Jen Psaki, the US State Department spokesperson, uttered yet another gaffe when she declared that the Obama administration signed off on more economic sanctions against Russia, setting off alarm bells in Russia. The bill, which provides some US$350 million in military and non-military assistance to Ukraine, is expected to be signed “by the end of the week,” White House press secretary Josh Earnest said on Tuesday. Perhaps Jen Psaki thought that was not expedient enough. “He signed it yesterday,” Psaki said during the briefing, interrupting RT’s Gayane Chichakyan who was asking a question about the military aid tucked away inside the controversial legislation, called the Ukraine Freedom Support Act of 2014.
Mike Whitney ■ Here’s what’s happening: Washington has persuaded the Saudis to flood the market with oil to push down prices, decimate Russia’s economy, and reduce Moscow’s resistance to further NATO encirclement and the spreading of US military bases across Central Asia. The US-Saudi scheme has slashed oil prices by nearly a half since they hit their peak in June. The sharp decline in prices has burst the bubble in high-yield debt which has increased the turbulence in the credit markets while pushing global equities into a tailspin. Even so, the roiled markets and spreading contagion have not deterred Washington from pursuing its reckless plan, a plan which uses Riyadh’s stooge-regime to prosecute Washington’s global resource war.
William Engdahl ■ The Secret Stupid Saudi-US Deal on Syria
The details are emerging of a new secret and quite stupid Saudi-US deal on Syria and the so-called IS. It involves oil and gas control of the entire region and the weakening of Russia and Iran by Saudi Arabian flooding the world market with cheap oil. Details were concluded in the September meeting by US Secretary of State John Kerry and the Saudi King... the kingdom of Saudi Arabia, has been flooding the market with deep discounted oil, triggering a price war within OPEC… The Saudis are targeting sales to Asia for the discounts and in particular, its major Asian customer, China.
xymphora Alternative fairly tale ■ "The Oil Coup" This is likely completely backwards. Kerry probably went to see King Abdullah to try to talk him out of this crazy scheme, part of the ongoing manic-depressive influence of Prince Bandar, but the Saudis, furious with the Americans over the failure to remove Assad and the negotiations with Iran, want to pressure the Americans to follow a more Zionist line. Noticing this is noticing American Empire vulnerability, so we can't go there. Of course, we could even travel a stage higher in questioning the idea that the Saudis, as we're constantly told the 'swing producer' (despite the fact that numerous new sources of hydrocarbons have come on line in the last 20 years), actually have that much power at all. The collapse of oil prices is actually due to a collapse in world demand for oil caused by the complete collapse of the world economy caused by the predations of the 1% and neoliberalism, but we're really not supposed to notice this, so we need an alternative fairy tale.
Russia could fall back on its 150 billion yuan (HK$189.8 billion) currency swap agreement with China if the rouble continues to plunge. ● If the swap deal is activated for this purpose, it would mark the first time China is called upon to use its currency to bail out another currency in crisis. The deal was signed by the two central banks in October, when Premier Li Keqiang visited Russia. "
Russia badly needs liquidity support and the swap line could be an ideal tool," said Bank of Communications chief economist Lian Ping. The swap allows the central banks to directly buy yuan and rouble in the two currencies, rather than via the US dollar. Two bankers close to the People's Bank of China said it was meant to reduce the role of the US dollar if China and Russia need to help each other overcome a liquidity squeeze. China has currency swap deals with more than 20 monetary authorities around the world. Swaps are generally used to settle trade. "
The yuan-rouble swap deal was not just a financial matter," said Wang Feng, chairman of Shanghai-based private equity group Yinshu Capital. "
It has political implications as it is a sign of mutual trust."
