Windows to Russia

“Cyber Warfare, Cyber Security and massive Cyber Attacks are alarmist and vastly overrated. Look at what is going on in Cyprus. What could trigger a run on the banks in the United States? Something as simple as shutting down all the ATM’s for three days. The resulting panic and long bank lines could irrevocably shake confidence in banks and financial institutions, as Americans find out the significance of all the paperwork they signed when they established their banks accounts, fed by direct deposits. Since many in the country know what the country was like before personal computers and the Internet, they’ll do fine. Those people who have exchanged their hearts and brains for computer chips manufactured in Vietnam, and are tethered to Smart Phones and the Cloud, are due for a very rude awakening. You’ve heard of sleeper agents and moles haven’t you? I wonder how many sleeper programs are in the millions of computer chips that are now in every single facet of our lives.” Source

“The US Army Secretary [McHugh] states that the program converted to DA Civilian and military positions. That was true up till a year ago but now the program is back to being filled by contractors. Why is that? Likely due to having so many legal problems getting rid of people – good and bad.   If the separate commands want a social science capability they can build their own team like CENTCOM did. They can provide the funding and the oversight. So many less issues that way and quite the savings! Though I agree with the intent of McHugh’s letter – to save an HTS type capability, I disagree with the saving the HTS program. McHugh sites ‘commanders’ assessments’ as reason to save the program. I doubt these assessments or at least their true value.

The House Armed Services Committee should have one of their educated staffers send a request to the team’s in theater requesting them to send in the products they have provided their current units for the last six months. A review of such products would show that a majority of such are just regurgitation’s of other products and lack any real operationally relevant info that was used in the day-to-day business of the units. The reason is very few, if any, HTS members have left their forward operating bases in the last 6-12 months to do what the program was designed to do. And now that US forces are handing over battle space to their Afghan partners, HTS work is for the most part limited to data-mining the internet and creating what the commanders ask for to support their desired course of action.” Source

“I can tell you CGI runs around talking about its $250 million contract with the US Army.” Source

And they rave about the performances on New York City’s Broadway?

The critics of theater should aim their witty minds at the actors and plots on the civil-military stage in Washington, DC. The actors there in the capital of the American nation—political, military, corporate, media and academia/think tanks–are in deadly serious roles but they are all trained as comedians it seems. And not very good ones at that. Two plots and the actors involved make the point.

The first is the never ending story of the US Army’s Human Terrain System (HTS), a Big Army intelligence program run out of the US Army’s G-2 intelligence function. On 15 March 2013 a letter ostensibly written by US Army Secretary John McHugh to Congressman Duncan Hunter (R-CA)–in response to two articles by Tom Vanden Brook of USA Today critical of HTS—seems to have been written by an autonomous software program. Instead, it was likely written by pro-HTS staff members in the US Army’s G-2 shop under orders to do so.

HTS, alas, is now viewed by those in the know as an assemblage of things: a toy for the general purpose US Big Army; an intelligence support function whose information is used for targeting rebels in insurgent populations, not understanding them; a chunk of funding that should have been given over to US Army Civil Affairs; and as a corporate money-trough and bureaucratic pit to be avoided by the special forces community.  “You can’t meddle with the indigenous condition if you do not understand it. We respect the intentions of HTS but when you hand it to corporate America it becomes a pocketbook game or simply putting butts to seats rather than getting and using experienced and qualified individuals in the project…we had success with it is because we respect the boundaries. These [HTS] guys tweak the cultural information gathered to fit policy instead of molding policy to the information. Intelligence types screw it up all the time…” said a veteran member of the special forces community.

Love Child: Never Meant to Be?

A number of sources asked to review McHugh’s letter to Hunter indicated that, as one did, “BDE Commanders knew this program was a Petraeus ‘Love Child’, so of course they aren’t going to bad mouth it The team I was on provided nothing beneficial to our command.“ The General’s reach is still in the minds of many in the US Army and his groupies are legion in Washington, DC.

One source had this commentary. “I would ask these commanders to show the research produced by their HTS team that produced the results they are shoveling praise on, and ask if there were no other resources he had available, that could have produced the same results. I remain highly skeptical and contend that HTS devolved into a highly lucrative cash cow for BAE, third-tier academics and marginally effective military personnel. While the concept of HTS is sound, the program was poorly managed, generated a large percentage of useless reports, experienced a high turnover of personnel, and was not cost efficient. To deny that HTS was an intelligence gathering program is perplexing, since, at the end of the day, the information collected, at the behest of the commander, was processed, and used, like intelligence. Furthermore, to say that commanders could not have benefited from more regional subject matter experts and linguists, is as absurd, as saying that an HTS research report on Pashtun homosexuality has tactical or operational relevance. I guarantee you that within two years, much of the information collected will find its way into Social Science journals, but will be dismissed or heavily criticized as amateurish and irrelevant.

