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Web Log - January, 2014

Summary

31-Jan-14 World View -- Diplomatic silence in North Korea raises military alarms

Syria's Bashar al-Assad (and Vladimir Putin) guilty of more war crimes

This morning's key headlines from GenerationalDynamics.com

Syria's Bashar al-Assad (and Vladimir Putin) guilty of more war crimes


Before (left) and after pictures show that the al-Assad regime destroyed entire civilian neighborhoods, killing many women and children in just a few days (CNN/HRW)
Before (left) and after pictures show that the al-Assad regime destroyed entire civilian neighborhoods, killing many women and children in just a few days (CNN/HRW)

It seems that almost every day, new evidence comes forth of war crimes and crimes against humanity by the genocidal monster president of Syria, Bashar al-Assad. A new report by Human Rights Watch shows that the Syrian government "deliberately and unlawfully" destroyed entire civilian neighborhoods. Just counting the suburbs of Damascus and Hama, thousands of homes were flattened.

Once again, this is a war crime on the part of Bashar al-Assad. And, once again, Russia's president Vladimir Putin is guilty of war crimes as well, for supplying the weapons to al-Assad. Human Rights Watch and CNN

U.S. accuses Syria of not complying with chemical weapons agreement

For the first time, U.S. administration officials are accusing Syria's Bashar al-Assad regime of not complying with its agreement to allow its chemical weapons and manufacturing facilities to be destroyed, with only 4% of the "low hanging fruit" so far delivered for destruction. At first, there were excuses that the weather was too cold, and so forth, but as the weeks have gone by, it's become increasingly clear that al-Assad is stalling.

Secretary of Defense Chuck Hagel said "The United States is concerned that the Syrian government is behind in delivering these chemical weapons precursor materials on time."

Apparently Hagel wasn't listening on Tuesday when President Obama gave the State of the Union address:

"You see, in a world of complex threats, our security and leadership depends on all elements of our power – including strong and principled diplomacy. American diplomacy has rallied more than fifty countries to prevent nuclear materials from falling into the wrong hands, and allowed us to reduce our own reliance on Cold War stockpiles. American diplomacy, backed by the threat of force, is why Syria’s chemical weapons are being eliminated, and we will continue to work with the international community to usher in the future the Syrian people deserve – a future free of dictatorship, terror and fear. As we speak, American diplomacy is supporting Israelis and Palestinians as they engage in difficult but necessary talks to end the conflict there; to achieve dignity and an independent state for Palestinians, and lasting peace and security for the State of Israel – a Jewish state that knows America will always be at their side."

Actually, it's been one debacle after another, especially President Obama's "red line" flip-flop. American diplomacy has made America a laughingstock, especially in the Mideast. The Israeli-Palestinian "peace process" is a joke. Syria has become the worldwide center for al-Qaeda linked jihadism, Bashar al-Assad is committing "industrial strength" torture and extermination on his own civilians, is now suspected of developing biological weapons, and has already used sarin gas on his own people, which he'll be free to do again since he apparently is reneging on his agreement to have his chemical weapons destroyed. ( "30-Jan-14 World View -- Syria a 'huge magnet' for terrorists - and perhaps biological weapons")

A lot of people have written to me over the years saying that they don't like me saying that America is policemen of the world. What they usually say is, "Who the hell appointed America to be policeman of the world?" Well, the answer to that question is President Harry Truman, who enunciated in 1947 the Truman Doctrine, saying that intervening in international conflicts may cost money and treasure, but it's only a tiny fraction of the money and treasure spent in World War II. Like it or not, America has been policeman of the world since the end of World War II.

Well, what happens to a city when the policemen stop enforcing the laws? The criminals and thugs take over, as has happened in President Obama's home town, Chicago. And what happens to the world when the policeman of the world starts "leading from behind?" You're seeing it in Syria. President Truman said that the cost of military intervention was tiny compared to the cost of fighting a world war, and that lesson is being brought home today. McClatchy and CBS News

Diplomatic silence in North Korea raises military alarms

Commentary from KGS Nightwatch indicates that Kim Jong-un's government is in chaos since the execution of his uncle, Jang Song-thaek:

North Korean policy is disjointed. That condition suggests the charm or reconciliation offensive is not real and might be part of a deception plan.

Supporting that judgment is the absence of diplomatic activity. North Korean media have reported the arrival or departure of no foreign delegations since 14 January. The last was by a member of the Japanese House of Councilors. Prior to that, the last foreign delegation was that led by Dennis Rodman. North Korea has sent no delegations abroad apparently since the death of Jang Song-thaek.

In times of political normality, foreign delegations arrive at or depart from Pyongyang several times a week. The absence of diplomatic activity reinforces the observation that North Korea has turned inward. It is not engaging in significant foreign initiatives and not responding to its own initiatives on North-South relations.

The absence of normal diplomatic activity is a general warning indicator. That means that conditions in the North are not normal but the reason is not yet clear.

The last comment is significant because North Korean media almost daily repeat the propaganda theme that North and South Koreans can and must solve the challenge of reunification. Nevertheless, the North has failed to respond to South Korea proposals and ignored its own proposals.

The disconnect between North Korea's words and actions justify a high alert condition by South Korean and Allied military forces. It also suggests that the overtures to the South are gestures without substance. They might provide cover for the continuing purges and campaigns to guard against counter-revolution. They also might cover North Korean preparations for a military provocation.

China Relations. A South Korean news outlet reported that on 10 January Kim Jong-un approved a security plan aimed at eliminating the "China pigs." The "China pigs" are all those people who worked with Jang Song-thaek to attract Chinese investment in North Korea.

If confirmed, as seems likely, this North Korean internal security program means that Chinese relations with North Korea are severely strained again. China has no credibility to act as an honest broker for restarting the Six Party Talks. KGS Nightwatch

(Comments: For reader comments, questions and discussion, see the 31-Jan-14 World View -- Diplomatic silence in North Korea raises military alarms thread of the Generational Dynamics forum. Comments may be posted anonymously.) (31-Jan-2014) Permanent Link
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30-Jan-14 World View -- Syria a 'huge magnet' for terrorists - and perhaps biological weapons

Chinese now drink more red wine than the French

This morning's key headlines from GenerationalDynamics.com

Chinese now drink more red wine than the French


Ad for Dynasty Red Wine, a joint venture of China and France
Ad for Dynasty Red Wine, a joint venture of China and France

China has overtaken France and Italy to become the world's number one consumer of red wine, consuming 155 million nine-litre cases, compared to 150 million for France, 141 million for Italy, 134 million for America, and 112 million for Germany. According to one analyst, there are Chinese superstitions over colors:

"Red is the color of luck and good fortune and white is the color of death [in China]. So you don't want to drink white, why would you?"

However, the U.S. is still the world leader in consumption of all forms of wine together. France 24

Syria replaces Pakistan as the center of al-Qaeda jihadist activity

US intelligence chief James Clapper said in Wednesday that Syria is replacing Pakistan as primary breeding ground for al-Qaeda linked terrorists. According to Clapper, "Syria has become a huge magnet for extremists," who can now recruit, train and equip a growing number of militants there:

"What’s going on there and the attraction of these foreign fighters is very, very worrisome.

We estimate at this point in excess of 7,000 foreign fighters have been attracted from some 50 countries, many of them in Europe and the Mideast. We’re seeing now the appearance of training complexes in Syria to train people to go back to their countries and of course conduct more terrorist acts."

This will not be a surprise to any Reader. As I've been saying for months, Russia and Iran are at fault here, for supplying weapons to a genocidal monster, Bashar al-Assad, allowing him "industrial level" torture and murder against his Sunni opponents, drawing Sunni jihadists from all over the world. Vladimir Putin is a war criminal for supplying weapons to al-Assad who is committing crimes against humanity. Time and US News

Syria may be developing biological weapons

Several months ago, Syria agreed to give up production of chemical weapons, such as the sarin that he used to slaughter his own people. But apparently the al-Assad and the Russians snookered the West again, because they forgot to ask about biological weapons. According to Clapper's written report:

"We judge that some elements of Syria’s biological warfare (BW) program might have advanced beyond the research and development stage and might be capable of limited agent production, based on the duration of its longstanding program. To the best of our knowledge, Syria has not successfully weaponized biological agents in an effective delivery system, but it possesses conventional weapon systems that could be modified for biological-agent delivery."

AFP and Worldwide Threat Assessment of the US Intelligence Community

(Comments: For reader comments, questions and discussion, see the 30-Jan-14 World View -- Syria a 'huge magnet' for terrorists - and perhaps biological weapons thread of the Generational Dynamics forum. Comments may be posted anonymously.) (30-Jan-2014) Permanent Link
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29-Jan-14 World View -- China's military moves to seize Malaysia's James Shoal

Syria's 'peace conference' proceeds as total farce

This morning's key headlines from GenerationalDynamics.com

Ukraine anti-government protests spread into the east


Protesters sit behind a barricade in Kiev on Tuesday (CNN)
Protesters sit behind a barricade in Kiev on Tuesday (CNN)

Up until now, the anti-government protests have been in the west, which is populated by Ukrainian-speaking ethnic Ukrainians demanding the resignation of president Viktor Yanukovych, who is from the east, which is comprised mostly of Russian-speaking ethnic Russians. However, now the protests are spreading into a few Russian-speaking cities in the east, indicating that Yanukovych may be losing control of the situation. In an attempt to head off further erosion of his credibility, he's accepted the resignation of the prime minister Mykola Azarov, and all the ministers in his cabinet, something that would have been unthinkable just two weeks ago. These resignations came shortly after the parliament voted to repeal the "anti-protest" law that had triggered a surge in violence two weeks ago.

Despite the spread to a few cities in the east, the protests do not appear to be spiraling into a larger conflict between Ukrainians and Russians. Right now the protests are almost purely political, and are being spurred by a few activists. It doesn't appear that that's going to change soon. BBC and Telegraph (London)

U.N. Security Council approves EU troops for Central African Republican

Fearing that the the violence between Muslims and Christians in the Central African Republic might spiral out of control into a full-scale genocidal civil war, like the one between the Hutus and the Tutsis in Rwanda in 1994, the United Nations Security Council on Tuesday unanimously voted to permit the European Union to supply 500 peacekeeping troops to the CAR, to join 1,600 French troops and 5,000 African Union troops already there.

From the point of view of Generational Dynamics, CAR is deep into a generation Crisis era, and the chances of a genocidal explosion are all but certain. ( "20-Jan-14 World View -- Mob rule in Central African Republic as Christians crave revenge") CAR's last generational crisis war was the 1928-1931 Kongo-Wara Rebellion ("War of the Hoe Handle"), targeting the French colonialists. In any event, the addition of another 500 peacekeeping troops to the thousands already there is unlikely to prevent what is coming anyway. United Nations and Reuters

Syria's 'peace conference' proceeds as total farce

The "Geneva-II" meetings are progressing in Switzerland this week, with the representatives of the regime of Syria's president Bashar al-Assad facing off against the representatives of the opposition rebels. The mainstream media is oohing and ahhing about how these meetings are a big step forward. The meetings are moderated by Lakhdar Brahimi, the Special Envoy appointed by the UN and the Arab League.

Here's how these meetings go: In the mornings, both sides are in the same room with Brahimi. The two sides are in the same room, but they don't talk to each other. Each of them talks only to Brahimi. The purpose of the morning sessions is to discuss the agenda for the afternoon sessions. In the afternoon sessions, the two sides are in different rooms, and Brahimi goes back and forth between the rooms, like Henry Kissinger's "shuttle diplomacy."

As we said the other day, al-Assad has no reason to compromise on anything. He's used sarin gas on his own people, he uses "industrial strength" torture on people, and every day he uses barrel bombs on his own people, which are designed to kill, maim and torture as many people as possible, especially women and children. Russia supplies an unlimited number of heavy weapons for Assad to use to continue his psychopathic murder. Al-Assad will probably win the war after he's killed off a few million more of his people, so why should he bother to compromise?

As an example of what a waste of time these Geneva meetings are, you need only look at what the mainstream media are calling "breakthroughs." The breakthrough that they always refer to is that both sides are in the same room, though they rarely mention that the two sides never actually talk to each other.

But the really, really big breakthrough was an agreement to allow some 2,500 women and children to leave the city of Homs, where they are trapped by all the bombing. I was surprised that Assad agreed to this because I assume that he gets sexual pleasure out of bombing women and children. But on Sunday he agreed to it.

But then on Tuesday, the al-Assad regime announced that all the militias (meaning all the men) would have to leave the city first, and then he would allow the women and children to leave. So, as usual, the al-Assad regime was just lying when they agreed to let the women and children leave. As usual, al-Assad and the Russians made complete fools of the mainstream media and the Western politicians.

These meetings are supposed to end on Friday, but Tuesday afternoon's session was called off because the two sides are completely deadlocked. Let's watch and see if there are any further "breakthroughs" before Friday. BBC

China's military moves to seize Malaysia's James Shoal


Malaysia's James Shoal and China (Google Maps)
Malaysia's James Shoal and China (Google Maps)

China has sent three armed ships to patrol the region around James Shoal in waters belonging to Malaysia that China has indicated in the past that it plans to seize. The shoal is named Zengmu Reef by the Chinese. According to Xinhua:

"During the ceremony held in the Zengmu Reef area, soldiers and officers aboard swore an oath of determination to safeguard the country's sovereignty and maritime interests.

[The fleet commander] urged soldiers and officers to always be prepared to fight, improve combat capabilities and lead the forces to help build the country into a maritime power."

If looking at the above map makes you think that James Shoal is awfully far away from China to be claiming it, then you would be right.

China is claiming vast areas of the South China Sea, including regions that that have historically belonged to Vietnam, Brunei, Malaysia, Indonesia and the Philippines, and has threatened to use its vast military power to threaten and subdue any neighboring nation that disobeys its orders. This comes just a few days after China escalated tensions by demanding that any foreign fishing vessel ask permission from China's military before fishing in the South China Sea. ( "16-Jan-14 World View -- China threatens military seizure of South China Sea island from Philippines")

China's media have reported a strategy of seizing one island after another, in each case without expecting any actual military confrontation because of its vast military power. China would be counting on the fact that this one-by-one approach would allow gradual seizure of the entire region without triggering a military response from the United States. As weeks go by, it seems that China is becoming more and more bellicose and militaristic. Generational Dynamics predicts that China is rapidly and aggressively preparing for preemptive war against the United States, and is rapidly developing a variety of missile systems with no other purpose than to strike American cities, aircraft carriers, and military installations. Malaysia Chronicle and Reuters

(Comments: For reader comments, questions and discussion, see the 29-Jan-14 World View -- China's military moves to seize Malaysia's James Shoal thread of the Generational Dynamics forum. Comments may be posted anonymously.) (29-Jan-2014) Permanent Link
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28-Jan-14 World View -- Army strongman al-Sisi may be Egypt's next president

Israel's PM Netanyahu slammed because son Yair is dating a gentile

This morning's key headlines from GenerationalDynamics.com

Army strongman al-Sisi may be Egypt's next president


 Abdel al-Fattah al-Sisi (AP)
Abdel al-Fattah al-Sisi (AP)

Egypt's Supreme Council of the Armed Forces (SCAF) on Monday gave its permission for army leader Abdel al-Fattah al-Sisi to become a civilian and run for president. This followed an announcement promoting al-Sisi from General to Field Marshal. According to reports, al-Sisi will announce within the next couple of days to resign from the army and enter the upcoming presidential elections as a civilian candidate.

Al-Sisi led the coup that ousted former president Hosni Mubarak and his Muslim Brotherhood government, and he's become extremely popular for his tough stand against terrorism, which many people blame on the Brotherhood. However, he's also an extremely divisive figure, since MB supporters consider him a criminal.

Al-Sisi is expected to win the presidential election. What's ironic is that three years after the Egyptian Revolution that ousted one military strongman, Hosni Mubarak, it appears that Egypt will soon be ruled by another. Al-Ahram (Cairo) and BBC

Al-Qaeda leader al-Zawahiri says: Don't fight the Christians in Egypt

Al-Qaeda leader Ayman al-Zawahiri has surprised observers by appearing to be defending Christians in Egypt. Instead of fighting Christians, Egyptian jihadists should focus their fire on Field Marshal Abdel al-Fattah al-Sisi. According to al-Zawahiri,

"We must not seek war with the Christians and thus give the West an excuse to blame Muslims, as has happened before. ...

[Al-Sisi] is a mercenary, an Americanized puppet, an impostor, treacherous and sinful with a history of bootlicking."

AP

Israel's PM Netanyahu slammed because son Yair is dating a gentile


Yair Netanyahu and Sandra Leikanger
Yair Netanyahu and Sandra Leikanger

Israel's prime minister Benjamin Netanyahu is being criticized because is son Yair, 23, is dating a non-Jewish Norwegian girl, Sandra Leikanger, 25.

One prominent Jewish education leader in Israel called on Netanyahu to "prevent the relationship":

"[T]he consequences of your son's actions, despite his being private individual, are far-reaching, both in terms of your family personally and in more national terms as well.

On the personal level, his children - your grandchildren, as you certainly know, will not be Jews; their name may be Netanyahu, but Netanyahu the non-Jew. On the national level, this is the son of the prime minister of Israel, the state of the Jewish nation, who will join the six million (lost Jews in the Holocaust) as Israeli Prime Minister Golda Meir declared."

Many Jews consider assimilation of other cultures into the Jewish culture to be an abomination. According to one commentator:

"I know friends of mine who invest tens of millions and more, hundreds of millions to fight assimilation in the world. If G-d forbid it's true, woe to us. ... I hope it's not true. [I]f this thing is true, there's a huge heart-break for him and [his wife] Sarah from this."