(Translation: Alice, S, Gideon, Marina. Editing: D.M. Pennington, Michael, Peter, Heather, Bernie, Patricia, Tom, Kristin.) Why did the Central Bank raise the interest rate and let the ruble flow? ● Another increase in key interest rates on loans issued by the Bank of Russia, for the purpose of refinancing commercial banks, made loans completely inaccessible for the majority of enterprises of the real sector of the economy. When the average profitability of the manufacturing industry is 7.5-8%, credit issued at rates of 10% or higher cannot be used by most businesses, either for investment or for replenishing working capital. Such decisions cut off the real economy, with the exception of some sectors of the oil, gas, and chemical-metallurgical sector, from credit issued by the State. ● Prior to that, the consumer lending boom drove millions of citizens into a 10-trillion ruble debt and the real economy lost the savings of the population, becoming a net debtor. Also, the Government withdrew pension savings from the economy. Sanctions imposed by NATO countries deprive the economy of the bulk of external credit. Most businesses have only their own funds to finance working capital and investments, which is clearly not enough to provide even simple reproduction, never mind an expanded one. The amount of profit of enterprises this year (taking into account the fall in the prices of export goods) will be no more than 10% of the required rate of investment of 25-30% of GDP. It’s no surprise that as a result of such decisions amidst the economic recovery in almost all countries of the world this year, Russia is experiencing an unexpected decline in investment and production. ● According to the Central Bank’s report, On the key rate of the Bank of Russia, October 31, 2014, its decision to raise interest rates was made because of external circumstances: “In September-October the external environment has changed significantly: oil prices dropped significantly while there has been a tightening of sanctions imposed by individual countries to a number of large Russian companies. The ruble has been weakening in this environment, which, against the backdrop of August’s restrictions on import of certain food products, led to a further acceleration of growth of consumer prices”. To support its previous decision to raise interest rates, the Central Bank argued that “inflationary risks had increased, including rising geopolitical tensions and their possible impact on the dynamics of the course of the national currency, as well as changes in the tax and tariff policy.” In the same policy statement, the Central Bank explained its decision to raise interest rates by “a stronger than expected effect of exchange rate dynamics on consumer prices, rising inflation expectations, as well as the unfavorable trends in the market for certain goods.” ● This reasoning does not stand up to criticism.
Stephen Lendman ■ The bubble of all bubbles. A house of cards waiting to collapse, says Paul Craig Roberts. A great unraveling looms. America's economy based on market manipulation. Rigging things one way. Smoke and mirrors deception. Money printing madness. Privatizing profits. Socializing losses. Upside down reality. Shifting wealth in unprecedented amounts. More than what's comprehensible. To monied interests. From ordinary folks. Stealing them blind. Creating ruler/serf societies. Notably in America. Enforced with police state harshness.
Paul Craig Roberts ■ On the Brink of War and Economic Collapse
Russia will take counter measures if Washington imposes new sanctions on Moscow over the Ukraine crisis, Russia's Deputy Foreign Minister Sergei Ryabkov said on Saturday. ● The U.S. Congress has readied new sanctions on Russian weapons companies and investors in the country's high-tech oil projects, but U.S. President Barack Obama has yet to sign a corresponding bill into law. "We will not be able to leave that without an answer," Russia's Interfax news agency quoted Ryabkov as saying. He did not say what form of counter-measure Moscow might take.
Patrick L. Smith ■ These Are Lies The New York Times Wants You to Believe About Russia
[The] thing which those who stick to a simplistic assessment of the sanctions are missing are the following:
1) Whom are these sanctions hurting more, Russia or the West?
2) What is the Russian staying power to put up with these sanctions?
3) Will time make these sanctions harder or easier for Russia to put up with?
I would argue that these sanctions are much more damaging to the the US European colonies (known as the "EU") than for Russia. I would argue that the Russian people have a formidable resistance to hardship and that western societies are, in comparison, soft, hedonistic, lazy, spoiled and generally weak. Russians have a staying power which is simply unimaginable for a west European person (the horrible siege of Leningrad lasted 900 days!!!). Lastly, I believe that time will allow Russia to take adaptive measures to basically render these sanctions irrelevant. Furthermore, the Russian staying power under AngloZionist sanctions needs to be compared with the staying power of the Ukrainian Nazi junta to keep control of the situation. It is one thing to put up with hardship and quite another to sit on a sinking ship.
A new railway connecting Central Asia with the Persian Gulf through Iran was officially opened on December 3. With Kazakhstan completing its east-west rail line that links the country's centre to the west earlier this year, the new international railway line now offers direct passage for Chinese goods to Iran and on to the Gulf, as well as Europe via Turkey. ● Kazakh President Nursutlan Nazarbayev, Turkmen leader Gurbanguly Berdymukhamedov and Iranian President Hassan Rouhani opened the new Ozen-Gyzylkaya-Bereket-Etrek-Gorgan railway line on the Turkmen-Iranian border on December 3. The line is part of the international North-South corridor. The length of the Kazakh section of the railway is 146 kilometres, Turkmen 700km and Iranian 82km. The parties signed the agreement on the construction of the railway link in 2007 and construction started in 2009. ● The project means that Kazakhstan now has a direct line to Turkmenistan and Iran, bypassing Uzbekistan and cutting the route by hundreds of kilometres. Together with the new east-west railway line from Beyneu to Zhezkazgan opened by President Nazarbayev in August, the lines will drastically cut the transit time for Chinese goods to Europe via Russia and the Middle East.
