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Apr 3, 2011

Why Silver’s Run May be Far From Done

From Minefund31 MAR 2011
ST. LOUIS (MineFund.com) -- Many professional investors spend a lot of time and treasure tracking reversions to the mean. In its most simple formulation, it means that if, say, the gold price, is at an extreme distance from the average, then there is a high probability that the next price points will be at a less extreme distance. The good news is that silver prices have a long way to go before they risk "extreme" territory.
That's all very well, but the mean is relative to the period under consideration. In the case of commodities, it's not worth much if you are only working with a decade or so of data. So we dug out some very long-range data and adjusted it to eliminate the effects of inflation. (Link for interactive versions of the charts below).

It's not perfect by any means because the data is affected by a ton of hidden "noise" - changes in monetary systems, global power shifts, changes in global trade, technology advances, demographic changes, 'hedonic' statistics, and so on. But it's unrealistic to assume that all those variables could be adequately accounted for without introducing more and new problems. So it is best to keep it simple; a golden constant if you like.
Working with the available data, we find that silver prices have only now breached the 220 year mean. So silver bugs have a reasonable expectation that there is still room for one of those healthy speculative blow-offs that rockets prices to multi-decade highs.
To be sure, there is also bad news. Look how long silver prices languished below the mean; nearly 90 years. And before that it was a century above the mean. This is principally the result of a monetary phenomenon so silver investors need to be extremely cautious about over-interpreting the data.
We are literally in uncharted waters when it comes to silver. It has lately begun behaving like money again, yet the 2008 crash reminded everyone of silver's dependence on industrial consumption in a digital photo era.
The gold-silver ratio offers some additional comfort for silver bugs.
As the chart shows, silver has been slowly clawing its way back to the mean. Yet it has some way to go to reach the long-term average of 32.98 ounces of silver per ounce of gold, which could be accomplished with further increases in silver or a crack in gold prices.
Timing will be critical. Silver is bound to overshoot at some point and become excessively expensive relative to gold. However, the window to swap positions out of silver and and into gold will be very small if the last century is anything to go by. It's also worth buffering expectations with the reminder that silver and gold have already doubled twice since their annual average lows of 2001.
Whilst gold investors may be a little disheartened by how far bullion has soared above the mean, they should take comfort from the early signals that the Bretton-Woods era is sunsetting, and the experiment with floating currencies has gone very poorly, especially in a global economy where the senior partners are financially and fiscally distressed.
© 2011, MineFund.com > Independent Natural Resources Investment Analysis & Analytics
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Related:

New 28 Year Lows for the Gold Silver Ratio

Libya: Facts & Analysis - By Helen Shelestiuk (4/4/11)

From Futurefastforward:

By Helen Shelestiuk
Sunday, 03 April 2011 

For several weeks now the entire world community, with bated breath, has been watching the developments in Libya. What do we know for certain about Libya? In fact, nothing, at least from the official media. The media persuade us that Gaddafi is a bloodthirsty dictator. But is it rightful to call Gaddafi a dictator and, of all the Arab leaders, "punish" him and his people with a full-scale intervention? Let us look at facts.

The dismissed Russian Ambassador to Libya, Vladimir Chamov, when answering a half-question and half-statement of the interviewer whether Gaddafi had oppressed his citizens, said: "What oppression are you talking about? Libyans were lavishly granted twenty-year interest-free credits for construction of their houses, a liter of gasoline cost about 10 cents, food did not cost anything at all, and a new South Korean KIA jeep could be bought for a mere $ 7,500. That country is no more..." (1)
What are other facts and figures that we know about Libya and its leader?

Libya’s GDP per capita is $ 14,192.

For each family member the state pays a $ 1,000 yearly subsidy.

Unemployed are paid 730 $ monthly.

The salary of a hospital nurse is $ 1,000.

For every newborn $ 7,000 is paid.

Newly weds are donated $ 64,000 to buy an apartment.

To open a private business one gets a one-time financial aid of $20,000.

Large taxes and duties are prohibited.

Education and medicine are free.

Education and Internships abroad are at government expense.

There are chain stores for large families with symbolic prices for basic foodstuffs.

For the sale of products past their expiry date large fines are levied, in some cases detention by the police is foreseen.

A number of pharmacies have free dispensing.

Counterfeiting medication is considered a major crime.

No rental payments.

No payment for electricity for the population.

The sale and use of alcohol is prohibited, "prohibition" is a law.

Loans for buying a car and an apartment are given at no interest.

Real estate services are prohibited.

If an individual decides to buy a car up to 50% of the price is paid by the state, to militia guards it donates 65% of the price.

Gasoline is cheaper than water. A liter of gasoline costs $ 0.14. (2) The profits from oil sale were spent on the population welfare and rising life standards.

