Thursday, December 18, 2008
China Air, Mail Links to Taiwan Begin
When China offered 30 years ago to set up transport links with Taiwan, the island’s government said no. But as China’s economy grew, Taiwan wavered. On December 15th ships, aircraft and mail at last began routine daily crossings directly across the Taiwan Strait. A jubilant Chinese official declared it “the final part of our economic circle with Taiwan.”
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Gold Slips in Japan
Gold declined in Japan Friday, extending losses the previous day as the dollar gained ground against other major currencies after a sell-off on the U.S. interest rate cut.
The dollar extended gains versus the yen in early Asian hours, underpinned by expectations that the Bank of Japan (BOJ) will lower interest rates later in the day.
Spot gold stood at $847.25 an ounce as of 0033 GMT (7:33 p.m. EST Thursday), down 0.6 percent from New York's notional close of $852.15. Gold earlier this week rallied to $881.20, a two-month high.Olmert: Peace with Syria is Possible
Foreign Confidential....
Outgoing Israeli Prime Minister Ehud Olmert said Thursday evening that it was possible to negotiate a peace deal between Israel and Syria, days ahead of his visit to mediator Turkey to advance the indirect peace talks.
"A peace treaty between Israel and Syria is feasible," said Olmert at a conference of the Institute for National Security Studies at Tel Aviv University.
Syria does not necessarily want to be part of the axis of evil," he said. "Syria wants to reconnect with the West and the United States. Removing Syria from the axis of evil is an Israeli interest."
An Israeli-Syrian peace deal will bring "substantial advantages" to the Jewish state, said the prime minister.
"A peace treaty would lower the possibility of war, break the strategic ties between Damascus and Tehran, lead to the expulsion of the Islamic Jihad and Hamas headquarters from Syria and would stop the cash flow to Hezbollah," said Olmert.
The prime minister stressed that though he could not guarantee success of a peace process with Syria, it was important to try.
"How will we know if we don't try? How can we try if we are not prepared to take any risks?" he asked.
- XinhuaIsraeli Official Appeals to Russia Regarding Iran
Foreign Confidential....
A senior Israeli defense official visited Moscow in an attempt to dissuade Russia from selling missile defense systems to Iran.
Amos Gilad, the head of the defense ministry's Security-Diplomatic Bureau, traveled to the Russian capital Wednesday to explain Israel's opposition to the deal.
At the same time, Israeli defense officials continued to waver on the sale of a batch of unmanned aerial drones to Russia, which has been unsuccessful at creating its own pilotless drone program. The purchase would be Moscow's first ever from Israel.
Drones as Leverage
Some evidence suggests that Israel may be holding out on the drones as leverage to keep the S-300 missile systems from going to Iran, according to a report in the state-run RIA-Novosti news agency.
"We are working on this issue," said Gen. Nikolai Makarov, the head of Russia's armed forces, according to the Interfax news agency. "We are considering a test batch of Israeli drones."
Israel is concerned that the S-300 missile system could be sold to Syria or Iran and hinder any first strike capability.
In an unrelated deal, Russia said this week it would include 10 MiG-29 fighter jets to Lebanon as part of a military aid package. The used Russian planes will be overhauled, restored and handed over to the Lebanese government.
- JTANetanyahu Urges World Action on Iran
Amey Keaten reports from Paris:Benjamin Netanyahu, who hopes to become Israel's next prime minister, warned Thursday that "a terribly dangerous threshold will be crossed" if Iran obtains nuclear weapons, and urged world leaders to make sure it does not happen.
After a meeting with French President Nicolas Sarkozy, the hardline front-runner in next year's Israeli elections laid out his plans for Mideast peace and called Iran the "greatest historical challenge" the world faces.
"We have never had a situation in the history of the world in which a radical regime with a retrograde ideology and apparently known ambitions on the use of force will get access to the weapons of mass death," Netanyahu told reporters, referring to the prospect of an Iranian nuclear bomb.
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China Confidential analysts say Islamist Iran is rapidly approaching nuclear bomb-making capability. The monstrous mullahocracy is likely to announce a major breakthrough in February to commemorate the 30th anniversary of the Islamic revolution, analysts say.Good News for Humanity: Oil Price Falls
Good news for humanity, bad news for petro-tyrants and terrorists ... and Al Gore and other global warming zealots who actually want oil prices to return to crushingly high levels, even in a worsening recession.
Crude is falling, and OPEC can't stop the slide.
Bloomberg's Mark Shenk reports:Crude oil fell below $38 a barrel for the first time since July 2004 on speculation that OPEC hasn’t trimmed production enough to bolster prices as demand drops.
Futures have tumbled 74 percent from a record $147.27 on July 11 as inventories increased and consumption declined. The Organization of Petroleum Exporting Countries agreed to cut output by 2.46 million barrels to 24.845 million barrels a day at a meeting yesterday in Oran, Algeria.