Robert Parry ■ A top problem of Ukraine has been corruption and cronyism, so it may raise eyebrows that new Finance Minister Natalie Jaresko, an ex-U.S. diplomat and newly minted Ukrainian citizen, was involved in insider dealings while managing a $150 million U.S. AID-backed investment fund. ● Ukraine’s new Finance Minister Natalie Jaresko, a former U.S. State Department officer who was granted Ukrainian citizenship only this week, headed a U.S. government-funded investment project for Ukraine that involved substantial insider dealings, including $1 million-plus fees to a management company that she also controlled.
Washington and its allies are pursuing a regime change policy towards Russia, deliberately introducing sanctions and attacking the ruble through manipulation of world oil prices, the head of Russia's external intelligence agency has said. ● Mikhail Fradkov, the head of the Foreign Intelligence Service (SVR), warned that Moscow is aware of US moves to oust Putin from power. “
Such a desire has been noticed, it’s a small secret,” Fradkov - a former prime minister - told Bloomberg on Thursday. “
No one wants to see a strong and independent Russia.” He also attributed the more than 30 percent drop in oil price partly to US actions. Lower prices on one of Russia's main exports placed immense pressure on the ruble, which is also suffering from sanctions. The ruble has lost 39 percent of its value against the dollar so far this year. Foreign investment funds are “taking part” in ruble speculation via intermediaries, Fradkov said. “Any speculation has specific schemes and the schemes have a number of participants.”
RT.com: ‘Putin made perfectly clear that Russia won’t be bullied by West’
VIDEO: The US govt bent on world hegemony, Russia stands in its way – Reagan economic ex-advisor
Paul Craig Roberts ■ Vladimir Putin’s Presidential Address to the Federal Assembly
The Saker ■ Main Message Of Putin's Big Speech: Russia is Fed Up with Neo-con Aggression
Russian Energy Minister Alexander Novak and Slovak Economy Minister Pavol Pavlis will sign a deal on the supply of Russian oil to Slovakia, starting from January 2015 until the end of 2029, which will be automatically prolonged every five years after that. ● Russian Energy Minister Alexander Novak and Slovak Economy Minister Pavol Pavlis will sign a deal on the supply of Russian oil to Slovakia for the next 15 years on Friday. The deal will be in force from January 2015 until the end of 2029, and will be automatically prolonged every five years after that, if neither of the sides objects, spokesperson for the Slovak Economy Ministry Miriam Ziakova told RIA Novosti Thursday. Russia will supply Slovakia with about 6 million metric tons of oil annually under the new deal, which will replace the previous agreement that expires on December 31, 2014. The same amount of Russian oil will be delivered via Slovakia to Western Europe.
Simon Black ■ On October 22, 1981, the government of the United States of America accumulated an astounding $1 TRILLION in debt. At that point, it had taken the country 74,984 days (more than 205 years) to accumulate its first trillion in debt. It would take less than five years to accumulate its second trillion. And as the US government just hit $18 trillion in debt on Friday afternoon, it has taken a measly 403 days to accumulate its most recent trillion. There’s so much misinformation and propaganda about this; let’s examine some of the biggest lies out there about the US debt.
Last week, total US debt was a meager $17,963,753,617,957.26. Two days later, as updated today, on Black Friday, total outstanding US public debt just hit a new historic level which probably would be better associated with a red color: as of the last work day of November, total US public debt just surpassed $18 trillion for the first time, or $18,005,549,328,561.45 to be precise, of which debt held by the public rose to $12,922,681,725,432.94, an increase of $32 billion in one day. It also means that total US debt to nominal GDP as of Sept 30, which was $17.555 trillion, is now 103%. Keep in mind this GDP number was artificially increased by about half a trillion dollars a year ago thanks to the "benefit" of R&D and intangibles. Without said definitional change, debt/GDP would now be about 106%. It also means that total US debt has increased by 70% under Obama, from $10.625 trillion on January 21, 2009 to $18.005 trillion most recently. And now we wait for the US to become Spain, and add the estimated "contribution" from hookers and blow to GDP, once again pushing the total debt/GDP ratio below the psychological 100% level.
More than 77 percent of Swiss voters have rejected the idea of their country's return to a modified version of the gold standard. ● Swiss voters chose not to oblige the country's central bank to boost its gold holdings to 20 percent and store the reserves inside Switzerland at a nationwide referendum held Sunday. As many as 77.3 percent of Swiss voters have rejected the idea of their country's return to a modified version of the gold standard that means that the money supply of the country should be tied to gold, according to Neue Zurcher Zeitung that displayed the results of all cantons published on their official websites.
