Obamagate

The popularity of US President Barak Obama is continuing to decrease. Recently, another scandal broke out which made it decrease further. It has become known that the US secret services had failed an operation against the Mexican mafia. However, for some reason, Mr. Obama is trying to hush up the details of the unsuccessful operation.

The governor of Texas Rick Perry has compared these attempts of Mr. Obama to the notorious attempts of President Nixon to hush up the Watergate scandal.

Mr. Perry, probably, really has the right to say so. The fact itself that the secret services failed this operation works against the popularity of the current US president. It seems to be understood by everybody that the best thing to keep a good reputation after making a mistake is to openly acknowledge it and to apologize for it. But the US administration, for some reason, has chosen the worst scenario – the policy of hushing up the details of this mistake.

The operation, called “Fast and Furious,” was carried out by the US Bureau of Alcohol, Tobacco, Firearms and Explosives. It was planned that agents of this bureau, under the guise of weapon smugglers, would sell weapons to Mexican criminal groups, and, then, catch them red-handed.

The first part of this plan was successful. A big amount of weapons was really sold to the Mexican mafia. However, it turned out that not all the criminals were caught red-handed. Moreover, the largest part of these weapons remained in the hands of criminals. Two Kalashnikov guns from this lot were found at the place of the murder of US border guard Brian Terry. It was also found out that other weapons from this lot had also been used for a number of murders in Mexico.

An investigation of this case started in the US. However, some details of this case looked so scandalous for certain high-ranking US politicians that they tried to hamper this investigation.

For example, recently, the House of Representatives demanded that the US Attorney General Eric Holder should be charged of lack of respect for the Congress. The reason for that is that Mr. Holder has concealed several documents concerning the failed operation with weapons from the Department of Justice. For some reason, President Obama, instead of ordering to make the documents concealed by Mr. Holder public, ordered to further keep them secret. (It is in the US laws that the president has the right for an individual decision of putting a label of secrecy on any documents.) This decision of Mr. Obama made many people suspect that these documents really hold something which the US authorities prefer not to reveal.

For Republicans, this was another chance to criticize their perpetual opponents, the Democrats. As it has already been mentioned, the governor of Texas Rick Perry compared this story with the Watergate scandal.

The name “Watergate scandal” refers to the notorious scandal of 1972, when the Republican Party was accused of setting eavesdropping devices in rooms occupied by Democrats in the Watergate Hotel in Washington. As a result of that scandal, US President Richard Nixon, a Republican, had to retire.

Rick Perry stresses that the Watergate scandal, for all its ugliness from the moral point of view, was, in fact, a minor accident in comparison with the failure of the operation “Fast and Furious.” This failure may have presented a serious threat for the security of the whole US, Mr. Perry insists.

The failure of the operation was a serious mistake for President Obama’s administration – but the attempts to hush up its details were probably a not lesser mistake. At present, when President Obama’s popularity is catastrophically declining, such mistakes are something what Mr. Obama needs less of all. Such mistakes may make many of those who voted for Barack Obama refrain from voting for him again at the coming presidential elections.

In fact, Mr. Obama has fulfilled very few, if any, of his promises of his first pre-election campaign. In 2008, he promised to bring order into the country’s home policy. Now, when his first (and, probably, the only) presidential term is nearly over, the US has managed to spoil the relations with Pakistan, which used to be probably the US’s most reliable partner in the whole Moslem world.

During his first pre-election campaign, Barack Obama promised to do away with the legacy of the gloomy epoch of George W. Bush – the notorious prisons for POWs. However, the prisons are still functioning. Besides, Mr. Obama is risking to lose the respect of the Hispanic population of the US because of his inability to resist the adoption of stricter laws of control over immigration. Recently, Mr. Obama abolished a number of tough anti-immigrant laws in the Alabama state, but did not abolish the right of the state’s authorities to check documents of people who are suspected of violating the US laws on immigration. However, initially, Mr. Obama promised to totally abolish such checking, saying that this practice runs counter to the US constitution.

But these are not the only reasons for the US citizens to be dissatisfied with President Obama. Many Americans believe that it is the ineffectual policy of the Republican Party, of which Mr. Obama is a member, that has drawn the country into a deep financial crisis. However, the Republicans are now trying to make President Obama a scapegoat for this.

