GEAB N°84 is available! Europe dragged into a division of the world between debtors and creditors: the United States’ desperate solutions for not sinking alone
- Public announcement GEAB N°84 (April 17, 2014) –
In the present confrontation between Russia and the West over the Ukrainian crisis, the image of the Cold War inevitably comes to mind and the media are obviously fond of it. However, contrary to what it gives us to understand, it’s not Russia that seeks the return of an iron curtain but really the US. An iron curtain separating the old powers and emerging nations; the world before and the world afterwards; debtors and creditors. And this in the crazy hope of preserving the American way of life and the US’ influence over “its” camp in the absence of being able to impose it on the whole world. In other words, go down with as many companions as possible to give the impression of not sinking.
For the US, these are the current stakes in fact: drag along the whole Western camp with them to be able to continue dominating and trading with enough countries. So, we are witnessing a formidable operation of turning round opinion and leaders in Europe to ensure docile and understanding rulers vis-à-vis the American boss, supported by a blitzkrieg to link them permanently with the TTIP and to cut them off from what could be their lifeline, namely the BRICS, their huge markets, their vibrant future, their link with developing countries, etc. We are analyzing all these aspects in this GEAB issue, as well as the subtle use of the fear of deflation to convince Europeans to adopt US methods.
In the light of the extreme danger of these methods used by the US, it goes without saying that leaving the US ship wouldn’t be an act of betrayal by Europe, but really a major step forward for the world as we have already extensively analyzed in previous GEAB issues (1).
Jim Sinclair’s Commentary
Bail in for depositors is set at 8% of the total loss the institution takes. Now think of the size of the derivative positions of international banks.
"One of the laws, a bank recovery and resolution directive, gives the 28 states in the union a common rule book for handling failing banks. It would also oblige creditors like bondholders to take losses of up to 8 percent of a bank’s total liabilities before state funds were used."
European Parliament Approves Laws on Banking Overhaul
By JAMES KANTERAPRIL 15, 2014
BRUSSELS — After countless late-night meetings and political skirmishes, the European Union on Tuesday put in place the final pieces of a landmark plan for managing a banking system whose troubles have done so much to dent the bloc’s economy.
The creation of structures that officials have grandly dubbed a “banking union” is one of the biggest steps toward European financial integration since the introduction of the euro more than a decade ago. The negotiations pitted prosperous northern countries like Germany and Finland against France and struggling southern countries like Greece over the issue of how much liability to share for bank failures.
“The E.U. has lived up to its commitments,” said Michel Barnier, the bloc’s commissioner for financial affairs, who originally proposed the three chunks of legislation passed on Tuesday.
But even as the union establishes new structures for assessing the health of banks and for rescuing some, and shuttering others that cannot be salvaged — even introducing an element of burden sharing — critics say the plan still is checkered with uncertainties and weaknesses.
Lawmakers meeting at the European Parliament in Strasbourg, France, for their last plenary session before May elections, overwhelmingly approved the package, which is subject to final approval by the bloc’s Council of Ministers. That is seen as a formality because representatives from the governments have already given their consent to harmonizing the patchwork of banking laws in Europe.
Ukraine crisis: US, Russia announce agreement in Geneva – live updates
Tom McCarthy in New York and Mark Tran in London
theguardian.com, Thursday 17 April 2014 14.48 EDT
We’re going to wrap up our live coverage for the day. Here’s a summary of where things stand:
• Both the United States and Russia took a wait-and-see approach to a deal struck in Geneva Thursday to de-escalate the crisis in Ukraine. The US gave the deal "several days" to produce results.
• The deal provides for a disarmament of "illegal" militias, a withdrawal by protesters from government buildings in the east and "public places" including in Kiev, and a general amnesty. An OSCE observer mission would grow.
• The deal pledged "additional support" for the Ukrainian economy. Russia has said Kiev owes more than $2bn in gas payments. The European commission warned Russia not to roil gas markets.
• US president Barack Obama echoed secretary of state John Kerry’s praise for a plan for establishing a reinvented, autonomous Ukraine laid out in Geneva by Ukrainian foreign minister Andrii Deshchytsia.
• Deep mistrust remained. Russia accused Kiev of taking up arms against its own people and Obama called the Russian mobilization on the Ukrainian border a "gesture of intimidation."
Monetary policy can’t save long-term unemployed: Economist
Jeff Morganteen | @jmorganteen
Thursday, 17 Apr 2014 | 10:07 AM ET
Jobless claims may have dropped to pre-recession lows, but that doesn’t mean the job market is healthy, the chief economist for Sterne Agee told CNBC on Thursday.
What’s more, another top economist believes monetary policy alone cannot help the long-term unemployed.
