Replies to post #306295 on $Stock*Shop*Charts*News*Option$

[Tuff-Stuff]

Highwoods Properties (HIW): Q4 FFO of $0.60 beats by $0.01. Revenue of $114M (-1%) in-line

[Stock Lobster]

TBI: Wall Street Trader: “Pretty Much Everyone Hates Obama.”

John Carney | Jan. 27, 2010, 2:07 PM

After a year in which his administration’s policies helped produce some of the best years on record for Wall Street firms, President Barack Obama has been struggling to recast himself as an adversary of the banks.

He seems to have succeeded in taking on this role with one important group—the bankers themselves.

“Pretty much everyone hates Obama,” a senior trader at a major Wall Street firm told us.

"He's never been popular but this is a whole new level," he said.

The trader explained that the thought the Obama administration’s plans were worse than unworkable.

“It’s one thing if he proposes something we don’t like, that we disagree with. But when he puts forth this thing, none of it backed with any thoughtfulness about how things work…it really pisses people off,” he said.

The trader was referring to the so-called Volcker Rule, which would ban banks from engaging in proprietary trading or owning hedge funds. He explained that the way banks carry out proprietary trading makes the ban unworkable.

“Every single trading desk that is engaged in market making also does proprietary trading, taking a position on the market. You cannot unscramble the egg,” he said.

He also said that the ban on hedge fund investing by banks was impractical.

“No institutional investor will ever go into an alternative investment product if the bank doesn’t also have skin the in game,” he said. “The whole concept doesn’t work.”

He critiqued the rule as misdirected, arguing that the problem at banks wasn’t prop trading and the crisis didn’t originate solely in commercial banks. What’s more, he explained that he thinks it is unwise to allow Goldman or Morgan Stanley to remain outside the rules if they choose to reject the bank label and cut themselves off from access to the discount window.

“Look at Bear, Lehman. They weren’t banks. But it was their collapse that bought everything to the edge,” he said. “And now the new rules may wind up exempting Goldman and Morgan Stanley? How does that make sense?”

He expects the final version of the rules will be very “watered-down.”

“London isn’t on board with the Volcker Rule. There’s no way they are going to put us at such a competitive disadvantage,” he said.

http://www.businessinsider.com/wall-street-trader-pretty-much-everyone-hates-obama-2010-1

[Stock Lobster]

AsiaTimes: Let's atomize Wall Street

THE BEAR'S LAIR
By Martin Hutchinson
Feb 3, 2010

The proposal by former Federal Reserve chairman Paul Volcker that proprietary trading should be spun off from deposit-taking banks is a worthwhile step in the direction of stabilizing the financial services business. However, when you consider that business in detail, it becomes clear that further breakups are necessary in order to remove the excessive risks from the US economic system.

Volcker became something of a hero to the left for his sponsorship of President Barack Obama's bank-bashing announcement. Indeed, I was very much hoping that Obama could ride this new-found enthusiasm through a defeat of Ben Bernanke in his senate confirmation vote, followed by a more or less unanimous senate approval of a Volcker nomination to replace

him as Fed chairman. Assuming Volcker hadn't suffered a Damascene conversion to sloppy monetary policy while I wasn't looking, Obama and the left would be suffering buyer's remorse within about an hour of Volcker's arrival at the Fed, but by that stage the deed would be done. I was practicing my Dr Evil laugh for this eventuality, but alas it was not to be.

There are three problems with the current setup on Wall Street: systemic risk, rent seeking and conflicts of interest. The Volcker proposal addresses the systemic risk problem to a great extent, but does not do much about the other two. For a complete solution, we thus need to go further.

When then Treasury secretary Larry Summers and former senator Phil Gramm (R-Texas), among others, pushed through repeal of the Glass-Steagall Act in 1999, they didn't give proper thought to the dangers of institutions funding a traders' casino with guaranteed deposits. The introduction of Glass-Steagall in 1934 had been highly damaging to the economy because it decapitalized the investment banks, killing off the capital markets for the remainder of the 1930s and playing a major role in prolonging the Great Depression. However, by 1999, the investment banks were more than adequately capitalized (provided they followed sound principles of risk management and leverage, which of course they increasingly didn't). Thus, the rationale for allowing commercial banking and investment banking to be combined was shaky at best. It should have caused further doubt that the trigger for Glass-Steagall repeal was the acquisition of the investment bank Salomon Brothers by Citigroup, itself a quagmire of conflicts of interest that had been bailed out from bankruptcy only eight years before.

However, restoring Glass-Steagall as it was would achieve nothing. After all, the two most serious failures of risk management in the 2008 crash were collateralized debt obligations, involving a mortgage bond market in which commercial banks' securitization operations have always been active, and credit default swaps, a product in which commercial banks were intimately involved from the first.

