Stock Market Tremors and the Financial Bubble Economy. The Failures of Monetary Policy (Source globalesearch.ca) All three major US stock indexes fell Friday, capping the largest weekly decline in US stock markets in nearly two months. The catalyst for Friday’s sell-off was a very weak series of sales figures and projections from three corporations tied to consumer spending: Amazon, the largest online retailer; Wal-Mart, the largest brick-and-mortar retailer; and Visa, the credit and debit card transaction company. More broadly, the stock market tremors reflect growing concern within the ruling class that share values, which have doubled, and in some cases tripled, since their 2009 lows, are on the verge of another historic collapse. The enormous social retrogression of American society is summed up in one statistic: one in four children in the United States live below the official poverty line, while one in five are at risk of going hungry. The 2008 collapse nearly brought down the entire world financial system and sparked a global recession, with no recovery. The Fed has lowered interest rates to essentially zero, where they have stayed for nearly six years, allowing banks access to cash for free. Through a variety of asset purchasing programs, the Fed has tripled the size of its balance sheet since 2008. This policy has been mimicked internationally, coupled with ever more brutal austerity measures directed at the working class. This game cannot go on forever. Ultimately, the valuations of financial assets must come crashing down. The consequences of the coming crash will be even more dramatic than those of the 2008 financial meltdown.
U.S. Says China Tested Anti-Satellite Missile (Source chinadigitaltimes.net) The Associated Press reports that China’s military has successfully conducted a missile test on Wednesday. Washington believes that the Chinese missile has the capacity to destroy satellites. From the Sun Herald: The U.S. says China has tested a missile designed to destroy satellites and is urging Beijing to refrain from destabilizing actions. State Department spokeswoman Marie Harf said the “non-destructive” test occurred Wednesday. She said a previous destructive test of the system in 2007 created thousands of pieces of dangerous debris in space. Harf said Friday that the continued development and testing of destructive anti-satellite systems threaten the long-term security and sustainability of the outer-space environment that all nations depend upon. According to state-run media, the latest Chinese missile test was the third such tests in the past four years. Ting Shi at Bloomberg reports that the recent success indicates advances in China’s missile-defense capabilities. China said its third anti-missile test in four years was a success, indicating progress in developing missile-defense technology.
GAZPROM READY TO DROP DOLLAR, SETTLE CHINA CONTRACTS IN YUAN OR RUBLES (Source Zero Hedge) A little over a month ago, when Russia announced the much anticipated “Holy Grail” energy deal with China, some were disappointed that despite this symbolic agreement meant to break the petrodollar’s stranglehold on the rest of the world, neither Russia nor China announced payment terms to be in anything but dollars. In doing so they admitted that while both nations are eager to move away from a US Dollar reserve currency, neither is yet able to provide an alternative. This changed rather dramatically overnight when in a little noticed statement, Gazprom’s CFO Andrey Kruglov uttered the magic words (via Bloomberg):
GAZPROM ready to settle China contracts in YUAN OR RUBLES. In other words just as the US may or may not be preparing to export crude – a step which would weaken the dollar’s reserve status as traditional US oil trading partners will need to find other import customers who pay in non-USD currencies – the world’s two other superpowers are preparing to respond. And once the bilateral trade in Rubles or Renminbi is established, the rest of the energy world will follow. Because only now does Gazprom appear to be unveiling all those “tangents” that were expected to hit the tape in May. Among Kruglov’s other revelations were that Gazprom is in talks on a Hong Kong listing and is weighing the issuance of Yuan bonds. Gazprom is also considering selling bonds in Singapore dollars, the CFO said at briefing in Moscow. Wait, you mean that by alienating and embargoing Russia from western (USD, EUR-denominated) funding markets, it has pushed the country to turn to its pivoting partner, China and thus further cementing the framework for the next Eurasian strategic alliance? It is not just Gazprom. As the PBOC announced overnight, PBOC Assistant Governor Jin Qi and Russian central bank Deputy Chairman Dmitry Skobelkin led a meeting held in Shanghai. The meeting discussed cooperating on project and trade financing using local currencies. The meeting discussed cooperation in bank card, insurance and financial supervision sectors.In other words, central bankers of China and Russia discussed how to replace the dollar with Rubles and Yuan.
