspect of this economic crisis is the context in which it occurs, just a few weeks before the presidential election in the United States.  The Bush administration's decline in approval ratings is likely to affect its party's presidential nominee, John McCain.  Despite huge efforts, this candidate has tried to distance himself from Bush, but the current administration's colossal failure to guarantee peace in the Middle East, along with its stubborn attitude towards multilateralism and global warming, leave many people wondering if McCain will follow in the footsteps of George W. Bush.  On the other hand, Democratic candidate Barack Obama may use the present economic crisis to his advantage, in hopes of increasing his support among the working class and by fomenting nostalgia for the Clinton years - a reminder of better economic times.

Apart from the two candidates' political rhetoric, the truth is that both political parties bear a huge responsibility for the current deteriorating economic condition.  Both parties have been promoters of neoliberal economic policies, privatizations, and free trade agreements.  In addition to that, both parties have always sought the usage of public funds for the benefit of their rich campaign contributors and in the interests of lobbyists in Washington D.C.  This is why Bush's proposed bailout plan should only surprise people by its absurd amount - not because it contradicts the recurrent invisible hand theory, which has remained consistent throughout recent capitalist history.  The root of the problem regarding the current economic crisis is not the slight difference (if any) between Democrats and Republicans; rather, it is the nature by which the economic system sustains itself.

Recently, during the 63rd session of the United Nations General Assembly, the president of Argentina, Cristina Fernandez, made a very interesting comment regarding the Bush administration's proposed bailout plan.  According to her, "The most formidable state intervention that there's memory of comes precisely from the place that had told us that the state wasn't necessary, in the context, moreover, of a fiscal and commercial deficit." [2]. Most likely, she was referring not only to the bailout plan to revive the US economy, but also to US Federal Government's purchase of companies that declared bankruptcy as a result of the current economic crisis.  Once again, the hard working money of the working class and collected by the Federal Government by the payments of taxes are used by the Bush administrations against the interest of the people and for the protection of the wealthiest.

Here, precisely, is where difference can be drawn between intervention of the economy by the Bush administration (Capitalist State intervention) and the past announcements by Latin-American governments such as Venezuela, Ecuador, and Bolivia in their nationalizations and strengthening of publicly owed companies (Socialist State intervention).  It's not so much that capitalists are against the intervention of the State; they just want that the intervention translates into strengthening the wealth and power of the richest people, this time by $700 billion dollars.  As Noam Chomsky correctly mentioned in April 13, 1996, regarding the contradictions of speech and reality about the free-market:
[T]he principle of really existing free market theory is: free markets are fine for you, but not for me. That's, again, near a universal. So you -- whoever you may be -- you have to learn responsibility, and be subjected to market discipline, it's good for your character, it's tough love.... But me, I need the nanny State, to protect me from market discipline, so that I'll be able to rant and rave about the marvels of the free market, while I'm getting properly subsidized and defended by everyone else, through the nanny State. And also, this has to be risk-free. So I'm perfectly willing to make profits, but I don't want to take risks. If anything goes wrong, you bail me out. So, if Third World debt gets out of control, you socialize it. It's not the problem of the banks that made the money. When the S&Ls collapse, you know, same thing. The public bails them out. When American investment firms get into trouble because the Mexican bubble bursts, you bail out Goldman Sachs. [3]

On the other hand, the Socialist State intervention prioritizes the most basic needs of people.  This is the type of controlled and planned intervention that has been carried out by Hugo Chavez in Venezuela, while at the same time maximizing democracy, political consciousness, and the participation of the people in managing their own affairs.  The enterprises that have been nationalized in Venezuela, such as the main communications company (CANTV), the iron and steel industry (SIDOR), and one of the principal banks of Venezuela (Bank of Venezuela), are highly profitable enterprises.  In the case of CANTV, its nationalization cost the Venezuelan State roughly $1.6 billion; however, after a full year of operations this company earned nearly $400 million in net profits. At this pace, the Venezuelan State will recover its initial investment is just three years of operations.  The resources that previously went into the pockets of rich people or became capital flight, are now being used by the government of Hugo Chavez to finance public heath care projects that are highly beneficial to the neediest people.

