Wednesday, November 7, 2018

Back Up Plans

Feeding the Army,

Consider it beyond ironic that some of the same experts and organizations now suggesting that we bet America’s future on pumping up the most inefficient sector of our economy -- no, no, I didn’t mean the coal industry, I meant the military-industrial complex -- are conservative experts who criticized the Soviet Union for the very same thing.  They still claim that it imploded largely because Washington cleverly lured its leaders into devoting ever more of their resources to the military sector.  That, they insist, reinforced a rigidity in the Soviet system which made it virtually impossible for them to adapt to a rapidly changing global economic landscape.
Our military buildup, they still fervently believe, bankrupted the Soviet Union. Other analysts, like the historian Lawrence Wittner, have questioned such a view. But for the sake of consistency, shouldn’t conservatives who claimed that excessive military spending did in the Soviets be worried that President Trump’s policy of massive tax cuts for the rich, increased Pentagon spending, and trade wars with adversaries and allies alike might do something similar to the United States?

Maybe you once thought the CIA wasn’t supposed to spy on Americans here in the United States.
That concept is so yesteryear.
Over time, the CIA upper echelon has secretly developed all kinds of policy statements and legal rationales to justify routine, widespread surveillance on U.S. soil of citizens who aren’t suspected of terrorism or being a spy.
The latest outrage is found in newly declassified documents from 2014. They reveal the CIA not only intercepted emails of U.S. citizens but they were emails of the most sensitive kind — written to Congress and involving whistleblowers reporting alleged wrongdoing within the Intelligence Community...
The March 2014 intercepts, conducted under the leadership of CIA Director John Brennan and Director of National Intelligence James Clapper, happened amid what’s widely referred to as the Obama administration’s war on whistleblowers and mass surveillance scandals...
It turns out the CIA claims it must engage in “routine counterintelligence monitoring of government computers” to make sure certain employees aren’t doing bad things. Poof! Now, all kinds of U.S. citizens and their communications can be swept into the dragnet — and it’s deemed perfectly legal. It’s just an accident or “incidental,” after all, if the CIA happens to pick up whistleblower communications with the legislative branch.

The F-35 finally has some competition for costliest boondoggle in American military history.
According to Bloomberg, the most expensive Navy warship to date, the $13 billion Gerald R. Ford aircraft carrier, was delivered last year without the elevators it needed to lift bombs from below deck for loading on to fighter jets. The "advanced weapons" elevators were supposed to have been installed by the ship's delivery date of May 2017. However, technical problems have caused repeated delays to the installation. While answering questions from reporters, Navy Secretary Richard Spencer described the elevator system as "our Achilles heel."

The Untouchable US-Saudi Relation is a Core Element of US Imperialism (Can't take the petro out of the petro-dollar at this point. It's already become a bludgeon to beat the rest of the world. Gotta' keep some carrot with that stick.)

Deeply overdrawn Pakistan close-dances with China and Saudi Arabia. Pakistan is critical to the new silk road, and Saudi relations with the rest of the Islamic world, notably Turkey and Iran. (Much of this debt could be satisfied without resorting to $US, I notice.) Pepe Escobar paints in bright colors...

Turkey will not recognize US sanctions against Iran, and will (again) have to work around the dollar...

In anticipation of the US sanctions against Iranian oil exports, which were reimposed by the Trump Administration on Monday (along with additional sanctions on everything from Iranian shipping to banking and insurance), oil tankers bearing the Iranian flag have embraced a stealthy approach to keeping the oil flowing: They're 'ghosting' international trackers by turning off their transponders, rendering the ships impossible to track by anything aside from visual cues...​ ​Already, the ghosting method is proving surprisingly effective: In an interview with Sputnik, the founders of one of the most popular oil-tanker tracking services,, have been "utterly exhausted" trying to track Iranian ships... Meanwhile, the "special purpose vehicle" - a kind of SWIFT alternative designed explicitly to help European companies avoid detection by the US - is helping to facilitate clandestine payments for Iranian crude, eliminating another methodology for tracking who, exactly, is buying Iranian crude. Iranian president Hassan Rouhani has said Iran will defy US sanctions, though both sides have insisted that they remain "open" to negotiations surrounding a new deal.  

OK, we will "grant waivers" to all the countries that have enough leverage to call our bluff. Oil prices won't go up, they say...
Pompeo defended the decision to provide waivers to several U.S. allies, arguing that those countries were working with the administration to reduce their Iranian oil imports.
In addition to Japan, China, and India, Pompeo said the U.S. also would exempt these five countries: ItalyGreeceSouth KoreaTaiwan and Turkey. China is Iran's largest oil customer, followed by India, South Korea, Turkey, and then Italy​.​

Midterm elections produce gridlock pattern, with Democratic majority in the House being more modest than a mandate, and Republicans getting more solid control of the Senate. Some things that big banks and corporations, Israel, and the military-industrial-security-complex want will pass easily...

Golem XIV points out where the bad-debt-sausage sits in the American financial landscape today, compared to 2008. 
Pension Funds. Insurance Companies. (Whew! I'm Glad bankers are gonna' be ok.)
Corporates are floundering in a river of debt of their own creation. They are the ones who have taken on loans they will not be able to pay if interest rates increase even a little. The banks have packaged up and sold on that leveraged loan debt and those junk bonds and they have been gobbled up by pensions and insurance companies desperate for yield after a decade of ‘temporary’ low interest rates.
In place of zombie banks we now have zombie corporations kept alive by low interest rates and bond buying QE. Those low interest rates have created a dysfunctional market. Zombie corporations are kept alive because they can sell their sub-prime bonds and get sub prime loans in a market where the buyers of those bonds and securitised loans, the insurers and pension funds and fund managers, are so desperate for yield that they gobble up ‘high yield’ which is just a euphemism for sub prime.
This time it will not be the banks that trigger another financial collapse. Not HSBC or Countrywide this time but GE or Caterpillar. The companies who have been propping up their share prices with endless buy backs funded by… low interest rate loans and junk bond issues. Or perhaps it will be the corporates who are merging and acquiring.


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