This debate comes in the context of a different kind of assimilation issue. On Friday, Netanyahu raised a firestorm by saying that up to 500,000 settlers might remain in the West Bank in a new state of Palestine, if a two-state solution were adopted, and that they would be under the jurisdiction of the government of Palestine. Chief Palestinian negotiator Saeb Erekat shot back:

"No settler will be allowed to stay in the Palestinian state, not even a single one, because settlements are illegal and the presence of the settlers on the occupied lands is illegal."

This brought charges of hypocrisy from Israeli leaders, who pointed to the many Palestinians living in Israel. However, Netanyahu also received criticism from some Israeli leaders, with Israel's pro-settler economy minister calling Netanyahu's suggestion "ethnic insanity." Jerusalem Post and Israel National News and The National (UAE)

(Comments: For reader comments, questions and discussion, see the 28-Jan-14 World View -- Army strongman al-Sisi may be Egypt's next president thread of the Generational Dynamics forum. Comments may be posted anonymously.) (28-Jan-2014) Permanent Link
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27-Jan-14 World View -- Hungary's 'fascist' Jobbik party leader Gabor Vona speaks in London

China banks halt domestic cash transfers as fund bankruptcy looms

This morning's key headlines from GenerationalDynamics.com

Hungary's 'fascist' Jobbik party leader Gabor Vona speaks in London


Gabor Vona in London on Sunday, carrying a Hungarian flag, protected from anti-fascist activists by police
Gabor Vona in London on Sunday, carrying a Hungarian flag, protected from anti-fascist activists by police

Gabor Vona, described as "one of Europe's most electorally successful fascists" spoke on Sunday to UK-based sympathizers of his Hungarian Jobbik Party. Demonstrations by anti-fascist campaigners prevented Vona from giving his speech at the planned venue, so he ended up speaking to around 100 supporters at Speakers' Corner in Hyde Park. The Jobbik party, which is considered anti-Roma and anti-Semitic, is the third biggest party in Hungary, with 43 seats in the national parliament. It's thought that Vona would like to create a "common core" of parties across Europe that would include the British National Party, the French National Front, Holland's Party for Freedom, and Greece's Golden Dawn. Each of these parties is, to a greater or lesser extent, anti-immigrant, anti-Roma and/or anti-Semitic. These nationalist sentiments have been growing around Europe, for the first time since World War II. According to the European Union Agency for Fundamental Rights, anti-Semitism has been skyrocketing in Europe, with some 66% of European Jews saying that in 2013, anti-Semitism has significantly impacted their lives. Independent (London) and Israel National News

Hussman's analysis of market instability

A major correction or crash on Wall Street is long overdue ( "25-Jan-14 World View -- That '1929 feeling' may be back on Wall Street"), and while the timing cannot be predicted with certainty, some analysts are saying that there are signs that it's not far off.

The Hussman Funds manager and analyst John P. Hussman is describing a number of factors leading to market instability:

Each one of these factors, by itself, is not of concern. But the combination of such factors, taken together, creates a state of market instability, such that any small disturbance may trigger a crisis or crash.

Hussman also expresses concerns about high levels of corporate debt, and adds: "In any event, however, the objective evidence speaks well enough for itself across history. If accuracy in projecting actual subsequent market returns is a standard by which alternative valuation metrics should be judged, then the U.S. equity market is trading about double its historical norms, and double the level at which investors should expect historically normal returns."

As I've been saying repeatedly, Generational Dynamics predicts a major stock market crash to the Dow 3000 level or lower. It's impossible to predict the exact timing, but there are increasing signs that the time is close. John P. Hussman

China banks halt domestic cash transfers as fund bankruptcy looms


People's Bank of China
People's Bank of China

The People’s Bank of China (PBOC) has issued an order to commercial banks to halt all cash transfers for 3 days, and to suspend conversions of renminbi to other currencies for 9 days. China's banks are giving no explanation except "system maintenance." China's week-long Lunar New Year holiday begins on January 31, there's a high demand for cash around this time, and banks are desperate to avoid a cash crunch. Although China's government has $3.82 trillion in foreign exchange reserves, this crisis is over the domestic currency (the renminbi), where dollars aren't of much use.

America's financial crisis began when the credit bubble, built on over-leveraged debts based on subprime mortgages, began to burst. The collapse of the investment bank Lehman Brothers Holdings Inc. in 2008 triggered a worldwide financial crisis.

China has a much larger shadow credit bubble, based on $4.8 trillion of over-leveraged loans made in its shadow banking system, and is now facing a major bankruptcy in its shadow banking system on Friday, January 31.

Just as American investment banks had sold trillions in fraudulent securities based on faulty subprime mortgages, the The Industrial and Commercial Bank of China sold $496.2 million in fraudulent securities called the "Credit-Credit Equals Gold #1 Collective Trust Product." The whole deal was full of corruption, and now the bill is coming due on Friday, when payment on the securities is due to investors.

According to Moodys,

"This case reminds people of Lehman minibonds because complicated credit-linked products were sold to individual investors via bank channels. It’s not clear whether misselling was involved due to lack of transparency. It’s also not clear who will share the loss. Regardless, both the product packager and distributor have seen their reputation suffer."

Many of those investors who will lose money are other banks, and so the "Credit-Credit Equals Gold #1" bankruptcy is thought to be the reason for the PBOC's order blocking cash transfers. Many banks had been counting on the money from the investment product, and some may be facing bankruptcies themselves, as a chain reaction looms. China's government will undoubtedly do everything possible to prevent such an outcome, but with China's credit bubble collapsing, it's possible that the chain reaction can't be stopped. Forbes and Bloomberg

(Comments: For reader comments, questions and discussion, see the 27-Jan-14 World View -- Hungary's 'fascist' Jobbik party leader Gabor Vona speaks in London thread of the Generational Dynamics forum. Comments may be posted anonymously.) (27-Jan-2014) Permanent Link
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26-Jan-14 World View -- HSBC cash withdrawal restrictions raise fears of bank runs

France's president Hollande announces end of relationship with Trierweiler

This morning's key headlines from GenerationalDynamics.com

29 die in clashes at three-way commemoration of Egypt's revolution


 Supporters of Egypt's government cheer with national flags (Al-Ahram)
Supporters of Egypt's government cheer with national flags (Al-Ahram)

Clashes killed 29 people, as hundreds of thousands of Egyptians took to the streets on Saturday to commemorate the third anniversary of the January 25, 2011, Egyptian Revolution, which resulted in the ouster of Hosni Mubarak. However, the demonstrators today are not nearly as united as they were in 2011. On Saturday, there were three distinct groups of demonstrators:

The only ones allowed into Tahrir Square were the pro-government demonstrators. However, all three groups were marching, and the army used teargas and birdshot to disperse the crowds. 29 people died in the resulting clashes.

Today the major debate in Egypt is whether the country if better off or worse off than under Mubarak. Al-Ahram (Cairo) and BBC

HSBC cash withdrawal restrictions raise fears of bank runs

Some customers of London-based international banking firm HSBC are being told that they can't make withdrawals above $5,000 or so without being questioned about the reason for the withdrawal. In some cases the bank has been demanding documentation before the withdrawal can be permitted, although they now say they've reversed that policy.

HSBC is saying that they're just trying to protect their customers, and they issued this statement:

"We ask our customers about the purpose of large cash withdrawals when they are unusual and out of keeping with the normal running of their account. Since last November, in some instances we may have also asked these customers to show us evidence of what the cash is required for.

The reason being we have an obligation to protect our customers, and to minimize the opportunity for financial crime. However, following feedback, we are immediately updating guidance to our customer facing staff to reiterate that it is not mandatory for customers to provide documentary evidence for large cash withdrawals, and on its own, failure to show evidence is not a reason to refuse a withdrawal. We are writing to apologize to any customer who has been given incorrect information and inconvenienced."

This announcement is triggering visceral fears of bank runs among a lot of people who remember the Cyprus bank bailout last year that kept people from withdrawing more then 300 euros per day, and permanently cost large depositors 40-80% of their deposits.

It's also reminiscent of HSBC's 2007 announcement that it had $1.75 billion in bad debts, resulting from bad subprime mortgages written by subsidiary Household Finance Corp., which HSBC had acquired in 2003.

Then, last year, HSBC was found to have, for five years, been laundering billions of dollars for Mexican drug mobs, organizations linked to al-Qaeda and Hezbollah, and Russian gangsters.

So is HSBC in trouble again? Or are these new policies really all about protecting their customers? I guess each depositor will have to make his own decision. BBC and ZeroHedge and Rollin Stone (Feb 2013)

Ukraine anti-government protests continue, despite offer of compromise

Anti-government protests in Ukraine are spreading from the capital city, Kiev, into cities in the western part of the nation. Western Ukraine is populated by ethnic Ukrainians, who largely oppose the current Russia-linked government, and who want Ukraine to have closer ties to Europe. Eastern Ukraine is populated by ethnic Russians, who prefer closer ties to Russia.

Protests in Kiev are large, but remain mostly peaceful. President Viktor Yanukovych offered several concessions to the opposition, including the appointment of anti-government activists to ministerial positions in the government. However, the opposition is demanding that Yanukovych step down, and that new elections be held. BBC

France's president Hollande announces end of relationship with Trierweiler


Valérie Trierweiler, 48 (left) and Julie Gayet, 41 (AFP)
Valérie Trierweiler, 48 (left) and Julie Gayet, 41 (AFP)

France's President François Hollande reportedly met for lunch on Thursday with his girlfriend Valérie Trierweiler, who has lived with him in the Élysée Palace since he took office last year. On Saturday, Hollande called an AFP reporter and gave this quote:

"I wish to make it known that I have ended my partnership with Valerie Trierweiler."

This harsh statement indicates that the luncheon meeting was not a pleasant one.

The announcement comes just as Trierweiler is just about to leave for India on a humanitarian trip, and a couple of weeks before Hollande will be making a state visit to the United States. Apparently Trierweiler will still go to India, but will not accompany Hollande on the state visit. Trierweiler is expected to resume her career as a journalist.

Trierweiler's relationship with 59 year old Hollande unraveled quickly after press reports two weeks ago indicated that Hollande was spending nights with an actress, Julie Gayet. Trierweiler and Hollande share something in common: She's France's least popular "first lady" in decades, while he's the least popular prime minister in decades. It is not expected that Gayet will move into the Élysée Palace. AFP and Telegraph (London)

(Comments: For reader comments, questions and discussion, see the 26-Jan-14 World View -- HSBC cash withdrawal restrictions raise fears of bank runs thread of the Generational Dynamics forum. Comments may be posted anonymously.) (26-Jan-2014) Permanent Link
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25-Jan-14 World View -- That '1929 feeling' may be back on Wall Street

'Geneva II' Syria peace conference is more political play-acting

This morning's key headlines from GenerationalDynamics.com

Terrorist bombings in Egypt may affect Saturday's revolutionary celebrations


Huge crater in front of Cairo police station from Friday's terrorist bombing (Reuters)
Huge crater in front of Cairo police station from Friday's terrorist bombing (Reuters)

Egypt's terrorist bombings had previously been taking place far away from Cairo, in the Sinai or in northern Egypt, but as of Friday morning, have now come to the most well protected part of central Cairo. A large terrorist blast exploded at the police building in central Cairo, killing four people and injuring 76 others. Hours later, once person was killed by a bombing in Giza. Late Friday morning, a third explosion at a Giza police station near the pyramids caused no casualties. But in the afternoon, a bombing at a Giza movie theatre left one person dead.

The spate of terrorist bombings has infuriated the public, who are widely blaming the Muslim Brotherhood for the bombings, and praising army general Abdel al-Fattah al-Sisi for declaring MB to be a terrorist organization.

The Muslim Brotherhood says they had nothing to do with the bombings, while al-Qaeda linked Sinai terrorist group Ansar Jerusalem (Ansar Bayt al Maqdis or Champions of Jerusalem) is claiming credit for the bombings. This group has claimed credit for several major terrorist bombings in the past.

Saturday is the third anniversary of the start of the 2011 Egyptian Revolution that led to the ouster of Hosni Mubarak. Many political groups had planned big public celebrations on Saturday, but some of them are being pulled back, giving as a reason fear of violent clashes with the Muslim Brotherhood. Al-Ahram (Cairo) and BBC

That '1929 feeling' may be back on Wall Street

This week is the first time in a long time that I've thought that the market has the "1929 feeling." Those feelings only became stronger on Friday with the dramatic 2% plunge in Wall Street stocks. Financial pundits gave these reasons for the plunge:

These are all likely to be long-term trends, and the sense of gloom that I'm detecting suggests that some change might be about to happen.

But this could all fall apart in the next few days. Perhaps Wall Street will recover from the big losses this week, and start growing again. We know that a crash is coming, but it's impossible to predict the timing. All we can do is guess, and depend on our "feelings," which can be wrong.

By the way, according to Friday's Wall Street Journal, the S&P 500 Price/Earnings index (stock valuations) on Friday (January 24) morning was 18.20, which is lower than the 18.72 of last month, but still astronomically high. It was only as recently as 1982 that the P/E index was 6, and it's about due to return to that level, as it does periodically, every 30 years or so. This would push the Dow Jones Industrial Average from its current 15,900 down to the 3,000-4,000 level, or lower, which is what Generational Dynamics is predicting.

So if that "1929 feeling" is going to turn into a 1929 crash at this time, then there are some things to look for in the next two months. The main thing to look for would be a gradual net fall, combined with a couple of wild fluctuations -- say, a 6% fall, then an 8% rise. In fact, if you take into account what's been happening in emerging markets, then it may be fair to say that this is already happening. This would set what might be called the "panic mood," where people would be anxious to avoid the next 6% fall, and that would trigger a much bigger fall, and a spiral downward. Reuters and AFP

'Geneva II' Syria peace conference is more political play-acting

A new Syria peace conference is going on in Geneva, Switzerland, and it certainly qualifies as a bizarre bit of political theatre. It's called "Geneva II" because there was an earlier Syrian peace conference in Geneva in June, 2012, now called "Geneva I." There was a communique issued after Geneva I, and it called for an end to the Syrian civil war by the resignation of president Bashar al-Assad, and instituting a new transitional government with members from the former al-Assad government, as well as members from the opposition.

Well, now it's time for Geneva II, and here are the realities:

So on Thursday, the two sides were in separate rooms, but they were supposed to meet with one another in the same room on Friday. Well that was canceled because of the above disagreement. But then UN and Arab League Special Envoy to Syria Lakhdar Brahimi stepped into the picture. He played "shuttle diplomacy," moving back and forth between the two rooms, and finally was able to announced that the two sides would meet in the same room on Saturday!! And this was described as a "major breakthrough"!!

Even if the civil war did end, on whatever terms imaginable, there would still be a resumption of peaceful protests. And remember that's how the war started -- the genocidal monster al-Assad responded to the peaceful protests by flattening civilian neighborhoods and torturing children. When the peaceful protests began again, what would al-Assad do next? Irish Times

(Comments: For reader comments, questions and discussion, see the 25-Jan-14 World View -- That '1929 feeling' may be back on Wall Street thread of the Generational Dynamics forum. Comments may be posted anonymously.) (25-Jan-2014) Permanent Link
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24-Jan-14 World View -- China increases military force in South China Sea

Conflicts arise between Arab and Chechnya jihadists in Syria

This morning's key headlines from GenerationalDynamics.com

Cyprus military base will house Russian aircraft, naval ships


Andreas Papandreou airbase in Paphos, Cyprus
Andreas Papandreou airbase in Paphos, Cyprus

The cabinet of Cyprus has approved a proposal to offer certain facilities to the Russian air force at the Andreas Papandreou military airbase in Paphos. Cyprus will also open the Limassol port to Russia's warships. However, some details have not been worked out, including the question of whether there will be a permanent Russian base at the airport, versus permitting Russian military aircraft to land for refueling or repairs. Russia has a very strong negotiating hand with Cyprus, especially after Russian depositors lost billions in last March's bailout –- in addition to Moscow’s very generous 2.5 billion euro loan to Cyprus. It's expected that Russia will use these military bases as a transit point for arms shipments to the Bashar al-Assad regime. Cyprus Mail and Jamestown

China increases military force in South China Sea

China is continuing its "Lebensraum" policy of using its vast military power and threats of military force to take control of vast portions of the South China Sea, including islands and regions that have historically belonged to Vietnam, Brunei, Malaysia, Indonesia and the Philippines. ( "16-Jan-14 World View -- China threatens military seizure of South China Sea island from Philippines") China is building a large military base on one of the Paracel Islands that are disputed by other countries, and will station a 5,000 tonne patrol ship. The ship will make regular patrols throughout the region, and presumably threaten military force against any vessels from other countries. Vietnam has accused China of harassing and even opening fire on its fishing boats near the Paracels. Reuters and AFP

Conflicts arise between Arab and Chechnya jihadists in Syria

As we recently described in detail, there are three groups of anti-Assad militants in Syria: The "moderate" Syrian National Coalition (SNC), the Islamic Front, or Jabhat al-Nusra, consisting of Syrian citizens who are salafists, and the al-Qaeda linked jihadists in the Islamic State in Iraq and Syria/Sham/theLevant (ISIS or ISIL), consisting of many foreign fighters who have been drawn to the region by both the Syria conflict and the deterioration of Iraq since the Americans withdrew.

There are splits and disagreements and clashes among all three of these groups, but now there are splits within ISIS itself, between two groups of foreign fighters: the Arabic speaking jihadists and the North Caucasian fighters, mostly from Chechnya, one of Russia's southern provinces. Many Chechen jihadists in ISIS are defecting to Jubhad al-Nusra, because they're apparently being treated as second-class jihadists in ISIS.

