Friday, January 09, 2009
Sources: Iran Orders Hezbollah to Ready Rockets
Foreign Confidential....
Intelligence sources say Iran has ordered its Lebanese proxy, Hezbollah, to launch a massive missile attack on Israel if Hamas finds itself on the verge of strategic defeat in Gaza. The Hezbollah assault would initially target northern Israel, including Haifa; but Tel Aviv could also be hit.
Iran is playing for time, sources say. The Islamist regime is rushing to complete a major nuclear breakthrough next month, and the fighting in Gaza is actually helping by focusing world attention elsewhere.Rich, Stealthy Survivalists Rushing to Rural Areas
Dateline USA....
The evidence is anecdotal and the numbers are apparently still too small to signify a trend, but a growing number of rich survivalists are buying or building second or third homes in rural yet reasonably accessible areas for the purpose of setting up crisis-proof family compounds. The owners are retrofitting or incorporating off-the-grid solutions for emergency electrical power and vehicular fuel, including redundant propane, gasoline and diesel tanks and generators.
Redundant water wells and septic systems are also being drilled and installed.
Geothermal, passive solar, micro-hydropower, and wood-fired systems are extremely popular, along with pre-electronic ignition cars and trucks. Late 1980s GM and Ford pickup trucks and Blazer-style, four-wheel-drive SUVs are also being acquired, along with older dirt bikes and motorcycles.
Rifles and shotguns and plenty of ammunition and at least six months of non-perishable food supplies are obligatory items.
The survivalist rush is spurred by fears of a Katrina-like disaster--a solar space storm that could knock out the nation's electricity, cell phones and water supply--and a nuclear attack by terrorists or a rogue state such as Iran or North Korea.China Losing Appetite for US Debt
China owns $653 billion of Treasuries, and indications are that it’s losing its appetite for U.S. debt. Expect Asia’s second-biggest economy to cut the share of dollars in its $1.9 trillion of reserves, and perhaps sharply.
The U.S. is, after all, acting at the expense of its best customer. Just as shareholders abhor companies diluting their stock with new offerings, China’s debt managers can’t be happy with the Treasury’s plans.
Along with its Faustian bargain, one wonders if China risks a Madoffian one, too.
No, the Treasury isn’t engaged in a massive fraud of the kind allegedly perpetrated by financier Bernard Madoff. Yet the U.S.’s $5.3 trillion government debt arena is looking more like a Ponzi scheme than a market.
Madoff’s Scheme
Madoff personifies the greed, lack of transparency and lost trust that has accompanied the U.S.’s fall from grace. Even though skeptics raised concerns about the veracity of Madoff’s performance over the years, regulators failed to act. They believed Madoff’s assertions and figures.
The reason credit-rating companies aren’t swarming around and threatening to downgrade the U.S. is trust. It’s a deep belief that the issuer of the reserve currency and one without foreign-currency debt will always make its payments. That doesn’t mean critics who say the market has become the world’s biggest pyramid scheme are wrong.
Holding the whole thing together is the idea that there will always be fresh money flowing in to save investors already there. A pyramid-scheme dynamic is very much at play. Treasury holders won’t lose everything the way Madoff’s investors might. Yet China will suffer when foreigners sell Treasuries and yields surge.
Sucker’s Bet
The question is how aggressively China will shield itself from what increasingly looks like a sucker’s bet. Economists at Deutsche Bank AG in Frankfurt, for example, estimate China will trim the share of dollars to about 45 percent this year from more than 70 percent in 2003.
Of course, having entered into this arrangement, China is hard-pressed to get out of it. Its economy is largely about selling manufactured goods overseas.
Click here to read the entire essay.
Saturday, 10 January 2009
WIlliam Pesek's commentary--comparing the U.S. government to alleged swindler Bernie Madoff--is must reading for the weekend. Pesek writes:
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