During an appearance on CNBC’s "Squawk Box," John Ryding, the chief economist for RDQ Economics, questioned whether monetary policy can spur more hiring. Large numbers of open positions, coupled with the long-term jobless dropping out of the labor market, has been a huge drag on the labor market. That comes even as the unemployment rate edges closer to 6.0 percent.
"I’m not saying we should write them off, but I don’t think monetary policy can help them and that’s the key difference," Ryding said. "What we have is a low hiring rate and a lot of job openings given where the unemployment rate is."
The Elites Fear What Will Crash The Global Financial System
Today one of the legends in the business spoke with King World News about what the elites fear is going to crash the American economy and the global financial system. Keith Barron, who consults with major companies around the world and is responsible for one of the largest gold discoveries in the last quarter century, also discussed the massive demand for gold from China as well as what to expect from the gold market in the future.
Barron: “The flow of gold into China is massive and it hasn’t abated. If anything, it has picked up speed. If you look at the growth in Chinese gold demand over the past few years, it won’t be long before we see almost the entire annual gold production in the world going to China….
Jim Sinclair’s Commentary
Gold is all that is left when a currency fails or falters.
GOLD IN UKRAINE CURRENCY SURGES ANOTHER 7% THIS WEEK – COLLAPSE CONTINUES
This is particularly evident in Ukraine where the economy is nearing collapse and the currency is in free fall. The Hryvnia has been the world’s worst performing currency in 2014.
The charts below gives an indication as to the terrifying magnitude and speed of the recent decline in the value of the currency. This week alone the currency has fallen by 7% against gold or gold per ounce has risen from 15,669 hryvnia per ounce at open on Monday to 16,880 hryvnia per ounce today.
Gold in Ukrainian Hryvnia (Sharelynx.com)
Year to date, gold in hryvnia has surged by 69% from 9,992 per ounce to 16,880 per ounce or to put it more correctly, Ukraine’s national currency has collapsed by 69% against gold in less than four months.
This has resulted in the cost of food, fuel and basic staples surging for ordinary people in Ukraine.
Weekly News Wrap-Up 4.18.14
By Greg Hunter’s USAWatchdog.com
A deal has been reached over the Ukraine crisis, and that will supposedly “de-escalate tensions and restore security.” This deal is between the EU, U.S., Russia and Ukraine. I guess this is good news, but I would call it extremely temporary. This is supposed to lead to disarming the pro-Russian militia and returning control of government buildings in Eastern Ukraine. Loyal Ukrainians and pro-Russian factions have been going at it, and I am not sure this deal is going to “de-escalate tensions.” Even President Obama is skeptical. He said that the U.S. has to be ready to “respond to what continue to be interference by the Russians.” The military option is off the table according to the White House. So, that leaves sanctions that nobody wants, especially in the EU. Massive amounts of business are done between Russia and the EU. The global economy is weak at best, and in some places in Europe, you can call it a depression. Meanwhile, Russian President Vladimir Putin says he has, “the right to use military force in Ukraine.” Russia is going to end up with much of Ukraine, and I do not think there is much anyone is going to do about it.
I don’t think the Russians are worried about sanctions over the Ukraine. I think they and many other countries are trying to halt the use of the U.S. dollar as fast as they can. The latest evidence of that is news of the BRICS making great strides in developing alternatives to the International Monetary Fund and the World Bank. There is no doubt that the use of the dollar is being used less and less to settle international trade. That is the dominate trend, and I see no reversal in sight. The rest of the world is going to stop depending on the U.S. dollar, and my prediction is that will be much sooner than many can imagine. The inflation this will bring is going to be stunning as there are $16 trillion liquid dollar assets held outside the country.
The Intelligence Minister of Israel is not happy about the negotiations with Iran over curtailing its nuclear program. Yuval Steinitz said the U.S. negotiations were a “surrender” to Iran. Israel is not happy that Iran could enrich uranium for a nuclear weapon in a matter of months. This is a big indication on how the negotiations are going. Iran maintains that its nuclear program is for the peaceful production of energy, and the West does not buy it. More negotiations are happening next month.
Germany has no alternative to Russian gas
More than 70 percent of Germany’s energy supply depends on imports. Russia alone accounts for a quarter of Germany’s gas, oil and coal imports. And real alternatives are not yet in sight.
Germany faces a renewed debate on energy in the wake of the ongoing Ukraine crisis. To a large extent, the country depends on Russian oil and natural gas imports. Just recently Chancellor Angela Merkel made it clear that "all of Germany’s energy policies must be reconsidered." According to Germany’s Energy Balances Group (AGEB), imported rose to 71 percent of all sources of energy last year.