Conventional underwriting of corporate debt and equity securities, the activity prohibited to commercial banks by Glass-Steagall, was not the problem, as it might have been had the crash occurred with the bursting of the 1999 dot-com bubble. The principal risks involved in finance today are those incurred by traders, but those proliferate in both types of banking.

It's not clear how Volcker's ban on proprietary trading in banks benefiting from deposit insurance would work. Every bank foreign exchange desk and money desk trades on the bank's own account in almost every transaction it makes (relatively few transactions are pure brokerage between two counterparties.) Thus, however simple the bank's operations, it cannot avoid "proprietary trading". Of course you can ban separate "prop trading" desks, but, in a naughty world, that would drive the proprietary traders to integrate themselves into the operations of the various products concerned, thus negating the effect of the legislation.

The other problem with the Volcker proposal is that even without separate proprietary trading operations, the banks are undertaking risks which they don't manage properly. Wall Street risk management systems are based on assumptions of Gaussian randomness in markets that are demonstrably far from realistic. In particular, Wall Street risk management systems understate the risk of several highly risky products such as collateralized debt obligations and credit default swaps. This understatement is in the interest of bank management, which benefits from state bailouts when it all goes wrong. It is even more in the interest of traders, who by and large make the most money from trading the riskiest instruments, and hence welcome artificially large position limits for those instruments.

Since current Wall Street risk management methods are in the interest of those who work on Wall Street, they will not be changed except by regulatory means. Before their alteration, they will, even without proprietary trading, leave the Wall Street behemoths in continual danger of explosion.

Rent-seeking is another current problem of Wall Street not addressed by Volcker. This takes many forms, and has resulted from computerization and from the endless proliferation of derivative instruments. Basically, Wall Street houses, by their substantial market share in trading businesses, acquire insider information about money flows, then profit by trading on this information. Traders have always done this, of course, and there is no sensible way of making it illegal. In addition, genuine "crony capitalism" insider information about future finances and future government actions is as available as it always has been, but with larger trading volumes and fewer inhibitions it is more usable without technically contravening insider treading legislation.

Thus insider trading, almost all of it technically legal, has acquired an enormously magnified profit potential. This is the principal reason for Wall Street's greater share of the economy; the genuine value added to third parties from "hedging" or liquidity" is only a tiny fraction of the rents Wall Street can extract from these markets.

There is no complete solution to this problem, but the best palliative is a "Tobin tax", a modest ad valorem transaction tax on each trade. By this means, the profitability of "high speed trading" would be eliminated and many of the other insider trading strategies would be reduced in scope and profitability, particularly if the tax were levied on the nominal principal amount of a derivative and not on its theoretical value. This would in turn swing the power base within Wall Street away from traders and back towards bankers and corporate financiers, whose approach to life is more conducive to maximizing those houses' genuine economic value added.

The final problem in the Wall Street behemoths, that of conflicts of interest, requires no legislative solution, at least as far as the corporate customers are concerned, but only that the financing business remain adequately competitive. With behemoths doing corporate financing transactions, any of their customers is faced with huge conflicts in dealing with them. If a company provides them with sensitive corporate data, it may be subjected to a leveraged buyout. If a company entrusts them with a new financing, it may find their trading operation shorting it, either directly or indirectly. (Those mortgage originators and investors still in business, for example, can reasonably feel miffed with Goldman Sachs making a profit from shorting subprime mortgage bonds through the CDS market while it was at the same time issuing and selling new ones).

Wall Street pretends to operate internal "Chinese walls" through which sensitive information does not penetrate, but to rely on those is to put yourself entirely under the protection of Wall Street's ethical integrity, a security currently trading at a very substantial discount.

The solution to these conflicts of interest is "single capacity", the system under which the City of London acted until the passage of the Financial Services Act of 1986, surely among the most misguided pieces of legislation in human history. Under this system brokers, who sold securities, were kept separate from jobbers, who made markets in them. Both were separate from merchant bankers who arranged financings and carried out mergers and acquisition transactions.

When an underwriting took place, the merchant bank arranged the transaction and the brokers sold the underwriting to insurance companies and other large investment institutions, who earned additional income by backstopping deals in this way. "Proprietary trading" was undertaken by investment trusts, pools of money whose business was to maximize income for their investors, in a similar way to a US hedge fund. As for banking, that was done by the merchant banks if complicated, but the high volume simple transactions were carried out by the clearing banks, home of the nation's retail deposits but not known for their intellectual heavy lifting.