It is worth remembering that at the peak of neoliberalism in Latin America, during the 90's, highly profitable publicly owed corporations were handed-over to the private sector.  One close example was Venezuela's national oil company (PDVSA).  Although this company was never fully privatized, previous governments before Chavez welcomed transnational oil companies by signing "Conjuncture Agreements" with PDVSA that would allow them to extract oil by giving a small portion back to the Venezuelan State, 16% at the most.  Thanks to a new Hydrocarbons Law drafted by the government of Hugo Chavez, these "Conjuncture Agreements" were replaced by Mixed Ventures where PDVSA will have the majority stake.  Long before that, President Chavez was widely criticized by the Clinton administration for a trip made to OPEC countries in an effort to recover the price of oil, which used to be at $8 a barrel at the time.

Thanks to the Chavez government, PDVSA has been strengthened and its revenues have allowed the Venezuelan State to finance countless social projects, which include: primary medical care access for the entire population, along with secondary and third level medical care facilities free of charge, the complete eradication of illiteracy, infrastructural projects that run from the building of new schools, hospitals, bridges, roads, the enhancement of public transportation and the development of a huge train transportation system across the whole country.  At the same time, the health of the economy has reached probably its best shape ever with international reserves and economic growth at its greatest level and the lowest unemployment rate in the history of Venezuela.   

Certainly the recent hike in the price of oil has factored favorably for the Venezuelan economy.  Nevertheless, this increment in the price of oil has been accompanied by the greatest weakening of the US dollar, which in real terms makes the price similar to the oil price hikes of 1981.  However, back then the Venezuelan State was in the hand of capitalist and corrupt politicians and PDVSA was managed as a transnational corporation, rather than as a vital institution for the development and growth of the economy.  As previously mentioned, today PDVSA has a greater participation in the production and exportation of Venezuelan oil than ever before and royalty increases for transnational corporations have allowed the Venezuelan State to collect a greater portion of profits than ever.  Additionally, according to the Central Bank of Venezuela, the Venezuelan economy has grown not only in the oil sector but also in the communications, construction, and service sectors.

Clearly, how Venezuela and the US allocate public funds differs greatly.  While the US government has abandoned the interest of its own people with its careless health care policies, dwindling education funding, increased military spending, and lowered taxes for the highest income bracket, the Venezuelan government has sought the careful use of public funds for developing an inclusive society, eradicating poverty, enhancing education and heath care facilities, and fostering the growth of a productive economy.  All of which has been carried out by fomenting greater democracy and the participation of the people in all aspects of politics.  

Martin Saatdjian is third Secretary at the Ministry of Foreign Affairs of the Bolivarian Republic of Venezuela.

[1] Figures gathered at: https://www.cia.gov/library/publications/the-world-factbook/ [1]

[2] Entire speech available at: http://www.un.org/ga/63/generaldebate/pdf/argentina_es.pdf [2]

[3] Chomsky (1996). Obtained from: http://www.un.org/ga/63/generaldebate/pdf/argentina_es.pdf [2]

~ Venezuelanalysis.com ~


Anthrax outbreak in the Kurdish region of Iraq

First cholera, now anthrax. The last time Iraq registered the anthrax infection in Iraq was during the Iran-Iraq war in the '80s. Now the health minister of the autonomous Kurdish region is reporting 37 infected Iraqis.

Health Minister Ziryan Othman said the disease appeared to have been passed on from livestock. The first human case of the outbreak was discovered in remote Dahuk province last month.

None of the reported cases had yet proven fatal, he told Reuters. The 37 cases in humans have all affected the patients' skin, rather than their lungs or internal organs, as occurs in more serious anthrax cases.

Othman said the authorities have ordered that infected animals be slaughtered and buried, while animals not yet infected should be vaccinated.

"The health and agriculture ministries are trying to contain this disease, because if it is spread among animals and then is transferred to humans it will have a negative effect on the economy," he said.

Official says deposits in Vatican bank are safe

A top official of the Vatican bank has offered assurances that its deposits are safe from the world financial meltdown, an Italian Catholic magazine said Monday.

Angelo Caloia said in interview released Monday, days ahead of publication in Famiglia Cristiana magazine, that the bank only makes safe investments.

"Our assets are solid and we have no lack of liquidity," said Caloia, president of the supervisory council of the Institute for the Works of Religion — the bank's official name.

The bank's depositors are religious orders, dioceses, Roman Catholic charities, other religious organizations and the Vatican itself.