One final point. As the auditors and bean counters review the myriad of programs rushed into Iraq and Afghanistan, you will begin to notice a familiar pattern. High praise for every gadget, initiative, program, and dog and pony show shoved into the fray, all under the auspices of saving lives. From a historical perspective, every single one of these gadgets and programs failed to live up to their expectations. That’s why we study history. The only thing that saves lives, is a change in operational tempo, or a change in tactics.  Unfortunately, this pattern will repeat itself in the next conflict, as we rush to substitute drones for pilots, lining the pockets of defense contractors and deluding ourselves into thinking we can substitute cold steel for humanism and remote control.”

Hey! Congressman Hunter! A Source is Talking Directly to You

“I can tell you that CGI talks about the program as having a $250 million budget, and of course they are aiming for more than that. If I had Duncan Hunter’s ear, I would tell him that HTS has no plans to create an infrastructure for dynamic, “game changing,” social research, despite having exclusive access to two separate research institutions. The HTS training focuses on teaching the students how to find out what their commander wants to know, then figure out ways to get the information. The teams are not trained for, nor provided with, any research methods to collaborate with other teams. HTS does not employ or work with anybody who can combine multiple sources of data to provide aggregated bigger picture analysis of the work done by HTS teams. The HTS leadership neither recognizes nor values such abilities. If the HTS program is to be valued, that value should be defined as providing commanders with HTS teams that gather sociocultural information specifically for the informational needs of that commander. For anybody who believes HTS teams provide capacities beyond a commander’s stated needs, such as preventing a Cold Start,” they will be disappointed to find out that HTS does not have any experience with, nor infrastructure for, providing a sociocultural Starting Point.

If the military values HTS for what it actually does, that’s fine with me. I do not want people getting the false impression that HTS is providing social researchers with an opportunity to use their skills to avert socioeconomic conflicts and improve long-term relations across cultures. The program has neither the leadership nor infrastructure to do such work. Many staff members like to suggest that HTS is doing such work, but if it did, the HTS leadership and staff would be eagerly collaborating with outside research programs in order to show these results to the public.”

Obama’s Cyber Aim: Limit Public Access Internet/WWW

So what, exactly, does the public know about HTS in 2013?  If one is to believe the US Secretary of the Army, Army G-2, and US Army public affairs, HTS has cleaned its house and all’s well now. One can hear them talking: “It’s alright, trust us Congressman Hunter and you too, you pesky journalists. And Joyce and John Q Public, have no doubt, because we up here in the lofty heights of  leadership—we can see all, know the score and what’s best for you.” This can also be heard–”Now get out there and find out who those sources are and where the Internet traffic is coming from and going to. Those &^%$#@! whistle blowers and websites that post this *&^%. We are going to nail them to a barn door and heal and hide ’em. Where is that 1917 Espionage Act in all this! We need a 2013 Cyber Espionage Act to deal with this crap. Call Holder!”

And so President  Obama had a nightmare in 2009 in which the Internet, World Wide Web–and the public that takes full advantage of those technologies to bypass the official civilian and military narrative—were like nuclear weapons. In that horrible dream Wikileaks/Julian Assange tortured Obama with bit by bit of information from a lowly US Army private, Bradly Manning, who both appeared in biblical, apocalyptic forms. Even the Washington Post and New York Times, so collusive with the President and his minions, seemed to be riding the horses of doom aiming to trample the pre-Internet/WWW system in which information flows to the public could be nicely controlled. And then he awoke.

Between 2009 and 2013 there has been a tremendous push by President Obama, Big Mainstream Media, the Pentagon and Defense Industrial Base, and businesses large and small, to pound the Cyber security, Cyber Safety threat into the consciousness of the American public. The verbiage and theater used in this process is nearly the same as that used for pushing other threats and, subsequently, waging war at an incredible cost in lives and treasure. Terrorism, Weapons of Mass Destruction and Iraq, Iran; and  illicit drugs come to mind. The US is already at war with Iran having inserted computer viruses into the SCADA’s of Iran’s industrial equipment and assisting in the murders of Iranian scientists. Who knows where other US created Cyber Weapons will create havoc.

Popular thinking is that Cyber War hit the big time in the October 2012 to March 2013 and that the Chinese, Russians, Teenagers, Industrial Espionage Goons, Anonymous, or, say, a Jihad Amok in Cyberspace are the actors that are in the system and are the cause for the development and deployment of Cyber War strategies, operations and tactics. History is thorny though.