This development has had an ironic effect. With Chechens on both sides of the al-Nusra vs ISIS divide, they're able to reach agreements and avoided clashes that might have killed hundreds of people, including civilians.

There are several hundreds, or possibly a thousand jihadists from Chechnya who have gone to Syria to fight against the Bashar al-Assad regime. The stream of jihadists from Chechnya arriving in Syria may be reduced because the jihadists might become discouraged by the violent disagreements among the groups fighting against al-Assad. Jamestown

Belgium mayor's underpants stolen from Brussels' Museum of Underpants

A signed pair of underpants from the mayor of Brussels in Belgium has been stolen from an anarchist bar housing the Museum of Underpants, which explores the relationship between politicians and their underwear. The bar is a well-known drinking spot for Belgium's bohemian far-Left. The museum has the "philosophical purpose to show that all people are equal in their underpants, whether they are famous, rich, powerful or all three at the same time." Telegraph (London)

(Comments: For reader comments, questions and discussion, see the 24-Jan-14 World View -- China increases military force in South China Sea thread of the Generational Dynamics forum. Comments may be posted anonymously.) (24-Jan-2014) Permanent Link
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23-Jan-14 World View -- Iran says it's not dismantling any nuclear components

China says that war with Japan is inevitable because they hate each other

This morning's key headlines from GenerationalDynamics.com

Ukraine anti-government protesters issue ultimatum after five are killed


Protester throws Molotov cocktail on Wednesday (CNN)
Protester throws Molotov cocktail on Wednesday (CNN)

Two months of anti-government protesters in Ukraine, mostly peaceful though strewn with some bursts of violence, are now close to becoming a war with the police, as protesters hurl stones and Molotov cocktails, and police respond with tear gas, stun grenades, and rubber bullets, killing five protesters in the first fatalities of the protests.

The protests were originally triggered when President Viktor Yanukovych did a 180 degree flip-flop in November and suddenly refused to sign a trade agreement with the European Union, as he had promised to do, choosing instead to accept a $15 billion bailout from Russia in return for closer ties. The protests became significantly more violent last week, after passage of new laws limiting the right to protests in Ukraine, according to opposition leader Vitali Klitschko, and a former world boxing champion.

There were several hours of negotiations on Wednesday, but according to Klitschko he ended them with an ultimatum:

"We did not receive any answers. When we talked about canceling the new laws that make each of us here a criminal, we heard that maybe this can be a point of negotiations. I will be with the people. If I have to fight, I will fight. If I have to go under bullets, I will. I will stand up for the people, because I want to live in a different country.

If Yanukovych does not make concessions, then tomorrow (Thursday) we will go on the attack." "

Yanukovych said the negotiations accomplished nothing, and the government gave security forces extra powers, including firing water cannon against the protesters despite the freezing temperatures.

January 22 is Ukraine's annual "day of national unity," celebrating the unification of western and eastern Ukraine in an attempt at independence in 1919 during the Bolshevik Revolution. However, Ukraine remains today two essentially different countries, with two distinctly different ethnic groups. The majority of the population are ethnic Ukrainians, occupying most of the country, in the western part of Ukraine. The minority group are ethnic Russians, occupying the east and south, descendants of ethnic Russians who were sent there by Stalin after World War II in order to "Russify" Ukraine. CNN and AFP

Iran says it's not dismantling any nuclear components

Iran's Foreign Minister Mohammad Javad Zarif directly contradicted the White House on the terms of the nuclear deal that was signed last November.

According to the White House "Fact Sheet: First Step Understandings Regarding the Islamic Republic of Iran’s Nuclear Program":

Iran has committed to halt enrichment above 5%:

Halt all enrichment above 5% and dismantle the technical connections required to enrich above 5%."

But according to Zarif:

"The White House version both underplays the concessions and overplays Iranian commitments.

The White House tries to portray it as basically a dismantling of Iran's nuclear program. That is the word they use time and again. If you find a single, a single word, that even closely resembles dismantling or could be defined as dismantling in the entire text, then I would take back my comment.

[W]e are not dismantling any centrifuges, we're not dismantling any equipment, we're simply not producing, not enriching over 5%."

White House and CNN

China says that war with Japan is inevitable because they hate each other

The Davos conference in Switzerland is discussing more than just global finance. One Chinese professional attending the conference, who, according to conference rules, shall not be named, said that war between China and Japan over the Senkaku/Diaoyu islands is inevitable because China and Japan increasingly hate each other.

He outlined China's plans for a "surgical invasion":

This outline is credible because it's very similar to the method used by China to seize the Scarborough Shoal from the Philippines in 2012, and it's similar to reports of plans for China's military to seize one island after another in the South China Sea. ( "16-Jan-14 World View -- China threatens military seizure of South China Sea island from Philippines")

It's quite possible that the Chinese really believe that this idea will work, since they're as far into fantasy land as Washington is. This world is deep into a generational Crisis era, which is characterized by surging nationalism in all countries. China might get away with snatching one island this way, just as Hitler got away with snatching the Sudetenland region of Czechoslovakia in 1938, after promising "Peace in our time." But the next such attempt would trigger extremely high nationalism in both America and Japan, and would certainly lead to a military confrontation that could spiral out of control.

Japan's Prime Minister Shinzo Abe is also at the Davos conference, and he says that the current tension between Japan and China is similar to the situation between Britain and Germany, prior to World War I. He said that Britain and Germany – like China and Japan – had a strong trading relationship. But in 1914, this had not prevented strategic tensions leading to the outbreak of conflict.

Abe said that China's rapidly growing military spending is a major source of instability in the region. Between 1908 and 1913, European powers increased military spending by 50% after Germany began building a navy to rival Britain's. Business Insider and Business Insider

(Comments: For reader comments, questions and discussion, see the 23-Jan-14 World View -- Iran says it's not dismantling any nuclear components thread of the Generational Dynamics forum. Comments may be posted anonymously.) (23-Jan-2014) Permanent Link
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22-Jan-14 World View -- Western leaders sickened by Assad's 'industrial strength' torture in Syria

Suicide bombing in Hezbollah stronghold in Lebanon kills four

This morning's key headlines from GenerationalDynamics.com

Suicide bombing in Hezbollah stronghold in Lebanon kills four


The aftermath of Tuesday's bombing in Beirut, Lebanon (AP)
The aftermath of Tuesday's bombing in Beirut, Lebanon (AP)

A suspected suicide bombing on Tuesday killed at least four people and wounded dozens of others in a Hezbollah stronghold south of Beirut, Lebanon's capital city. The auto was a Kia Sportage that had apparently been stolen for just this purpose. The Lebanon branch of the Jabhat al-Nusra (al-Nusra Front), a Syria-based Sunni terrorist group fighting Syria's Bashar al-Assad regime, claimed responsibility for the bombing. According to one eye-witness,

"We saw a car that was speeding. The driver was honking like a mad man. Seconds later, we saw the explosion which sent the vehicle flying up in the air."

A year ago, it would have been unthinkable that a terrorist bombing could occur in the heart of Hezbollah's stronghold in Beirut. The Hezbollah terrorist militia was too powerful, and their headquarters region was too well guarded and protected.

But that was before April 30, when Hezbollah leader Sayyed Hasan Nasrallah gave a televised speech saying that Hezbollah would militarily enter the fight in Syria on the side of the regime of Syria's president Bashar al-Assad. Nasrallah reluctantly agreed to enter the Syrian war after being commanded to do so by his Iranian masters. ( "27-Sep-13 World View -- How Hezbollah's reluctant foray into Syria changed the Mideast") Al-Assad is a Shia/Alawite, conducting sectarian violence against Sunnis, while Hezbollah is a Shia organization under the control of a Shia country, Iran.

Since then, there have been half a dozen car bombings in the Hezbollah-controlled region of Beirut, starting with a July 9 car bombing. Tuesday's bombing is the second one to occur in this month alone. Daily Star (Beirut) and Foreign Policy

Putin's anti-gay campaign a high-risk appeal to Russia's 'traditional values'

Russia's president Vladimir Putin has made international news recently for his bizarre statements in response to questions about gay people attending the Sochi Olympics. On the one hand, he smiles warmly and says that they're all welcome and there will be no discrimination against them. But then he adds, "But stay away from the kids!"

The strategy behind this campaign is to overcome the problems with a more standard appeal to Russian nationalism, which could lead to violence and threaten his power, as illustrated by the recent and repeated extremely xenophobic violence between ethnic Russians and Russian citizens from the North Caucasus (Russia's southern provinces).

Putin, who has been losing popularity, is appealing instead to something a little different: the defense of "traditional values," a loosely defined mixture of ideas, including opposition to secularism, homosexuality and gender equality; support for hierarchical power relations; deference to authority; and social discipline. More interesting is the fact that he feels that people abroad who share his distaste for the extension of rights to formerly excluded groups like gays will look to Moscow as a defender of their values and thus help the Russian government bring pressure on their countries. As a result, he's received expressions of support from some of the more well-known far-right politicians in Europe, including Marie le Pen of France, anti-immigrant activist Geert Wilders of the Netherlands, British National Party leader (and Holocaust denier) Nick Griffin, and Mateusz Piskorski, an openly anti-Semitic leader of Poland’s populist agrarian and nationalist Samoobrona (Self-Defense) party.

However, this approach to "traditional values" could harm his reputation as a modernizer, and may cause many Russian nationalists inside Russia to view Putin’s cooperation with such radicals in the West as a signal that they are free to push similar ideas, a step that could trigger more violence there. Jamestown/Paul Goble

Western leaders sickened by Assad's 'industrial strength' torture in Syria


Emaciated man showing wounds from repeated beatings by rod-like object.  There are 55,000 photos like this, showing 11,000 corpses
Emaciated man showing wounds from repeated beatings by rod-like object. There are 55,000 photos like this, showing 11,000 corpses

Western officials are reacting with "horror" at a new report that details how officials in the regime of Syria's president Bashar al-Assad used electrocution, eye-gouging, strangulation, starvation, and beating on prisoners on a massive "industrial strength" scale.

The report is backed up by 55,000 photos showing about 11,000 men exhibiting these signs of torture. They were similar to the images found in Nazi death camps after World War II, and show that al-Assad is guilty of war crimes and crimes against humanity.

The report was prepared by three top war crimes prosecutors. The prosecutors spent several days with a defector who had been a military photographer in the al-Assad regime for 12 years, and whose job had been to photograph these corpses after they had been tortured and killed. Al-Assad had demanded photographs of the dead corpses out of distrust of his own officials, so that he'd have proof that the killings had actually taken place.

And this was only the tip of the iceberg, as these 55,000 photos came from just one location out of many locations where this torture took place. This one photographer photographed almost 20 bodies every day, suggesting that there was "torture for pleasure" on a massive scale.

A Syrian spokesman asked to respond didn't actually deny that the torture had taken place, but he questioned the source of the photos, and claimed that Qatar, which had provided the funding for the report, was also guilty of war crimes.

A Soviet spokesman asked to respond didn't actually deny that the torture had taken place, but he said that things like that always happen in a civil war, and he suggested that the entire matter be turned over to the United Nations Security Council, presumably so that the Russians could use their veto power to bury it.

As I've said in the past, Bashar al-Assad is the greatest genocidal monster in today's world, comparable to Hitler, Pol Pot and Stalin. Al-Assad is literally killing thousands of Syrian civilians every week with complete impunity, using Russian-supplied barrel bombs on civilian neighborhoods. And he's used sarin chemical weapons on civilians. There is no mass weapon of destruction, nor any gruesome form of torture, that he won't use to satisfy his psychopathy. This shows that al-Assad uses the most gruesome forms of torture on a personal, individual scale, as well as on a mass scale. And the Obama administration is indirectly supporting al-Assad through Russia. BBC and CNN and Full Report (PDF)

Syria report shows Bashar al-Assad and Vladimir Putin guilty of war crimes

The Syria report shows that Bashar al-Assad is guilty of war crimes. But the same report also shows that Russia's president Vladimir Putin is also guilty of war crimes.

This is because in 2012, a United Nations war crimes tribunal convicted Liberia's former president Charles Taylor of war crimes conducted in the war in neighboring Sierra Leone. The prosecutor was unable to prove that Taylor himself had ordered the war crimes -- genocide, rape, torture, etc. But the prosecutor did prove that Taylor had sold weapons to rebels who committed the war crimes, thus making Taylor guilty of war crimes himself.

Based on that 2012 decision, the new Syria report clearly implicates Vladimir Putin as a war criminal. He didn't order the genocide and torture conducted by the Bashar al-Assad regime, but he's provided unlimited supplies of weapons to carry out that genocide and torture, and he's very well aware of how those weapons are being used. Reuters (2012)

(Comments: For reader comments, questions and discussion, see the 22-Jan-14 World View -- Western leaders sickened by Assad's 'industrial strength' torture in Syria thread of the Generational Dynamics forum. Comments may be posted anonymously.) (22-Jan-2014) Permanent Link
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21-Jan-14 World View -- Fears of terrorism at Sochi Russian Olympics soar

New Nato headquarters building in big financial trouble

This morning's key headlines from GenerationalDynamics.com

Fears of terrorism at Sochi Russian Olympics soar


Sochi 'black widow' terror suspect Ruzanna Ibragimova (Russian Security Services)
Sochi 'black widow' terror suspect Ruzanna Ibragimova (Russian Security Services)

Russia's president Vladimir Putin rarely gives interviews to foreign media, but over the weekend several Western media services obtained "exclusive" interviews. Putin's purpose in appearing charming was to assure everyone that the Olympics would be safe, and to encourage people to come to Sochi for the games that begin on February 6, but events seem to be speeding past his PR attempts.

Russian police have been handing out fliers to hotels, warning them of a "Black Widow" terror suspect who may be planning terrorist attacks during the Sochi Olympics. The name "Black Widow" originally was applied to women who were avenging the deaths of their husbands during the 1990s Chechnya wars, but in recent years the term has referred to any of the increasing numbers of female suicide bombers. Terrorist groups prefer female suicide bombers because security officials often are prohibited from searching females, making the females more successful at being violent.

Russian security services may be looking for as many as four "Black Widows," including Ruzanna Ibragimova, the 22-year-old woman in the flyer. She uses the nickname Salima and she's the widow of an Islamic militant killed by Russian security sources last year. She is described as being affiliated with the Caucasus Emirate, the terror group led by Doku Umarov that has threatened attacks against the Winter Games in Sochi.

In other news, jihadists claiming to be responsible for the two suicide bombings in Volgograd (formerly Stalingrad) last month posted a video over the weekend threatening further suicide attacks during the Olympics. In a message directed at Putin, the jihadists said:

"That which we will do, that which we have done, is only a little example, a little step. We’ll have a surprise package for you. And those tourists that will come to you, for them, too, we have a surprise.

All of these events are raising fears and anxiety over terrorist attacks, especially among the 15,000 Americans who will be attending the Sochi games.

The two jihadists in the video claimed that they were from a terrorist organization in Iraq. If this turns out to be true, then it will be karmic justice for Putin, whose support for genocidal Syrian president Bashar al-Assad has encouraged Russian jihadists to go to the Syria-Iraq region for training and experience. AP and NBC News

U.S. military puts warships into Black Sea in case of Sochi terrorism

The U.S. military will move two warships into the Black Sea under a contingency plan to react to terrorism at the Sochi Olympics. If ordered to do so, they will launch helicopters to help evacuate American officials and athletes, and they will provide support to Russian security forces if requested by Russia to do so. In addition to the warships, C-17 transport aircraft would be on standby in Germany, and could reach the region in about two hours. CNN

New Nato headquarters building in big financial trouble


New Nato headquarters under construction in Brussels (Spiegel)
New Nato headquarters under construction in Brussels (Spiegel)

Nato is building a new headquarters building, a project that was decided at the Nato summit of government leaders in April 1999 in Washington. The budget was 1.05 billion euros, but now the consortium of firms building it is at risk of insolvency, and is requesting an additional 245 million euros. The building was supposed to be completed by September, but now it's going to be delayed 9-1/2 months. Nato's Deputies Committee has approved an immediate 20 million euros to prevent an immediate construction halt, but there's hostility to providing more money. Those who favor providing the money needed to complete construction give the following reasons:

The construction financial crisis is an embarrassment for outgoing NATO chief Anders Fogh Rasmussen, under whose management the crisis occurred. Spiegel

(Comments: For reader comments, questions and discussion, see the 21-Jan-14 World View -- Fears of terrorism at Sochi Russian Olympics soar thread of the Generational Dynamics forum. Comments may be posted anonymously.) (21-Jan-2014) Permanent Link
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20-Jan-14 World View -- Mob rule in Central African Republic as Christians crave revenge

Egypt ponders the 98.1% 'yes' vote on new constitution referendum

This morning's key headlines from GenerationalDynamics.com

Mob rule in Central African Republic as Christians crave revenge


Body burning, after being hacked to pieces on Sunday morning (Al-Jazeera)#
Body burning, after being hacked to pieces on Sunday morning (Al-Jazeera)#

On Sunday morning, a Christian mob in Bangui, the capital city of Central African Republic, lynched two Muslims, hacked them to pieces, and then burned their bodies in an act of rage. Scenes of this sort are being reported across CAR, but this one was different because there's a video of the act that's so horrifying that it's drawing worldwide attention. One Christian interviewed by the BBC says that his brother was killed last year by a Muslim, and now says, "If I see a Muslim go past, I will kill them myself."

