Henry Kissinger

Was the Real Purpose of the Iraq War to Restrict Oil ... So As to Raise Oil Prices?

Memo to the Arab World: Good news and bad news with the re-election of Barack Obama to the White House. The good news is that a victory by the Republican candidate Mitt Romney would have given Israel and its current leadership a free hand at continuing a policy of arrogance that will lead the region towards greater mayhem. On the other hand, with Obama in the Oval Office, don’t expect anything drastically different to happen in the Middle East in so far as US involvement goes. And if Obama’s acceptance speech is anything to judge by, where his only mention of anything related to foreign affairs was a reference to "freeing ourselves from foreign oil," it seems obvious that the Obama administration will want to focus on solving domestic issues. At the end of the day these are issues that matters most to the average American who would rather not have to worry about the Middle East and terrorism – that is until they come knocking at our doors as they did on September 11, 2001.

From a "Europe in pieces" to a "Europe of peace" and back?

Lately various media outlets have been swamped with stories and allegations of precious metal manipulation ranging from the arcane, to the bizarre to the outright ridiculous. At issue is not that these claims of price fraud are unfounded - they very well may be completely true - but without a notarized facsimile of an actual trade ticket signed by Brian Sack, or his replacement Simon Potter, or any of the BIS traders confirming they are indeed selling gold on behalf of the Fed, BOE, ECB, SNB or BOJ simply to keep the price of the metal down, what such constant factless accusations (and no, sorry, a chart showing that the price of gold may go up or go down sharply indicates merely that and nothing about the underlying factors for such a move) do is to habituate the broader public to the real issues surrounding precious metal, and other asset class, manipulation. So instead of searching for circumstantial evidence which one can easily find everywhere, we decided to go straight to the source. To do that we go back to a post we wrote back in September of 2009, based on an internal previously confidential Fed document, which conveniently enough explains everything vis-a-vis gold manipulation and leaves nothing to speculation or misinterpretation. Zero Hedge presents the smoking gun that may provide responses to all the various open questions regarding the Fed's Modus Operandi in the gold arena which answer the core question - motive - courtesy of a declassified memorandum, written by none other than the then Fed Chairman, and addressed to the president of the United States.

The question of whether conflict between US and China is inevitable is among the most important for the world as the US-China relationship, as JPMorgan's Michael Cembalest notes, is likely to be one of the most important issues of the 21st century. The inevitability view is sometimes explained by the thesis that countries rarely rise economically without also doing so militarily. The chart below looks at the major economic powers of the world since the year 1 at various intervals. Ignore for the moment some of the abstract issues which this kind of data involves; it’s pretty clear that China’s rise, fall and subsequent rise is something that hasn’t happened a lot over the past 2,000 years, and that the United States is on the front lines of having to adjust to it. Cembalest's recent interview with Henry Kissinger noted the impact of China's troubled relations with the West during the 19th century, which remains on China's political consciousness, and how China might define its interests in different ways than the West would, whether they relate to global energy security, North Korea, global warming, currency management or trade.

The phrase “New World Order” is so loaded with explosive assumptions and perceptions that its very usage has become a kind of journalistic landmine.  Many analysts (some in the mainstream) have attempted to write about and discuss this very real sociopolitical ideology in a plain and exploratory manner, using a fair hand and supporting data, only to be attacked, ridiculed, or completely ignored before they get a chance to put forward their work.  The reason is quite simple; much of the general public has been mentally inoculated against the very whisper of the terminology.  That is to say, they have been conditioned to exhibit a negative reaction to such discussion instinctively without even knowing why....  The Liberty Movement has always defined the NWO as a concerted effort by elitist organizations using political manipulation, economic subversion, and even war, to centralize global power into the hands of an unelected and unaccountable governing body.  The goal; to one day completely dismantle individual, state, and national sovereignty.  However, what I and many others hold as fact on the New World Order is not enough.  We must examine the original source and how we came to our mutual conclusions.      

I often wonder who is worse: George W. Bush — the man who turned a projected trillion dollar surplus into the greatest deficits in world history, who bailed out the profligate Wall Street algos and arbitrageurs, who proceeded with two needless, pointless and absurdly costly military occupations (even though he had initially campaigned on the promise of a humble foreign policy), who ignored Michael Scheuer’s warnings about al-Qaeda previous to 9/11, who signed the Constitution-trashing PATRIOT Act  (etc etc ad infinitum) or his successor Barack Obama. The answer, by the way, is Richard Nixon. Nixonianism has been the corporate aristocracy’s crowning achievement. And to some extent, this period of free lunch economics was a banquet, even for middle class Americans. The masses were kept fat and happy. But now the game is up — like Nixon’s Presidency — its days are numbered.

I recently wrote an article that addresses the subject of sociopaths and how they insinuate themselves into society. Although the subject doesn't speak directly to what stock you should buy or sell to increase your wealth, I think it's critical to success in the markets. It goes a long way towards explaining what goes on in the heads of people like Bernie Madoff and therefore how you can avoid being hurt by them. But there's a lot more to the story. At this point, it seems as if society at large has been captured by Madoff clones. If that's true, the consequences can't be good. So what I want to do here is probe a little deeper into the realm of abnormal psychology and see how it relates to economics and where the world is heading. If I'm correct in my assessment, it would imply that the prospects are dim for conventional investments – most stocks, bonds and real estate. Those things tend to do well when society is growing in prosperity. And prosperity is fostered by peace, low taxes, minimal regulation and a sound currency. It's also fostered by a cultural atmosphere where sociopaths are precluded from positions of power and intellectual and moral ideas promoting free minds and free markets rule. Unfortunately, it seems that doesn't describe the trend that the world at large and the US in particular are embarked upon. In essence, we're headed towards economic and financial bankruptcy.