Actually Cyber Thinking began in earnest on 30 September 1993 with the release by the National Communication System of The Electronic Intrusion Threat to National Security and Emergency Preparedness and then a second edition on 4 December 1994 (same title). A fascinating visit back to the future can be found in a compendium of conference briefings from 12-13 June 1995 titled Information Warfare: Addressing the Revolutionary New Paradigm for Modern Warfare. The conference was co-sponsored by the Technical Marketing Society of America.  Even back then, a critical issue was who would control the flow of information in the USA and abroad, In particular, acceptable whistle blowing/trial ballooning; or, more to the point, insider information meant only for insider trades (CIA exchanging information with the New York Times or Washington Post, for example). Information Warriors of old recognized that the Internet/WWW would destabilize the standard operating procedure for leaks making it easier for whistle blowers and the public to work together. Worse still, the spread of information on civilian, military and corporate programs gone wrong/rogue could no longer be confined to one specific area. How to corral independent thinkers? How to stop the spread of news indicting leaders from all sectors of, say, the US crticial infrastructure?

It has taken a full 20 years to push the Cyber Noodle into public prominence. And with the public in a state of Cyber Fear, there is an attempt by government and industry to get back to some sort of pre-Internet/WWW days through classification and prosecution of those who leak, who aide, somehow, those whose interests are inimical to American national security interests so broadly defined as to make everyone guilty of overtly supporting the Bill of Rights. President Obama’s legacy—and that of those who advise him–will be one of collective vengeance against the sun, the light of day.

It was in 2009 when Wikileaks started to seriously upset the information control system in the USA that once allowed relatively few to comfortably controlled the flow of information to the public. In 2009 it published US senatorial campaign documents, Barclay’s Bank data and procedures for POW’s in Guantanamo Bay, Cuba. By 2010 Wikileaks published US gunship videos and US state department cables which humiliated the Executive and Legislative branches of the US government and with it the many organizations that shape civilian and military life in America. As an example, the State Department cables gave insight into classification practices. Suggested classification/release dates from dates of original publication were laughable. Obama has already sentenced Assange and Manning by public statement. And Assange was merely the reporter of the information as was the New York Times.

In late January of 2013, the New York Times reported that its data had been trawled and compromised by hackers. A few days later on 1 February 2013,  the New York news organization pumped more air into the Cyber Bubble with this report: “After The New York Times reported on Wednesday that its computers as well as those of Bloomberg News had been attacked by Chinese hackers, The Wall Street Journal said on Thursday that it too had been a victim of Chinese cyberattacks. According to people with knowledge of an investigation at The Washington Post, its computer systems were also attacked by Chinese hackers in 2012.” Since budgets are defended in the US Congress during Winter-Spring of each year, this, with remarkable coincidence, set the stage for US government officials who in US Congressional testimony–along with Cyber Defense Contractors civilian and military alike bloated the threat. A Cyber Defense Contractor named Mandiant surfaced and confirmed that the menace behind this enterprise was the Chinese, in Shanghai to be exact. Earlier in January 2013 the head of the US Department of Homeland Security said a Cyber Attack was “immanent.”

In March 2013 the Director of National Intelligence said Cyber Crime was a key threat to the US intelligence community. Corporations (banks and financial) went public with their weaknesses. On 28 March 2013 the New York Times had this headline, “Cyberattacks Seem Meant to Destroy, Not Just Disrupt” with this comment “Security experts who studied the attacks said that it was part of the same campaign that took down the Web sites of JPMorgan Chase, Wells Fargo, Bank of America and others over the last six months. A group that calls itself the Izz ad-Din al-Qassam Cyber Fighters has claimed responsibility for those attacks.”

So in a year or so, Cyber War has apparently become “real.” With the nation’s critical infrastructure at risk, particularly Big Corporate Media (Walt Disney, News Corporation, WAPO-Kaplan Education), Finance and Banking (JP Morgan, American Express, Bank of America) under electronic attack, the rubber has finally met the road. Coincidentally in March 2013 the Tallinn Manual on the International Law Applicable to Cyber Warfare was produced by NATO. Talk about Cyber Synergy!!

“We are a nation at war” and the post-911 national state of emergency, renewed by Obama each year, has finally found its eternal anchor. Nowhere is this more evident than in the outrageous Final Report of the Defense Science Board (DSB) Task Force on Resilient Military Systems. No one doubts that Cyber Security and Physical Security should be improved, considered more seriously in civilian and military budgets. This is particularly true with the problem of counterfeit software, hardware and telecommunications gear. But why does the US government allow corporations to outsourcing the manufacture of such critical gear to foreign countries? At any rate these matters are responsibilities that fall on the human, not the machine as the latter is just a tool. But to equate an existential Nuclear Attack on the USA with an existential Cyber Attack is, well, comedy. ARPANET, which the Internet is based on, was designed for heavy duty military communications redundancy. The Internet is far more robust and adaptable that the 1960’s ARPANET ever was. The bad guys need it functioning as much as the good and neutral parties.

“While the manifestation of a nuclear and cyber attack are very different, in the end, the existential impact to the United States is the same. Existential Cyber Attack is defined as an attack that is capable of causing sufficient wide scale damage for the government potentially to lose control of the country, including loss or damage to significant portions of military and critical infrastructure: power generation, communications, fuel and transportation, emergency services, financial services, etc.”