Muslim Seleka militias began killing Christians last year, after a coup by Muslim leader Michel Djotodia. There were predictions last year of revenge by Christians. The international community forced Djotodia to step down earlier this month, in the hope that his doing so would quiesce the Christians, but that hope was in vain.

As I've been saying for several weeks, this is spiraling into a full-scale generational crisis war, despite increasingly desperate international efforts to prevent it. As I've explained several times, CAR's last generational crisis war was the 1928-1931 Kongo-Wara Rebellion ("War of the Hoe Handle"), which was a very long time ago, putting CAR deep into a generational Crisis era, where a new crisis war is increasingly likely.

The Kongo-Wara rebellion was nominally an uprising against the French colonialists, but it also had it share of the same kind of tribal violence that we are seeing today. After a crisis war like that ends, the survivors on both sides look back in horror at the acts that were perpetrated on both sides, and vow to devote the rest of their lives to making sure that nothing like that happens to their children or grandchildren. They succeed at that, but once the survivors have passed away, so that there's no one left with a personal memory of the last crisis war, then there's nothing to stop a new crisis war from starting, and that's what's happening now. United Nations and African Union peacekeepers will try desperately to put a lid on it, but nothing will stop it now.

In fact, young people in CAR today certainly have heard of the Kongo-Wara war, just as Americans have heard of WW II. But what do they know? Nobody's told them about the its horrors. What the Muslims know is that their great-grandfathers were war heroes because they killed thousands of French and Christians, while the Christians have heard that their great-grandfathers were even bigger heroes, because they slaughtered even more Muslims.

A BBC reporter made an interesting comment several days ago on the war in Central African Republic. He said that in the last few days the war has gotten worse, because it was now neighbor versus neighbor, rather than militia versus militia, as it had been previously. This is a characteristic of a generational crisis civil war, that people who lived together for decades as neighbors in peace and harmony, and even intermarried, suddenly burst into violence against each other. This is what happened in Rwanda in 1994 and in Bosnia in 1995.

This also provides some insight into what's happening in Syria. I haven't seen any reports of "neighbor versus neighbor" fighting, which would be characteristic of a crisis war. It's all been "militia versus militia" and "army versus civilians," which is characteristic of a non-crisis war that would end, if, for example, Russia stopped providing an unlimited supply of weapons to genocidal monster president Bashar al-Assad, who rains barrel bombs on innocent civilians every day, killing thousands of them every week with complete impunity.

Militia versus militia wars can go indefinitely, and indeed many of them do go on for decades, with violence alternating with peace agreements that turn out to be temporary.

But neighbor versus neighbor wars can't go on forever, because eventually you run out of neighbors. These are the crisis wars that reach an explosive genocidal climax, and then there's a peace through exhaustion. That's what's coming in Central African Republic, but we're a long way from that climax. BBC and Reuters

Egypt ponders the 98.1% 'yes' vote on new constitution referendum

There are no charges of election fraud in the 98.1% "yes" vote in the referendum over Egypt's new proposed constitution, but there's a lot of soul-searching going on as to where the country goes next, and a lot of questions about the next moves of army chief Abdel al-Fattah al-Sisi. ( "19-Jan-14 World View -- Egypt's constitution approved by 98.1% of referendum voters")

Put simply, the turnout high "yes" vote, combined with the low turnout -- less than 39% of registered voters -- seem to indicate that a lot of people decided to vote "no" by not voting at all. Some are even calling the 98.1% victory "alarming," because it reflects the climate of intimidation that prevailed, targeting anyone who opposed the new constitution, forcing them to stay at home rather than to vote at all. There are several groups that are known to have boycotted or partially boycotted the vote:

According to one youth activist:

"For us it is ironic that the constitution talks of freedom of speech and yet those who said no to the constitution have been jailed. For many this is a reminder of the previous Mubarak era regime."

Al-Sisi, who says that he will run for president only if there's a popular mandate, is wildly popular among those opposed to Morsi, but is reviled by Morsi followers. It turns out that the 98.1% "yes" vote does not mean that Egypt is a unified country. Combined with the 39% turnout, it means that Egypt is more angry and divided than ever. Daily News Egypt and Al-Ahram (Cairo) and AFP

(Comments: For reader comments, questions and discussion, see the 20-Jan-14 World View -- Mob rule in Central African Republic as Christians crave revenge thread of the Generational Dynamics forum. Comments may be posted anonymously.) (20-Jan-2014) Permanent Link
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19-Jan-14 World View -- Egypt's constitution approved by 98.1% of referendum voters

Smog-shrouded China shows live sunrise on giant TV screens

This morning's key headlines from GenerationalDynamics.com

Rio's giant 'Christ the Redeemer' statue struck by lightning


Rio's Christ the Redeemer statue struck by lightning (AFP)
Rio's Christ the Redeemer statue struck by lightning (AFP)

Spectacular pictures were produced when the 130 foot tall Christ the Redeemer (Cristo Redentor) statue in Rio de Janeiro, Brazil, was struck by lightning on Thursday. The statue was originally built in 1931, and underwent a $3 million renovation in 2010. Thursday's lightning strike damaged the right thumb of the statue, and the local archdiocese said that the thumb would be repaired. Metro (London)

Egypt's constitution approved by 98.1% of referendum voters

In a referendum that was held on Tuesday and Wednesday on whether to approve a proposed new constitution, a spectacular 98.1% of those voting said "yes," though voter turnout was only 38.6% of registered voters. This has given rise to questions of ballot-stuffing, but there have no reports of this happening.

However, the army-led government left nothing to chance in the referendum. There were expensive ad campaigns telling people to vote "yes" in the referendum, but anyone campaigning against the consitution could be arrested. Thousands of Muslim Brotherhood members have been arrested or killed since the ouster of Mohamed Morsi, so the climate of fear was such that any serious opposition to the referendum was unlikely to surface. The low voter turnout is being ascribed to a boycott by Muslim Brotherhood members.

When Muslim Brotherhood leader Mohamed Morsi was elected president in June 2012, his election was hailed as the first free democratic election of an Egyptian leader in the millennia of the nation's history. However, once in office, Morsi stunned Egypt and the world by taking a series of steps to make himself the "new Pharaoh" of Egypt, a virtual dictator. He issued decrees giving himself dictatorial powers, he fired other government officials and replaced with the Muslim Brotherhood officials, and had his Muslim Brotherhood supporters unilaterally rewrite the constitution according to the Brotherhood's strict version of Shariah law.

A referendum on Morsi's new constitution was conducted in December, 2012. It received an overwhelming 64% "YES" vote, but only 33% of registered voters actually voted. So an army coup ousted Morsi on July 3 of last year, and now a new referendum has been held on a new constitution. The "yes" vote was 98.1%, and the turnout was 38.6%. Officials in the army-led government are pointing to the slightly higher turnout figure as an indication of the huge victory in the referendum.

Now that the referendum is over, elections must be held within six months. All eyes are on army chief Abdel al-Fattah al-Sisi, who is considered to be a hero by many for freeing Egypt of Morsi's dictatorship, while Morsi supporters consider him guilty of crimes against humanity. Al-Sisi is a very charming 59 year old man, and extremely popular with women, despite having a wife and four children. It's believed that al-Sisi is considering becoming a civilian and running for president. Al-Ahram and McClatchy and AFP

Smog-shrouded China shows live sunrise on giant TV screens


Giant television screen in Beijing displaying the sunrise in real time (Getty)
Giant television screen in Beijing displaying the sunrise in real time (Getty)

Beijing's smog level reached highly dangerous levels on Thursday afternoon, forcing almost everyone to remain indoors. The air had an acrid odor, and anyone venturing out wore an industrial strength face masks. In some places, you couldn't see the buildings across the street. Some Chinese newscaster must have had a sense of humor, because they started televising the sunrise in real time, and displaying them on the giant outdoor electronic screens that normally provide advertisements. The pollution level reached as high as 671 micrograms on Thursday at 4 am, 26 times as high as considered safe by the World Health Organization.

Coal burning and car emissions are major sources of China's pollution. Many Chinese businesses are government owned, so there is little or no incentive for these businesses to reduce pollution. China's government has been trying to use regulations to reduce pollution for years, but these programs have been an almost total failure, as have large government programs in a number of nations in the world. Daily Mail

(Comments: For reader comments, questions and discussion, see the 19-Jan-14 World View -- Egypt's constitution approved by 98.1% of referendum voters thread of the Generational Dynamics forum. Comments may be posted anonymously.) (19-Jan-2014) Permanent Link
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18-Jan-14 World View -- Kerry says that he won't be fooled by Syria's Assad regime

Uganda enters the war in South Sudan

This morning's key headlines from GenerationalDynamics.com

Kerry says that he won't be fooled by Syria's Assad regime


Neighborhood in Syria targeted by barrel bombs in December (Reuters)
Neighborhood in Syria targeted by barrel bombs in December (Reuters)

U.S. Secretary of State is leading yet another peace conference, this one to be held in Geneva for Syria. The nominal aim of the conference is to promote peace by transitioning Syria to a new government. On Thursday, the Bashar al-Assad regime sent Kerry a letter saying that the peace conference would be about combating "terrorism" in Syria, not about transitioning to a new government. This could effectively torpedo the conference, because the opposition groups, whom Kerry has been begging to attend, are interested only in seeing al-Assad out of power.

However, Kerry says he's too smart to be fooled by the new al-Assad letter:

"Nobody’s going to be fooled. We’re not going to be fooled by this process.

They can bluster, they can protest, they can put out distortions, the bottom line is we are going to Geneva to implement Geneva I, and if Assad doesn’t do that he will invite greater response.

I believe, as we begin to get to Geneva and begin to get into this process, that it will become clear that there is no political solution whatsoever if Assad is not discussing a transition and if he thinks he’s going to be part of that future. It’s not going to happen."

And so I'm quoting John Kerry again, and once again I have to shrug my shoulders at how ridiculous this statement is. Kerry's clownish statements are increasingly embarrassing to the United States.

Meanwhile, the al-Assad regime is literally killing thousands of Syrian civilians per week, with complete impunity, by using Russian-supplied barrel bombs. A "barrel bomb" is a barrel containing hundreds of pounds of explosives, designed to cause massive damage on impact, and to kill as many people as possible. Why should al-Assad agree to anything? He can slaughter thousands of people and no one cares.

Bashar al-Assad is the greatest genocidal monster in today's world, comparable to Hitler, Pol Pot and Stalin. It makes me vomit to think that the United States is indirectly providing support for this monster through Russia.

This is so completely f--ked up. Kerry and the Obama administration are supporting the Russians who are providing unlimited supplies of heavy weapons to the al-Assad regime, who is using those weapons to slaughter thousands of civilians every week. And what's the response? A truly moronic statement by Kerry about a "greater response" that's completely non-existent. CNN and LA Times

Uganda enters the war in South Sudan

For the first time, Uganda is admitting that it has military forces in South Sudan fighting on the side of South Sudan's president Salva Kiir, and his Dinka tribe supporters, and against Riek Machar and his Nuer tribe supporters. Machar used to be Kiir's deputy, but is now leading a coup attempt against Kiir. Uganda previously denied that its forces were fighting in South Sudan, saying that its forces were there to protect and evacuate Ugandan civilians.

A long-time Generational Dynamics web site reader, and a prominent businessman living in Uganda, sent me his analysis of what's going on, and says that it all has to do with oil:

"Just thought I'd make some brief comments / speculations on the subject. Uganda, Kenya and US (and Japan probably too) seem to be generally aligned with Kiir and against China and Machar in the current phase of the conflict. The question of whether the pipeline of oil will continue to flow northward or more southwards I suspect is key.

And possibly within that alliance for the southern pipeline there is also the possibility that after the overall political and financial commitments to the southern pipeline are made that Uganda finds itself at odds with elements within Kenya, since Uganda might not want the oil to bypass having value addition in Uganda by the refinery complex also being planned and invested in.

This is most likely a secondary concern at the moment since Uganda itself has enormous amounts of oil that it will be producing within the next few years which could be refined locally and/or flow as crude through a feeder pipeline to the pipeline bound for the Kenyan coast.

Wheels within wheels within wheels.

The insecurity of the neighbors has a significant impact on the economy here. For example, traders of Uganda's goods to South Sudan face large losses from increased risk factors and security costs. Ugandan traders are also now fleeing back into Uganda which also is absorbing refugees as it did during the the earlier phase of the north vs south conflict. If S Sudan oil revenue is reduced, so too is their ability to purchase Ugandan agricultural products and the manufactured goods that pass through Uganda from Kenya. On the other hand, sectors of the economy that profit from higher prices for goods in short supply in S Sudan or those entities which insure such risky trade either through financing or military protection could be doing okay."

VOA

Hackers use a refrigerator for a cyberattack

Hackers found a way to hack into the computer chips in an ordinary refrigerator, and use it to send out spam and malicious e-mail messages. That's just one example of a component in a wide scale attack last month on more than 100,000 everyday consumer gadgets, including home-networking routers, connected multi-media centers, televisions, computers, and at least one refrigerator. The attack took place between December 23, 2013, and January 6, 2014, according to security firm Proofpoint. The hackers connected to these gadgets, hacked into them, and used them to mail more than 750,000 malicious e-mail messages to businesses and individuals worldwide.

You may find it surprising to know that your refrigerator may be capable of sending e-mail messages, but that in fact is the case. What can you do to protect yourself? If you have a web-connected device of any kind, then ask your kids to check all the privacy settings. In particular, make sure that you change the default password that the device comes with. Business Insider and Proofpoint press release

(Comments: For reader comments, questions and discussion, see the 18-Jan-14 World View -- Kerry says that he won't be fooled by Syria's Assad regime thread of the Generational Dynamics forum. Comments may be posted anonymously.) (18-Jan-2014) Permanent Link
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17-Jan-14 World View -- Aftermath of Egypt's referendum vote will affect U.S. aid

International concern over Russia's Sochi Olympics grows after Volgograd bombings

This morning's key headlines from GenerationalDynamics.com

Aftermath of Egypt's referendum vote will affect U.S. aid


Sochi by the beach, with snowy mountains in the distance
Sochi by the beach, with snowy mountains in the distance

As expected, Egypt's new constitution has received overwhelming approval in a two-day referendum. According to preliminary results, the boycott by Muslim Brotherhood members took its toll, as only 42.2% of registered voters turned out. However, among those who voted, 95.2% voted "yes." The new constitution is thought to be targeting the Muslim Brotherhood, as it forbids parties "formed on the basis of religion, gender, race or geography."

After the July 3 army coup that ousted President Mohamed Morsi and his governing coalition, a year after he was freely elected, Egypt was led by army chief Abdel al-Fattah al-Sisi. However, after taking power, al-Sisi hand-picked Adly Mansour to be President of the Egypt. Since Mansour is a civilian, Egypt's Foreign Ministry is claiming that Egypt is not under military role, and that it won't be in the future.

However, al-Sisi some reports indicate that al-Sisi is a very charming 59 year old man, and extremely popular with women, despite having a wife and four children. It's believed that al-Sisi is considering becoming a civilian and running for president.

Before the coup, Egypt was receiving $1.5 billion in U.S. aid annually, $1.3 billion of which is designated for the military. The aid included military equipment, including F-16s. For months, the Obama administration carefully refrained from using the word "coup" to describe Morsi's ouster, since American law requires aid to be cut off to a country that overthrows a democratically elected leader in a coup. Finally, on October 9, the political pressure became too great, and the administration cut off military aid to Egypt.

Now that the referendum as passed and Egypt appears to be returning to democracy, Washington is discussing whether to unfreeze the aid to Egypt. According to a State Dept. spokesman, "It's also important for the interim government to foster a positive environment for civil society, to protect the rights of political activists and groups, to peacefully respect their views on the country's future." Daily News Egypt and AP and AFP

International concern over Russia's Sochi Olympics grows after Volgograd bombings

In late December, terrorist bombings on two consecutive days, blowing up a commuter bus and the inside of the railway station in Volgograd, Russia, triggered worldwide concern over security at the Winter Olympics to be held at the Sochi Black Sea resort on February 6-23. ( "31-Dec-13 World View -- Another Volgograd explosion throws Russia's Sochi Olympics into doubt")

Russia is promising that the Sochi Olympics will be the most secure ever, despite the threats by Chechnya Islamic warlord Doku Umarov, leader of the so-called Caucasus Emirate, to disrupt the "satanic" Olympics with terrorist attacks. Russia emphasizes the billions of dollars being spent to create a 1,500 mille ring of protection all around the Sochi area, and that it's imposing extraordinary restrictions on anyone hoping to attend the Olympics in person.

What the Volgograd bombings have done is show that Umarov can still strike major targets outside of Sochi, and that doing so raises almost as many international concerns as strikes within the Sochi region.

In fact, many security analysts say that the Olympics faces a high risk of a jihadist terrorism attacks. The problem is that the Sochi region is mostly wilderness, and can't be entirely protected. The athletes in the skiing competitions will be particularly vulnerable to terrorist attack, since the ski slopes can be miles long, and can't be completely protected.