Gaddafi has amassed more than 143 tons of gold. He planned to introduced the dollar-free zone use a gold dinar instead of currency in settlements with other countries. (3)

In Libya, much money is spent on irrigation by the country's groundwater, the amount of which is about 100 annual runoffs of the Nile. By its scale, this water project has earned itself the name of “the Eighth Wonder of the World." It provides 5-million cubic meters of water a day across the desert, greatly increasing the irrigated area. 4,000 kilometers of pipes are buried deep into the ground to secure them from the heat. All that was needed for the project was carried out mostly by Libya herself. Nothing was bought in the First World, which has never helped developing countries to rise from a supine position, and if it does, then with the further enslavement of the receiving country. With this water project, Libya was able to start a real "green revolution", in the literal sense, that would solve a lot of problems with food in Africa. And most importantly, it would ensure stability and economic independence. At one time, Gaddafi said that Libya's water project would be "the strongest response to America, which accuses Libya of supporting terrorism." (4)

In 2010 Gaddafi made a motion to the UN General Assembly to investigate the circumstances of the US and NATO aggression against Iraq and bring to justice those guilty of mass human rights abuse. He also submitted a draft resolution on the liability of former colonial states to their former colonies for the exploitation during the colonial period, and on compensation payments thereupon. (5)

Western propaganda has been demonizing Muammar Gaddafi as pathological tyrant and implacable foe of the democratic aspirations of the Libyan people. This is not true. There exist some mechanisms of popular control and democracy in Libya: elected councils of citizens and self-governing communities (communes). All that without the Soviet-style party nomenklatura, bloated bureaucracy, but with very high standards of living and social security of its citizens. Something of a society that in a number of ways looks like communist. Is this why Libya has been demonized and attacked by the old imperialist powers?

Let me quote a passage from Sigizmund Mironin's article 'Why Is Libya Bombed': "Libya, which is believed to be Gaddafi's military dictatorship is actually the most democratic state in the world. There, in 1977, Jamahiriya was proclaimed the highest form of democracy in which the traditional institutions of government are abolished, and all power belongs to the people directly and through the people's committees and people's congresses. The state is divided into many communities which are self-guided 'mini-states within a state', with full authority in their district, including the allocation of budgetary funds. Recently Muammar Gaddafi proclaimed more democratic ideas - to distribute the budget revenues among the citizens directly and equally.... This measure according to the leader of the Libyan revolution eliminates corruption and parasitic bureaucracy." (6)

Yet anyway, there have been clashes with certain rebel groups. Why, and what are those groups? The answer, supported by some evidence (7), seems to be as follows. In Libya, there are several clans. Apparently the U.S. through its own channels pushed some of them to fight for the control of Libyan oil. Then, calling a spade a spade, there were specially coached gangs of mercenaries, some "unknown snipers" - and - bingo! you have a revolution. True, it was not easy to summon enough rebels, in fact there were few - most are very happy with the regime. That is why the Western intervention was needed to instigate real turmoil.

So what are the reasons for the inevitable 'direct' intervention? Putting aside the special reasons of Britain and France (and the former appears to play first fiddle, while the latter, alongside with other countries, to play up), let us concentrate on the United States. This is what above-mentioned S.Mironin suggests. The most important immediate reason for the aggression of the West against Libya, from the US perspective, appears to be the need to plug a hole in the U.S. state debt. As you probably know, before March 2011 Japan had been one of the major buyers of U.S. securities, especially treasury bonds, it accumulated these assets to the tune of over $ 880 billion dollars. In the circumstances where the cumulative damage from earthquakes, tsunamis and the nuclear accident at Fukushima-1 is estimated at about $ 300 billion, it was natural to assume that these 'gold' reserves will be used by Japanese for the post-disaster. However, senior U.S. officials have firmly warned the Japanese side not to discharge its treasures on the world markets. Nevertheless, the inevitable withdrawal of Japan, who was an active buyer of U.S. securities, still makes this market a "hole" to fill, that in this situation can be done only with the help of oil-producing Arab countries, Russia and China. This entails a new jump in world oil prices and, respectively, the demand for the dollar. That, apparently, is designed to be achieved through the intervention of international forces in Libya under a UN mandate.


Notes


1. Chamov, Vladimir. "Gaddafi's regime can endure 2-3 months", an interview to Moskovsky Komsomolets http://pda.mk.ru/politics/interview/2011/03/23/575076-rezhim-kaddafi-mozhet-proderzhatsya-trichetyire-mesyatsa.html

2. http://www.echosevera.ru/politics/2011/03/17/314.html

3. Sterligov, Genrich. Bombing Libya as a punishment for the attempt to introduce a gold dinar http://sterligov.livejournal.com/4389.html

4. Kholmogorov, Ye. Gaddafi: questions, answers and lessons of history http://www.imperiya.by/rusworld.html?id=9379

5. Mironin, Sigizmund. "Why is Lybia bombed?"

6. Boldyrev, Yu. Executioners, Not Warriors http://narodinteres.ru/pryamaya-sdacha-nacionalnix-interesov.html?"

7. Scott, Peter Dale. Who are the Libyan Freedom Fighters and Their Patrons? globalresearch.ca/index.php?context=va&aid=23947 



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Related:

Stephen Goodson: The Truth About Libya



Mr. Obama’s Libyan Adventure – OpEd



Rebellious Eastern Libya epicenter of Islamist extremism – Canadian document reveals - World News


America's exit from Libya ends coalition no-fly zone, military campaign
DEBKAfile Exclusive Analysis April 3, 2011, 3



Here Come "The Boots On The Ground": EU Approves "Possible" Military Operation For Libya




Libya and Obama’s Defense of the ‘Rebel Uprising’



James Petras | The People’s Voice | April 2nd, 2011

Over the past two weeks Libya has been subjected to the most brutal imperial air, sea and land assault in its modern history. Thousands of bombs and missiles, launched from American and European submarines, warships and fighter planes, are destroying Libyan military bases, airports, roads, ports, oil depots, artillery emplacements, tanks, armored carriers, planes and troop concentrations. Dozens of CIA and SAS special forces have been training, advising and mapping targets for the so-called Libyan ‘rebels’ engaged in a civil war against the Gaddafi government, its armed forces, popular militias and civilian supporters (NY Times 3/30/11).


Despite this massive military support and their imperial ‘allies’ total control of Libya’s sky and coastline, the ‘rebels’ have proven incapable of mobilizing village or town support and are in retreat after being confronted by the Libyan government’s highly motivated troops and village militias (Al Jazeera 3/30/11).


One of the most flimsy excuses for this inglorious rebel retreat offered by the Cameron-Obama-Sarkozy ‘coalition’, echoed by the mass media, is that their Libyan ‘clients’ are “outgunned” (Financial Times, 3/29/11). Obviously Obama and company don’t count the scores of jets, dozens of warships and submarines, the hundreds of daily attacks and the thousands of bombs dropped on the Libyan government since the start of Western imperial intervention. Direct military intervention of 20 major and minor foreign military powers, savaging the sovereign Libyan state, as well as scores of political accomplices in the United Nations do not contribute to any military advantage for the imperial clients – according to the daily pro-rebel propaganda. The Los Angeles Times (March 31, 2011), however described how “…many rebels in gun-mounted trucks turned and fled…even though their heavy machine guns and antiaircraft guns seemed a match for any similar government vehicle.” Indeed, no ‘rebel’ force in recent history has received such sustained military support from so many imperial powers in their confrontation with an established regime. Nevertheless, the ‘rebel’ forces on the front lines are in full retreat, fleeing in disarray and thoroughly disgusted with their ‘rebel’ generals and ministers back in Benghazi. Meanwhile the ‘rebel’ leaders, in elegant suits and tailored uniforms, answer the ‘call to battle’ by attending ‘summits’ in London where ‘liberation strategy’ consists of their appeal before the mass media for imperial ground troops (The Independent (London) (3/31/11).


Morale among the frontline ‘rebels’ is low: According to credible reports from the battlefront at Ajdabiya, “Rebels …complained that their erstwhile commanders were nowhere to be found. They griped about comrades who fled to the relative safety of Benghazi… (they complained that) forces in Benghazi monopolized 400 donated field radios and 400 more…satellite phones intended for the battlefield… (mostly) rebels say commanders rarely visit the battlefield and exercise little authority because many fighters do not trust them”(Los Angeles Times, 3/31/2011). Apparently ‘Twitters’ don’t work on the battlefield.


The decisive issues in a the civil war are not weapons, training or leadership, although certainly these factors are important: The basic difference between the military capability of the pro-government Libyan forces and the Libyan ‘rebels’, backed by both Western imperialists and ‘progressives,’ lies in their motivation, values and material advances. Western imperialist intervention has heightened national consciousness among the Libyan people, who now view their confrontation with the anti-Gaddafi ‘rebels’ as a fight to defend their homeland from foreign air and sea power and puppet land troops – a powerful incentive for any people or army. The opposite is true for the ‘rebels’, whose leaders have surrendered their national identity and depend entirely on imperialist military intervention to put them in power. What rank and file ‘rebel’ fighters are going to risk their lives, fighting their own compatriots, just to place their country under an imperialist or neo-colonial rule?


Finally Western journalists’ accounts are coming to light of village and town pro-government militias repelling these ‘rebels’ and even how “a busload of (Libyan) women suddenly emerged (from one village)…and began cheering as though they supported the rebels…” drawing the Western-backed rebels into a deadly ambush set by their pro-government husbands and neighbors (Globe and Mail (Canada)3/28/11 and McClatchy News Service, 3/29/11).
The ‘rebels’, who enter their villages, are seen as invaders, breaking doors, blowing up homes and arresting and accusing local leaders of being ‘fifth columnists’ for Gaddafi. The threat of military ‘rebel’ occupation, the arrest and abuse of local authorities and the disruption of highly valued family, clan and local community relations have motivated local Libyan militias and fighters to attack the Western-backed ‘rebels’. The ‘rebels’ are regarded as ‘outsiders’ in terms of regional and clan allegiances; by trampling on local mores, the ‘rebels’ now find themselves in ‘hostile’ territory. What ‘rebel’ fighter would be willing to die defending hostile terrain? Such ‘rebels’ have only to call on foreign air-power to ‘liberate’ the pro-government village for them.