Who can say how many acrid HTS programs there are in government? How many Cyber Terrain, Cyber Counterinsurgency projects are in the works that will be managed incompetently? Who knows where on the Cyber Continent the US national security apparatus will be roaming and collecting information?

It deserves repeating: “Unfortunately, this pattern will repeat itself in the next conflict, as we rush to substitute drones for pilots, lining the pockets of defense contractors and deluding ourselves into thinking we can substitute cold steel for humanism and remote control.”

And lives will be shattered or lost.

John Stanton is a Virginia based writer specializing in national security matters. His recent book the Raptor’s Eye is at Amazon. Reach him at cioran123@yahoo.com

Post by Kyle Keeton
Windows to Russia…

You realize that the remake of Red Dawn is out and this time it is North Korea, with the help of Russia of course, who attacks America and we have to defend ourselves against the evil of the Universe as only a handful of young people can do…

Storyline: A group of teenagers look to save their town from an invasion of North Korean soldiers…

Now we have the real thing (According to the press and our government!) But no one ties the movie in with the whole parading of propaganda and the whole evil North Korea thingy…

North Korean leader Kim Jong Un warned Friday that his rocket forces were ready “to settle accounts with the U.S.,”

North Korea’s leader has told rocket units to be on standby for an attack on US bases, according to state media…

Defense Secretary Chuck Hagel said on Thursday that North Korea’s provocative actions and belligerent tone had “ratcheted up the danger” on the Korean peninsula, but he denied that the United States had aggravated the situation by flying stealth bombers to the region…

North Korea has revealed its plans to strike targets in Hawaii and the continental United States in photos taken in Kim Jong-un’s military command center…

How can North Korea’s frenzy of threats be brought under control?

Thousands upon thousands of articles of the scary, evil, devious and powerful NK…

Pretty simple – a propaganda movie, made by America, for America and to be used against American feelings against war. So what better timing than to make use of such a movie and take the rhetoric to a whole new level…

How can you be anti-war when a country like North Korea is planning to attack and take over America, with the help of Russia and China of course…

We need to stop someone from doing to us that we do to others all the time. Heaven forbid…

Post by Kyle Keeton
Windows to Russia…

I have been watching this interesting evil happening against Cyprus, but what was made clear was that the rich did not get bothered much and the middle class took the brunt of the blow. This was never about a failed banking system or about a collapsing economy. Cyprus was doing better than the US and most of Europe, before they were attacked by the EU and her cronies. Cyprus had a lot of money in the banks as deposits and that is where the issue lies…

Though never fear, Russians got their money and Russia promised to keep her mouth shut…

From Reuters: While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money. No one knows exactly how much money has left Cyprus’ banks, or where it has gone. The two banks at the center of the crisis – Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus – have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia’s Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks’ largest depositors…

The backdoor is always left open for those who have money and power. In this case the door internally between banks was revolving as billions of dollars escaped and the main door on the banks to everyday customers was slammed shut in their faces…

Then having seen the photos of the lines of trucks full of freshly printed Euros, as they refilled the restructured banks, in attempt to open the banks back up again…

Russia was given her money back, in return for staying out of what the EU did. Which was the condition for Russia not to bail out Cyprus…

The EU declared war upon Cyprus and without firing a single bullet, they crushed Cyprus and closed a tax haven country. The EU wants that tax money and they got it, but not without losing more than they gained…

While all this may help Germany determine who wins this election coming up and the propaganda is flying over this whole situation as we speak. The end results are things that are long term and once again short sightedness rules the planet…

So people who worked all their lives and people who could save money, became the victims of what I now call “The EU Folly!” The big money makers , who only put their money whee it is safe, will never see Europe as a safe place again and without that money, things are going to get really bad in the long term in Europe. There was a million things they could have done and stealing peoples money was not in that million things…

Politicians everywhere in the world are so excited about what has happened. This is another way to get their hands on your money and there is nothing you can do about it! Unless you keep your money out of the banks…

The trust in the system has been broken and it is just a matter of time before it collapses, as the foundation has eroded. Is your money safe? Is that paltry interest worth losing your money over? Can you afford to lose 40% + of your money to the government?