In a rare interview, Caloia said the bank stayed away from derivatives — the financial instruments blamed for many of the steep loses in the current financial meltdown.

Caloia was also quoted as saying that the bank makes no loans and as a result "we have no uncollectable losses."

An Italian economist and banker, Caloia took the bank's helm in the 1980s after the collapse of Banco Ambrosiano, which had the Vatican Bank as its main shareholder.

The collapse resulted in one of Italy's largest fraud cases, but the Vatican denied any wrongdoing while agreeing to pay $250 million to Ambrosiano's creditors.

~ more... ~


Would you trust a financial bailout from a failed brothel owner?

By 1990, the IRS was fed up with his tax shenanigans and seized the ranch, putting the federal government in the unique position of running a brothel. It failed and the ranch was padlocked for the first time.
The IRS auctioned off the beds, the bedding, the bidets — even the room numbers — to recover some of Conforte's tax debt.
The brothel was sold for $1.49 million to a shell company overseen by Conforte and his attorney, Peter Perry. Conforte returned briefly to run the ranch, then fled to Brazil in 1991.
The IRS got its final say in 1997 when it filed a $16 million tax lien, followed in July 1999 with indictments of Conforte and principals in his shell company on charges including racketeering and money laundering. Millions of dollars allegedly were wired to Conforte in Brazil.
Federal agents, doing their best Men in Black, padlocked the gate where — according to Conforte — more than 1 million men had pressed the button that allowed them to be buzzed inside.
Four years later, the brothel's new owner — the federal Bureau of Land Management — put the once infamous painted lady in the desert ignominiously up for grabs on eBay. Lance Gilman snapped it up for $145,100 — adding the $100 in the final seconds of bidding.
"The Mustang Ranch was a historical site," Gilman said. "It was a business decision."

The Secret History of the American Empire

~ via Information Clearing House ~

Why the bailout scam is more likely to fail than to succeed

Leaving the issue of fraud aside, the bail out scam is also doomed to fail because it avoids diagnosis and dodges the heart of the problem: the inability of more than five million homeowners to pay their fraudulently ballooned mortgage obligations.  

Instead of trying to salvage the threatened real assets or homes and save their owners from becoming homeless, the bailout scheme is trying to salvage the phony or fictitious assets of the Wall Street gambler and reward their sins by sending taxpayers' good money after gamblers bad money. It focuses on the wrong end of the problem.  

The apparent rationale for the bailout plan is that while the injection of tax payers' money into the Wall Street casino may not be fair, it is a necessary evil that will free the "troubled assets" and create liquidity in the financial markets, thereby triggering a much-needed wave of lending, borrowing and expansion.  

~ more... ~


Baltic states could follow Iceland's lead, warns IMF

M. Strauss-Kahn said some banks in eastern Europe have become increasingly exposed to struggling property markets, having raised funds on international money markets in the same way as the ill-fated Icelandic banks, now failed and nationalised.

These banks may be forced to reduce credit and the risk of such a scenario has risen, for instance, in the Baltic states, where house prices and credit growth have fallen, M. Strauss-Kahn said. Unlike Iceland, Estonia, Latvia and Lithuania are full members of the EU, and may turn to the EU for help if their economies s begin to struggle.

M. Strauss-Kahn said the combination of tightening credit markets, rising domestic interest rates and the global growth slowdown could increase the force of the credit squeeze and rising defaults to a larger number of emerging markets and some developing countries. "Vulnerabilities are increasing and some countries with large current account deficits have had more difficulty financing them," he said.

Argentina, Ukraine and Kazakhstan are also increasingly mentioned as economically vulnerable nations, but the IMF has already sounded a major warning signal over eastern Europe. In its Global Financial Stability Report, published last week, the IMF said: "House prices in eastern Europe have soared in tandem with domestic credit growth, and the credit portfolios of banks in emerging Europe have become increasingly exposed to the real estate sector." This, said the fund, could lead to bank losses and a sharp credit crunch if the banks then contract their lending. "The risk of such a scenario has risen, for instance, in the Baltics, where house price appreciation has slowed or prices have fallen," the report said.

~ more... ~


Elijah Muhammad's widow finds synchronicity, aspires to Mongol roots

[On the eve of the 13th anniversary of the Million Man March.]