The Western media, unable to grasp these material advances by the pro-government forces, attribute popular backing of Gaddafi to ‘coercion’ or ‘co-optation’, relying on ‘rebel’ claims that ‘everybody is secretly opposed to the regime’. There is another material reality, which is conveniently ignored: The Gaddafi regime has effectively used the country’s oil wealth to build a vast network of public schools, hospitals and clinics. Libyans have the highest per capita income in Africa at $14,900 per annum (Financial Times, 4/2/11. Tens of thousands of low-income Libyan students have received scholarships to study at home and overseas. The urban infrastructure has been modernized, agriculture is subsidized and small-scale producers and manufacturers receive government credit. Gaddafi has overseen these effective programs, in addition to enriching his own clan/family. On the other hand, the Libyan rebels and their imperial mentors have targeted the entire civilian economy, bombed Libyan cities, cut trade and commercial networks, blocked the delivery of subsidized food and welfare to the poor, caused the suspension of schools and forced hundreds of thousands of foreign professionals, teachers, doctors and skilled contract workers to flee.


Libyans, who might otherwise resent Gaddafi’s long autocratic tenure in office, are now faced with the choice between supporting an advanced, functioning welfare state or a foreign-directed military conquest. Many have chosen, quite rationally, to stand with the regime.


The debacle of the imperial-backed ‘rebel’ forces, despite their immense technical-military advantage, is due to the quisling leadership, their role as ‘internal colonialists’ invading local communities and above all their wanton destruction of a social-welfare system which has benefited millions of ordinary Libyans for two generations. The failure of the ‘rebels’ to advance, despite the massive support of imperial air and sea power, means that the US-France-Britain ‘coalition’ will have to escalate its intervention beyond sending special forces, advisers and CIA assassination teams. Given Obama-Clinton’s stated objective of ‘regime change’, there will be no choice but to introduce imperialist troops, send large-scale shipments of armored carriers and tanks, and increase the use of the highly destructive depleted uranium munitions.


No doubt Obama, the most public face of ‘humanitarian armed intervention’ in Africa, will recite bigger and more grotesque lies, as Libyan villagers and townspeople fall victims to his imperial juggernaut. Washington’s ‘first black Chief Executive’ will earn history’s infamy as the US President responsible for the slaughter of hundreds of black Libyans and mass expulsion of millions of sub-Saharan African workers employed under the current regime (Globe and Mail 3/28/11).


No doubt, Anglo-American progressives and leftists will continue to debate (in ‘civilized tones’) the pros and cons of this ‘intervention’, following in the footsteps of their predecessors, the French Socialists and US New Dealers from the 1930’s, who once debated the pros and cons of supporting Republican Spain… While Hitler and Mussolini bombed the republic on behalf of the ‘rebel’ fascist forces under General Franco who upheld the Falangist banner of ‘Family, Church and Civilization’ – a fascist prototype for Obama’s ‘humanitarian intervention’ on behalf of his ‘rebels’.


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James Petras is the author of over 62 books published in 29 languages, and over 600 articles in professional journals, including the American Sociological ReviewBritish Journal of SociologySocial Research, and Journal of Peasant Studies. He has published over 2000 articles in nonprofessional journals such as the New York Times, The Guardian, The Nation, Christian Science Monitor, Foreign Policy, New Left Review, Partisan Review, Temps Moderne, Le Monde Diplomatique, and his commentary is widely carried out in the Internet. James Petras is a former professor of Sociology at Binghamton University, New York, has a 50-year membership in the class struggle, the author is an advisor to the landless and jobless in Brazil and Argentina and is co – of Globalization Unmasked (Zed Books) and Zionism, Militarism and the Decline of U.S. Power (Clarity Press, 2008). James Petras latest book is War Crimes in Gaza and the Zionist Fifth Column in America (Atlanta: Clarity Press 2010). He can be reached at: jpetras@binghamton.edu

Ellen Brown: Japan - Financing Reconstruction. The Monetary Implications of the Nuclear Catastrophe

Global Research, March 31, 2011



WHY THE JAPANESE GOVERNMENT CAN AFFORD TO REBUILD:
IT OWNS THE LARGEST DEPOSITORY BANK IN THE WORLD

The Japanese government can afford its enormous debt because it owns the bank that is its principal creditor.  But competitors are attempting to force the bank’s privatization.  If they succeed, they could propel the country into debt servitude along with other credit-strapped nations. 

When an IMF spokeswoman said at a news conference on March 17 that Japan has the financial means to recover from its devastating tsunami, skeptical bloggers wondered what she meant.  Was it a polite way of saying, “You’re on your own?” 

Spokeswoman Caroline Atkinson said, "The most important policy priority is to address the humanitarian needs, the infrastructure needs and reconstruction and addressing the nuclear situation.  We believe that the Japanese economy is a strong and wealthy society and the government has the full financial resources to address those needs."  Asked whether Japan had asked for IMF assistance, she said, "Japan has not requested any financial assistance from the IMF."