It is! It is! You can! Well I am glad it is and you can…

I can’t…

Post by Kyle Keeton
Windows to Russia…

I have already talked about the root canal and that went as good or actually better than can be expected. No root canal is fun and I definitely do not want to experience anymore root canals, but it is a necessary evil sometimes. But with a root canal many times, comes having a cap or a crown put on the tooth. This tooth broke many many years ago and has been that tooth from hell ever since. I really think that this dentist got it taken care of and fixed it right this time. I am expecting many years of respite from going back. “Knock on wood” is what I am doing as I say this…

In between the root canal and crown being done, I had to have a filling redone. I have only a couple of fillings and one of them got a cavity below it. So I had to have the filling removed and clean out the old cavity (Or caries – as Russians call them!), that was fine and was the only issue that I had extra to deal with. I also had my teeth cleaned for the first time in 20 years and that was needed also…

I gave up trying to keep exact track of what I spent, but I know it did not exceed 15,000 rubles. Now 15,000 rubles sound like a big number, but that in American dollars is less than $500 for everything…

Now try to have a three channel root canal, silver palladium post, half a dozen x-rays, color matched crown, all teeth ultrasonic cleaned, one filling done, 7 or 8 office visits and somethings that I forgot and oh yes, lots of pain, all for less than $500 dollars in American money. Remember that insurance is not involved in this. This is not the deductible, it is the full price. Go ahead and try to match that price in America, without driving across the border into Mexico and getting it done?

The one price that I do remember that is stunning to the senses, is that the crown cost just 900 rubles, for the finished product…

That price alone makes me a happy American living in Russia… 🙂

Oh my aching head! I am so glad it is all done and now to look forward to our Turkey vacation on the 3rd of April…

Post by Kyle Keeton
Windows to Russia…

They have developed cargo/container versions of the widely-exported ship-based Club, or Kalibr, short-range surface-to-surface missile battery. The new weapon is codenamed Club-K. It comes on two easily transportable and mountable versions: one, hidden inside a standard 40-foot shipping container, and the other, inside a similar 20-foot one. These deadly containers can be deployed in ports. They can be installed on the decks of civilian ships, making them not that defenseless in the face of hostile naval forces.This is the greatest thing to be developed I have seen in a while and it will make bully countries think twice before they try to jump on someone’s back…

Fittingly, the world marketing is naming the system,“Pandora’s Box.” – When opened – you are in for trouble…

The average container-looking weapon system can be fired from a cargo ship, a train car, or a flat bed truck. By appearing externally as a simple unmarked shipping container, the Club-K can be positioned covertly, ready to unleash a surprise attack, probably firing simultaneously from more than one container.

This literally turns huge cargo/container ship into a super missile cruiser…

Here is the Russian weapon – The Club-K…

Or this as a extra tidbit to make you think…

The Russian weapon – Club-M…

I think Club-K’s are just perfect for those average Americans in the USA to deal with those damn drones that should not be there, flying in the skies of America. Fight fire with fire…

Post by Kyle Keeton
Windows to Russia…

THE 5th BRICS summit ended yesterday with leaders agreeing to establish a development bank, while several agreements were signed to strengthen cooperation within the grouping and enhance engagement with other emerging and developing economies…

New BRICS chairperson and South African President Jacob Zuma told a media briefing early yesterday afternoon that following a report from the finance ministers, the leaders were satisfied that the establishment of the bank was feasible and viable…

This was after the consideration that developing countries faced challenges of infrastructure development due to insufficient long-term financing and direct investment, especially in capital stock, and constrained aggregate demand…

As a result, there was need for BRICS cooperation towards more productive use of global financial resources to make a positive contribution to the process…

“We have agreed to establish the new development bank. The initial capital contributions for the bank should be substantial and sufficient for the bank to be effective in financing infrastructure,” he said…

The development bank would be based on the needs of the BRICS countries which require about 4.5 trillion U.S. dollars over the next five years for infrastructural development, he said…

Zuma added that BRICS leaders had also in June 2012 tasked finance ministers and central bank governors to explore the construction of a financial safety net leading to the creation of a Contingent Reserve Arrangement (CRA) within BRICS countries…

Leaders agreed that the creation of the CRA with an initial size of 100 billion U.S. dollars was also viable subject to internal legal frameworks and appropriate safeguards…

“We direct our finance ministers and central bank governors to continue working towards its establishment. We are grateful to our finance ministers and central bank governors for the work undertaken on the new development bank and contingent reserve arrangement…

“We direct them to negotiate and conclude the agreement which will establish them. We will review progress made in these two initiatives at our net meeting in September 2013,” he said…

Agreements signed during the summit included one on green economy cooperation co-financing and another on infrastructure co- financing for Africa…

The leaders also launched the BRICS Business Council, which will provide business to business linkages within the grouping, while an agreement on the establishment of a BRICS Think-Tanks Council that was signed on March 11 was formally declared…

They also recognized the 5th BRICS Academic Forum and the role of academics in fostering dialogue…

Indian Prime Minister Manmohan Singh urged BRICS nations to promote the forum by allowing academics to share their unique experiences, particularly in the areas of energy, food security, education, health care, sustainable development, information technology and public service…

“Our roadmap of the future should focus on deepening of our existing cooperation.”