A threat to the Olympics has come from another direction. Nationalism among ethnic Russians targeting Muslims from the North Caucasus, Russia's southern provinces, has been growing for years, resulting in an increasing level of xenophobia between the Orthodox Christian ethnic Russians and the Muslim North Caucasians. The Volgograd bombings have triggered nationalist protests in Volgograd, Moscow, and other cities. Opposition rallies coordinated via the social networking site VKontakte, attracted more than 50,000 signatories. Nationalist pogroms against people from the Caucasus, but sometimes taking in all dark-skinned foreigners as well, have become a frequent occurrence in Russia over the last eight years. Russian nationalists have already expressed displeasure about the Sochi Olympics because of the astronomical costs and the massive corruption. This nationalist opposition could become violent at any time, and represents yet one more danger to the peacefulness of the Sochi Olympics. Jamestown and Washington Times and CNN

(Comments: For reader comments, questions and discussion, see the 17-Jan-14 World View -- Aftermath of Egypt's referendum vote will affect U.S. aid thread of the Generational Dynamics forum. Comments may be posted anonymously.) (17-Jan-2014) Permanent Link
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16-Jan-14 World View -- China threatens military seizure of South China Sea island from Philippines

Vietnam reverses policy and become openly anti-China

This morning's key headlines from GenerationalDynamics.com

Vietnam reverses policy and become openly anti-China


Anti-China protesters in Hanoi (Reuters)
Anti-China protesters in Hanoi (Reuters)

Up until recently, Vietnamese policy was to very carefully avoid offending China, even to the point of using security forces to crush any civilian anti-China protests. But Vietnam has apparently now completely reversed that policy. The occasion is the anniversary of a naval clash between South Vietnamese and Chinese naval forces on January 19, 1974. China's superior naval power crushed the Vietnamese forces, and China seized some of the Paracel Islands controlled by Vietnam, and has occupied them ever since.

For forty years, Vietnam has never mentioned the battle, for fear of offending China; it's not even included in modern history books. But now, Vietnam's state media is publicly marking the event, and printing numerous articles on the subject, describing how the islands were taken by China by force, and the heroic actions of the Vietnamese sailors. Public meetings have been held to commemorate the battle and there are calls to recognize the "martyrdom" of the fallen soldiers and offer support to their families.

This highly nationalistic policy change by Vietnam's government comes just a few days after China demanded foreign fishing vessel ask permission from China's military before fishing in the South China Sea, something that infuriated the Vietnamese who, at the very least, claim to have as much right to fish in the South China Sea as the Chinese do.

Things have really changed rapidly in the past few months. China has threatened Japan militarily over the Senkaku / Diaoyu Islands, and Japanese nationalism has surged. Nationalism has sharply increased in the Philippines and Vietnam. And for years we've been reporting on the vastly increased nationalism in China, especially among the younger generations. With tensions growing throughout the region, it would not take much for an accident or miscalculation to spiral into a larger military confrontation. BBC

China threatens military seizure of South China Sea island from Philippines

A Chinese media article published over the weekend says that China is preparing for a military invasion of the second-largest of the Spratly Islands. Pagasa Island is administered by the Philippines. China calls it the Zhongye Island, and claims it, along with vast areas of the South China Sea, including regions that that have historically belonged to Vietnam, Brunei, Malaysia, Indonesia and the Philippines, and has threatened to use its vast military power to threaten and subdue any neighboring nation that disobeys its orders. This comes just a few days after China escalated tensions by demanding that any foreign fishing vessel ask permission from China's military before fishing in the South China Sea.

Pagasa Island is designated a town in the Philippines with a civilian population of nearly 200, and an airstrip with 50 soldiers. In March 2011, the Philippine military announced plans to upgrade the airfield.

According to a translated summary of the Chinese media report:

"Relying on US support, the Philippines is so arrogant as to announce in the New Year that it will increase its navy and air force deployment at Zhongye Island, a Chinese island that it has illegally occupied for years. It will be an intolerable insult to China

According to experts, the Chinese navy has drawn a detailed combat plan to seize the island and the battle will be restricted within the South China Sea. The battle is aimed at recovery of the island stolen by the Philippines from China. There will be no invasion into Filipino territories.

A report in the Philippines Star confirmed the Philippines military buildup on the island."

The article said that the attack will occur in 2014. This would be the second such military seizure by China. In 2012, China used threat of military force to seize the Scarborough Shoal from the Philippines.

Some analysts are speculating that China's new military policy will be to seize all the islands in the South China Sea, one by one, counting on the fact that no single military act would force a response by the United States. China Daily Mail and Philippine Star

China tests hypersonic speed missile vehicle


Chinese media graphic showing potential flight of new missile (Free Beacon / Global Times)
Chinese media graphic showing potential flight of new missile (Free Beacon / Global Times)

China's military on January 9 tested a new ultra-high speed missile vehicle aimed at delivering warheads too quickly for U.S. missile defense to respond. The new weapon is being dubbed the WU-14 by the Pentagon. The military advantages of hypersonic craft include precise targeting, very rapid delivery of weapons, and greater survivability against missile and space defenses. Generational Dynamics predicts that China is rapidly and aggressively preparing for preemptive war against the United States. As we've reported on a number of occasions, China is rapidly preparing new missile systems for an attack with maximum surprise and maximum force striking America's cities, military installations, aircraft carriers, and satellites. America's defenses have been weakened in recent years by defense cutbacks, and the massive release of secret information by Edward Snowden may have left America's defenses completely exposed. On Wednesday, China confirmed the test of the new hypersonic missile delivery vehicle, but claimed that it was a scientific test, not a military test. Free Beacon (Washington) and Reuters

(Comments: For reader comments, questions and discussion, see the 16-Jan-14 World View -- China threatens military seizure of South China Sea island from Philippines thread of the Generational Dynamics forum. Comments may be posted anonymously.) (16-Jan-2014) Permanent Link
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15-Jan-14 World View -- Israeli remarks about Kerry grow into international incident

Le scandale du jour: Who is France's 'First Lady' now?

This morning's key headlines from GenerationalDynamics.com

Le scandale du jour: Who is France's 'First Lady' now?


François Hollande at press conference on Tuesday (Reuters)
François Hollande at press conference on Tuesday (Reuters)

At a press conference on Tuesday, France's president Francois Hollande refused to "clarify" who his current girlfriend is, just a few weeks before he and his partner are expected to make a state visit to the United States on February 11. Hollande lives in the Elysee palace with his girlfriend, Valerie Trierweiler, who is considered the de facto "first lady" of France, and is expected to play that role in state visits. But Hollande has been spending nights with a new girlfriend, actress Julie Gayet, amid rumors that Trierweiler is going to have to find a new place to live. When the affair became public on Friday, Trierweiler checked into the hospital with a "severe case of the blues." Her aides say that her stay is being extended because "doctors believe she needs more rest."

When asked at Tuesday's press conference to clarify his relationship with Trierweiler, Hollande said:

"I understand your question. And I am sure you will understand my answer. Everyone can go through hardships. That is the case. But I have one principle. Private affairs are dealt with in private, with due respect to all parties. Therefore this is not the place to go into this."

He added that Trierweiler was "resting," and that he would clarify the situation before the February 11 trip to the U.S.

The news of women trouble in France is inspiring the revival of some previous rumors that Michele Obama is fed up with her husband and plans to divorce her husband. Voice of Russia speculates that they "sleep in separate bedrooms," and points out that her husband returned home alone from the family vacation in Hawaii. Telegraph (London) and Voice of Russia

Israeli remarks about Kerry grow into international incident

Washington is expressing outrage at comments by Israel's defense minister calling U.S. Secretary of State obsessive and messianic.

Defense minister Moshe Ya'alon is quoted as saying in private meetings:

"Abu Mazen (Palestinian President Mahmoud Abbas) is alive and well thanks to us. The moment we leave [the West Bank] he is finished. In reality, there have been no negotiations between us and the Palestinians for all these months – but rather between us and the Americans. The only thing that can 'save us' is for John Kerry to win a Nobel Prize and leave us in peace.

The American security plan presented to us is not worth the paper it's written on. It contains no peace and no security. Only our continued presence in [the West Bank] and the River Jordan will endure that Ben-Gurion Airport and Netanya don't become targets for rockets from every direction. American Secretary of State John Kerry, who turned up here determined and acting out of misplaced obsession and messianic fervor, cannot teach me anything about the conflict with the Palestinians."

U.S. State Department spokesman Marie Harf shot back:

"If these comments are accurate, we find the remarks of the defense minister to be offensive and inappropriate, especially given all that the United States has done to support Israel's security needs and will continue to do. Secretary Kerry and his team, including Gen. (John) Allen, have been working day and night to try to promote a secure peace for Israel because of the secretary's deep concern for Israel's future."

Late news is that Ya'alon's office has issued an apology.

It's hard to know what to make of this situation. Kerry and the Obama administration have been stumbling from one foreign policy debacle to another for months. The Syria "red line" debacle and the Afghanistan "peace process" debacle come most readily to mind, but there are others. The Mideast "peace plan" that Kerry is "obsessively" pushing is almost farcical in its naïveté, which is the kind of thing that Ya'alon was saying.

I constantly complain that politicians frequently lie and say really dumb and dishonest things. Now you can see why. Any politician who doesn't follow the party line, even if it's utter nonsense, risks an international incident. The ideal politician is a stupid crook, and we have many that meet that ideal. YNet and CNN

White House confirms, then denies, a secret Iran agreement

Iran disclosed on Monday that there's a 30-page side agreement that's a secret part of the nuclear agreement between Iran and the West. The secret deal has not been released. White House Press Secretary Jay Carney said on Monday that the agreement would be released to Congress. However, a State Dept. spokesman later denied that there was a secret agreement.

Carney also commented on on a tweet by Iran's president Hassan Rouhani:

"Our relationship w/ the world is based on Iranian nation's interests. In #Geneva agreement world powers surrendered to Iranian nation's will. — Tweet: Hassan Rouhani (@HassanRouhani) January 14, 2014"

According to Carney, "It matters what they do, not what they say." Apparently that bit of wisdom doesn't apply to remarks made in private by Ya'alon in Israel. LA Times and Weekly Standard

Egypt to side with the Palestinian Authority / Fatah against Hamas


 An Egyptian woman ululates as others wave a national flag in front of a polling station in Cairo on Tuesday (AP)
An Egyptian woman ululates as others wave a national flag in front of a polling station in Cairo on Tuesday (AP)

A bombing caused no casualties, but at least 9 people in Egypt died on Tuesday in violence related to a referendum on a new constitution, with clashes reported in several provinces. The new constitution forbids parties "formed on the basis of religion, gender, race or geography."

The new constitution is targeting the Muslim Brotherhood, which was the governing party for a year before the army ousted Brotherhood leader Mohamed Morsi in a coup. The referendum is likely to win approval, since the Brotherhood has announced that it will boycott the vote.

The army has already declared the Brotherhood to be a "terrorist organization," and now the army is going further by attempting to eradicate Hamas, the governing authority of Gaza. Hamas was originally formed in the early 1980s as an offshoot of Egypt's Muslim Brotherhood. Egypt's army has accused Hamas not only of supporting the Brotherhood in Egypt, but also of being behind several bloody terrorist attacks in Egypt, which Hamas has denied.

Hamas is increasingly cooperating with Fatah and the Palestinian Authority, the governing authority in the West Bank. Hamas and Fatah have been split since the war between them in Gaza in 2008, which forced Fatah to withdraw from Gaza completely. Egypt and Fatah are hosting anti-Hamas activists. According to one Fatah official in Cairo:

"We support the movement and any peaceful movement against the cruelty of the Islamist group that is part of the terrorist Muslim Brotherhood organization."

Al Ahram (Cairo) and Reuters

(Comments: For reader comments, questions and discussion, see the 15-Jan-14 World View -- Israeli remarks about Kerry grow into international incident thread of the Generational Dynamics forum. Comments may be posted anonymously.) (15-Jan-2014) Permanent Link
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14-Jan-14 World View -- Chechen terrorist Omar Shishani leads al-Qaeda to victories in Syria

Thailand army coup feared in face of massive anti-government protests

This morning's key headlines from GenerationalDynamics.com

Thailand army coup feared in face of massive anti-government protests



The racial split in Thailand's population between the light-skinned people of the Thai-Chinese elite minority versus the dark-skinned people of the indigenous Thai-Thai laborer majority is potentially reaching a crisis point, as tens or hundreds of thousands of Thai-Chinese anti-government flag-waving "yellow shirt" protesters have blocked major roads around the center of Bangkok.

Protest leader Suthep Thaugsuban of the People's Democratic Reform Committee (PDRC) vowed on Monday to shutdown Bangkok indefinitely:

" Today will be written in Thai history. ... We will shut down the city. We will do it all days and we will do it everyday until we win. No negotiations. No compromise."

Thaugsuban is calling on his supporters to boycott the planned February 2 election, which he knows his party will lose because his elite racial group is in the minority. Instead, Thaugsuban is demanding that the prime minister resign, and be replaced by an unelected "people's council," whose members are presumably to be chosen by Thaugsuban.

So far, the "red shirt" pro-government supports have kept their rallies fairly small, but there are fears that that could change if it begins to appear that Thaugsuban might get his way. It's particularly ominous that Thaugsuban is calling for a boycott of the February 2 election, since the last time that happened, in 2006, an army coup ousted the prime minister, Thai-Thai hero Thaksin Shinawatra, brother of the current prime minister Yingluck Shinawatra.

The army is known to be strong on the side of Thaugsuban's elite minority, and have shown willingness in the past to be violent to the red shirt protesters, while excusing the yellow shirts. If there's violence between the red shirts and the yellow shirts, then the army may stage a coup once more, and that is presumably exactly what Thaugsuban wants, even though that could mean a lot more violence. Bangkok Post and AP

Chechen terrorist Omar Shishani leads al-Qaeda to victories in Syria

The al-Qaeda linked Islamic State in Iraq and Syria/Sham/theLevant (ISIS or ISIL) killed as many as 100 anti-Assad activists in Syria over the weekend, and took control of several cities. Al-Qaeda and Syria's president Bashar al-Assad have essentially become military allies, fighting the Syrian anti-Assad militants. ( "11-Jan-14 World View -- Syria's president al-Assad collaborates with al-Qaeda against Syria rebels")

The Syrian anti-Assad militants are the moderate Syrian National Coalition (SNC) and the salafist Jabhat al-Nusra. Both of these groups consist of actual Syrian citizens, and both are opposed to the al-Assad government.

ISIS consists mostly of foreign al-Qaeda trained fighters, and is being led by Abu Omar al-Shishani, a prominent jihadist leader from Chechnya, and the most influential military leaders in Syria in ISIS. The slaughter of dozens of activists in the SNC and al-Nusra over the weekend puts him squarely on the side of al-Assad's army.

Well, this is certainly a complex situation. Al-Qaeda terrorists are Sunni jihadists who consider Shia Muslims to be infidels or apostates. Al-Assad is Shia/Alawite, and is being supported by the so-called "Shia crescent," consisting of Iran and Lebanon's Hezbollah. ISIS is also fighting the Shia government in Iraq. Jihadists in Chechnya are fighting the Orthodox Christian government of Russia, which is providing an unlimited supply of heavy weapons to al-Assad. So we have to assume that ISIS's love affair with al-Assad is not going to last forever.

In the meantime, the U.S. Secretary of State John Kerry and the Russians are leading the effort to hold a "Syria Peace Conference" in Geneva on January 22. It's not known if any of the Syrian opposition groups will be there, or if Iran will be there, and Israel certainly won't be there. ISIS's string of victories over the weekend makes it appear that that it will be the next in the list of John Kerry's failed peace conferences, peace agreements and peace announcements, a list that seems to get longer every week. Cihan (Turkey) and Reuters

(Comments: For reader comments, questions and discussion, see the 14-Jan-14 World View -- Chechen terrorist Omar Shishani leads al-Qaeda to victories in Syria thread of the Generational Dynamics forum. Comments may be posted anonymously.) (14-Jan-2014) Permanent Link
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13-Jan-14 World View -- Iran will 'roll back' its nuclear program, starting January 20

Plummeting velocity of money explains deflation trend

This morning's key headlines from GenerationalDynamics.com

Iran will 'roll back' its nuclear program, starting January 20


Iran's foreign minister Mohamed Javad Zarif (Reuters)
Iran's foreign minister Mohamed Javad Zarif (Reuters)

U.S. Secretary of State John Kerry announced that the six-month deal reached between Iran and the West last November will begin implementation on January 20, when Iran will begin to eliminate some of its uranium stockpile. According to Kerry:

"As of that day, for the first time in almost a decade, Iran's nuclear program will not be able to advance, and parts of it will be rolled back, while we start negotiating a comprehensive agreement to address the international community's concerns about Iran's program."

The official Iranian news media confirmed the announcement, saying that Iran agreed not to expand its nuclear program and to suspend its 20 percent uranium enrichment in return for a limited easing of the sanctions imposed on the country. According to the deputy foreign minister:

"Today, we were informed that the six countries have approved the proposed solutions and have accepted them. And in Iran, the relevant organizations have also reviewed and approved the solutions.

The approval was announced in a telephone conversation ... and we agreed that the implementation of the first step of the agreement will begin on January 20."

Approval of the deal may have been motivated by threatened passage in Congress of a bill that would automatically increase sanctions if Iran failed to live up to its part of the deal. Support for this bill is high among both Republicans and Democrats, and even a threatened veto could be overridden. According to one Republican:

"I'm concerned that this agreement takes us down that path where sanctions pressure is relieved, but Iran maintains its ability to produce a nuclear weapon. Given these stakes, it's regrettable that the President does not want to work with Congress to bolster his negotiating hand with additional sanctions, which would go into effect should Iran fail to meet its commitments."

Among the total sanctions relief over the six months, $4.2 billion is in the form of access to currently blocked Iranian revenues held abroad. CNN and Tehran Times and Reuters

Plummeting velocity of money explains deflation trend

The strong deflationary trend in Europe ( "9-Jan-14 World View -- Eurozone plummets into deflation") is puzzling many people who don't understand why massive money "printing" by the Fed and other central banks isn't causing inflation or even hyperinflation in Europe, the U.S., and around the world.