The Time Line of History, the Law of Synchronicity and the Hour!
By Mother Tynnetta Muhammad
7 Oct, 2008

Journey to Mongolia, Part 2—

"And for their disbelief and for their uttering against Mary a grievous calumny: And for their saying: We have killed the Messiah, Jesus son of Mary, the messenger of Allah, and they killed him not, nor did they cause his death on the cross, but he was made to appear to them as such. And certainly those who differ therein are in doubt about it. They have no knowledge about it, but only follow a conjecture, and they killed him not for certain: Nay, Allah exalted him in His presence. And Allah is ever Mighty, Wise." Holy Qur'an, Surah 6, verses 156-158

Behind the scenes of this magnificent event that took place in the second week of September in Mongolia, much transpired behind the scenes that heightened the drama and added to our awareness bringing the law of synchronicity (the frequency of telepathy) to the foreground in the fulfillment of Divine Prophesy. The timing of my visit to Mongolia coincided with the exact timing of the International Leadership Conference and Global Peace Fest convened by the Universal Peace Federation working in Mongolia, without my having previous knowledge of its preparation. I entered Mongolia precisely at the time of this event being exactly the time of my arrival.

Once the sponsoring entities learned of my expected arrival, I was placed along with my traveling companions as the guests of Bishop Chang Shik Yang, who now heads the leadership of the Unification Church in Korea. He hosted our visit both in Mongolia and in Seoul, Korea. This event was several years in the making being stimulated by my first visit in 2003. This was the start of my search to find answers to how I might be related to Kublai Khan. This information that was revealed to me in a vision in 1984 while visiting Addis Abbaba, Ethiopia, in Africa.

Representatives from the Unification Church leadership and Universal Peace Federation having learned of my vision and search in finding the interpretation of this vision had first opened the doors to my investigations and my most recent discoveries in Mongolia.

I was told several years ago before the first organized visit of the Unification Church to Mongolia, giving way to this extraordinary event of this month that I had been shown the significance of Mongolia years before the present hour and before the Reverend and Mrs. Moon began to mention the important genetic link between the Peoples of the Mongolian Nation in the geneology of the rest of the world. Recently, I was told by visiting dignitaries from the Unification Church at the office and Residence of the Honorable Minister Louis Farrakhan in Chicago that one of the sons of Reverend and Mrs. Moon also had a vision similar to my own concerning a peace concert and festival several months prior to its inauguration by the Chairman of the Global Peace Fest, Dr. Hyun Jin Moon in Washington, D.C. on August 9th. I had no idea until my recent travel to Mongolia that I would be participating as a guest of the Global Peace Fest planned in Mongolia and that my ticket for travel was arranged to arrive in the exact timing of its program schedule set for the evening of September 9th in Ulaanbaatar, Mongolia. Nor did I know that I would meet the exact son who was carrying this vision.

When meeting him and his wife at the gala dinner banquet held at the Presidential Palace, I shared with him briefly the story of my vision with words to convey to his father that I had come into the knowledge, after these five years, of the meaning of my vision and the historic relationship that I bear to the people of Mongolia traced through the lineage of Genghis Khan passed on to his grandson and last of the great Mongol Khans, Kublia Khan. We also met with several noted artists from the world of the classical and traditional schools of music and Theatre who pledged their support by one day being able to visit the United States to participate in my TaHa Production of a World Peace Concert and International Arts Festival in the near future. They are also planning to premier this work, Insha Allah, in Mongolia next year.

There is a timeline for every fulfillment of prophesy which can neither manifest before or after its time; but with patience and prayer, we will all come to know about it at the proper time.

"And there is none of the People of the Book but will believe in this before his death; and on the day of Resurrection he will be a witness against them. So for the iniquity of the Jews, We forbade them the good things which had been made lawful for them, and for their hindering many (people) from Allah's way." Holy Qur'an, Surah 6, verses 159-160

To be continued.

Crisis throws up sobering non-capitalist thoughts

It is tempting to dismiss Iceland's misadventures as tragicomedy, an economic version of The Mouse that Roared, a country of some 320,000 people (roughly the same as Cork and its immediate surroundings) borrowing €94 billion.

Two chilling realities quickly freeze the mirth. The first is that the investments of the Icelandic banks were largely sound. Like Northern Rock in the UK, their lending was far from unreasonable. Their Achilles heel was that their loans were funded, not by deposits, but by borrowing on the world market. Once banks refused to lend to other banks, they were dead.