It worked beautifully, just as well as the modern system, indeed better. It cost far less, in terms of the wealth it extracted from the economy. It was much less risky. And there were few conflicts of interest; each participant in the business, having only one function and capability, was devoted to its own interest rather than torn between the interests of several participants in every transaction.

This system is to some extent returning anyway, with the increasing market share of "boutique" investment banks such as Greenhill & Co and Evercore Partners, which at least have fewer conflicts of interest than the behemoths. However, a regulatory "nudge" or two would be no bad thing.

As I said, Volcker had a good idea, but he did not go nearly far enough.

Martin Hutchinson is the author of Great Conservatives (Academica Press, 2005) - details can be found at www.greatconservatives.com.

http://www.atimes.com/atimes/Global_Economy/LB03Dj01.html

[Stock Lobster]

ZH: Surprise! The Dollar Is Rallying... Or Is It?

Submitted by Tyler Durden on 02/10/2010 12:38 -0500


Submitted by Yves Lamoureux of Macquarie Private Wealth

If you have been wondering what is the real reason for the recent upswing in the US dollar, read on. I am very bullish on its future rise. This report follows our early December comments, which were appropriately called “The carry trade now in trouble.” You can review them at http://www.zerohedge.com/article/guest-post-carry-trade-now-trouble.

Very clearly, we stated, “The carry trade as a barometer of things to come will show the unwind at the early stage. From my perspective it is here and now that the carry trade ends.”

My recent enthusiasm is largely based on evidence gathered since 2007 of the loss of velocity in money aggregates. In other words, the money base is contracting or slowing down its expansion phase.



Like anything that matters in the investing world: rarity defines value. It would then be no surprise that the US dollar will appreciate in the medium term. This is what I call the “now mechanics.” Recent movements are still mostly defined as stocks versus bonds and anything else here has been a sideshow. I am still bullish on a number of things—namely, the hard assets category. I do think that timing is critical to temper this bullishness and money contraction will become the overriding factor.

Even when broad-based equity markets rally, I find astonishing that money is not able to gain traction. The focus on M1 is ultimately wrong, since it is not transmitted to other parts of the economy.

However, it should not be underappreciated that falling stocks will have huge repercussions on the money base and will only exacerbate ongoing volatility. The period 1930 to 1940 was a great example of how the dynamics of money velocity impact stocks and the economy.

We are great students of past eras as they provide guidance and insight into present markets.

People focus too much on the day-to-day news as it reveals very little of the markets’ often superb anticipation skills. Contracting money, to us, is now the prime driver of the greenback’s rise and its ascension could definitely surprise us .

Yves Lamoureux, Investment Advisor, Macquarie Private Wealth Inc.

http://www.zerohedge.com/article/guest-post-surprise-dollar-rallying-or-it

COMMENTS:

by 10044
on Wed, 02/10/2010 - 12:59
#225136

Money base is contracting?? WTF?? Has this guy ever seen the [no longer] published M3?
The dollar is up because the fed is buying , that's it

reply
by Anonymous
on Wed, 02/10/2010 - 13:20
#225182

All the estimates for M3 (Shadow Stats, etc) show that it has also decreased in the past year. The dollar is up on some fear and reverse of the carry trade.

reply
by butchee
on Wed, 02/10/2010 - 13:41
#225227

John Williams at SGS reports the M3 is contracting and accelerating in its contraction to 5.2% in Jan.

reply
by butchee
on Wed, 02/10/2010 - 13:42
#225228

John Williams at SGS reports the M3 is contracting and accelerating in its contraction to 5.2% in Jan.


reply
by Anonymous
on Wed, 02/10/2010 - 13:43
#225232

M3, currently dropping like a stone:

http://www.nowandfutures.com/images/m3b_long_term.png

reply
by CONners
on Wed, 02/10/2010 - 13:03
#225148

The banks are not lending. Velocity goes to zero. The credit crunch continues.

reply
by aswipe
on Wed, 02/10/2010 - 13:04
#225150

+1 10044 We are the lesser of currency evils.


by Anonymous
on Wed, 02/10/2010 - 13:15
#225175

You all don't get it!!!

All currencies are gone and not just the Euro or the Dollar..

One of this days we are going to wape-up with an huge headache and discover that all savings are gone...all pensions benefits are gone etc...

At that time you would have Mr. Volcker coming like a Terminator and saying: Let's default on everyhing as this is unsustainable

Never forget that the end of Bretton Woods was done just to leverage the debt portion of every country but who benefited the most was the US.

Now you have no way out of this as until you have 3B Chinese, Indians and Africans working for $200 per month without any social security, the problems are likely to compound.