Financial "experts" on CNBC and elsewhere are highly motivated to promote inflationary expectations, even if they have to lie, because they want to sell stocks. If they convince you that hyperinflation is coming, then you'll want to get rid of your cash and invest it in things like stocks, which can be expected to go up with inflation. They want to make sure that you don't worry about deflation, since then you would keep your assets in cash, rather buy stocks and pump up their commissions.

When the money supply goes up quickly, it doesn't always mean inflation, especially in the current world where central banks are "printing" money by purchasing bonds, and the money just goes into the banks and into the pockets of investment bankers. Almost none of this money is reaching the ordinary consumer, who would use it to buy things and push up prices, or the ordinary business, who would use it to hire people and push up wages. Instead, it's just sloshing around in the banking system and through the stock market, where it's been pushing the stock market bubble to new heights.

In Economics 1.01, the inflation rate is determined by the formula:

inflation-rate = (growth in money supply) x (velocity of money)

The "velocity of money" counts the number of times a dollar bill passes from one person to another, which is a measure of whether anyone is buying or hiring. Here's a graph of the velocity of money since 1959:


Velocity of Money, 1959-2013 (St. Louis Fed)
Velocity of Money, 1959-2013 (St. Louis Fed)

As you can see from the graph, the velocity of money started falling rapidly since the Nasdaq crash in the year 2000, and even more sharply since the financial crisis of 2007.

That's why there's been no inflation. The money supply has been increasing because the Fed has been "printing" a lot of money, but the velocity of money has been plummeting, with no change in sight, and when you multiply the two relevant factors together, the inflation rate has been fairly constant.

This is the generational change that happens in every "great depression." There is always a huge bubble from debt securitization, where pieces of paper saying "IOU" are traded as if they were money. This was even true in the famous Tulipomania bubble, where certificates were issued for tulips to be grown the following year. In the last decade, the certificates were synthetic securities created by slicing and dicing subprime mortgage debts, and fraudulently turning them into AAA securities. Once the bubble bursts, people save themselves by saving money and paying off debt, causing the velocity of money to plummet, leading to a deflationary spiral.

The generations that survived the Great Depression of the 1930s reacted to the stock market bubble of the 1920s by becoming savers and remaining so for the rest of their lives. As they were replaced by younger generations with no personal memory of the 1930s, a new debt securitization bubble occurred, and then burst. We're seeing a repeat of the 1930s today, with the worst yet to come. St. Louis Fed Velocity of Money

France's 'First Lady' admitted to hospital

France's "First Lady," Valerie Trierweiler, the official girlfriend of president François Hollande, was admitted to a hospital on Friday for depression, after a gossip magazine published photos and a report that Hollande was spending nights with another woman, actress Julie Gayet, as we reported yesterday. Trierweiler and Hollande are not married, but they've been together since 2007, and they live in the Elysee palace together. There have been recent rumors that Trierweiler and Hollande are becoming estranged, and that she may be leaving the Elysee palace.

Despite the fact that the French people claim that the president's sex life is nobody else's business, this has become major news in France. There is a major presidential news conference scheduled for Tuesday, and Hollande and Trierweiler are scheduled to visit Washington together next months. Hollande's approval rating is already rock-bottom, and this mess is expected to make it worse. BBC

(Comments: For reader comments, questions and discussion, see the 13-Jan-14 World View -- Iran will 'roll back' its nuclear program, starting January 20 thread of the Generational Dynamics forum. Comments may be posted anonymously.) (13-Jan-2014) Permanent Link
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12-Jan-14 World View -- Israel's former prime minister Ariel Sharon dies

France's Francois Hollande's affair throws U.S. visit into doubt

This morning's key headlines from GenerationalDynamics.com

Israel's former prime minister Ariel Sharon dies


Ariel Sharon in October, 1973 (Reuters)
Ariel Sharon in October, 1973 (Reuters)

Israel's former prime minister Ariel Sharon died on Saturday, after 8 years in a coma caused by a massive stroke in January, 2006. Sharon's death is, perhaps surprisingly, a major international news story, even though he hasn't opened his eyes or spoken a word in 8 years.

Sharon is considered by many to be Israel's greatest national hero. Starting with the 1948 war with Arabs, he fought for Israel in one war after another, often as commander. Many people believe that Israel owes its continued existence to the life of Sharon.

From the Arab point of view, Sharon's victories in all those wars were actually war crimes, where thousands of Palestinian civilians were killed with no justification. The greatest event in this category occurred in 1982, when Christian Arab forces allied with Sharon's Israeli army massacred and butchered hundreds or perhaps thousands of Palestinian refugees in camps in Sabra and Shatila in Lebanon. Sharon personally had nothing to do with the attack, but many, including some Israelis, believe that it was a war crime for Sharon not to do anything to stop it, when he allegedly knew that it was in progress.

As Prime Minister in the early 2000s, Sharon began to transform from a warrior to a statesman. He initiated the building of the barrier security fence separating Israel from Arab territory. After the death of Yasser Arafat in November, 2004, Sharon brought about the withdrawal of all Israeli forces and settlements in the Gaza Strip, in a move for peace in cooperation with the President George Bush's May 2003 "Mideast Roadmap to Peace."

When Palestinian leader Yasser Arafat died in November, 2004, there was a widespread belief that everything in the Mideast would change. It had been thought that there was no Mideast peace agreement because Arafat did everything in his power to stop it, and that with him gone, successful peace talks would go ahead. But as I've written many times, it's a basic principle of Generational Dynamics that great events are determined by masses of people, generations of people, and that politicians are largely irrelevant. The death of Arafat showed that to be true. Things not only didn't get better, they continued to get worse. In Gaza, for example, it had been hoped that the Palestinian residents would create a sound economy and peaceful democracy, but instead, the Palestinian residents spent most of 2005 trashing Gaza, and using it as a base for terrorist attacks against Israel.

From the point of view of Generational Dynamics, Ariel Sharon and Yasser Arafat were very similar men. They were born one year apart (1928 and 1929, respectively), and they both survived the bloody, genocidal war between Arabs and Jews that followed the partitioning of Palestine and the creation of the state of Israel in 1948. Each had fought in Arab vs Israeli wars after that, viewed by their supporters as heroes, and by their enemies as terrorists.

However, what always united Sharon and Arafat was that, like all survivors of generational crisis wars, they were determined to make sure that no such war happens again, to their children and grandchildren. So Arafat may have been a terrorist, and he may have been approved suicide bombings that killed Jewish children, but he undoubtedly saw it as the lesser of two evils. Sharon and Arafat shared a view that the greatest evil of all would be to unleash a new genocidal war, one that would kill many more Jewish and Arab children than suicide bombings do. However, their deaths bring exactly the kind of war closer. Jerusalem Post and AP

France's Francois Hollande's affair throws U.S. visit into doubt


François Hollande and French actress Julie Gayet (EPA)
François Hollande and French actress Julie Gayet (EPA)

A gossip magazine has reported that France's Socialist president François Hollande has been riding across Paris each evening on the back of a scooter, arriving at the home of his latest mistress, French actress Julie Gayet. He spends the night there, according to the reports, leaving his officially recognized girlfriend, Valerie Trierweiler back at the Elysee palace, where they live together. An outraged Hollande has demanded that his private life be kept private, and he's even threatened to sue the gossip magazine. However, he didn't deny the facts in the story.

Before Trierweiler, Hollande's previous girlfriend of 30 years and mother of his four children was Segolene Royal. Trierweiler and Royal got into a tweeting spat over Hollande just last year. All this is quite amusing, but it's bad news for Hollande, as his approval rating is now just 15%, the lowest for any president in the past 50 years.

Trierweiler is expected to accompany Hollande on a state visit to the United States next month. That should keep Hollande's latest love affair in the news for some time to come. BBC

(Comments: For reader comments, questions and discussion, see the 12-Jan-14 World View -- Israel's former prime minister Ariel Sharon dies thread of the Generational Dynamics forum. Comments may be posted anonymously.) (12-Jan-2014) Permanent Link
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11-Jan-14 World View -- Syria's president al-Assad collaborates with al-Qaeda against Syria rebels

Christians cheer as Central African Republic president resigns

This morning's key headlines from GenerationalDynamics.com

Syria's president al-Assad collaborates with al-Qaeda against Syria rebels


Syrian citizens pray over the coffins wrapped by Syrian flags for the victims who were killed on Thursday by a car bomb (AP)
Syrian citizens pray over the coffins wrapped by Syrian flags for the victims who were killed on Thursday by a car bomb (AP)

Nearly 500 people have been killed in northern Syria in the last week because of fighting among supposedly anti-Assad militias. The army of Syria's president Bashar al-Assad was not even involved in this fighting.

As we recently described in detail, there are three groups of anti-Assad militants in Syria: The "moderate" Syrian National Coalition (SNC), the Islamic Front, or Jabhat al-Nusra, consisting of Syrian citizens who are salafists, and the al-Qaeda linked jihadists in the Islamic State in Iraq and Syria/Sham/theLevant (ISIS or ISIL), consisting of many foreign fighters who have been drawn to the region by both the Syria conflict and the deterioration of Iraq since the Americans withdrew.

It's thought that the SNC and Jabhat al-Nusra are on the same side, fighting al-Qaeda. This view has been supported by Turkey's foreign minister Ahmet Davutoglu:

"What I say is that some circles are trying to show al-Assad as less evil than al-Qaeda.

The al-Assad regime has not fought al-Qaeda yet. The Free Syrian Army is fighting both regime forces and al-Qaeda. The existence of al-Qaeda creates an area of legitimacy for the regime and the pressures of the regime create [one] for al-Qaeda. Thus they benefit and support each other.

If the al-Assad regime had not applied such intense pressure during the past two years, no groups like the Islamic State in Iraq and Levant (ISIL) could have emerged."

The argument that al-Assad and ISIS are helping each other politically is obviously true, as al-Assad and Russia use ISIS as a club in the international community to support al-Assad's genocidal atrocities on his own people. What hasn't been proven is that al-Assad is militarily aiding al-Qaeda against the two Syrian anti-Assad groups.

However, Debka's subscriber-only newsletter (sent to me by a subscriber) says that al-Assad has a long history of supporting al-Qaeda militarily:

It was recalled in some US intelligence quarters how key members of the Assad family made their fortunes from hosting the Al Qaeda networks which funneled combatants and arms from Syria into Iraq to fight US forces in 2004, a year after the American invasion, and again in 2005.

Leading figures in this episode were Gen. Assef Shawqat, Assad's brother-in-law, deputy Defense Minister until he was assassinated in July 2012; and Rami Makhlouf, tycoon and Assad's maternal cousin.

The networks they harbored smuggled al Qaeda terrorists into Iraq as they poured into Syria from the Gulf, other parts of the Mid East, and from Muslim population centers in the West.

Is Assad at his old double game?

US Secretary of State at the time Colin Powell traveled to Damascus to tax Bashar Assad with double-dealing and sabotaging the American war effort. He came away furious over Assad's denials and on the plane taking him back to Washington, Powell told reporters that the Syrian ruler had lied in his teeth several times in their interview.

Those US veteran watchers of the Iraqi and Syrian scenes, recalling their stealthy interaction, saw a rat in the ease with which Assad and his security agencies have allowed Al-Baghdadi's legions to move out of Syria to Iraq in recent weeks.

They suspect that the Syrian president, becoming worried by the Obama administration's rapprochement with Tehran, betrayed both their interests in Iraq by opening the door to al Qaeda's access, exactly as he did a decade ago.

At the same time, fresh intelligence reached Washington about another double game, whereby Iran and al Maliki are suspected of deliberately overstating Al Qaeda's battle successes, as a pretext for cracking down on the very Iraqi Sunnis, who collaborated with Washington during America's 2003-2012 US presence in the country."

Arab News / AP and Hurriyet (Ankara) and Debka

Christians cheer as Central African Republic president resigns

Christians in Bangui, the capital of Central African Republic (CAR), filled the streets and cheered wildly at the news that the country's president, Michel Djotodia, had announced his resignation, under pressure from France and others in the international community. Djotodia, a Muslim, became president last March in a coup that ousted president François Bozize, a Christian.

Following the coup, Muslims formed Seleka brigades and began going door to door and killing Christians. Millions of Christians across the country have been forced to flee their homes, and some groups of Christians have been forming anti-Seleka revenge militias. Thus, Christians are hoping that the reversal of the event that triggered the massacre will now cause things to go back to the way they were, when Muslims and Christians lived together in love and harmony. Although Christian neighborhoods were rocking with celebrations, Muslim neighborhoods were eerily silent, according to reports.

From the point of view of Generational Dynamics, the resignation of Djotodia will make little difference, and the hope of a return to the old days is a pipe dream. The violent, visceral attacks by the Muslims on the Christians were triggered by the Djotodia coup, but they could only have occurred because of hatreds bottled up for years or decades, presumably based on anger and resentment by the Muslim minority at discrimination by the Christian majority.

As I've written many times, it's a basic principle of Generational Dynamics that even in a dictatorship, major policies and events are determined by masses of people, entire generations of people, and not by politicians. Thus, Hitler was not the cause of WW II. What politicians say or do is irrelevant, except insofar as their actions reflect the attitudes of the people that they represent, and so politicians can neither cause nor prevent the great events of history. Djotodia could neither have caused nor prevented bloody slaughter that's unfolding, just as no politician could have caused or prevented the bloody slaughter in Rwanda in 1994.

CAR's last generational crisis war was the 1928-1931 Kongo-Wara Rebellion ("War of the Hoe Handle"), targeting the French colonialists. The way that this works is that a generational crisis war is so horrific that the survivors make it their life's work to make sure that nothing similar ever happens to their children or grandchildren. However, once those survivor generations are gone, then all you have left are younger generations with no personal memories of the last war, and no personal inhibitions against their ultra-nationalist drives. After that, a new generational crisis war breaks out, and we're seeing the beginnings of it now. AP and Reuters

Israel announces plans for 1,800 new West Bank settlement homes

As expected, Israel on Friday announced plans to build 1,800 new West Bank Jewish settlement homes. The announcement was expected after Israel's recent release from jail of twenty-six Palestinian prisoners who committed terrorist acts prior to the 1994 Oslo accords, as part of the deal for Israeli-Palestinian "peace talks." Prime minister Benjamin Netanyahu is thought to have been forced to announce the settlement plans as part of a deal with Israeli politicians who opposed the prisoner release.

According to Saeb Erekat, the top Palestinian negotiator:

"The new settlement construction plan is a message from Netanyahu to [U.S. Secretary of State John] Kerry not to come back to the region to continue his efforts in Israeli-Palestinian peace talks.

Every time Kerry has stepped up his efforts, returning to the region, Netanyahu has stepped up his efforts to destroy the peace process. Netanyahu is determined to destroy the two-state solution."

AFP

U.S. sends troops to Somalia

The Obama administration has reversed two decades of U.S. policy that effectively prohibited military "boots on the ground" in Somalia, after the "Black Hawk Down" disaster in 1993. The U.S. military secretly deployed about two dozen troops to Somalia in October, to serve as trainers and advisers. Drones from a U.S. base in neighboring Djibouti conduct surveillance missions and occasional airstrikes, but except for occasion use of special forces, this is the first introduction of American troops on the ground. Washington Post

(Comments: For reader comments, questions and discussion, see the 11-Jan-14 World View -- Syria's president al-Assad collaborates with al-Qaeda against Syria rebels thread of the Generational Dynamics forum. Comments may be posted anonymously.) (11-Jan-2014) Permanent Link
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10-Jan-14 World View -- Uganda and China intervene in South Sudan conflict

China demands approval of fishing in South China Sea

This morning's key headlines from GenerationalDynamics.com

Uganda and China intervene in South Sudan conflict


Ugandan tanks (UGO)
Ugandan tanks (UGO)

As the ethnic Dinka vs Nuer conflict continues in South Sudan, Uganda has provoked controversy by send an unspecified number of troops into South Sudan to support the Dinka side. Uganda's President Yoweri Museveni says that the troops are purely defensive, guarding the airport and government buildings. The political opposition in Uganda is criticizing the president for abandoning neutrality. According to Wilfred Niwagaba, a Ugandan MP:

"The rhetoric itself denies Uganda the chance of playing a neutral role. We lose what we would have otherwise gained as a neutral arbiter, so we cannot participate as an arbiter in the Sudan. And regardless of how finally the war ends, our leadership will still be viewed as a partisan and biased partner. So the benefits of us remaining neutral would have definitely outweighed the advantages, if any, that are being obtained now. ...

We do not know the cost of that war, both materially on the taxpayer of Uganda, and two, the human cost. Our country now seems to be involved in so many wars. We are in Somalia, now the Sudan, the Central African Republic, but government has never come up to give us accountability. Who spends on these troops? And is it worth the cost?"

His words are interesting, as they might have come from an American politician talking about American troops somewhere in the Mideast.

There are several conflicts currently going on in Africa. In the east, there's Somalia, which is jihadist. Moving west, there's South Sudan and the Democratic Republic of Congo (DRC), which are local ethnic rivalries, and Central African Republic, which is jihadist. According to Niwagaba, Uganda is involved in all but the one in Congo, though we know from other reporting that the Congo war has spilled over into Uganda. The other two wars right now are both jihadist, in Nigeria and Mali. Of the six, the Central African Republic war is deepest into a generational Crisis era, as we've been reporting in recent days, so is most likely to explode into mass carnage.

Uganda's prime minister Amama Mbabazi defended the military action:

"What happens in the region affects all of us and so we must ensure there is peace in the region. We are fighting a war.

‘I don’t want you to think that the UPDF [Uganda People’s Defense Forces] are just war mongers, Ugandans need to understand that this conflict is for Uganda too."

