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Jokes: Bush went in as a Social Conservative and came out as a Conservative Socialist.

There are two problems here – one is the folding banking industry around the world – and the other is that the weakened banking industry would allow – outsiders and mainly sovereign wealth funds to come in a cherry pick the banks and or industries that they want at rock bottom prices – these very powerful sovereign funds are mainly coming from three areas – the Middle East, Russia and China. Their investments at a time like this would give these areas undue influence over US and EU banking and insurance industries – but more their investments will give these countries or regions undue influence over US and possibly EU policy. With undue Middle East influence we could all be eating Halal. Western governments had to act.

To blame – of course are a number of things – but one is George Bush’s oil policy. Since the US only has 3% of the world’s oil – to fund its oil usage – it has to get oil from somewhere else. Saudi Arabia held almost all of the cards up until the war in Iraq – and the removal of Saddam Hussein – allowed the US create a major oil player in Iraq. But the cost was enormous. Yesterday 40bn barrel Iraqi oil contracts were put on sale in London. Drill Baby Drill to Big Oil. The problem is that the cost of the war could have funded the industry to build solar panels for every roof – in sunnier areas. And the new research in a whole host of energy alternatives – which would one day become fixtures – or until we develop the new technology.

If you listen to McCain – and Palin – Russia is ready to attack – but the real deal is the laying and operation of a gas pipeline through Georgia. So like Iraq – likely there will be a military build up there – against the evil Russia – to secure the oil or gas coming from there.

Under Bush’s policy vast amounts of money is being transferred to the Middle East – vast amounts of money is going into wars for oil – under “security” – Condi recently had a meeting with the Libyan leader – with the intention of vast amounts of US money flowing into Libya.

While in the US infrastructure crumbles, while the people in the Western world are at the whim of dictators – like Chavez, or Russia which clearly is putting its interests first. And in the Middle East – which showed itself when George Bush didn’t speak at the Israeli Kenesit – as the German Chancellor Angela Merkel did- because – he had to ask the Saudi’s to lower the price of oil – and as a part of that deal – he slung them some nuclear technology.

The oil game is a crazy game and it is leaving the US broke and at a disadvantage. The advantage and the money are in new generation of ET energy technology – one where for example cars are run on magnetism (magnetic motor) – and more efficient battery technologies. What would it mean to the US and EU countries – if they could get a mechanized factory – a factory of robots – to work around the clock without having to take into account the cost of energy. With this we can compete with China. There would be no need to ship jobs abroad.

The candidate with real foresight is Barack Obama. He’s thinking.

President Bush, right, smiles during the G20 ministerial meeting at the International Monetary Fund Saturday, Oct. 11, 2008 in Washington. From left, Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson, and Bush. (AP Photo/Evan Vucci) (Evan Vucci - AP)

President Bush, right, smiles during the G20 ministerial meeting at the International Monetary Fund Saturday, Oct. 11, 2008 in Washington. From left, Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson, and Bush. (AP Photo/Evan Vucci) (Evan Vucci - AP)

The U.S. government is dramatically escalating its response to the financial crisis by planning to invest $250 billion in the country’s banks, forcing nine of the largest to accept a Treasury stake in what amounts to a partial nationalization.

News that European governments also planned to take stakes in their banks and anticipation of new U.S. measures unleashed a tremendous surge in U.S. stock prices yesterday, with the Dow Jones industrial average soaring to the biggest percentage gain since the 1930s, up 11.1 percent. It ended 936.42 points higher, the largest point gain ever, just days after the Dow had its steepest weekly decline in history.

The Treasury Department’s decision to take equity stakes in banks represents a significant reversal, coming just weeks after Treasury Secretary Henry M. Paulson Jr. had opposed the idea. In a momentous meeting yesterday afternoon in Washington, Paulson, flanked by top financial regulators, told the executives of nine leading banks that they needed to participate in the program for the good of the national economy, two industry sources said on condition of anonymity because they were not authorized to speak publicly.

The government’s initiative, which was to be announced this morning before the markets open for New York trading, is part of a wider plan that goes beyond the $700 billion rescue package approved by Congress earlier this month. The Federal Deposit Insurance Corp. is also set to announce today the launch of an insurance fund to guarantee new issues of bank debt. It will provide unlimited deposit insurance for non-interest-bearing accounts, which are widely used by small businesses for payroll and other purposes.

In pressing the bank executives to accept partial government ownership, Paulson’s message was clear: Though officially the program was voluntary, the banks had little choice in the matter. In exchange for giving the Treasury minority stakes, the nine firms would jointly receive an investment worth $125 billion. The government would make another $125 billion available for the next 30 days to thousands of other banks and thrifts across the country.

Federal officials set conditions, telling the banks they could not raise their dividends without government permission and could not offer their executives new retirement packages, though the old packages would remain intact.

Paulson told them the moves would shore up confidence in their own institutions, spark lending throughout the system and send a message to smaller institutions that there is no stigma in accepting federal funding. Though some were reluctant, all of the executives complied.

There is a risk that banks will take the new government capital and use it to bolster their balance sheets but still not resume lending, and the Treasury is not getting any specific contractual guarantee to prevent that from happening. But bank regulators, particularly the Federal Reserve, will lean heavily on the firms receiving infusions to use the capital to increase their lending to businesses and consumers.