Skeptics asked how a country with a national debt that was over 200% of GDP could be “strong and wealthy.”  In a CIA Factbook list of debt to GDP ratios of 132 countries in 2010, Japan was at the top of the list at 226%, passing up even Zimbabwe, ringing in at 149%.  Greece and Iceland were fifth  and sixth, at 144% and 124%.  Yet Japan’s credit rating was still AA, while Greece and Iceland were in the BBB category.   How has Japan managed to retain not only its credit rating but its status as the second or third largest economy in the world, while carrying that whopping debt load?

The answer may be that the Japanese government has a captive funding source: it owns the world’s largest depository bank.  As U.S. Vice President Dick Cheney said, “Deficits don’t matter.”  They don’t matter, at least, when you own the bank that is your principal creditor.  Japan has remained impervious to the speculative attacks that have crippled countries such as Greece and Iceland because it has not fallen into the trap of dependency on foreign financing.  

Japan Post Bank is now the largest holder of personal savings in the world, making it the world’s largest credit engine.  Most money today originates as bank loans, and deposits are the magic pool from which this credit-money is generated.  Japan Post is not only the world’s largest depository bank but its largest publicly-owned bank.  By 2007, it was also the largest employer in Japan, and the holder of one-fifth of the national debt in the form of government bonds.  As noted by Joe Weisenthal, writing in Business Insider in February 2010:
Because Japan's enormous public debt is largely held by its own citizens, the country doesn't have to worry about foreign investors losing confidence.
If there's going to be a run on government debt, it will have to be the result of its own citizens not wanting to fund it anymore. And since many Japanese fund the government via accounts held at the Japan Post Bank -- which in turn buys government debt -- that institution would be the conduit for a shift to occur.

That could explain why Japan Post has been the battleground of warring political factions for over a decade.  The Japanese Postal Savings System dates back to 1875; but in 2001, Japan Post was formed as an independent public corporation, the first step in privatizing it and selling it off to investors.  When newly-elected Prime Minister Junichiro Koizumi tried to push through the restructuring, however, he met with fierce resistance.  In 2004, Koizumi shuffled his Cabinet, appointed reform-minded people as new ministers, and created a new position for Postal Privatization Minister, appointing Heizo Takenaka to the post.  In March 2006, Anthony Rowley wrote in Bloomberg:

By privatizing Japan Post, [Koizumi] aims to break the stranglehold that politicians and bureaucrats have long exercised over the allocation of financial resources in Japan and to inject fresh competition into the country's financial services industry. His plan also will create a potentially mouthwatering target for domestic and international investors: Japan Post's savings bank and insurance arms boast combined assets of more than ¥380 trillion ($3.2 trillion) . . .


Read Ellen Brown's Analysis in The Global Economic Crisis



A $3 trillion asset pool is mouthwatering indeed.  In a 2007 reorganization, the postal savings division was separated from the post office’s other arms, turning Japan Post into a proper bank.  According to an October 2007 article in The Economist:

The newly created Japan Post Bank will be free to concentrate on banking, and its new status will enable it to diversify into fresh areas of business such as mortgage lending and credit cards. To some degree, this diversification will also be forced upon the new bank. Some of the special treatment afforded to its predecessor will be revoked, obliging Japan Post Bank to invest more adventurously in order to retain depositors--and, ultimately, to attract investors once it lists on the stock market.

That was the plan, and Japan Post has been investing more adventurously; but it hasn’t yet given up its government privileges.  New Financial Services Minister Shizuka Kamei has put a brake on the privatization process, and the bank’s shares have not been sold.  Meanwhile, the consolidated Post Bank has grown to enormous size, passing up Citigroup as the world’s largest financial institution; and it has been branching into new areas, alarming competitors.  A March 2007 article in USA Today warned, “The government-nurtured colossus could leverage its size to crush rivals, foreign and domestic.” 
Before the March 2011 tsunami, that is what it appeared to be doing.  But now there is talk of reverting to the neoliberal model, selling off public assets to find the funds to rebuild.  Christian Caryl commented in a March 19 article in Foreign Affairs, published by the Council on Foreign Relations:
As horrible as it is, the devastation of the earthquake presents Japan and its political class with the chance to push through the many reforms that the DPJ [Democratic Party of Japan] has long promised and the country so desperately needs. 
In other words, a chance for investors to finally get their hands on Japan’s prized publicly-owned bank, and the massive deposit base that has so far protected the economy from the attacks of foreign financial predators. 
The Japanese government can afford its enormous debt because the interest it pays is extremely low.  For the private economy, public debt IS money.  A large public debt owed to the Japanese people means Japanese industries have the money to rebuild.  But if Japan Post is sold off to private investors, interest rates are liable to rise, plunging the government into the debt trap it has so far largely escaped.    
The Japanese people are intensely patriotic, however, and they are not likely to submit quietly to domination by foreigners.  They generally like their government, because they feel it is serving their interests.  Hopefully the Japanese government will have the foresight and the fortitude to hang onto its colossal publicly-owned bank and use it to leverage its people’s savings into the credit needed to rebuild its ravaged infrastructure, avoiding a crippling debt to foreign interests.
A longer version of this article was posted on Asia Times on March 31, 2011.
Ellen Brown is an attorney and president of the Public Banking Institute,
http://PublicBankingInstitute.org.  In Web of Debt, her latest of eleven books, she shows how a private cartel has usurped the power to create money from the people themselves, and how we the people can get it back.  Her websites are http://webofdebt.com and http://ellenbrown.com. 