Only a miracle can help Barack Obama to regain his former popularity again. But miracles, as a rule, happen very rarely.

Retired army officers and politicians have criticized the “land for peace” idea in general and unilateral action in particular. For example, in an opinion published in Haaretz on June 5, Moshe Arens argued, “Israeli leadership suffers from unilateral withdrawal syndrome.”

The strategy of unilateral withdrawal combined with the “land for peace” paradigm has been used time and again despite the harm it has caused Israel, Arens argued.

But what is the alternative?

Last week, an exhibition of work by Israeli artist Larry Abramson called “1967″ opened at the Gordon Gallery in Tel Aviv. Death notices of soldiers that fell during the Six Day War peer out from paint-smeared editions of Haaretz from the time. Alongside the death notices are headlines, such as “IDF Powerfully Strikes Arab Aggressor,” and ads calling for the annexation of the territories.

The exhibition leaves the impression that the 45 years since the Six Day War have brought us no closer to fulfilling the Zionist dream of a nation-state founded on the principles of equality and democracy. In the seventh decade since its establishment, Israel has neither recognized borders nor a constitution, both of which are vital to ensuring its identity as a Zionist and democratic state for the Jewish people.

See Full Article Here

Opinion

Another treaty, another Irish referendum

EUobserver.com

BRUSSELS – Another European treaty. Another Irish referendum. Once again the main political parties, somewhat battle weary, join forces to argue Yes. Sinn Fein and Declan Ganley, the maverick federalist, campaign for a No.

Most voters evince no or little knowledge about what the referendum is officially about ‑ the Treaty on Stability, Co-ordination and Governance in the Economic and Monetary Union, or fiscal compact treaty for short. Come polling day, 31 May, many may not vote.

The significance of the Irish referendum seems also to have escaped Ireland’s EU partners.

Pierre Moscovici, France’s new minister of finance, speaks blithely about changing the treaty. The German Bundestag has postponed its own ratification of the treaty from 25 May until after the Greek elections on 17 June. For the moment, the SDP and Greens are happy to play domestic electoral politics with ratification by depriving Chancellor Angela Merkel of the two-thirds majority she needs.

These second thoughts about the treaty in Paris and Berlin are distinctly unhelpful to the Irish Yes cause. Such cavalier treatment of the Irish voter is rightly resented in Ireland.

The rest of Europe should have learned by now that Ireland’s verdict is very important. The opinion polls give the Yes side a lead but, as always in referendums, the gap narrows. What is really at stake?

The fiscal compact treaty was conceived at the December European Council in the teeth of British opposition. It is not, of course, another European Union treaty, but works by explicit analogy with them, respecting EU competences and seeking to deploy EU institutions.

It is an archetypal confederal treaty, committing the governments which sign it to a course of action which, in the event, they may choose not to pursue without formal penalty. The price of confederacy is high moral hazard.

The European Commission may help to implement the fiscal compact treaty, but cannot use its full powers vested under the EU treaties.

The European Court of Justice (ECJ) is enjoined to act at the behest of one member state against another according to Article 273 of the Treaty on the Functioning of the EU in a dispute “which relates to the subject matter of the [EU] Treaties.”

Iran rejects reports of Salehi detention as fake

Press TV

Social protest demonstrators near Habima Square in Tel Aviv. Photo by Alon Ron

Police intelligence officers have been told to collect information about Israeli Arabs who join the social justice protests, Channel 10 reported last night. Police Commissioner Yohanan Danino issued a directive to the police top brass ordering them to document every “involvement of the Arab community in the protests.”

Unlike the directives about Jewish demonstrators, which focus on rioters and anarchists, the section about Arabs does not specify which type of demonstrators police should watch out for, referring only to Arabs in general.

The social protest movement is planning to follow up Thursday’s dissident “Black Night” events with another march in Tel Aviv on Saturday night against government economic policy. Scores of artists, musicians and other performers last night joined in a boycott of the municipality’s annual White Night in a continuation of the protests over police violence against social justice demonstrators.