The foremost challenge facing the BRICS nations was to respond to persistent weaknesses in the global economy, he said…

“Recognizing that BRICS countries will remain key drivers to global economic growth, we should further sustain our growth by harnessing opportunities and investment ties between ourselves,” he said, adding that they should exploit their complementarities for their mutual benefit taking into consideration their unique resources and strengths…

Singh also highlighted the challenges of terrorism and piracy and said that it was incumbent upon the nations to use their collective voice and capacity to make an effective and meaningful contribution to these challenges and foster global peace and security…

Russian President Vladmir Putin said he hoped that BRICS nations would continue working on a professional level and called for the strengthening of technological and industrial markets while special attention should be given to expanding business ties.
He also encouraged the promotion of the green economy for sustainable development: “We will need to implement the highest environmental standards.”

China’s President Xi Jinping said the leaders of the five BRICS countries were full of confidence in the potential of the grouping saying that the countries shared broad common interests and that the establishment of the development bank would unlock the potential for BRICS cooperation…

He called for greater balance to the global economy and greater democracy in international relations, pledged China’s continued readiness to play a part in forging ahead BRICS ties and added that China had already established strategic partnerships with others…

Besides the summit proper, BRICS nations also signed bilateral agreements among themselves as they sought to cement relations within the context of the transcontinental grouping…

Addressing a plenary session earlier in the morning, Zuma said it was appropriate that the leaders celebrate BRICS achievements, including its further contributions to the strengthening of the global agenda to ensure a more equitable and prosperous world…

“The BRICS Forum offers member states the opportunity of amplifying voices for political, financial, economic and social interests around common goals and development agenda based on shared values.”

He said there was need to forge a paradigm shift in global relations and cooperation…

“BRICS countries continue to power, stabilize and support the global economy. We, however, should remain vigilant to underlying weaknesses and risks in the global economy.”

He said BRICS countries would continue to consider crisis situations in the world and would coordinate closely as they sought to achieve global peace and security in line with the United Nations Charter…

The shared vision of integration and industrialization would remain at the core of BRICS cooperation, he said…

There was need for emerging countries to enjoy the fruits of their resource endowments by shifting from primary to industrial development and thus beneficiate their goods…

Shifting to his country, he said South Africa was keen to learn from the experiences of others and wanted to upgrade about 3.2 million youths into formal employment while enhancing skills development…

Post by Kyle Keeton
Windows to Russia…

China has secured that oil and gas, that it needs so badly to continue its upward movement in the world. Russia gets to sell it to them and even get the money before delivery. You know, “Prepaid!” This is what I am thinking, over a cup of wonderful coffee…

This prepaid also includes opportunities for China to invest in Russian oil and gas. This is a huge win win for both countries. China needs that gas and oil to fuel the growth that has been happening for many years and their national security depends on a stable Russian supply of fuel. Russia has the same needs and so we have watched in the last few years, a beginning of a future powerhouse, Russia and China…

But oil and gas were not the only thing discussed, but were the only thing put to the media. The smoke and mirrors are up and as it has been for several years now. The shift of power in the wind has been happening. It is not a tornado wind, but it is a steady breeze that is blowing the giant ship in a different direction, even while the self-proclaimed captains do not even know it is going off course…

Russia and China realize after the last few decades, that the world is being driven off a cliff by the west. It is a run away train and the brakes are burned out. China has seen it coming, as Russia has also and they both fueled the end results as much as they can. America was so stupid that it never saw it coming and we have a saying to fit this issue…

“Give him enough rope and he’ll hang himself!”

Means: If one gives someone enough freedom of action, they may destroy themselves by foolish actions…

Now that definition is America and she gladly went along with it as she borrowed herself into a casket. All that is left is to nail the lid shut. War is done on many levels and actually the physical war is the least damaging war…

You say, “Lets just not pay that debt.”  You say, “Lets inflate our way out!” You say and you say and you say…

The bottom line is, “The debt will go, but the dollar will die with it and all your fancy debt driven fantasies will go to hell in a hand basket, with you!” America will be on the bottom of the credit default list and be hugging Zimbabwe, as everyone riots and wars across America. People do not like to loose all their material items and in America they have had so many toys that they think it is real life…

This is what China and Russia have expressed many times and this is what China and Russia have been secretly working on for years now. They have been relocating their base cores and moving assets to buffer the inevitable crash of the demons from the west. They do not want a sudden death of America and have supported the US and west in endeavors to increase the longevity of the western empire, as to allow a movement of assets. Remember when China bought US bonds? Remember when the US did not buy her own bonds? Remember when? Remember when?

I suspect that we in the US, will be seeing the government buying even more bonds than the 85 billion (a month) that they do now. I suspect that it will increase to 120 billion a month. That is hanging on that rope and starting to choke…

What makes me realize all this is happening?