Taken together, the steps planned by the Treasury, the FDIC and the Federal Reserve amount to a monumental effort to jump-start the business of lending, which all but dried up in recent weeks as banks have lost faith in one another and their customers. Global markets began to melt down. Some emerging nations teetered on the brink of financial collapse.

Source: Washington Post

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While McCain Backs Petraeus, General Sounds Notes That Harmonize With Democratic Nominee.

Gen. David Petraeus (WDCpix)

Throughout Sen. John McCain’s presidential campaign, the Republican nominee has wrapped himself in the mantle of U.S. Army Gen. David H. Petraeus, proclaiming himself the leading advocate of the former commanding general in Iraq who devised last year’s controversial troop surge. Yet during a talk Wednesday about Iraq at the Heritage Foundation, a conservative Washington policy organization, Petraeus repeatedly made statements that bolstered the foreign-policy proposals of Sen. Barack Obama, McCain’s Democratic rival, or cut against McCain’s own lines.

Petraeus relinquished command in Iraq last month. He assumes responsibility for U.S. Central Command later this month, putting him in charge of U.S. forces in the Middle East and South Asia.

As a serving military officer, Petraeus attempted to avoid any explicit political discussion. “I’m not walking into minefields now,” Petraeus said, to laughter, when asked a question that referred to Tuesday night’s presidential debate. In fact, the general averred that he didn’t watch the debate.

Yet Petraeus, whether intentionally or not, often waded into areas of dispute between Obama and McCain involving Afghanistan, negotiating with adversaries and other recent campaign controversies. Each time, the general either lent tacit support to Obama or denied tacit support to McCain.

Unbidden, Petraeus discussed whether his strategy in Iraq — protecting the population while cleaving apart the insurgency through reconciliation efforts to crush the remaining hard-core enemies — could also work in Afghanistan. The question has particular salience as Petraeus takes over U.S. Central Command, which will put him at the helm of all U.S. troops in the Middle East and South Asia, thereby giving him a large role in the Afghanistan war.

“Some of the concepts used in Iraq are transplantable [to Afghanistan] while others perhaps are not,” he said. “Every situation is unique.”

Petraeus pointed to efforts by Hamid Karzai’s government to negotiate a deal with the Taliban that would potentially bring some Taliban members back to power, saying that if they are “willing to reconcile,” it would be “a positive step.”

In saying that, Petraeus implicitly allied with U.S. Army Gen. David McKiernan, the U.S. commander in Afghanistan. Last week, McKiernan rejected the idea of replicating the blend of counterinsurgency strategy employed in Iraq. “The word that I don’t use in Afghanistan is the word ’surge,’” McKiernan said, opting against recruiting Pashtun tribal fighters to supplement Afghan security forces against Al Qaeda and the Taliban. “There are countless other differences between Iraq and Afghanistan,” he added.

McCain, however, has argued that the Afghanistan war is ripe for a direct replication of Petraeus’ Iraq strategy of population-centric counterinsurgency. “Sen. Obama calls for more troops,” McCain said in the Sept. 26 debate, “but what he doesn’t understand, it’s got to be a new strategy, the same strategy that he condemned in Iraq. It’s going to have to be employed in Afghanistan.”

McCain qualified that statement in Tuesday’s debate, but clung to it while discussing Afghanistan and Pakistan. “Gen. Petraeus had a strategy,” McCain said, “the same strategy — very, very different, because of the conditions and the situation — but the same fundamental strategy that succeeded in Iraq. And that is to get the support of the people.”

Petraeus also came out unambiguously in his talk at Heritage for opening communications with America’s adversaries, a position McCain is attacking Obama for endorsing. Citing his Iraq experience, Petraeus said, “You have to talk to enemies.” He added that it was necessary to have a particular goal for discussion and to perform advance work to understand the motivations of his interlocutors.

All that was the subject of one of the most contentious tussles between McCain and Obama in the first presidential debate, with Obama contending that his intent to negotiate with foreign adversaries without “precondition” did not mean that he would neglect diplomatic “preparation.”

McCain, apparently perceiving an opportunity for attack, Tuesday again used Obama’s comments to attack his judgment. “Sen. Obama, without precondition, wants to sit down and negotiate with them, without preconditions,” McCain said, referring to Iran.

Yet Petraeus emphasized throughout his lecture that reaching out to insurgent groups — some “with our blood on their hands,” he said — was necessary to the ultimate goal of turning them against irreconcilable enemies like Al Qaeda in Iraq.

Petraeus favorably cited the example of one of his British deputies, who in a previous assignment had to negotiate with Martin McGuiness of the Irish Republican Army, responsible for killing some of the British commander’s troops. The British officer, Petraeus said, occasionally wanted to “reach across the table” and choke his former adversary but understood that such negotiations were key to ending a war.

Petraeus reflected at length on the need to “take away and hold the strongholds and safe havens” possessed by Al Qaeda in Iraq during 2007 and 2008, saying that without doing so, the rest of the counterinsurgency strategy “won’t work.” While he did not initially make reference to Al Qaeda’s much greater presence in the Federal Administered Tribal Areas of Pakistan, it was hard not to hear the overtones of the current argument over Pakistan policy between Obama and McCain.

McCain has attacked Obama for explicitly stating conditions under which he would order U.S. military action against the senior leadership of Al Qaeda in Pakistan, deriding that by saying Obama is “going to attack Pakistan,” while advocating that the Pakistanis perform the task instead of U.S. troops.

[..]

Source: Washington Independent

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