The price of gold is being actively managed by central planners and their proxies. The main culprit here appears to be the US authorities, as the manipulation is most apparent in the US open gold market. For the most part, this 'management' has resulted in letting the price of gold rise, but not too much, or too quickly.  The price of gold has always been an object of interest for governments and central bankers. The reason is simple enough to understand: Gold is an objective measure of the degree to which fiat money is being managed well or managed poorly. As such, whenever paper money is being governed poorly, the price of gold becomes an important barometer. And this is why the actual price of gold is a strong candidate to be 'managed.' Or 'influenced'. Or 'manipulated'. Whichever word you prefer, they all convey the same intent. Some who are reading this are likely having an eye-rolling moment because they hold a belief that there is no conspiracy to manage the price of gold. This is an interesting belief to hold because it runs heavily against the odds. We could spend a lot of time discussing how a belief such as 'gold is not being manipulated' gets promoted and inserted into the popular consciousness, but we won't. Instead, we'll simply note that the people who hold this belief -- and you may be among them -- react to the concept at a visceral level, often with strong emotions such as anger or contempt, and even anxiety. When a strong emotional response surfaces during a conversation of ideas, it usually means that beliefs are in play -- neither facts nor logic. Experience has taught me that when someone becomes dismissive or angry or hostile when the idea of price manipulation is discussed, it's best to simply drop the conversation and move on. No combination of logic or facts is effective against a deeply-held belief. It's better to wait until some new evidence calls that belief into question, opening the door for revisiting the topic. But for those with an open mind, there is a very interesting trail of dots to connect.

Now we all get to wince once again watching Greenberg trying to get his final Fat Cat licks in.

Where does Larry Summers get off giving Americans advice on how to fix the continuing housing crisis?  And where does this political opportunist find the unmitigated gall to instruct us not to “finger point” and thereby identify culprits in Washington who helped enable the housing mess?

Although I am not as convinced as Stefan that the US government has brought about all our economic ills through deceit, I give it ample credence; but also give a good share of the blame to a citizenry at large vested with waste and greed. On my drive back, ruminating on that blame placed on the government as the mastermind and source of deceit I thought of my friend back in Portland. Was he really the victim of deceit, or did he really invite deceit by his own self-deceit? By entering into a romantic relationship two years before with a woman less than half his age with a compromising polyamorous background, one which was not much different from that which she is exhibiting, and blamed for, today!? Is it really economic, political or romantic deceit we are sometimes victims of, or is it more often than not a case of unfulfilled wishful thinking, of self-deceit?

Are they pulling a Columbo?

The euro, global equities and bonds in peripheral Eurozone countries are all lower this morning on heightened concerns about the debt crisis in the Eurozone. The euro has fallen against all currencies and is now at a record low against gold at EUR 1,080.21/oz. Silver is lower against most currencies but is higher against the Australian dollar and the euro ( EUR 24.80/oz). Greece’s 10 year government debt has surged to 16.98%, Portugal’s to 9.6% and Ireland’s to a new record at 10.76%. The yield on Italian 10-year government debt is up 9bp to 4.85% after S&P cuts its rating outlook on Italy’s sovereign debt to “negative” from “stable”. The Spanish 10 year bond has risen 11 basis points to 5.57%. Besides sovereign debt risk, gold is also being supported by geopolitical risk as seen in the increasingly unstable nuclear armed Pakistan where armed militants attempted to take over Pakistan’s naval air force headquarters. There is increasing tension between the U.S. and Pakistan after what the U.S regards as Pakistan’s failure or collusion regarding Osama Bin Laden. China has increasing economic and military ties and interests in Pakistan and has vowed to standby Pakistan and has called on the world to respect Pakistan’s sovereignty. Separately, in an interview with the Financial Times on Saturday, Henry Kissinger has warned of a world war involving Pakistan and India.

There was a time when having one’s name listed in the despised ranks of those villains that governments often categorize as “terrorists” involved quite a bit of leg work, as well as an ominous running resume of death, destruction, and general mean spiritedness. Of course, if one examines the history of every modern country which eventually disintegrated into despotism, the definition of who the “enemy” is tends to become rather broad rather quickly. That is to say, the more criminal the leadership of a country becomes, the easier it is for the average person to find himself labeled a criminal by that same leadership. Today, one does not need to blow up buildings, take hostages in political motivation, send anthrax through the mail, or even wave a gun around in a public place to be considered a terrorist threat. In fact, a man could never leave his house and still find himself under suspicion as an enemy of the state. The Department of Homeland Security has released numerous standardized guidelines to law enforcement offices across the country which are meant to make it “easier” for police and others to identify a possible terrorist. If you were to take at face value such documents as the now famous MIAC Report, the Virginia Fusion Center Report, the DHS’ “see something, say something” campaign, the Enemy Belligerents Act, the post trial statements of the Department Of Justice in the Liberty Dollar case, or the wild spewing rhetoric of establishment mouthpiece organizations like the SPLC, then you would discover that a likely terrorist is...