My take is that not only currencies are already gone accross the board but that free trade is also gone

by Anonymous
on Wed, 02/10/2010 - 14:33
#225333

I ran this chart and superimposed the dxy, there is no relation here, in fact if anything there is a more positive correlation than negative. Run the facts yourself before listening to anyone.


by Anonymous
on Wed, 02/10/2010 - 14:58
#225374

A stronger USD due to global "margin" calls does not affect any of the US gov accounts/outlays, especially if zirp is maintained.

I too was trained in old style accounting....one must get over it. Flows are the only metric, collateral be damned.

Flows are needed ONLY to extract FEES. Bonus time ensues if one can grab collateral for no cost.

Stop the flows and the fees stop. Simple, really, for those not needing another dime. Trouble is, too much of the investing world needs another dime.

40muleteam borax


by Instant Karma
on Wed, 02/10/2010 - 15:45
#225505

I went long USO for Iran's "stunning" surprise tomorrow. Also balances off my smallish short positions in silver and gold.


by Mr Lennon Hendrix
on Wed, 02/10/2010 - 18:26
#225771

(B)arry (S)anders is running things...juke moves! All this talk, juke moves. Ben is looking over his "What to do once re-elected" checklist....

1) Helicopter. Check.

b) Updated "Turbo Deluxe Printing Press". Check.

4) Big tittied hoes. Check.

g) PPT (He looks over his shoulder. His team gives him a thumbs up). Check.

4) Black cape and wizard's cap. Check.

5) Picture of Sarah Palin in running shorts. Check.

7) Picture of Palin naked (a la Dulles' body scanners). Check.

J) Get out of jail free card, signed "From your bestess buddy, W." Check.

13) 6 big phattie spliffs, and a celebration cigar. Check and check.


by Anonymous
on Wed, 02/10/2010 - 19:08
#225863

Money supply is vaporizing. The past few days have been HUGE for gold in relative terms. Nominal values are deceptive. Pay attention to stocks not flows. Dow 1000? Were headed there until the UST cries uncle and then it's Dow back to 5000 along with gold 5000. If not Dow 10k and gold 10k

[Stock Lobster]

ZH: Coming To America: The Greek Sovereign Debt Crisis

Submitted by Tyler Durden on 02/10/2010 19:14 -0500

Yesterday we presented our views on why Europe's decision to tip over the first of the bailout dominoes will be inherently a catastrophic one in the long term, and will ultimately transfer the peripheral liquidity risk into funding, and ultimately, solvency (and once again, liquidity) risk to the very core. Today, Niall Ferguson joins in, in this latest Op-Ed in the Financial Times. "It began in Athens. It is spreading to Lisbon and Madrid. But it would be a grave mistake to assume that the sovereign debt crisis that is unfolding will remain confined to the weaker eurozone economies. For this is more than just a Mediterranean problem with a farmyard acronym. It is a fiscal crisis of the western world. Its ramifications are far more profound than most investors currently appreciate." In other words, Marc Faber 1, CNBC talking heads, 0... as usual.

Ferguson lists the current dead ends presented before the EU:

There is of course a distinctive feature to the eurozone crisis. Because of the way the European Monetary Union was designed, there is in fact no mechanism for a bail-out of the Greek government by the European Union, other member states or the European Central Bank (articles 123 and 125 of the Lisbon treaty). True, Article 122 may be invoked by the European Council to assist a member state that is “seriously threatened with severe difficulties caused by natural disasters or exceptional occurrences beyond its control”, but at this point nobody wants to pretend that Greece’s yawning deficit was an act of God. Nor is there a way for Greece to devalue its currency, as it would have done in the pre-EMU days of the drachma. There is not even a mechanism for Greece to leave the eurozone.

The options are no surprise to anyone who has followed this drama as it has unfolded over the past two months, starting with the Dubai implosion in late November (whose CDS, incidentally, is almost back to all time wides). It is certainly no surprise to anyone who, like us, has been concerned about the sovereign implosion almost a year ago.

That leaves just three possibilities: one of the most excruciating fiscal squeezes in modern European history – reducing the deficit from 13 per cent to 3 per cent of gross domestic product within just three years; outright default on all or part of the Greek government’s debt; or (most likely, as signalled by German officials on Wednesday) some kind of bail-out led by Berlin. Because none of these options is very appealing, and because any decision about Greece will have implications for Portugal, Spain and possibly others, it may take much horse-trading before one can be reached.

To be sure, Keynesianism is starting to unravel. The greatest failed experiment in economic history could only have been propped up for so long, courtesy of its core beneficiaries: the very oligarchs and financiers who transferred wealth over the ages from the working class to the "financially creative" product class (i.e., those that "packaged" and managed risk...look where they got us, but don't look how much they got paid for it).