“Even though OPEC announced a substantial cut yesterday, the market doesn’t seem to have any confidence in their ability to manipulate the market,” said Tom Bentz, senior energy analyst at BNP Paribas in New York. “Even if they make the promised cuts, it will be a long time before we see evidence of it here.”
Crude oil for January delivery fell $2.14, or 5.3 percent, to $37.92 a barrel at 10:07 a.m. on the New York Mercantile Exchange. Futures touched $37.71, the lowest since July 1, 2004.
JPMorgan Chase & Co., the largest U.S. bank by assets, reduced its 2009 average oil price forecast to $43 a barrel from $69 as a global economic slowdown causes a contraction in demand. The prospect of oil falling to $25 is “hard to dismiss amid a serious deterioration of economic conditions and building stocks,” the bank said in a report released yesterday.
Click here to continue.Gold's Universal Allure
Dateline USA....
Imagine a recently arrived, covert, mole-like visitor from another planet who spent the last few months glued to American TV--specifically, CNBC. The alien could easily have concluded that the American stock market is essentially a criminally-influenced casino where big players representing staggering sums compete in a variety of cheating-prone games--some rigged--in order to reap rewards out of reach to ordinary humans.
Taking in the news, what would the visitor do with his spaceship loaded with cash and all the money his handlers electronically created for him in secret offshore bank accounts to finance his exploration of Earth?
This reporter's guess: he would (a) buy a few well positioned concrete and alternative energy companies to benefit big-time from the coming, government-financed infrastructure and green energy booms, and (b), after setting aside a year or two of "walking around money," convert the remainder into real money--meaning gold.
Bloomberg's Nicholas Larkin reports:Gold rose for a ninth day in London, its longest winning streak in two years, as the dollar’s slide boosted the metal’s appeal as an alternative investment and physical bullion purchases increased.
The precious metal gained 15 percent in the past eight days, as the dollar lost 12 percent against the euro in the same period. Gold, heading for a second weekly gain, typically moves in the opposite direction to the U.S. currency. German business confidence dropped to a record low this month as the credit crisis pushes Europe’s largest economy deeper into a recession.
Click here to continue. While reading, keep in mind the perfect storm that is clearly forming across an ocean of mounting debt and weakening fiat currencies: an unprecedented combination of inflation and a physical shortage of gold that should send prices of the precious metal soaring to $2,000 an ounce or higher.
Declining gold production is still a largely untold story. Production is falling
in three of the top four gold producing countries. South African gold production is nearing its lowest level since 1920. Australian gold production is at a 20-year low. U.S. gold production is down for the 5th consecutive year.
UPDATE: Polya Lesova reports:Gold futures fell Thursday, reversing course after the previous session's big rally, as the U.S. dollar rebounded against most other major currencies.
Gold for February delivery fell $15.20 to stand at $853.30 an ounce on the New York Mercantile Exchange.
Earlier, the gold contract soared as high as $879.60 an ounce.
"The gold rally remains largely a dollar phenomenon, courtesy of the Fed's flooding of liquidity and target-based Fed funds policy," said Ashraf Laidi, chief market strategist at CMC Markets. "Oil and industrial metals such as copper remain pressured by weak demand story."Hu: China's Economy Must Continue to Grow
Chinese President Hu Jintao said the world’s fourth-largest economy can expand quickly enough for the nation’s 1.3 billion people to become wealthy by 2049, in a speech that highlighted the political challenge of China’s slowing growth as much as it did 30 years of market reforms.
Amid a list of achievements, Hu acknowledged the difficulties facing China, including lagging productivity and a lack of innovation, and called repeatedly throughout his remarks for greater government accountability and focus on serving the public.
Today’s celebration of China’s decision to embrace a capitalist economic system coincides with sputtering economic expansion that is a serious concern for a government whose justification for one-party rule is tied to delivering greater prosperity. The $3.3 trillion economy is 68 times larger than in 1978, when former leader Deng Xiaoping began the reforms.
“China’s growth needs the world, while the world can’t grow without China,” Hu said in a 93-minute speech to Communist Party cadres at the Great Hall of the People in the center of Beijing. “Our development model must be sustainable, our focus must be to lift the standard of living of the people, ensure social equity, stability and harmony.”
Continue here.Wednesday, December 17, 2008
Nervous Rich Rush to Gold; $2,000 Price Predicted
Foreign Confidential....
Write this down: gold will hit $2,000 an ounce by June 2010.
The rush to gold is unparalleled.
Arnd Wiegmann and Lisa Jucca report from Switzerland:Sealed off by grey concrete walls and barbed wire, the workmen in protective glasses and steel-toed boots at this smelter cannot work fast enough to meet demand from the nervous rich for gold.
This refinery near Lake Lugano in the Alps is running day and night as people worried about recession rush to switch their assets into something that may hold its value.
"I have been in the gold business for 30 years and I have never experienced anything like this," said Bernhard Schnellmann, director for precious metal services at the refiner Argor-Heraeus, one of the world's three largest.
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Friday 19 December 2008
Foreign Confidential....
Dune Lawrence reports from Beijing:
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