Earthquake map: 42 states stand ‘reasonable chance’ of temblors (Source csmonitor.com) US Geological Survey updates its earthquake risk map, which heightens the risk for one-third of the US and lowers it for about one-tenth. Earthquakes can happen anywhere. While most Americans associate quake hazards with the West Coast, one-third of the states in the nation face a “relatively high likelihood of experiencing damaging ground shaking,” according to a new report from the US Geological Survey. The latest national seismic hazard map from the USGS lends a more nuanced view to earthquake risks across the country than ever before, thanks to new advances in sensing instruments, modeling technology, and data analysis tools, says Mark Petersen, chief of the USGS National Seismic Hazard Mapping Project.
RUSSIAN INSTITUTE FOR STRATEGIC STUDIES: NATO IS ATTEMPTING TO “REVOLUTIONIZE THE CURRENT WORLD ORDER” (Source blacklistednews.com) The tense situation between Ukraine and the United States is outlined in a paper released earlier this month by the Russian Institute for Strategic Studies (RISS). A week prior to the downing of Malaysian flight 17, the institute warned that the west “refuses to adhere to the principles and norms of international law and the rules and spirit of the existing system of international relations.” Much like the United States Army War College Strategic Studies Institute, RISS provides “…information support to the Administration of the President of the Russian Federation, the Federation Council, the State Duma and the Security Council as well as to Government offices, ministries and departments”. The paper warns that the United States and NATO are attempting to create a “new world order” out of the Ukrainian situation that will impose totalitarian global laws and regulations. The authors state that because this system will meet resistance, the threat of war needs to be maintained.
Study: America on Its Way Out (Source thetrumpet.com) New data show that the world is preparing for a new superpower. As the United States publicly retreats from the world stage, people finally seem to be catching on. A new Pew Research Center study found many nations foresee a new superpower rising in the next few years to replace America—others think it’s already happened. The Pew study, published July 14, describes the world’s perception of America. The study reveals that although the vast majority of nations condemn America’s extensive use of drones as well as the amount of intelligence gathering taking place, 65 percent of people from 44 different nations still hold a favorable view of the U.S. Despite their positive views, many don’t see the U.S. continuing as the world’s only superpower for much longer. The study found that “a median of 50 percent of those surveyed,” up from 41 percent last year, “see China eventually supplanting America as the dominant world superpower.” The belief that America will be replaced as the world’s superpower is strongest in Europe, a historic supporter of America. Sixty percent of those polled across the seven European nations surveyed thought the U.S. was on the way out or had already been replaced by China. The top four nations that thought America was about to be replaced were countries typically thought of as America’s closest European friends: Spain (67 percent), the United Kingdom (62 percent), France (61 percent) and Germany (60 percent). Conversely, only 59 percent of Chinese felt they would overtake America.
NEW WORLD DISORDER: EMERGING DIVISION BETWEEN EAST AND WEST THREATENS TO PLUNGE THE GLOBE INTO CHAOS (Source blacklistednews.com) The civil war in Ukraine and the crash of MH17 have created an enormous amount of tension between the United States and Russia, and many analysts believe that relations between the two superpowers are now even worse than they were during the end of the Cold War era. In addition, the indictment of five PLA officers for cyber espionage and sharp disagreements over China’s territorial claims in the South China Sea (among other issues) have caused U.S. relations with China to dip to their lowest point since at least 1989. So could the emerging division between the east and the west ultimately plunge us into a period of global chaos? And what would that mean for the world economy? For as long as most Americans can remember, the U.S. dollar and the U.S. financial system have been overwhelmingly dominant. But now the powers of the east appear to be determined to break this monopoly. Four of the BRICS nations (China, Russia, India and Brazil) are on the list of the top ten biggest economies on the planet, and they are starting to make moves to become much less dependent on the U.S.-centered financial system of the western world. For example, just last week the BRICS nations established two new institutions which are intended to be alternatives to the World Bank and the IMF… So in their summit, from July 14 to 16, the five BRICS announced two major initiatives aimed squarely at increasing their power in global finance. They announced the launch of the New Development Bank, headquartered in Shanghai that will offer financing for development projects in the emerging world. The bank will act as an alternative to the Washington, D.C.—based World Bank. The BRICS also formed what they’re calling a Contingent Reserve Arrangement, a series of currency agreements which can be utilized to help them smooth over financial imbalances with the rest of the world. That’s something the IMF does now. Russia has been actively pursuing a “de-dollarization strategy” for months now. Each new round of economic sanctions pushes Russia even further in the direction of independence from the U.S. dollar, and Gazprom has been working hard to get large customers to switch from paying for natural gas in dollars to paying for natural gas in euros and other currencies.