What we in the western world are about to learn is that there is no such thing as a Keynesian free lunch. Deficits did not “save” us half so much as monetary policy – zero interest rates plus quantitative easing – did. First, the impact of government spending (the hallowed “multiplier”) has been much less than the proponents of stimulus hoped. Second, there is a good deal of “leakage” from open economies in a globalised world. Last, crucially, explosions of public debt incur bills that fall due much sooner than we expect

For the world’s biggest economy, the US, the day of reckoning still seems reassuringly remote. The worse things get in the eurozone, the more the US dollar rallies as nervous investors park their cash in the “safe haven” of American government debt. This effect may persist for some months, just as the dollar and Treasuries rallied in the depths of the banking panic in late 2008.

Yet even a casual look at the fiscal position of the federal government (not to mention the states) makes a nonsense of the phrase “safe haven”. US government debt is a safe haven the way Pearl Harbor was a safe haven in 1941.

Even according to the White House’s new budget projections, the gross federal debt in public hands will exceed 100 per cent of GDP in just two years’ time. This year, like last year, the federal deficit will be around 10 per cent of GDP. The long-run projections of the Congressional Budget Office suggest that the US will never again run a balanced budget. That’s right, never.

This is where shades or Reinhart and Rogoff emerge.

Explosions of public debt hurt economies in the following way, as numerous empirical studies have shown. By raising fears of default and/or currency depreciation ahead of actual inflation, they push up real interest rates. Higher real rates, in turn, act as drag on growth, especially when the private sector is also heavily indebted – as is the case in most western economies, not least the US.

As we approach the proverbial endgame, the biggest supporter and enactor of flawed Keynesian policy, the Fed, is fast running out of bullets. Simply without the consumer becoming once again intimiately involved with the lie, the game can not continue.

Although the US household savings rate has risen since the Great Recession began, it has not risen enough to absorb a trillion dollars of net Treasury issuance a year. Only two things have thus far stood between the US and higher bond yields: purchases of Treasuries (and mortgage-backed securities, which many sellers essentially swapped for Treasuries) by the Federal Reserve and reserve accumulation by the Chinese monetary authorities.

But now the Fed is phasing out such purchases and is expected to wind up quantitative easing. Meanwhile, the Chinese have sharply reduced their purchases of Treasuries from around 47 per cent of new issuance in 2006 to 20 per cent in 2008 to an estimated 5 per cent last year. Small wonder Morgan Stanley assumes that 10-year yields will rise from around 3.5 per cent to 5.5 per cent this year. On a gross federal debt fast approaching $1,500bn, that implies up to $300bn of extra interest payments – and you get up there pretty quickly with the average maturity of the debt now below 50 months.

The conclusion, knowing all too well that our political and financial leaders will do everything in their power, even sacrifice the population, to prevent the collapse of the system, can only be a rhetorical one.

The Obama administration’s new budget blithely assumes real GDP growth of 3.6 per cent over the next five years, with inflation averaging 1.4 per cent. But with rising real rates, growth might well be lower. Under those circumstances, interest payments could soar as a share of federal revenue – from a tenth to a fifth to a quarter.

Last week Moody’s Investors Service warned that the triple A credit rating of the US should not be taken for granted. That warning recalls Larry Summers’ killer question (posed before he returned to government): “How long can the world’s biggest borrower remain the world’s biggest power?”

On reflection, it is appropriate that the fiscal crisis of the west has begun in Greece, the birthplace of western civilization. Soon it will cross the channel to Britain. But the key question is when that crisis will reach the last bastion of western power, on the other side of the Atlantic.

America no longer has the luxury of expecting that shoving its head in the sand long enough will fix everything. Indeed, we now live in a world where whole developed countries are being bailed out. A mere 3 years ago this would have sounded ludicrous and deranged, and now it causes a flurry of buying excitement in the stock market. Unfortunately, a repeat of the days of September 2008 is fast approaching, only this time absent Marsians coming to bail out the world, we are on our own.


http://www.zerohedge.com/article/coming-america-greek-sovereign-debt-crisis

by RobotTrader
on Wed, 02/10/2010 - 19:27
#225902

Meanwhile, Riverboaters are starting to "front run" a positive resolution to this mess by buying junker stocks like this:



by RobotTrader
on Wed, 02/10/2010 - 19:36
#225925

And my buddy Rasputin throws in his 2 cents:

..............................

Youza! Denninger reveals the true extent of EU scroomage.
Rasputin - Wed, Feb 10, 2010 - 07:18 AM

In a missive found here:

http://market-ticker.org

...Karl Denninger reveals just how much debt the EU idiots have run up.