Neue Zurcher Zeitung: Abstimmungen
On the heels of US Vice President Joseph Biden's trip to Ukraine this week, NATO Supreme Allied Commander for Europe, Gen. Philip Breedlove, is in Kiev today pledging increased military assistance to the US-backed government there. As the Kiev regime readies another assault on breakaway regions in the east of the country, General Breedlove announced today that:
"We are going to help Ukraine's military to increase its capacities ... [to] make them ever more interoperable with our forces." Breedlove again repeated NATO's assertion that the Russian military is operating in east Ukraine, claiming the Russians are providing the "backbone" for the forces seeking independence from rule by Kiev. This latest NATO assertion of Russian involvement in east Ukraine is in addition to 36 -- count them -- prior claims of a Russian invasion of Ukraine since February. Thirty-six invasions of Ukraine but NATO has yet to produce a definitive photograph of a Russian military presence. Either Russia's is the most stealth army in the history of warfare or NATO operatives are misleading those they are paid to serve.
King World News has published an interview with expert Steve Quayle who said he believed that China and Russia were going to publicly demand that the US show its gold reserve "
Less than a year ago I was given access to information about intended economic war plans that indicated that a time is coming very soon when both Russia and China will announce to the world that they don’t believe the United States has all [8,100 tons of ]
the gold it claims to possess," Quayle said. He added that "China already possesses more physical gold than anyone in the world." Earlier, Germany and Switzerland announced their intention to take their gold back from abroad. Quayle said that his efforts sparked an intense debate over German gold repatriation in the German media. When a country filed a request with the FRS to repatriate its gold, the request was denied or a country only received a token amount back. Officially, Germany was told that its gold would be safer where it is. Unofficially, it is believed that there it did not seem possible to repatriate the gold reserve from America. This has led Quayle to believe that the FRS does not have gold in its vaults.
Banks Goldman Sachs, HSBC and Standard Bank and a unit of chemical producer BASF conspired to manipulate platinum and palladium prices, according to a US lawsuit filed this week. ● The class-action suit, filed Tuesday in New York, said the four defendants shared nonpublic information about client purchases and sale orders to manipulate prices for their benefit and to the detriment of plaintiffs. This illegal sharing of information "gave them the ability to execute trades... in advance of those (price) movements," the complaint said. "This unlawful behaviour allowed Defendants to reap substantial profits, while non-insiders, which include Plaintiffs and members of the Class, were injured." The plaintiff, Modern Settings, a US maker of jewelry and other metal products, alleges it lost value on "tens of thousands of transactions" due to the conspiracy, the complaint said. Investors in the commodities "lost millions of dollars as a result of this conduct," said Labaton Sucharow, the firm representing the plaintiffs, in a statement.
Ukraine is teetering on the edge of collapse, but the West is "sleepwalking" in its response to the impending crisis, say observers. ● The West has made a catalogue of errors since Ukraine's fateful decision to turn its back on Russia, to which Moscow responded by launching a proxy war that has made Kyiv's already dire economic situation worse. The EU's Association Agreement with Kyiv, which commits Ukraine to moving closer to Europe, has not come with enough financial support to re-boot the economy. "There is a currently a major hole in the Western financing package for Ukraine of somewhere in the order of $10bn for the next six months," says Tim Ash, head of emerging markets research at Standard Bank. The Institute of International Finance (IFF), a global financial industry group, was also in Kyiv last week and came to pretty much the same conclusion. Despite a recent ceasefire with pro-Russian separatists in eastern Ukraine, Kyiv will suffer a "double-digit recession this year", the IFF said in a report.
We noted in 2010 that the American Dream – the possibility of a “rags to riches” success story – has moved abroad … since social mobility in the U.S. is much lower than in many other developed nations. (And we pointed out that conservatives are as disturbed as liberals by the collapse of social mobility in modern America.) A paper published last year by University of Ottawa economics professor Miles Corak tells us exactly where the American Dream has gone … to Scandinavia. Denmark, Norway and Finland have the most social mobility (and Sweden is not that far behind). On the other hand, the UK, Italy and America have the least social mobility. [...] Norway is arguably the world’s most prosperous country. Denmark is 3rd; Sweden is 6th; and Finland is 8th … but the U.S. has dropped down to 10th place.