BRICS…

They (BRICS) are building a banking system. This bank will not allow western influence nor members…

The BRICS are developing their own financial rating system to counter the corrupt western versions…

The BRICS will have a separate currency and it will be backed by gold and silver and other commodities…

The BRICS want a true “multipolar world” and that is just right…

The BRICS are creating a “geopolitical competitor” to the west and the fact that Putin made sure to express that it was not this fact, that we know it is this fact…

The icing on the cake is the fact that in the west they only see that the BRICS are western wannabes and are a threat to the western way of life…

I promise you that the rest of the world does not want to live like the debt riddled west and have the immoral values of the west hanging over their heads as they try to live a good life in the world…

But this western, “We are number one!” and “The would can not survive with out us!” and “We are god chosen to rule!” aspects will lead the world into war, a world war, of all world wars! This is not Libya with these aspirations, this is a bunch of strong countries doing this…

Yes the Putin-Xi summit: It was very productive…

Post by Kyle Keeton
Windows to Russia…

The only rational explanation for the original plan of the Cyprus – is that German politicians do not like depositors Cypriot banks..

The financial system of Cyprus is so many problems within one column, they do not fit that column. Moreover, the situation is changing so rapidly that discussion is not in the current events in the newspapers but in the comments page. We have decided to devote this article to where it all began – with the first sentence of the EU “Tax Deposits” (At a rate of 6.75 and 9.9% for deposits up to and over 100 000 euros respectively).

To this proposal, the reaction not only Putin and Medvedev, but almost all economists – both Russian and foreign. Why? The point is not that we are talking about losses of investors. Cypriot banks in any case not be able to completely pay off its liabilities. Therefore, investors in Cyprus assets somehow lose some of their money. Can not avoid bankruptcy. But bankruptcy can be structured to effectively and fairly – and not set a dangerous precedent for other countries and banks. From this point of view “Tax on deposits” – a very bad decision.

First, the tax on deposits actually destroys the deposit insurance guarantee (Which in Europe apply to deposits of up to 100,000 euros). Deposit insurance – a key element of any modern banking system. Without deposit insurance banking system is much more susceptible to panic. Bank panic or lack thereof – a classic example of a situation that economists call the non-uniqueness of equilibrium. One such harmony – when all investors believe that everything is in order. In this equilibrium, there is no sense to run and take deposits, the bank quietly earns and pays interest on deposits. However, there is a second, poor balance – when investors are afraid that things are bad in the bank. They know that the bank invests in long-term assets. This is normal – this is the business of the bank. But if you must pay for all investors here and now, to liquidate the assets can only be big losses. In fact, to timely pay all depositors money is not enough. Depositors understand this and try to withdraw their money as soon as possible – not to remain last in the queue. Both internal consistency and balance are based on self-fulfilling expectations. If everyone thinks that things are bad, there is a bank panic and the bank does break, no matter how healthy it is. If everyone thinks that all is well, the panic and the bank will not be able to continue working.

It is in order to avoid the risk of panic retail investors, and invented a system of deposit insurance. “Tax on deposits” de facto cancel deposit insurance – and gives the signal that the EU considers such cancellation normal. It makes depositors of other banks, such as Spanish, to think that they too can lose money. The very thought may lead to the banking panic in Spain. They will take the money under the mattress or, for example, German banks are not so important – in any case it is about the Spanish banking system will cease to exist jiffy.

Of course, deposit insurance, and creates problems. Being protected from losses, investors are willing to trust money is more risky banks with higher rates. World Bank economist Asli Demirguc-Kunt and her co-authors collected data on deposit insurance around the world and showed that deposit insurance does increase the probability of bank failures. Therefore, deposit insurance, typically covers only a relatively small contribution (Holders who are less able to monitor banks’ risk and often take a decision to withdraw deposits on hearsay). In addition, it is necessary and banking regulation – the state limits the risks of placing banks.

The regulation does not always work – in all countries there are cases where banks do go bankrupt. In these situations it is very important the order in which investors lose their money. First, shareholders should be punished – and then the lenders and investors. This simple principle gives shareholders greater incentives to monitor the management of banks.

Lenders and large depositors also understand that in the event of bankruptcy and they are losing money (Or get them at once.) Therefore, they also have an incentive to choose less risky banks. It is this incentive to deprive the second disadvantage of the EU, namely, that the depositors of all banks are affected equally. This is a very dangerous precedent. It means that we should not take responsibility for the choice of the bank – still losing (“Tax on deposits”) are the same everywhere.

Third, the plan does not mean long-term solution, but just pretend that today “One-time” tax on deposits will be enough. As it is now, few believe. The main victim of the tax will be the reputation of European policy in the field of economy. Today it is a tax on deposits, tomorrow cancellation of international trade rules, the day after selective nationalization of enterprises? One of the main results of the macroeconomic research – the importance of reputation. After all, once lost it, reputation is very difficult to recover. And then no one will believe any low inflation, no attractiveness for investment, or in the future in the eurozone.