Here is an excerpt:

"Yet unlike Greece, which has a GDP of EUR $261 billion, Spain's is EUR 1.134 trillion and Italy's EUR 1.406 trillion. Portugal and Ireland's economies are smaller, but they belie big problems, with the "best" indication being the external debt to GDP ratio.

Italy's is 127% (the US is running close to 100% at present), while Greece's is 161%. Spain's, on the other hand, is 171%. Germany, for all of its vaunted "strength", runs 178% of GDP, Portugal is at 214% and Ireland is running an unbelievable 1267%.

That's right - tiny Ireland with EUR 144 billion in GDP has well north of a trillion Euros outstanding in external debt."

(Ras):And he doesn't even discuss Japan, which I understand is also over 100% debt-to-GDP.

So, it is truly "Inflate or Die" time for the world's economies.

Which one will they choose?


And by the way, all of these fiatscos the Fed is flinging go to fund Uncle Gorilla who is the:

1. Employer

2. Mortgage provider

3. Entitlement disburser

4. Buyer

5. Seller

...of first, last and ONLY resort and is able to impose his will on the entire economy, distorting markets and sectors as he sees fit.

Sheesh, just look at the hiring boom in D.C. and the continued housing bubble there for all you need to know regarding Uncle's ability to spend our way out of this little recession.

Bernanke says "any minute now...we're gonna raise rates and also hand back all that toxic trash to Wall Street".

Here's the link to his testimony:

http://federalreserve.gov/newsevents/testimony/bernanke20100210a.htm

So, if the Fed isserious, and follows through, then it's right back to "Great Disintegration I".

But as Mike Tyson used to say:

"Everybody's gotta plan, until they get hit in the face".

Let's see how tough Big Boy Bernanke is when he gets smacked with the upper-cut of McStucco prices crashing another twenty-percent because no one will touch a Fannie/Freddie MBS.

Or when he takes a right-cross on the chin from the liquidity-driven stock market dead cat bounce ending and everyone's 401(k)/IRA/mutual fund re-collapses.

Or, when he feels the pressure of Congress telling him to take a dive and implement "QuantSleaze 2.0".

Then we'll see who's woofin' and who came to fight.


LOL...


by Landrew
on Wed, 02/10/2010 - 19:36
#225927

Tyler, I do not understand your Keynes reference to all of the debt expenditures. I have never read where Keynes thought bailing out banks, ins, autos, etc. was a good thing. In fact reading his work points more towards tax cuts with a combination of work programs like the WPA. Can you point me to what you mean buy Keynes bailout spending?

reply

[Stock Lobster]

IRAN: Fiery rhetoric fuels Mideast war fears

Published: Feb. 10, 2010 at 5:34 PM

TEL AVIV, Israel, Feb. 10 (UPI) -- Tough-talking Foreign Minister Avigdor Lieberman has raised the temperature in the Middle East by warning the Damascus regime it will fall if Syria gets involved in the regional conflict that many fear is now brewing.

As the inflammatory rhetoric on both sides becomes more strident, the Iranian-backed Hezbollah militia in Lebanon has gone on alert.

Israel is positioning its new Iron Dome anti-rocket system along its northern border to counter any Hezbollah broadsides, instead of being deployed in the south to shield against Hamas rockets as planned.

The Israelis are realizing that the next war will expose their civilian population to greater risk than ever before because of the large number of rockets and missiles that will be fired by Iran, Hezbollah, Hamas and probably Syria as well.

Yet the hawkish Lieberman warned Syrian President Bashar Assad on Feb. 4: "In the next war, not only will you lose, but you and your family will lose the regime."

Prime Minister Binyamin Netanyahu's government sought to distance itself from Lieberman's provocative outburst. But to many in the Middle East his comments only emphasized the bellicose statements being voiced by Israeli leaders that war is coming.

This has been simmering since the summer of 2006, when Hezbollah and Israel fought a 34-day war triggered by a Hezbollah attack on the border.

The conflict ended with Israel failing in its avowed aim to destroy Hezbollah. Its guerrilla fighters not only fought the Israelis to a standstill but pummeled northern Israel with 4,000 rockets, eroding Israel's deterrence capability.

The bombardment was the most sustained battering the Jewish state had endured.

Israel maintains that it pulled its punches in 2006 and did not go after the nation as a whole, concentrating on Hezbollah and its infrastructure. But next time, they say, they will show no mercy.

Ever since Hezbollah joined the Beirut government a few months ago, Israel has repeatedly warned the Lebanese that if war erupts again the whole nation will be held accountable.

Tension in the region has been high because of Israeli threats to launch pre-emptive strikes against Iran, Hezbollah's patron, to knock out its nuclear facilities.