Marchers will head out from Habima Square for a rally outside the Tel Aviv Museum of Art, where the organizers will present a social economic contract including guidelines for the next state budget. They will call on the government to reduce poverty and inequality, increase the state’s share in the gross domestic product, implement tax reform and strengthen the pension reserves.

Ben-Gurion University Prof. Yossi Yonah, one of the protest leaders’ advisers, and south Tel Aviv activist Itzik Amsalem will be among the rally’s speakers.

See Full Article Here

The Dow Jones Industrial Average went down to 136 points at 12,491, while the bank stocks were hardest hit as the court ruled that the requirement to have health insurance can be construed as a tax.

JPMorgan Chase shares plunged 4.4 percent following a report indicating that its losses from a mismanaged trade could hit USD 9 billion.

Shares of hospital chains jumped, while stocks of major insurance companies fell sharply. UnitedHealth Group declined 3 percent, WellPoint almost 6 percent and AFLAC 1.5 percent.

In other trading, the Standard & Poor’s 500 index fell 13 points to 1,319 and the Nasdaq composite index fell 40 points to 2,836. On the Nasdaq, eBay shares fell 3.6 percent, Seagate 5.6 percent, Intel 2.2 percent and Microsoft 1.7 percent.

The reforms, officially known as the Patient Protection and Affordable Care Act, were introduced on March 23, 2010, Obama’s first year in the White House.

With a 5-4 decision, the Court’s justices ruled in favor of the reforms on Thursday, saying although the individual mandate was not valid under the US Constitution’s Commerce Clause, it was legal under the US government’s tax powers.

The Court’s ruling is considered a major victory for Obama before the presidential elections in November as the law is intended to spread health insurance coverage to more than 30 million un-insured Americans.

However, the mandate has been severely opposed by 28 Republican-controlled states, as they believe the Obama administration has no right to force people into insurance programs.

TNP/HJL/SS

It wasn’t long ago that Mario Draghi was spreading confidence and good cheer. “The worst is over,” the head of the European Central Bank (ECB) told Germany’s Bild newspaper only a few weeks ago. The situation in the euro zone had “stabilized,” Draghi said, and “investor confidence was returning.” And because everything seemed to be on track, Draghi even accepted a Prussian spiked helmet from the reporters. Hurrah.

Last week, however, Europe’s chief monetary watchdog wasn’t looking nearly as happy in photos taken in front of a circle of blue-and-yellow stars inside the Euro Tower, the ECB’s Frankfurt headquarters, where he was congratulating the winners of an international student contest. He smiled, shook hands and handed out certificates. But what he had to tell his listeners no longer sounded optimistic. Instead, Draghi sounded deeply concerned and even displayed a touch of resignation. “You are the first generation that has grown up with the euro and is no longer familiar with the old currencies,” he said. “I hope we won’t experience them again.”The fact that Europe’s top central banker is no longer willing to rule out a return to the old national currencies shows how serious the situation is. Until recently, it was seen as a sign of political correctness to not even consider the possibility of a euro collapse. But now that the currency dispute has escalated in Europe, the inconceivable is becoming conceivable, at all levels of politics and the economy.

Collapse of Currency a ‘Very Likely Scenario’

Investment experts at Deutsche Bank now feel that a collapse of the common currency is “a very likely scenario.” German companies are preparing themselves for the possibility that their business contacts in Madrid and Barcelona could soon be paying with pesetas again. And in Italy, former Prime Minister Silvio Berlusconi is thinking of running a new election campaign, possibly this year, on a return-to-the-lira platform.

Nothing seems impossible anymore, not even a scenario in which all members of the currency zone dust off their old coins and bills — bidding farewell to the euro, and instead welcoming back the guilder, deutsche mark and drachma.

It would be a dream for nationalist politicians, and a nightmare for the economy. Everything that has grown together in two decades of euro history would have to be painstakingly torn apart. Millions of contracts, business relationships and partnerships would have to be reassessed, while thousands of companies would need protection from bankruptcy. All of Europe would plunge into a deep recession. Governments, which would be forced to borrow additional billions to meet their needs, would face the choice between two unattractive options: either to drastically increase taxes or to impose significant financial burdens on their citizens in the form of higher inflation.