VOA and UGO News (Uganda)

China violates its lofty 'non-interference' policy in South Sudan

Getting back to South Sudan, China's involvement is very interesting. China's politicians, as we know, become apoplectic and vitriolic when anyone in the West criticizes the brutal treatment of Tibetans or Uighurs, and they always insist that these are "internal" problems that are no one else's business. And China has no problem endorsing the atrocities and slaughter conducted by Syria's psychopathic president Bashar al-Assad.

But South Sudan is different, and the Chinese seem quite willing to "interfere." China is in talks with neighboring Sudan to deploy a military force to protect South Sudan's oil fields. This could potentially risk a proxy war in South Sudan, since Uganda and Sudan support opposite sides of the conflict in South Sudan.

However, China has now abandoned all its lofty, highly moralistic "non intervention" principles anyway. Why? Because China is desperate for oil. China has invested some $30 billion in Sudan / South Sudan oil. Oil production has already dropped by 20% since the onset of the conflict three weeks ago, and more than 300 Chinese workers have been evacuated. So the People's Republic of China is just as immoral as anyone else, but we already knew that, didn't we? BBC and Guardian (London)

China demands approval of fishing in South China Sea

China has further escalated the international dispute in the South China Sea by demanding that all foreign fishing vessels ask permission before entering much of the South China Sea. China has adopted a kind of "Lebensraum policy," by claiming territory in the South China Sea that has historically belonged to Vietnam, Brunei, Malaysia, Indonesia and the Philippines, and using its vast military power to threaten and subdue any neighboring nation that disobeys its orders. China has already forced the Philippines to cede the Scarborough Shoal to China, under threat of military force. The new escalation risks a confrontation that could spiral out of control. Vietnam has already stated that it will ignore the new demands. VOA

(Comments: For reader comments, questions and discussion, see the 10-Jan-14 World View -- Uganda and China intervene in South Sudan conflict thread of the Generational Dynamics forum. Comments may be posted anonymously.) (10-Jan-2014) Permanent Link
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9-Jan-14 World View -- Eurozone plummets into deflation

Measles spread feared in Central African Republic

This morning's key headlines from GenerationalDynamics.com

Eurozone plummets into deflation


Inflation versus deflation (Don Stott, Silver Bear Cafe)
Inflation versus deflation (Don Stott, Silver Bear Cafe)

The eurozone consumer price index (CPI) inflation rate fell to 0.8% in December, continuing a long string of steadily decreasing month after month inflation rate reports. The "core inflation rate," which excludes food and energy and so is less volatile, fell to 0.7%. The following table shows the core inflation rate reported in each of several months in the last year:

|   Dec 2012    1.5%
|   Jul 2013    1.1%
|   Aug         1.1%
|   Sep         1.0%
|   Oct         0.8%
|   Nov         0.9%
|   Dec 2013    0.7%

This has been a fairly dramatic trend, and shows that deflation is becoming firmly lodged in the European economy.

For over ten years, mainstream economists have been predicting inflation or hyperinflation, because central banks have had near-zero interest rates, and have been pumping trillions of "printed" dollars into the economy. For ten years, Generational Dynamics has been predicting a deflationary spiral. Once again, it's generational theory that's right, and mainstream economists who are wrong. Mainstream economists didn't predict and can't explain the tech bubble of the 1990s, the real estate and credit bubble of the 2000s, or the financial crisis of 2007. It was perfectly obvious that there was a huge real estate bubble in the 2004-2007 time frame, as I wrote about many times in that period, but mainstream economists didn't even recognize the bubble, until around 2009, when they started saying, "Oh yeah, by the way, there was a real estate bubble in 2006. Let's not do that again." Are you kidding me? Mainstream economists have no clue what's going on, and have no clue what will happen next year, except to assume that the same thing that happened last year will happen next year, and you don't need mainstream economists to make that "prediction."

The Wall Street stock market bubble has gotten so large that even some mainstream financial advisers are predicting a crash soon. (See, for example, Estimating the Risk of a Market Crash, John P. Hussman Ph.D.) According to Friday's Wall Street Journal, the S&P 500 Price/Earnings index (stock valuations) on Friday (January 3) morning was 18.88, which is astronomical by historic standards, indicating that stocks are far overpriced, and the stock market bubble is worse than ever.

As Europe spirals into deflation, it's worth duly noting that Bank of England Governor Mark Carney is expressing concern about China's credit bubble. The Chinese credit system has grown to $24 trillion from $9 trillion in late 2008, equivalent to adding the entire US commercial banking system.

Generational Dynamics predicts a continued deflationary spiral, and a massive world financial crisis, as a crisis in one country or market creates a chain reaction that affects the entire world. Reuters and Telegraph (London) and Telegraph (Dec 2013)

Measles spread feared in Central African Republic

Measles has broken out at the airport in the capital, Bengui, of the Central African Republic. There are about 100,000 people there, mostly Christians fleeing Muslim Seleka militia attacks, squeezed like sardines into the area. Seleka militias have been going from house to house, killing young men. However, Christian groups are preparing a violent revenge against the Muslims, leading to fears of a huge regional war.

A month ago, there were only a few thousand camped out near the airport. The 100,000 people there now are among the 513,000 total Bangui citizens who have been driven from their homes. Across the country, about 2.2 million people have been made homeless, about half the total population.

Last March's coup by a Seleka leader unleashed a wave of looting, rapes and massacres by its fighters that degenerated into clashes with the Christian militias. It's become murder of neighbor against neighbor, like the Rwanda genocide in 1994, or the Bosnian massacre in 1995.

From the point of view of Generational Dynamics, Central African Republic is deep into a generational Crisis era, and this conflict is rapidly deteriorating into a full-fledged generational crisis war between Muslims and Christians. There are 1,600 French and 6,000 African Union "peacekeepers" who are supposed to stop the slaughter, but a generational crisis war is an elemental force of nature that can sometimes be briefly delayed, but cannot be stopped until it reaches an explosive climax. BBC and Guardian (Nigeria) and AP

(Comments: For reader comments, questions and discussion, see the 9-Jan-14 World View -- Eurozone plummets into deflation thread of the Generational Dynamics forum. Comments may be posted anonymously.) (9-Jan-2014) Permanent Link
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8-Jan-14 World View -- The 'Battle of Fallujah' begins in Iraq

Turkey's political crisis grows as police are reassigned

This morning's key headlines from GenerationalDynamics.com

The 'Battle of Fallujah' begins in Iraq


Fighters with guns march triumphantly (DPA)
Fighters with guns march triumphantly (DPA)

Iraqi army troops are massing around the city of Fallujah in Anbar Province in Iraq, in preparation for an attack to retake Fallujah back from the forces of Al-Qaeda in Iraq and Syria/Sham/theLevant (ISIS or ISIL), after the latter capture Fallujah and parts of Ramadi last week. Clashes have already begun on the outskirts of Fallujah, following the ISIS capture of an army officer and four soldiers on Monday.

The situation in Iraq began deteriorating steadily after the December 2011 withdrawal of American troops, without a "status of forces" agreement with Iraq's government, headed by Shia prime minister Nouri al-Maliki. The Obama administration is being blamed by Republicans for the rapid deterioration of Iraq after the Bush administration's successful "surge" strategy, and is also being blamed by families of soldiers who fought and died in Fallujah. President Obama is now desperately searching for ways to help the al-Maliki administration prevent a complete rout. However, al-Maliki has lost credibility because of his harsh treatment of and open discrimination against Sunni politicians and people. Secretary of State John Kerry says that some weapons may be supplied to al-Maliki, but there will be no American soldiers on the ground. CBS News

Turkey's political crisis grows as police are reassigned

In what might be called a "Monday morning massacre," Turkey's interior minister ordered 350 police officers in Ankara from the anti-smuggling and organized crime units to positions in other departments, such as the traffic department (where they're presumably directing traffic in the desert somewhere). The number of transferred officers has risen to 560 in the capital city Ankara alone, 400 were transferred in Istanbul, and many were more transferred in other cities. The interior minister is new, having taken office last month when the previous minister was forced to resign.

Turkey was shaken last month when three ministers in the cabinet of prime minister Recep Tayyip Erdogan all resigned, and one of them called for Erdogan's resignation. In the case of each minister, his son has been the target of a wide-ranging corruption investigation that resulted in the arrest of 52 people, including bureaucrats and well-known businessmen. The corruption investigation involves billions of dollars, including illegal money laundering through Iran, and bribes and kickbacks for construction projects.

On Monday, a simultaneous corruption operation in five cities across Turkey detained 25 more businessmen and state officials.

Erdogan is trying to containing the growing scandal. He's described it as a "dirty plot" by his political enemies, led by former ally and now political enemy Islamist cleric Fethullah Gulen, who has lived in self-imposed exile in Pennsylvania since 1999. Zaman (Ankara) and BBC

(Comments: For reader comments, questions and discussion, see the 8-Jan-14 World View -- The 'Battle of Fallujah' begins in Iraq thread of the Generational Dynamics forum. Comments may be posted anonymously.) (8-Jan-2014) Permanent Link
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7-Jan-14 World View -- Mideast 'peace talks' near collapse as Kerry leaves without deal

Tens of thousands of migrants to Israel protest in Tel Aviv

This morning's key headlines from GenerationalDynamics.com

Tens of thousands of migrants to Israel protest in Tel Aviv


Tens of thousands of migrants protest in Tel Aviv on Sunday and Monday (AP)
Tens of thousands of migrants protest in Tel Aviv on Sunday and Monday (AP)

Tens of thousands of African migrants to Israel, mostly from Sudan, South Sudan and Eritrea, have been massing and protesting in front of embassies in Tel Aviv. They are protesting that migrants are treated poorly, that few if any migrants have been granted refugee status, and that a new law will allow an illegal immigrants to be held in detention in a facility in Holot for up to a year with no charges filed. Israel has a program where it will pay an illegal immigrant $3,500 plus a one-way plane ticket, if the immigrant will go back home. Israel is threatening to deport other immigrants.

The United Nations High Commissioner for Refugees (UN refugee agency - UNHCR) is joining with international NGOs to pressure Israel to grant an unlimited number of asylum requests to refugees. According to a UNHCR statement:

"Placing asylum seekers in duress that may force asylum seekers to opt to return without having examined their asylum claim could amount to a violation. The current policy and practices create fear and chaos amongst asylum seekers, not taking into account their specific situation. 'Warehousing' refugees in Holot is not a solution in line with the 1951 Refugee Convention."

Israelis who oppose granting asylum say that the migrants are not refugees at all, but have come to Israel to get a job and send money back to their families at home. Some Israeli commentators say that UNHCR and the international NGOs are exploiting the migrants and sometimes endangering their lives in order to gain a broader political objective of diluting the population with tens or hundreds of thousands of migrants in order to change Israel from being a Jewish state. CS Monitor and Jerusalem Post

Mideast 'peace talks' near collapse as Kerry leaves without deal

U.S. Secretary of State John Kerry left the Mideast on Monday, having failed in four days of intense negotiations with Israelis and Palestinians to get agreement on a "framework" to guide future peace talks. Kerry parroted the usual claim that "progress has been made," but in the opposite appears to be true. There were bitter recriminations from both Israeli and Palestinian leaders. The Israelis said that the Palestinians were "continuing their campaign of inciting hatred," while the Palestinians adamantly refuse to recognize Israel as a "Jewish state", and remain steadfast in their opposition to stationing any Israeli troops in the occupied Jordan Valley, which forms a third of the West Bank.

There is an April deadline for the current round of "peace talks," and Kerry will be making one more trip before then in a last-ditch attempt to salvage the negotiations, before having to deal with yet one more major Obama administration foreign policy debacle, among many others. Ma'an News Agency

Hamas welcomes the Palestinian Authority back to Gaza

Ever since they went to war in 2007, the Palestinians have been split into two groups. Hamas, considered a terrorist group by the West, is the governing authority in the Gaza Strip. The Palestinian Authority and Fatah are the governing authority in the West Bank. The so-called Mideast "peace talks" have been between Israel and the Palestinian Authority, but one of the many reasons why they've failed is that Hamas opposes them.

On Monday, Hamas' prime minister Ismail Haniyeh said that all Fatah members, except those accused of killing Hamas members in 2007, would now be welcome to return to Gaza, after being exiled in 2007. However, a Fatah spokesman called the announcement a "superficial" gesture, and demanded that Hamas agree to elections for a government for both Gaza and the West Bank. Al-Jazeera

(Comments: For reader comments, questions and discussion, see the 7-Jan-14 World View -- Mideast 'peace talks' near collapse as Kerry leaves without deal thread of the Generational Dynamics forum. Comments may be posted anonymously.) (7-Jan-2014) Permanent Link
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6-Jan-14 World View -- Thailand's elite minority seeks to shut Bangkok down

Syria's Sunni opposition militias fight each other

This morning's key headlines from GenerationalDynamics.com

Thailand's elite minority seeks to shut Bangkok down


Anti-government protesters rally in front of the statue of King Rama I at Bangkok's Memorial Bridge (Bangkok Post)
Anti-government protesters rally in front of the statue of King Rama I at Bangkok's Memorial Bridge (Bangkok Post)

Anti-government protesters led by Suthep Thaugsuban of the "People’s Democratic Reform Committee" are planning a massive rally to shut down the city of Bangkok, Thailand, next week on Monday, January 13, in an attempt to gain control of the government. Prime Minister Yingluck Shinawatra has offered to step down, and has scheduled new elections for next month. However, that doesn't work for Thaugsuban, because Shinawatra's Pheu Thai political party has won the last five elections, and will undoubtedly win the next election. Instead of an election Shinawatra is demanding that a new "People's Council" select the next prime minister. Presumably, Thaugsuban wants the People's Council to be packed with is allies.

Thailand is in a very dangerous situation. Thaugsuban's market-dominant light-skinned Thai-Chinese elite minority do not wish to give up any power, but they're vastly outnumbered by the dark-skinned Thai-Thai who do most of the menial labor, and who continue to support the Pheu Thai political party. So if the latter stick together, they will always win every election, and Thaugsuban knows it.

Thaugsuban's "yellow shirt" supporters are apparently planning terrorist violence on January 13 to get their way, including gunfire and bombs. If they do get their way, then expect a violent backlash from the "red shirt" Thai-Thai. Bangkok Post

Syria's Sunni opposition militias fight each other

As al-Qaeda linked jihadists pour into Syria, the fighting on the ground is becoming more complex. There are now four different groups fighting in Syria:

The Syrian army has been taking advantage of the increasing fighting among the opposition forces. Some people are accusing al-Assad and ISIS as being allied against the moderates, while al-Assad fools the international community by claiming to be fighting terrorists in Syria. The SNC has issued this statement:

"The Syrian National Coalition believes that ISIS is closely linked to the terrorist regime and serves the interests of the clique of President Bashar Al-Assad…. The murder of Syrians by this group leaves no doubt about the intentions behind their creation, their objectives, and the agendas they service, which is confirmed by the nature of their terrorist actions that are hostile to the Syrian revolution."

Al-Jazeera (TV report) and Joshua Landis

(Comments: For reader comments, questions and discussion, see the 6-Jan-14 World View -- Thailand's elite minority seeks to shut Bangkok down thread of the Generational Dynamics forum. Comments may be posted anonymously.) (6-Jan-2014) Permanent Link
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5-Jan-14 World View -- U.S. sends Polar Star icebreaker to free Russian ship and Chinese icebreaker

Islamic State of Iraq and Syria (ISIS) in control of Fallujah

This morning's key headlines from GenerationalDynamics.com

U.S. sends Polar Star icebreaker to free Russian ship and Chinese icebreaker


Chinese helicopter ferries the Shokalskiy passengers to safety
Chinese helicopter ferries the Shokalskiy passengers to safety

The United States Coast Guard is sending the Seattle-based icebreaker Polar Star south to the Antarctic to free a Russian research ship that got trapped in the ice, and also to free a Chinese icebreaker that got trapped in the ice while trying to free the Russian ship. An Australian icebreaker also was unable to help. The 399-feet long Polar Star can break ice that's six feet deep, at a continuous rate of three knots. (Paragraph corrected. 5-Jan)

The Russian ship MV Akademik Shokalskiy with 52 passengers was on a four-week expedition to follow the path taken a century ago by Australian explorer Sir Douglas Mawson.

One aim of the expedition was to track how quickly the Antarctic's sea ice was disappearing because of global warming, but a blizzard and thick ice caused the expedition to be abandoned on Christmas eve, despite the fact that it's the height of Summer in the Antarctic.

A Chinese icebreaker, the Xue Long (Snow Dragon), tried to free the Shokalskiy, but got trapped in the ice before it reached the Shokalskiy. An Australian icebreaker, the Aurora Australis, also made an attempt, but turned back before getting trapped. The passengers and crew of the Shokalskiy have never been in danger, with plentiful supplies of food and water. Last week a Chinese helicopter ferried the passengers to the Australian ship, though the Russian crew will remain where they are, hoping that the Polar Star can free them. Seattle Times and Telegraph (London)

Islamic State of Iraq and Syria (ISIS) in control of Fallujah

More than 100 people were killed on Friday in Fallujah and Ramadi as Iraq's army battled fighters from the Islamic State of Iraq and Syria (ISIS or ISIL), leaving ISIS in control of Fallujah and parts of Ramadi on Saturday.