The European Central Bank provided Iceland with some operating credit, while the central banks of the other Nordic countries assemble a €10 billion package and Reykjavik negotiates a €5 billion loan from Russia. This, and further assistance, should be adequate to keep the Icelandic economy operational while its government sorts through the rubble. In time the authorities in Reykjavik will most likely recuperate much of their former banks' assets. An Icelandic request to join the European Union has become a political probability.

If the rest of the world can, with a little effort accompanied by a shredding of the rule book, bail out Iceland, it is doubtful whether it could so easily digest a 20 times larger rescue of Swiss banking. The Icelandic ratio of bank assets to GDP was 11:1. The Swiss equivalent is around 5.5:1. The two largest Swiss banks, UBS and Credit Suisse, have assets of just over €2 trillion, while Switzerland's GDP stands at €332 billion and rumours about UBS refuse to go away. Sacrosanct rules and long-established reference points are being swept away by seemingly irresistible torrents of change. The process has become so rapid that even radical analyses become redundant almost as soon as they are put forward.

US author David Rothkopf, a former member of the Clinton administration, last March published his controversial book Superclass - The Global Power Elite and the World They Are Making. The book argues that the world's six billion people are governed by an elite superclass of 6,000 individuals. This superclass, he argued, has helped create complex financial instruments that replaced currency as the primary repositories of "value". These are not issued by governments, most are not regulated, and the risks associated with them are hidden. Research among big US institutional investors reveals that over 80 per cent of staff felt their boards did not understand the risks inherent in the portfolios they were responsible for.

~ more... ~


Icelandic shoppers splurge as currency woes reduce food imports

After a four-year spending spree, Icelanders are flooding the supermarkets one last time, stocking up on food as the collapse of the banking system threatens to cut the island off from imports.
``We have had crazy days for a week now,'' said Johannes Smari Oluffsson, manager of the Bonus discount grocery store in Reykjavik's main shopping center. ``Sales have doubled.''
Bonus, a nationwide chain, has stock at its warehouse for about two weeks. After that, the shelves will start emptying unless it can get access to foreign currency, the 22-year-old manager said, standing in a walk-in fridge filled with meat products, among the few goods on sale produced locally.
Iceland's foreign currency market has seized up after the three largest banks collapsed and the government abandoned an attempt to peg the exchange rate. Many banks won't trade the krona and suppliers from abroad are demanding payment in advance. The government has asked banks to prioritize foreign currency transactions for essentials such as food, drugs and oil.
The crisis is already hitting clothing retailers. A short walk from Bonus in the capital's Kringlan shopping center, Ragnhildur Anna Jonsdottir, 38, owner of the Next Plc clothing store, said she can't get any foreign currency to pay for incoming shipments and, even if she could, the exchange rate would be prohibitively high.
``We aren't getting new shipments in, as we normally do once a week,'' Jonsdottir said. ``This is the third week that we haven't had any shipments.''
Iceland's 320,000 inhabitants have enjoyed four years of economic growth in excess of 4 percent as banks and businesses expanded abroad, buying up companies from brokerages to West Ham United soccer club. Now, the three biggest banks, Kaupthing Bank hf, Landsbanki Island hf and Glitnir Bank hf have collapsed under the weight of about $61 billion in debts, 12 times the size of the economy, according to data compiled by Bloomberg.
The central bank, or Sedlabanki, ditched its attempt to peg the krona to a basket of currencies on Oct. 9, after just two days, citing ``insufficient support'' in the market. Nordea Bank AB, the biggest Scandinavian lender, said the same day that the krona hadn't been traded on the spot market, while the last quoted price was 340 per euro, compared with 122 a month ago.
``There is absolutely no currency in the country today to import,'' said Andres Magnusson, chief executive officer of the Icelandic Federation of Trade and Services in Reykjavik. ``The only way we can solve this problem is to get the IMF into the country.''
Imports Dependency
The International Monetary Fund sent a delegation to the island last week. Prime Minister Geir Haarde said on Oct. 9 his country may ask it for money after failing to get ``the response that we felt that we should be able to get'' from European governments and central banks. The state will also start talks with Russia over a possible 4 billion-euro ($5.5 billion) loan.


image from http://www.spitting-image.net

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