The general feeling is that if Israel does attack, despite U.S. efforts to prevent that, Tehran will retaliate by unleashing Hezbollah and Hamas against the Jewish state.

That will undoubtedly entail a more ferocious missile barrage from both groups than anything Israel has had to endure before.

Salvos of ballistic missiles from Iran are likely as well. The Israelis suspect that Syria, Iran's sole Arab ally, will have little option but to join in as well if Tehran orders it to.

The Israelis know they are vulnerable to coordinated attacks by hundreds of missiles from north and south and that their much-vaunted anti-missile shield will be able to knock out only a fraction of the incoming projectiles.

Casualties are expected to be high since the whole country would be exposed, not just the north. One estimate put potential fatalities at 8,000, mostly civilians -- an unprecedented death toll for the Jewish state.

In 2006 Hezbollah had some 12,000 Syrian and Iranian rockets. Now it's believed to have in excess of 42,000, including a large number capable of hitting Tel Aviv, Israel's largest city, and the Dimona nuclear reactor further south.

According to Jane's Defense Weekly, Syria has recently supplied Hezbollah with M-600 missiles, copies of Iran's Fateh-110 system and capable of hitting central Israel.

Even Hamas, less well equipped than Hezbollah, is now reputed to have rockets that can hit Tel Aviv's outskirts from the south.

In the event of a coordinated attack the Israeli air force, the most powerful in the region, would be overwhelmed and unable to knock out every missile launch site.

Israeli commanders have said as much publicly, which indicates that they seek to prepare the civilian population for the worst.

In January Minister without Portfolio Yossi Peled declared that another conflict with Hezbollah was "just a matter of time." He said that if war erupted, Israel would hold Syria and Lebanon alike responsible.

Soon after, Defense Minister Ehud Barak said that if Israel had to fight Syria "we will defeat them."

Syria's "undaunted and increased support for Hezbollah appears to reflect a clear strategic turn taken by Damascus," according to analyst Jonathan Spyer of the Global Research in International Affairs Center outside Tel Aviv.

http://www.upi.com/Top_News/Special/2010/02/10/Fiery-rhetoric-fuels-Mideast-war-fears/UPI-61251265841240/

[Stock Lobster]

IRAN: "Shock" Announcement Promised Tomorrow

Iranian nukes

Published: Feb. 10, 2010 at 9:27 AM
By United Press International

WASHINGTON, Feb. 10 (UPI) -- U.S. President Barack Obama threatened Tehran with "significant" sanctions regarding Iran's nuclear program.

Obama said Tuesday that Iran is on a course that would lead to the development of nuclear weapons-grade material. Iran has contended its nuclear program is for peaceful purposes; many Western countries fear that true goal is to make Tehran a nuclear weapons power.

Obama said international officials were "developing a significant regime of sanctions" because of Iran's nuclear ambitions.

Tehran has taken its own course on nuclear development, virtually ignoring existing sanctions and allegedly not being completely forthcoming with international bodies such as the International Atomic Energy Agency.

Iran this week said it would build additional nuclear material refining facilities and increase the level of refinement to 20 percent. Currently its program can refine uranium to 3.5 percent, which could be used in nuclear reactors. A nuclear weapon needs materials reined to 90 percent.

Iranian leaders promised that a "shock" announcement regarding its nuclear program would be made during ceremonies marking the Feb. 11 anniversary of the Islamic Revolution. It is unclear if the increase in refinement was that announcement or if Tehran will have additional news Thursday.

http://www.upi.com/Daily-Briefing/2010/02/10/Iranian-nukes/UPI-84691265812022/

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TRUMPET: Six Minutes to Midnight

From the March 2010 Trumpet Print Edition »

The Bulletin of Atomic Scientists says mankind has bought itself some time. By Jeremiah Jacques

The minute hand of the symbolic Doomsday Clock was moved back by one minute on January 14. The Bulletin of Atomic Scientists (bas) cited a “more hopeful state of world affairs” regarding the threat of nuclear war and global climate change. The clock is now set at six minutes to midnight.

The “Doomsday Clock,” created in 1947, is a symbolic measurement of the likelihood that mankind will begin nuclear war, with midnight representing the zero hour—global destruction. The farthest from midnight the clock has ever been was in 1991 when the Cold War era ended, and it was set at 17 minutes to midnight. The nearest to the zero hour it has ever been was in 1953 when it sat at two minutes to midnight following the announcement that the U.S. and the Soviet Union had tested thermonuclear devices within less than a year of each other.

The bas reported that the most recent change represents new optimism on the part of its panel of scientists—including 19 Nobel laureates—about the threat of nuclear war, and global cooperation on climate change.