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Eternal Punishment: Obama Leads Third Century of Imperial Revenge on Haiti

By Chris Floyd
Empire burlesque, April 2, 2011

The blood and thunder (or is it thud and blunder?) of the American-led intervention in Libya has obscured one of the more revealing episodes of our times -- especially for those many millions who still cling to the idea that Barack Obama is somehow an improvement, however slight, over the ruthless, lawless, corroded souls who preceded him in the post of imperial manager.

We speak of course of the American rigging of the election in battered, helpless Haiti -- a brazen effort to disenfranchise the majority of the population and ensure the election of a vicious -- but acquiescent -- client to the presidency. This sordid episode comes complete with a personal intervention by the Nobel Peace Laureate himself to try to continue the exile and persecution of the democratically elected Haitian president overthrown by George W. Bush in a brutal coup.

Even as he was scheming with the CIA to put covert American "boots on the ground" in the Libyan civil war, Obama and his dream team have been maneuvering like mad to put one of a pair of right-wing fanatics into office in Haiti while excluding any other candidates from the running -- including those from Haiti's biggest political party. Obama also personally called South African President Jacob Zuma to ask to keep holding Bush-ousted former Haitian president Jean-Bertrand Aristide in Africa and prevent him from returning to his native land before the election.

With the sublime hypocrisy that has become the hallmark of this most mendacious militarist administration, an Obama spokesman said the Peace Laureate opposed Aristide's return due to "deep concerns that President Aristide's return to Haiti in the closing days of the election could be destabilising," adding that the defender of freedom and democracy believes "that the Haitian people deserve the chance to choose their government through peaceful, free and fair elections."

Even from Team Obama, this is pretty rich. After blocking the largest political party from running, then forcing a run-off between two former supporters of vicious coups, Obama said he didn't want Haiti's democratically elected former leader to return to the homeland he was trundled from at gunpoint by Bushist goons in order to give the Haitian people "a free, fair election."

The result has been a record-low turnout and run-off so riddled with corruption that it may be weeks before one of America's hand-picked stooges is declared the winner. Meanwhile, Aristide did return -- Zuma told Obama plainly that Astride was a free man, he had a passport from his home country, and "I cannot hold him hostage." He did not interfere with the election, he endorsed no candidate. Most of his supporter simply boycotted the election, because of its blatant illegitimacy.

So this is what Barack Obama and his partner in imperialism, the globe-trotting Hillary Clinton, have been up to on the side while they are killing children in Libya and bluntly declaring to Congress that Obama will not acknowledge any restriction on his imperial will to wage war where whenever and wherever he damn well pleases. As John Caruso notes in a blistering post:


In an episode that makes the importance of democracy subversion in Haiti eminently clear, even while the popular uprising in Egypt was peaking, our Secretary of State was dispatched to Haiti to ensure that Michel "Sweet Micky" Martelly advanced to the presidential runoff election rather than Jude Celestin (she flew there literally right after she'd finished putting out the administration's Egypt spin on the Sunday morning talk shows).  So just who is this U.S. favorite?
Seven months after his inauguration, President Aristide was overthrown by a US-backed neo-Duvalierist military putsch on 30 September 1991. "Sweet Micky" was one of the principal cheerleaders of this three-year coup, which claimed some 5,000 lives, according to Amnesty International.


In the years following Aristide's restoration to power in 1994, Martelly became obsessed with hatred for the man. In a video from not too long ago, which can be seen on YouTube, the candidate threatens a patron in a bar where he has performed. "All those shits were Aristide's faggots," he says. "I would kill Aristide to stick a dick up your ass."
You can certainly see why Clinton made the trip.  And if the Obama administration doesn't manage to get this homicidal homophobic Duvalierist into power, they'll still end up with the Secretary General of the right-wing RDNP party (and wife of a former right-wing "president" of Haiti).  Win-win!


...As I've written before, anyone who feared that our first black president might not be sympathetic to the need to smash the democratic aspirations of the first free black nation in the hemisphere can rest assured: Obama will never let race—or anything else—stop him from doing the empire's dirty work.