The most important energy supplier is Russia: It provides 38 percent of Germany’s natural gas imports, 35 percent of all oil imports and 25 percent of coal imports, covering a quarter of the country’s entire energy needs. There are no suitable alternatives in sight that could cover shortfalls of this magnitude.
Germany can supply only 15 percent of its gas needs using its own resources, the Association of Energy and Water Industries (BDEW) says. Most of its gas is supplied by Norway and the Netherlands. Both countries could increase their short-term shipments via pipelines, but not in the long run, because experts believe North Sea gas reserves are slowly being used up.
Ukraine disbands army unit after fiasco push into east
April 17, 2014 10:49 AM
Kiev (AFP) – Ukraine on Thursday disbanded an army unit that lost six armoured vehicles to pro-Russian militants, as Kiev’s military reeled from a disastrous attempt to oust separatists in its eastern regions.
"The 25th parachute brigade, members of which showed cowardice and gave up their weapons, will be demobilised and the guilty servicemen brought before court," acting President Oleksandr Turchynov told parliament.
Ukraine’s enfeebled army suffered a major embarrassment Wednesday as a much-hyped "anti-terrorist" operation to force pro-Moscow protesters out of a string of eastern towns descended into humiliating farce when separatists seized six armoured personnel carriers and forced another mechanised column of troops to disarm.
Ukraine’s defence ministry said in a statement Thursday that the column of armoured vehicles and soldiers blockaded a day earlier by pro-Russian activists in the town of Kramatorsk was returning to base after the tense stand-off.
The capitulation represents a serious blow to the fragile morale of Ukraine’s embattled armed forces and Kiev’s hopes of reimposing its authority over its industrial heartland.
Three points of assent for de-escalation at Ukraine talks
DEBKAfile April 17, 2014, 8:28 PM (IDT)
The statements made first by Russian Foreign Minister Sergey Lavrov, then by US Secretary of State John Kerry, highlighted the broad points of assent reached at the Geneva conference Thursday for de-escalating the Ukraine conflict. The EU and Ukraine were also present.
Agreements covered three main points: An amnesty for all protesters; their disarming and their return of all buildings, towns and squares to their “legitimate owners;” and a broad national dialogue on constitutional reform with all the regions and political constituencies taking part. The OSCE (Organization for Security and Cooperation in Europe) was entrusted with the key mission of monitoring he immediate implementation of these decisions in a concrete, transparent and answerable fashion.
Kerry called the meeting a good day’s work, but added if no progress is made, “we will have no choice but to impose further costs on Russia.” He said al sides had agreed there must be no more violence, intimidation and provocative actions.
President Barack Obama was more skeptical about the Russian follow-through in his remarks later, he said it would take a few days to determine whether the agreement was working. In the meantime, he was consulting with allies about consequences.
DEBKAfile adds: Kerry said differences between the two sides were narrowed, not overcome. Notably, neither statement by Lavrov or Kerry mentioned “federalization” – a key Moscow demand or Ukraine joining NATO, which Vladimir Putin has emphatically refused to accept; nor was any demand registered for Russia to move its troop concentrations back from the Ukrainian border.
Russia-China ties to alter global equations: Putin
April 18, 2014, 7:37 am
Russian President Vladimir Putin has said Moscow’s ties with Beijing are expected to be a considerable factor in global politics.
Russia-China ties “will significantly affect the contemporary architecture of international relations,” said the president.
“It is absolutely clear that we will be expanding collaboration with China. Our trade with the United States is 27.5 [billion], but trade with China is 87 billion, and it is growing. And experts will agree that China is gradually becoming the number one economic power. The question is when it will happen: in 15, 20 or 25 years. But everybody understands that it is inevitable,” asserted Putin.
“We’ll develop relations with China. We’ve never had such trusted relations,” Putin said.
Putin Hopes Italian EU Presidency Will Boost Russia-Europe Ties
MOSCOW, April 17 (RIA Novosti) – Russian President Vladimir Putin expressed hope Thursday that Italy’s upcoming position as the rotating head of the European Union will help spur cooperation between Russia and Europe.
Italy, which has recently seen a new leadership come to power, will hold the EU presidency from July until December.
“We note that despite the cabinet change and the internal political processes, which is natural for any modern civilized country, Italy has retained warm and comradely attitudes toward Russia,” Putin told reporters after a televised question and answer session with the Russian public.
“We have high hopes that Italy will give a new impetus to the development of relations between Russia and the European Union,” Putin said.
“Italy is one of Russia’s closest partners in Europe. The two countries are enjoying intensive cooperation in almost all spheres and share common views on many international political issues,” the Russian Foreign Ministry said in a statement.
Italy is Russia’s fourth largest trading partner and investment between the two countries is continually advancing. In recent years, Russian investments in Italy have grown to $500 million. Italian investments in Russia are estimated at around $1 billion.