“The main factor,” bas board member Lawrence Krauss told National Public Radio, “was that there’s been a sense that there’s been a sea change in the possibility for international cooperation regarding both nuclear weapons and climate change” (January 15).

“There are now—largely, one would have to say, as a result of the election of Barack Obama—new international talks and agreements to reduce arms,” he said.

To those keeping close watch on global developments relating to nuclear proliferation, this statement likely comes as a shock. An unbiased evaluation of global trends since the clock was last adjusted in 2007 reveals that the threat of nuclear war has only multiplied in that time.

U.S. Appeasement

A U.S. administration operating on a policy of appeasement and trust of enemies has convinced this panel of scientists that the world is a safer place because of its softening stance, but the opposite is true. The Obama administration last year slashed America’s homeland missile defense budget and abandoned plans for a missile defense system in Eastern Europe that would have served as a major deterrent to a nuclear attack on its allies. Have America’s disarmament policies really lessened the threat of nuclear war? Has its willingness to perpetually suspend judgment on Iranian designs in the name of diplomacy removed the world one inch from the danger of nuclear war? Policies of appeasement have only shown Iran, North Korea and other nations how quickly U.S. will to counter their aggressive actions is evaporating. Those policies have emboldened the rogue nations of the world.

Iran

A litany of headlines shows Iran making great strides toward nuclear armament. In December, the Times of London cited secret Iranian documents revealing that Tehran has been working on a “neutron initiator”—the trigger used to detonate a nuclear bomb. This discovery further exposed the deceit of Iran’s claims that its nuclear program is strictly for peaceful purposes. Compounding the significance of Iran’s nuclear advancements is President Mahmoud Ahmadinejad’s desire to plunge the world into a nuclear abyss for religious reasons.

North Korea

2009 saw a North Korea of unprecedented defiance. Since President Obama took office, Kim Jong Il’s nation has successfully tested a bona fide nuclear weapon and a long-range missile, withdrawn from the 1953 armistice agreement with South Korea, and announced that it will weaponize its plutonium reserves. In response to these belligerent acts, the Obama administration showered Pyongyang with concessions, including caving in to Kim’s demand for bilateral talks.

Russian Arms Reduction

High on the list of 2009’s celebrated international peace talks was July’s discussion between President Obama and Russian President Dmitry Medvedev about cutting the nuclear arsenals of their respective countries. But even a cursory look at the agreement reveals these reduction plans to be ludicrous—at least for America. Washington Post columnist Charles Krauthammer called the agreement “useless at best, detrimental at worst,” because Russia agreed to dismantle a certain quantity of its archaic offensive nuclear warheads in exchange for the U.S.’s elimination of a comparable amount of its state-of-the-art nuclear defense weaponry. In this laughable scenario, Russia loses nothing, and the U.S. loses everything.

Pakistan

Although Pakistan’s nuclear weapons haven’t yet come under direct attack by Islamists, the looming threat is increasing. Never before have Pakistan’s weapons been in so much danger of being stolen by terrorist organizations. In 2007, militants attacked nuclear weapons facilities in Punjab, Sargodha and Kamra. In 2008, they blew up gates to the Wah weapons complex, leaving 63 people dead. The U.S. government is funneling substantial funds into Pakistan’s military because the stakes are so high. So far the terrorists have been kept at bay, but the threat is growing.

Krauss was careful to point out that the January adjustment was the first time in history that the bas has moved the clock’s time by an increment as small as one minute. In explaining that the board’s optimism is reserved, he said, “If we don’t follow up on all the talk that’s been happening with action, it could go much closer to midnight. On the other hand, if all of these things that we hope are going to happen happen, it could move much further away.”

So the move was essentially based on talk—on diplomatic initiatives. But an objective analysis of our diplomatic track record shows that these efforts will prove fruitless in most situations and counterproductive in others.

However slight the adjustment, the bas’s optimism over these talks showcases man’s refusal to admit that the problems threatening us are too big for us to solve. It highlights mankind’s unwarranted confidence in itself. Six thousand years of strife-ridden history have failed to teach our experts that man does not know the way of peace. Man’s inability to effect peace should have become more evident in the last two years. But, as the danger intensifies, man’s delusion that he is able to solve his own problems has only grown stronger.

It will take Christ’s intervention to keep us from annihilating ourselves and usher in true peace (Matthew 24:22). There is no cause for optimism about mankind solving its problems, but there is every cause to be optimistic about God’s solutions to humanity’s troubles!

For more about this hope-filled future—a future in which the concept of a Doomsday Clock will be totally irrelevant—request a free copy of Herbert W. Armstrong’s inspiring booklet The Wonderful World Tomorrow—What It Will Be Like. •