No, indeed. Doing the empire's dirty work is the Obama Administration's raison d'etre. Caruso helpfully points us to this incandescent post by Linh Dinh:

As firemen and cops are being fired across America, as teachers are being told they must accept austerity measures, the country is broke, after all, as public radio and television, with their supposed liberal bias, lay on the chopping block, as more homeless sprawl and tent cities spring up, as casinos, a sure sign of desperation, mushroom, the United States has entered another costly war without any fanfare or discussion whatsoever. Obama didn’t have to persuade anybody, no sending a Secretary of State to make a fool of herself in front of the United Nations’ General Assembly, no congressional vote, which, last time I checked, was supposed to be a Constitutional requirement, no media blitz. No lies even. He simply ordered more than a hundred Tomahawk missiles, so far, to rain down on Libya, with many more to come. In any case, this it not even a war, but merely a "kinetic military action," according to an Obama aide. Such straight faced butchery of language, even as one butchers real people, shows that the United States has entered a deep psychotic state. Upon winning the Nobel Peace Prize, Obama himself declared, "I am living testimony to the moral force of non-violence."  ...

The President of the United States is a traveling salesman for the military industrial complex. In 2010, Obama came to India to visit the Mumbai home of Gandhi, a hero of his, someone he would most like to dine with, very touching, before announcing a mega arms deal of GE fighter jet engines and Boeing military transport planes. Now, as he bombs Libya, Obama tries to sell F-18 fighter planes to Brazil. According to an aide, "President Obama underscored that the F-18 is the best plane on offer" as he made a "strong pitch" to Brazilian President Dilma Rousseff.

The President of the United States is also a spokesman for murderers and crooks. He doesn’t rule, but obeys. His main job is to deceive the masses as he serves his enablers. He can say anything at any time, and means none of it. The President of the United States is the world’s most visible actor, in short. Campaigning in 2007, Obama said, "If American workers are being denied their right to organize and collectively bargain when I’m in the White House, I’ll put on a comfortable pair of shoes myself. I’ll walk on that picket line with you as president of the United States." Quite a performance. This year, as Wisconsin teachers fight to retain their right to collectively bargain, Obama has said absolutely nothing. One would have to be a fool to think he would join them. ...

As Obama fizzles out, as he loses legitimacy, the power brokers will come up with other figureheads and slogans for American liberals and conservatives to become passionate about. These candidates will jabber, jab and insult each other. As in professional wrestling, the battle will appear fierce. Barack, meanwhile, can look forward to a lucrative memoir and six-figure speaking fees. Even that man of malapropisms and snafus, the much despised Bush, is getting $150,000 each time he opens his mouth these days.

In any case, the latest draconian farce in Haiti is only par for a savage course that Obama and Clinton have been carrying out from the get-go, standing on the shoulders of that giant statesman, Dubya. As I noted here almost two years ago (again following in Caruso's footsteps):

Haiti has been a cursed nation throughout its existence. As I noted in a piece in 2004:
Exactly two hundred years ago, Haitian slaves overthrew their French masters -- the first successful national slave revolt in history. What Spartacus dreamed of doing, the Haitian slaves actually accomplished. It was a tremendous achievement -- and the white West has never forgiven them for it.

In order to win international recognition for their new country, Haiti was forced to pay "reparations" to the slaveowners - a crushing burden of debt they were still paying off at the end of the 19th century. The United States, which refused to recognize the country for more than 60 years, invaded Haiti in 1915, primarily to open it up to "foreign ownership of local concerns." After 19 years of occupation, the Americans backed a series of bloodthirsty dictatorships to protect these "foreign owners." And still it goes on.
It certainly does -- even under the "enlightened" foreign policy of Barack Obama. As John Caruso reports (in separate pieces in A Distant Ocean and A Tiny Revolution), Obama and his "superstar" secretary of state, Hillary Clinton, are loudly championing the latest egregious, brutal farce that Washington and the West have foisted upon the uppity natives of Haiti.

Senatorial elections held this month by the government imposed on Haiti after the U.S.-backed coup of 2004 (more on this below) produced a turnout of less than 10 percent of eligible voters: a result that mocks any notion of a popular, legitimate democracy. But this is not because the Haitians are so lazy and disinterested that they couldn't be bothered to vote. Nor that they are so satisfied with the benevolent, paternal care of their American-appointed masters that they saw no need to let silly electoral contests trouble their bucolic life.

No, the 90 percent refusal rate was in fact a massive protest action, driven chiefly by the fact that the American-backed government would not allow the most popular party -- the party of the government ousted by the 2004 coup -- to run a slate of candidates in the election. By clerkly hook and bureaucratic crook, Haiti's election overseers banned the Fanmi Lavalas slate back in February. At that moment, the April elections became a dead letter, a meaningless farce -- yet another cruel joke played on the people of Haiti.
Another April, another joke -- and a third century of imperial revenge goes on.

NOTE: For more background, especially on the 2004 coup that led to the current crisis, see "Operation Continuing Sweatshop." Below is an excerpt:
This week, the Bush administration added another violent "regime change" notch to its gunbelt, toppling the democratically elected president of Haiti and replacing him with an unelected gang of convicted killers, death squad leaders, militarists, narcoterrorists, CIA operatives, hereditary elitists and corporate predators - a bit like Team Bush itself, in other words.