What to do? We have already mentioned, which is to deal with such problems, you can use the approach “Good bank – bad bank”, which has worked well during the banking crisis in Sweden in the 1990s. To avoid repetition, we describe only the main ideas of this approach. It is necessary to divide each ailing bank into good and bad. Good bank should get the remaining good assets. There also need to be translated insured deposits and liabilities to senior creditors. The remaining assets should be passed to the bad bank, whose shares will be shareholders and junior creditors original bank. Bad bank should not engage in lending – it’s just a management company of distressed assets. Her goal – eventually return to its investors if not all, but some means.

Main mystery – why the EU has formulated such a dangerous plan. If this plan was implemented, it would have wiped out all previous efforts to restore confidence in the European banking system. Moreover, the economy of Cyprus and its problems are minor compared with the effects of loss of reputation the European Union. The only rational (Albeit very strange) explanation – is that German politicians do not like to Cypriot banks and investors want to solve the Cyprus problem at their expense. Even if it will hit Europe itself. That says a lot about Russia’s image and its relation to Russia in Europe.

Authors Sergei Guriev and Oleg Tsyvinski – In order: Rector of the New Economic School and Professor at Yale University and New Economic School…

Post by Kyle Keeton
Windows to Russia…

Endnotes:

1. Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directives 77/91/EEC and 82/891/EC, Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC and 2011/35/EC and Regulation (EU) No 1093/2010 /* COM/2012/0280 final.

2. According to figures issued by the OECD’s Financial Action Task Force (FATF), other countries do investigate more thoroughly and detect crimes four to 20 times more frequently than German authorities do, see www.dw.de/germany-a-safe-haven-for-money-laundering/a-16343313.

3. For more on Cyprus see Trimikliniotis, N. and Bozkurt, U. (ed.) (2012).

4. Former Finance Minister Stavrakis (2012) went further claiming that the Governor of the Bank had advised bankers not to buy RoC bonds and buy Greek bonds.

5. There are some small organizations to the Left of AKEL influenced primarily by Greek groupings but they do not have any significant mass support.

6. See Panayiotou 1999; 2012.

7. According to an opinion poll by Insight Market Research (IMR) – University of Nicosia.

8. See Trimikliniotis and Bozkurt 2012.

9. See Christodoulou, 1992.

10. See Panayiotopoulos 1996; Trimikliniotis, 2001.

11. See Ioakimoglou et al, 2011; Trimikliniotis et al 2012.

12. See Panayiotou, 1999.

13. See Constantinou (2008) and Trimikliniotis (2009); (2010).

14. See Economic Interdependence in Cyprus, Main findings and recommendations, (accessed March 23, 2013).

15. See Trimikliniotis, 2001.

16. See Lapavitsas “Cyprus Should Let the Banks Go Bankrupt.”

Post by Kyle Keeton
Windows to Russia…

I told Sveta this morning that Russia worked things out and now we wait to see what all was laid out on the tables. For Putin has been busy with the EU and Cyprus…

I very much doubt any significant Russians will lose any money in the Cyprus issue. The EU will make a secret payment (or something or another) to Russia and Russia will compensate the key people affected and all will be happy…

Unless they (EU) fail to do as they have promised… (Big issue here!)

Remember, these headline haircuts are only in place to placate the German electorate in the mainstream press (to get Merkel re-elected).  What goes on behind the scenes will be something quite different and as illegal as what they tried to do large scale…

Does anybody believe Russia would be staying this quiet (Cyprus was here and Putin has communicated with the EU and Russia silenced the war drums!) if their citizens really had to bear any great financial loss?

Putin has also told the Russian government to refinance the Cyprus debt from several years ago, so that it will help out the situation in that aspects…

I also see that Russia has quietly whispered that it will move in and do what needs to be done if this falls through and the EU fails at its attempts. It dawned on me that Russia has the EU over a barrel-head and the silence proves it. Russia is waiting for the EU to do what she says she will do…

Bottom line is that Cyprus is history and the banks all over the world will never be looked at the same again. This will happen again and if they open the Cyprus banks back up, if they open the banks, is the best they have right now to hope for. They will most likely run and drain all the cash they can to keep this from happening again. Banks can not be trusted and “That is That!”

One day we will all be looking at this scenario, because the west is flat busted, broke, immoral and too self-centered to care about anything but the almighty fiat cash, that they shove on us as real money…

Funny how all through history, “Governments (Any governments!) come before people! Even if they started out differently! Like ours in the USA!”

Sp blame it on the banks, corporations or governments, because they are all the same in the end…

Post by Kyle Keeton
Windows to Russia…

Update: The EU has already dropped the ball and is letting things get out of hand. Russia has expressed the problem and now we watch and see what happens. Remember that Russia was asked to step aside and the EU would handle this. Russia is seeing that the EU may not be able to handle it…