Flight MH17: ‘Europeans Have to Be the Ones to Take the Lead on This’ (Source thetrumpet.com)
A Boeing 777 operated by Malaysian Airlines flying from Amsterdam to Kuala Lumpur crashed July 17 in the Donetsk region of eastern Ukraine. All 298 people on board died. Based on the evidence currently available, it seems pro-Russia separatists shot down the plane using the Russian Buk missile system. , evidence indicates inexperienced separatist fighters, thinking the plane was a Ukrainian military transport, shot down the airliner using either a missile system Russia gave them or one they captured from the Ukrainian military. In short, Russia-backed insurgents shot down a passenger jet. So what’s next? In 1983, Russia shot down a Korean airliner after it strayed into restricted airspace. America, under then-President Ronald Reagan, delivered a firm response, using the outrage to gain support for stationing Pershing II cruise missiles in West Germany.
This time, early indications are that America won’t do much. In an interview for America’s Public Broadcasting Service (PBS), talk show host Charlie Rose asked former U.S. Secretary of State Hillary Clinton, “What does the United States do if there is a clear indication … that it was Russian separatists … perhaps using weapons from Russia?” “I think that the first question is what does Europe do,” Mrs. Clinton replied. And Mrs. Clinton is right—this crash should shake Europe. It could be a trigger for Europe to unify and build its ability to put up some serious opposition to Russia. Even if nothing much happens in the short term, it still increases Europe’s fear of Russia. “For the first time, the conflict claimed victims who are citizens of Western countries, over half of them Dutch nationals,” Lithuanian Foreign Minister Linas Linkevičius said. “So if before, the conflict was seen as a local one, it has become much broader in scale and can be a breaking point in how everyone sees the situation.” This is one of the biggest trends to watch for in the ongoing Crimean crisis. The fear you see in Europe because of events in Crimea is going to cause 10 leaders in Europe to unite in a sudden and dramatic way—and in precise accordance with the Bible’s description of that European empire!”
THE SITUATION IN EASTERN UKRAINE IS ABOUT TO BECOME MUCH MORE DANGEROUS(Source Storm Clouds Gathering) Many analysts have speculated that the Ukrainian crisis is a trap laid by the U.S. and NATO to entice Russia to invade Ukraine and thereby weaken Russia on multiple levels. Indeed, this line of reasoning seems to be influencing Putin’s decision making process, even to the point that he is resisting domestic pressure to protect the eastern Ukrainians. Again, Putin clearly doesn’t want this situation to escalate to a full out armed conflict between Ukraine and Russia, otherwise he would have responded already, however to assume that his previous decisions can be used to predict his future actions would be very foolish. Given the Ukrainian military’s bombing of residential areas in eastern Ukraine, Russia now has a credible argument for intervention if Kiev attempts to repeat this tactic in Donetsk. Though it’s unlikely that Russia would make the mistake of launching a full ground offensive, airstrikes on Ukrainian artillery positions and the imposition of a no-fly zone would be more than enough to tip the scales in the favor of the separatists. The United States would of course be tempted to respond in kind, but their options would be limited. All speculation aside, it should be clear that this situation is highly volatile, and one single event could spark a chain reaction that has unimaginable consequences.
Pope Francis: ‘About 2%’ of Catholic clergy pedophiles (Source bbc.com) Pope Francis was quoted as saying that the 2% estimate came from advisers. It would represent around 8,000 priests out of a global number of about 414,000. While the incidence of pedophile as a psychiatric disorder in the general population is not accurately known, some estimates have put it at less than five percent. “Among the 2% who are pedophiles are priests, bishops and cardinals. Others, more numerous, know but keep quiet. They punish without giving the reason,” Pope Francis was quoted as saying. Many survivors of abuse by priests are angry at what they see as the Vatican’s failure to punish senior officials who have been accused of covering up scandals.