Although the Haiti coup was widely portrayed as an irresistible upsurge of popular discontent, it was of course the result of years of hard work by Bush's dedicated corrupters of democracy, as William Bowles of Information Clearinghouse reports. Bushist bagmen funded the political opposition to President Jean-Bertrand Aristide, smuggled guns to exiled Haitian warlords, and carried out a relentless strangulation of the county, cutting off long-promised financial and structural aid to one of the poorest nations on earth until food prices were soaring, unemployment spiked to 70 percent, and the broken-backed government lost control of society to armed gangs of criminals, fanatics and the merely desperate.

Meanwhile, Haiti was forced to pay $2 million a month on debts run up by the murderous U.S.-backed dictatorships that had ruled the island since the American military occupation of 1915-1934. The Haitian press, controlled by cronies of the former dictators, supplied the lazy American media with reams of stories about Aristide's "tyranny." These were swiftly followed by thunderous denunciations from the Bush Regime. Wholesale murders of government officials and Aristide partisans by Bush-backed opposition gangs were, of course, demurely ignored -- as were Aristide's own condemnations of violence by his supporters. The old reliable "madman" trope was also brought out for an airing, with constant press drumbeats about Aristide's "mental instability." (America's designated targets are always "deranged monsters," although sometimes, when they prove politically useful again, they miraculously recover their wits, like Libya's Moamar Gadafy.)

[Note 2001: Although, as we can see today, our good reformed monsters always relapse -- when it suits the imperial agenda.]
[Aristide's] real crime, of course, was not the Florida-style election follies or the reported "tyranny." ... No, Aristide did something far worse than stuffing ballots or killing people -- he tried to raise the minimum wage, to the princely sum of two dollars a day. This move outraged the American corporations -- and their local lackeys -- who have for generations used Haiti as a pool of dirt-cheap labor and sky-high profits. It was the last straw for the elitist factions, one of which is actually led by an American citizen and former Reagan-Bush appointee, manufacturing tycoon Andy Apaid.

Apaid was the point man for the rapacious Reagan-Bush "market reform" drive in Haiti. Of course, "reform," in the degraded jargon of the privateers, means exposing even the very means of survival and sustenance to the ravages of powerful corporate interests. For example, the Reagan-Bush plan forced Haiti to lift import tariffs on rice, which had long been a locally-grown staple. Then they flooded Haiti with heavily subsidized American rice, destroying the local market and throwing thousands of self-sufficient farmers out of work. With a now-captive market, the American companies jacked up their prices, spreading ruin and hunger throughout Haitian society.

The jobless farmers provided new fodder for the factories of Apaid and his cronies. Reagan and Bush chipped in by abolishing taxes for American corporations who set up Haitian sweatshops. The result was a precipitous drop in wages -- and life expectancy. Aristide's first election in 1990 threatened these cozy arrangements, so he was duly ejected by a military coup, with Bush I's not-so-tacit connivance.

Bill Clinton restored Aristide to office in 1994 -- but only after forcing him to agree to, yes, "market reforms." In fact, it was Clinton, the privateers' pal, who instigated the post-election aid embargo that Bush II used to such devastating effect. Aristide's chief failing as a leader was his attempt to live up to this bipartisan blackmail. As in every other nation that's come under the IMF whip, Haiti's already-fragile economy collapsed. Bush family retainers like Apaid then shoved the country into total chaos, making it easy prey for the warlords whom Bush operatives -- many of them old Iran-Contra hands -- supplied with arms through the Dominican Republic, the Boston Globe reports.

When Aristide called for an international force to stem the terrorist attack, Bush refused. When Aristide agreed to a deal, brokered by his fellow leaders in the Caribbean, that would have effectively ceded power to the Bush-funded opposition but at least preserved the lineaments of Haitian democracy -- Apaid and the boys turned down the offer, with the blessing of their paymasters in Washington, who suddenly claimed they had no influence over their recalcitrant hired hands. When Aristide asked for American protection as the rebel gang closed in on the capital, Bush refused.

Instead, Aristide was told by armed American gunmen that if he didn't resign, he would be left to die at the hands of the rebels. Then he was bundled onto a waiting plane and dumped in the middle of Africa. Within hours, the Bush-backed terrorists were marching openly through Port-au-Prince, executing Aristide's supporters.

Guess they won't be asking for two dollars a day now, eh? Mission accomplished!

This policy is what the Nobel Peace Laureate -- the first African-American president in history -- is now perpetuating in the only nation to liberate itself from slavery. But of course, the most important thing is not the dispossessed in Haiti, nor the innocent people in Libya, Afghanistan, Iraq, Yemen, Somalia and Pakistan being killed, day after day, by the Laureate's bombs, bullets and assassins. No, the main thing is -- he's not John McCain! And we must put aside these trifles, these heaps of corpses, and rally around the prez to "defend our gains and regroup for a progressive counter-offensive in 2012!" The best is yet to come!

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