The sum is comprised of the €1.2 billion the contract is worth and a compensation of €800 million for each of the ships. ● If France doesn't deliver Mistral helicopter carriers to Russia, the penalty may ammount to €3 billion, the Le Parisien newspaper reported Wednesday. The sum is comprised of the €1.2 billion the contract is worth and a compensation of €800 million for each of the ships. No official confirmation has been yet received. Earlier, French media estimated the compensation at €10 billion. On Tuesday French President Francois Hollande said the current situation in Ukraine does not allow Paris to hand over the first Mistral helicopter carrier to Russia. Russian deputy defense minister Yuri Borisov told TASS on Tuesday Russia will be acting strictly in line with the contract and file a lawsuit if the ship is not delivered.
In a word - Ukraine is in big trouble... Kiev’s foreign reserves plunged last month by a whopping 23.2 per cent to a paltry $12.6 billion. By the end of the year it will be even messier. Kiev’s gotta pay a $3.1 billion gas bill to Gazprom, or else...The central bank will have to sell more foreign currency to support the hryvnia. And there are MORE hefty gas bills as General Winter advances. Is the austerity-devastated EU lending them at least one euro? Of course not. It’s up to the IMF, who now OWNS Ukraine. Yet there will only be “emergency funding” if Kiev applies that good ol’ “structural adjustment” – as in turning the overwhelming mass of Ukrainians into beggars for life. These are the facts. The rest is rubbish.
● Western media reports of the summit are an embarrassing travesty
● Far from isolated, Putin was embraced by the great majority of heads of state
● Idea that he left early, upset over criticism is total, complete, sheer, bloody rot - a new low for western media who alleged this in chorus
● EU leaders tried to browbeat Putin - Putin told them to take a few laps in the Brisbane river, and explained to them yet again, correctly, that it is he, in fact, who holds the strong cards in Ukraine, and that the EU had better get its act together
● As before, the EU has no idea what to do about the Ukraine mess
● The clinically obtuse Mr. Obama managed to insult China
US sanctions violate the very system they created. ● Sanctions levied against Russia are against the norms of international trade and the core principles of the G20, as they can only be introduced via the United Nations, Putin said. Sanctions are “against WTO principles and the General Agreement on Tariffs and Trade, the GATT. The United States itself created that organization at a certain point. Now it is crudely violating its principles,” Putin explained.
Interconnected economy: What hurts us hurts you ● Sanctions against Russia have targeted the finance, energy and weaponry sectors of the economy. Russia’s retaliatory sanctions to ban agricultural imports are having a colossal ripple effect on jobs, social sectors, and growth. This is especially pertinent to Europe, which is feeling the squeeze of the agricultural export ban to Russia, one its biggest markets. “Everyone must understand that the global economy and finance these days are exceptionally dependent on each other,” Putin said. Germany’s economic growth is an example of financial blowback from sanctions with Russia.
“Ordinary people lost enormous amounts of money” when JP Morgan Chase sold millions in faulty loans – and taxpayers still paid a big chunk of its billion-dollar settlement with the government, investigative journalist Matt Taibbi told RT. ● In recent story published in Rolling Stone, Taibbi detailed how a former JP Morgan employee Alayne Fleischmann helped the Justice Department in its investigation against the bank. Eventually, a $9 billion settlement was reached. However, that agreement did not require the bank to admit guilt for fraud – and it all came about to keep the information Fleischmann divulged from surfacing. Speaking with Thom Hartmann on RT’s ‘The Big Picture’, Taibbi said that Fleischmann, a deal manager at the company, criticized JP Morgan’s banking practices when she realized that the normal procedures on due diligence and compliance on loans were not being handled in the usual way. These loans were to be packed into securities and re-sold to investors (pension funds, hedge funds, insurance companies), but the due diligence department wasn’t forthcoming with information, and deal managers were told not to send emails with their inquiries. As a result of JP Morgan’s decision to sell these loans despite knowing they were defective, Taibbi said Americans suffered dramatically.
President Barack Obama is again pushing international leaders to finalize the trans-Pacific trade deal between 12 countries that would eradicate tariffs and regulations, but critics say the secretive negotiations have been a boon only to corporations. ● Leaders of the countries negotiating the Trans-Pacific Partnership (TPP) deal at this week’s Asia Pacific Economic Cooperation (APEC) meetings have not set a timetable for settling the pact, but the Obama administration is optimistic that by end of his eight-day visit to Asia a deal can be reached. If finalized, it would eliminate tariffs on goods and services and change regulations for labor, government procurement, state-owned enterprises, intellectual property and environmental protections. The deal would also enhance the United States’ presence in Asia, something the White House has wanted to do ever since President Obama was first inaugurated.
PressTV: US promoting military agenda in Pacific: Dennis Etler
SputnikNews (RIA Novosti): Putin, Obama Spoke Several Times in Beijing, Discussed Bilateral Relations
Stephen Lendman ■ Obama at APEC
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