Fallujah and Ramadi were two of the main battlegrounds in the Iraq war in 2005-2008. In 2007, President Bush's surge, in conjunction with the "Anbar Awakening," defeated al-Qaeda in Iraq, ISIS's predecessor, but since the withdrawal of American forces in December, 2011, al-Qaeda has been surging in strength. ISIS Iraq, has taken control of large sections of eastern Syria and of Anbar province in western Iraq. There is no longer any effective border between the two countries. However, ISIS is not monolithic, as there are al-Qaeda linked militias fighting one another for power within the region. France 24 and Al-Jazeera

(Comments: For reader comments, questions and discussion, see the 5-Jan-14 World View -- U.S. sends Polar Star icebreaker to free Russian ship and Chinese icebreaker thread of the Generational Dynamics forum. Comments may be posted anonymously.) (5-Jan-2014) Permanent Link
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4-Jan-14 World View -- H1N1 swine flu spread in Michigan and Texas revive fears of pandemic

IMF working paper predicts major global financial crisis

This morning's key headlines from GenerationalDynamics.com

H1N1 swine flu spread in Michigan and Texas revive fears of pandemic


All hospitals in New Delhi were put on high alert last year after six cases of swine flu were confirmed (India.com)
All hospitals in New Delhi were put on high alert last year after six cases of swine flu were confirmed (India.com)

The number of people hospitalized with cases of H1N1 swine flu is climbing in the area of Ann Arbor, Mich., area, following a series of H1N1 deaths in eastern Texas, raising fears of a repeat of the 2009-2010 H1N1 pandemic, this time with a mutated virus that's more deadly. The last H1N1 pandemic ran from April, 2009 to May 2010, and killed at least 18,000 people, though though some estimates run into the hundreds of thousands. Mexico City was particularly hard hit, and the city was all but shut down for several months.

The fear in 2009, and again today, is a repeat of the huge Spanish flu pandemic that took tens of millions of lives in 1918-19, decimating entire communities. (See "Rapid worldwide H1N1 swine flu spread is raising big concerns for the Fall" from 2009.) The 2009 pandemic fizzled without causing massive numbers of death, but the world is overdue for a massive pandemic, and the possibility cannot be excluded now. Michigan Live and Recombinomics

Nearly one million people homeless in Central African Republic

According to Doctors Without Borders, "fighting, lynchings and violent attacks remain a daily occurrence in Bangui," the capital of Central African Republic (CAR), "where the situation appears to be out of control." The number of people driven from their homes in Bangui alone was around 700,000 a week ago, and is now close to one million. These are people who have fled their homes in the sectarian violence between Muslims and Christians in Bangui alone. There do not seem to be figures for the rest of the country. France has deployed 1,600 peacekeeping troops to Bangui, supplemented by about 6,000 African Union peacekeeping troops. C.A.R. is deep into a generational Crisis era, so it's quite possible that these peacekeeping troops will be unable to keep the peace, and that C.A.R. will repeat the genocidal bloodletting of Rwanda in 1994. Doctors Without Borders and AFP

IMF working paper predicts major global financial crisis

Mainstream economists are generally becoming increasingly alarmed by the imbalances in the global economy, whether from a stock market bubble or from historically high public debt, and are expressing increasing concern about a major financial crisis. In an IMF working paper, economists Carmen M. Reinhart and Kenneth S. Rogoff particularly criticize national governments' wishful thinking that debt can be ignored because it will be eliminated automatically by a spurt of economic growth. According to the report:

"Even after one of the most severe crises on record (in its fifth year as of 2012) in the advanced world, the received wisdom in policy circles clings to the notion that advanced, wealthy economies are completely different animals from their emerging market counterparts. Until 2007–08, the presumption was that they were not nearly as vulnerable to financial crises.2 When events disabused the world of that notion, the idea still persisted that if a financial crisis does occur, advanced countries are much better at managing the aftermath, thanks to their ability to vigorously apply countercyclical policy. Even as the recovery consistently proved to be far weaker than most forecasters were expecting, policymakers continued to underestimate the depth and duration of the downturn. ...

It is certainly true that policymakers need to manage public expectations. However, by consistently choosing instruments and calibrating responses based on overly optimistic medium-term scenarios, they risk ultimately losing credibility and destabilizing expectations rather than the reverse.3 Nowhere is the denial problem more acute than in the collective amnesia about advanced country deleveraging experiences (especially, but not exclusively, before World War II) that involved a variety of sovereign and private restructurings, defaults, debt conversions, and financial repression. This denial has led to policies that in some cases risk exacerbating the final costs of deleveraging."

The paper points out that, "In fact, going back to 1800, the current level of central government debt in advanced economies is approaching a two-century high-water mark." With debt higher than it's been in 200 years, a major financial crisis will not be far off.

The paper warns that savers will face "haircuts" in the form of negative interest rates and cancellation of government debt. IMF (PDF) and Telegraph (London)

Was North Korea's Kim Jong-un's uncle eaten by ravenous dogs?

Jang Song-thaek, the uncle of North Korea's child dictator Kim Jong-un was executed in a particularly gruesome manner, according to a report in Hong Kong's strongly pro-Beijing newspaper Wen Wei Po. According to the report, Jang and his five closest aides were stripped naked and thrown live into a cage with 120 hunting hounds that had been starved for five days. According to the newspaper, Jang and his aides were "completely eaten up." The story is unconfirmed, but because the paper is a Beijing mouthpiece, the story may indicate the contempt that Chinese officials are expressing for the current North Korean government. NBC News

(Comments: For reader comments, questions and discussion, see the 4-Jan-14 World View -- H1N1 swine flu spread in Michigan and Texas revive fears of pandemic thread of the Generational Dynamics forum. Comments may be posted anonymously.) (4-Jan-2014) Permanent Link
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3-Jan-14 World View -- Al-Qaeda militants seize cities in Iraq's Anbar province

Car bomb explodes in Hezbollah stronghold in Beirut, Lebanon

This morning's key headlines from GenerationalDynamics.com

Car bomb explodes in Hezbollah stronghold in Beirut, Lebanon


Car bombing in Beirut on Thursday (AFP)
Car bombing in Beirut on Thursday (AFP)

A car bomb exploded Thursday in the well-protected Shia / Hezbollah stronghold in downtown Beirut, Lebanon, killing 5, just one week after a car bomb exploded in the well-protected Sunni region of Beirut, killing a leading Sunni leader. ( "28-Dec-13 World View -- Lebanon faces new chaos after car bombing in heart of Beirut") This bombing comes weeks after a twin suicide bombing killed 25 people at the Iranian embassy in Beirut.

The sectarian war in Syria has been spilling over into Lebanon almost since it began in 2011, mostly in the form of sectarian gunfights in northern Lebanon in Tripoli, on the border with Syria. But the violence in Lebanon has been spreading and worsening since April 30, when Hezbollah chief Sayyed Hassan Nasrallah committed his Shia militia to fighting alongside the army of Syria's Shia/Alawite president Bashar al-Assad against the Sunni opposition. And in the last couple of months, the violence in Lebanon has crossed several red lines, particularly striking at the heart of Beirut, in the most well-defended sections of the city. Each side is determined to prove that it can strike at the other side, and that attempts at protection are futile. AFP

Al-Qaeda militants seize cities in Iraq's Anbar province

The war in Syria is also spilling over into Iraq, where sectarian violence has been growing since the withdrawal of American troops in December, 2011. During the last week, al-Qaeda linked forces have been taking control of parts of the cities of Fallujah and Ramadi in Anbar province, near the border with Syria. Al-Qaeda in Iraq was defeated in 2007 by President George Bush's "surge" strategy (See "Iraqi Sunnis are turning against al-Qaeda in Iraq" from 2007.) Shia Prime Minister Nouri al-Maliki has adopted hostile policies towards the Sunni population, alienating them, perhaps getting even for the decades when Sunni leader Saddam Hussein treated the Shia population extremely harshly.

The old Al-Qaeda in Iraq has become the Islamic State of Iraq and Syria (ISIS), also called the Islamic State of Iraq and the Levant (ISIL). During the last few months, ISIS has become a magnet for Sunni jihadists around the world. ISIS's victories in Iraq are a sign of the growing strength of ISIS in the region, as the entire Mideast becomes inflamed along sectarian Shia/Sunni lines. Al-Jazeera and AFP

(Comments: For reader comments, questions and discussion, see the 3-Jan-14 World View -- Al-Qaeda militants seize cities in Iraq's Anbar province thread of the Generational Dynamics forum. Comments may be posted anonymously.) (3-Jan-2014) Permanent Link
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2-Jan-14 World View -- Latvia becomes 18th nation to adopt the euro currency

Palestinian ambassador to Czech Republic dies in freak explosion

This morning's key headlines from GenerationalDynamics.com

N. Korea's Kim Jong-un struggles for stability, purging 'factionalist elements'


Kim Jong-un giving New Year's day speech (AP)
Kim Jong-un giving New Year's day speech (AP)

In his typically shrill speech to the North Korean people on New Year's Day, the child dictator Kim Jong-un appeared to be responding to numerous national and international concerns about his government's stability, describing as removing "factionalist scum" the execution of his uncle and mentor Jang Song-thaek:

"Our party's timely, accurate decision to purge the anti-party, anti-revolutionary and factionalist elements helped greatly cement unity of the party and the revolution and strengthened our solidarity by 100 times. ...

It is necessary to establish stringent revolutionary discipline and order in all domains of the revolutionary struggle and construction work."

He pledged a crackdown on "any sort of alien ideology and decadent lifestyle." By referring to his uncle as "factionalist elements," he's hoping to reverse the loss of respect among the North Korean for having killed a family member, in a culture where family is extremely important. Furthermore, the word "factionalist" seems to indicate that there was a power struggle, and he hoped that executing Jang would help "greatly cement unity."

Although most reasons given in the press for the execution of Jang have referred to corrupt deals involving sales of coal and other resources to China, South Korean analysts say that the Kim's fury at Jang was far more personal in nature:

It's Jang that maintained good relations between N. Korea and China. From the Chinese perspective, Kim is too young to be a partner, and Jang provided a bridge. Some Beijing officials may actually have been in a panic after Jang's execution. Channel News Asia and Korea Times

Palestinian ambassador to Czech Republic dies in freak explosion

The Palestinian ambassador to the Czech Republic Jamal Al Jamal, 56, was killed in Wednesday in a freak explosion when he attempted to open what was evidently a booby-trapped safe. The safe had been located in the old Palestinian embassy in Prague, and hadn't been opened in at least 20 years. The safe had been moved to the new Palestinian Embassy which wasn't yet officially open. The ambassador had officially assumed his post on October 11, 2013. It was not known why the safe had been booby-trapped. Prague Post

Latvia becomes 18th nation to adopt the euro currency


Say goodbye to the lat currency
Say goodbye to the lat currency

Latvia rung in the new year by becoming the 18th country to join the eurozone, which uses the euro as its currency. The Latvian people, with a large ethnic Russian minority, are mostly opposed to the conversion to the euro currency. This will be the fourth currency for Latvia in the last 22 years. During the Soviet era, Latvia's currency was the Russian ruble. When Latvia became independent, it first adopted a new Latvian ruble and then, a year later, adopted the pre-World War II lat currency. Many Latvians are extremely reluctant to give up their lats for euros, because they're well aware that Greece and other eurozone countries have gone through major financial and currency crises. However, the supporters of the euro say that this time it's different. Bloomberg and BBC

(Comments: For reader comments, questions and discussion, see the 2-Jan-14 World View -- Latvia becomes 18th nation to adopt the euro currency thread of the Generational Dynamics forum. Comments may be posted anonymously.) (2-Jan-2014) Permanent Link
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1-Jan-14 World View -- The Year Ahead - the 2014 World View

Policeman of the World versus Leading from Behind

This morning's key headlines from GenerationalDynamics.com

Russia takes the lead in world foreign policy


World leader Vladimir Putin (Reuters)
World leader Vladimir Putin (Reuters)

In 2011, Russia was very unhappy that they'd abstained in the U.N. Security Council resolution allowing military action in Libya, because they felt that the U.S. and Nato had taken advantage of the situation to go much farther than they had said they would. ( "22-Apr-11 News -- Russia seeks to cripple Nato through Libya United Nations politics") At the time, I wrote the following, quoting an analyst from Jamestown:

"Russia plans to demand that Nato restrict its activities to only the humanitarian acts allowed by the UN resolution, and then veto any attempt to expand the resolution in the Security Council, in order to guarantee a continued stalemate in Libya.

This will set a precedent that allows Russia to effectively control future activities of Nato, since only activities approved by the Security Council, and hence by Russia, could ever be permitted.

Moscow has a broader interest in seeing the US and NATO tied down in wars of choice and other protracted confrontations. These wars increase Russia’s leeway for action in ex-Soviet territories, which is Russia's top priority, according to the article. Furthermore, if Libya's oil exports are stopped, then Russia's own oil exports become more valuable."

Little did I realize at the time how spectacularly successful this Russian policy would be. Under the leadership of Russia's president Vladimir Putin, not only Nato foreign policy but also U.S. foreign policy have become completed crippled. Whether we're talking about policy in Mideast, or Afghanistan, or the South China Sea, it's almost impossible to think of any action that President Barack Obama took that wouldn't have been fully approved by Putin.

This was most spectacular in Syria. Putin repeatedly humiliated Obama by forcing Obama to flip-flop on red line after another. Finally, on the issue of chemical weapons, Obama gave in to Putin completely.

And that's not all. Putin has humiliated Obama repeatedly in other areas as well, most notably in the handling of Snowden.

The Truman Doctrine versus Leading from Behind

Whether people like it or not, America has been Policeman of the World since the end of World War II. President Harry Truman made it so with the Truman Doctrine in 1947, saying that no matter how much it cost the United States to help others who wish to be free, the cost would be far less than the cost of World War II. President John Kennedy reaffirmed the Truman Doctrine, when he said, "Ask not what your country can do for you - ask what you can do for your country." ( "25-Sep-13 World View -- President Obama blasts Russia and Iran over Syria")

What's remarkable is how thoroughly America has abandoned the Truman Doctrine during the last couple of years under President Obama. Obama's policy of "Leading from behind" is the antithesis of the Truman Doctrine, the analog of a city policeman telling the street gangs to fight it out among themselves, and call him when it's all over.

France in 1940: Leading from behind

One reader in the Generational Dynamics forum compared Obama's attitude towards that of France when the Nazis invaded in 1940:

"I wonder if this is what it felt like before World War II. The players are different of course. The Philippines or Vietnam may play the role of Poland, and Japan perhaps France. Or maybe Japan is Poland and the United States France.

One could see when threatened with "a nuclear winter that no one could win" Obama would abandon Hawaii and other Pacific Island territories, plus the Panama Canal to China, and withdraw all surviving U.S. military forces out of the Pacific Theater leaving the U.S. west coast as a hostage guaranteeing U.S. neutrality.

As preposterous as this sounds, France surrendered in World War II to Germany with the vast majority of the French Army intact.

The French Army was the largest Army in the world at the start of World War II and considered one of the most well equipped with artillery and infantry weapons. France also had one of the largest Naval Fleets in the World. Most of the French Army sat on the border of Germany at the time of surrender with no significant German forces between that border and the German industrial heartland.

The bulk of the German army was far behind French lines, near Paris and other Northern French cities, with tanks and troop transports, but no fuel supplies that would allow those tanks and troops to withdraw and defend Germany.

The French just decided not to trade the destruction of French cities for the destruction of German cities.

One could only guess what would happen in Western Europe and the Middle East if the U.S. was no longer willing to risk anything to defend U.S. allies."

The situation with France in WW II is a fascinating one, and it really only makes sense when you consider what happened in France's two previous major wars.

In World War I, France had fought the bloody Battle of Verdun and Battle of the Somme, resulting in tens of millions of deaths. It was horrific. And then what happened? First the Americans came over. Next, the Germans surrendered, not because they were defeated on the battlefield, but because of internal political squabbles in Berlin's government during their generational Unraveling era. And after the French fought all those bloody battles, who got all the credit for winning? The Americans.

Also, in 1940, there were still memories of the 1871 Paris Commune, where tens of thousands of Parisians rose up and killed each other in a battle that was historically viewed as insane.

In 1940, the French well remembered the Paris Commune and World War I, both wars with insane results. So in 1940, the mood was, "Hey, here we go again. Let the British fight this one. Let the Americans fight this one. We're going to sit this one out, because to do anything else is insane."

From France's point of view, this worked out great. London got bombed, but Paris did not, and the Germans were defeated anyway. I doubt that the French would have openly gloated about that, but "Leading from behind" worked very well for them in WW II.

Unfortunately, Leading from behind hasn't worked so well for America so far, as American foreign policy has been disastrously weak and naive, and has led to problems around the world:

The problems are part of a trend that's leading to a new world war, but that's going to happen anyway.

It was almost ten years ago that I said that in the coming Clash of Civilizations world war, China, Pakistan and the Sunni Arab countries would be the "axis" fighting against the "allies," the West, India, Russia, Iran and Israel.

Ten years ago, the thought that we might be allied with Iran seemed fantastical, and indeed I was criticized for suggesting it. But few people would consider it fantastical today. Iran and West are moving closer together, while Saudi Arabia is moving away from the Wet.

At the same time, it's probably a good thing that Japan, Philippines and others are arming themselves, as we'll need all the help we can get confronting China's plans for full-scale war.

Things to watch for in 2014

Here are the major things to watch for in 2014:

In U.S. domestic policy, Obamacare continues to be a growing economic disaster, and it's expect to cause major dislocations in the healthcare industry in 2014. ( "1-Dec-13 World View -- Obamacare: 500M lines of code, $500M, only 60% completed")

(Comments: For reader comments, questions and discussion, see the 1-Jan-14 World View -- The Year Ahead - the 2014 World View thread of the Generational Dynamics forum. Comments may be posted anonymously.) (1-Jan-2014) Permanent Link
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