A horrific scenario would become a reality, a prospect so frightening that it ought to convince every European leader to seek a consensus as quickly as possible. But there can be no talk of consensus today. On the contrary, as the economic crisis worsens in southern Europe, the fronts between governments are only becoming more rigid.

The Italians and Spaniards want Germany to issue stronger guarantees for their debts. But the Germans are only willing to do so if all euro countries transfer more power to Brussels — steps the southern member states, for their part, don’t want to take.

The Patient Is Getting Worse

The discussion has been going in circles for months, which is why the continent’s debtor countries continue to squander confidence, among both the international financial markets and their citizens. No matter what medicine European politicians prescribe, the patient isn’t getting any better. In fact, it’s only getting worse.

For weeks, investors and experts demanded a solution to the Spanish banking crisis, preferably in the form of a cash infusion from the two Luxembourg-based European bailout funds, the European Financial Stability Facility (EFSF) and the European Stability Mechanism (ESM). When Madrid finally decided to request what could ultimately amount to almost €100 billion ($125 billion), the experts realized that this would suddenly send Spain’s government debt shooting up from 70 to 80 percent. As a result, interest rates started rising instead of falling.

The experience of the last few days describes the entire dilemma faced by European politicians trying to rescue the euro: A step that was intended to provide relief only exacerbated the problem.

The same thing happened with the next proposal, which made the rounds last week. Italian Prime Minister Mario Monti wanted the European bailout funds to intervene on behalf of Spain and Italy to bring down their borrowing costs.

But that would have required the affected countries to submit to a program of reforms, a path Monti and his Spanish counterpart, Mariano Rajoy, want to avoid. They would prefer to have the money without conditions. But the German government is unwilling to accept this, which puts Europe at its next impasse. Furthermore, the rescue strategists’ resources are limited. Although the Luxembourg bailout funds still have more than €600 billion in uncommitted resources, it is already clear that the money would be used up quickly if what many experts now believe is unavoidable came to pass, namely that not just the Spanish banking industry but in fact the entire country required a bailout. The bailout funds would be completely overtaxed if Italy also needed help.

Even ECB Has Largely Exhausted Resources

Until now, the defenders of the euro have been able to resort to the massive funds of the ECB, if necessary. If things got tight, the monetary watchdogs could inject new money into the market.

But now even the ECB has largely exhausted its resources. It has already bought up so much of the sovereign debt of ailing countries that any additional shopping spree threatens to backfire, causing interest rates to explode instead of fall. At the same time, the conflict between Northern and Southern Europe in the ECB Governing Council is heating up. Last week, the head of Spain’s central bank managed to convince the ECB to ease its rules to allow Spanish banks to use even weaker collateral than before in exchange for borrowing money from the ECB. This could set off a tiff with the central bankers from the donor countries, who are loath to look on as the risks in the central bank’s balance sheet continue to grow.Indeed, the European leaders seeking to save the euro are in a race against the clock. The question is whether the economy in Southern Europe will recover before the euro rescuers’ tools are exhausted, or whether it will be too late by the time the recovery arrives. It’s a question of growth and the economy, but also of character. How willing are the Spaniards and Italians to accept reforms and hardship, and how willing, on the other hand, are the donor countries of the north to provide assistance and make sacrifices?

Not willing enough, say many experts. As a result, the world is imagining the unthinkable: the withdrawal of several Southern European countries from the monetary union, or possibly even the general collapse of the euro zone. It isn’t easy to predict how such a tornado would affect the global economy, but it’s clear that the damage would be immense.

Read Full Article Here

RMB en route to Become World Currency: Expert     2012-06-27 11:25:58     Xinhua      Web Editor: luodan Chinese currency Renminbi (RMB) has embarked on a quick internationalization process, and is on the way to become a world payments currency, according to Mark Boleat, Policy Chairman with the City of London Corporation. Audio • Designer Patrick Bruce: HK My Home, Mainland My Biggest Market • China’s Top Legislature Reviewing Labor Contract Law to Protect Outsourced Workers’ Rights • Widening Income Gap Hampers China’s Domestic Consumption • The Mixed Real Estate Market • Talks with Heather Graham on the State of the Film Industry

Chinese currency Renminbi (RMB), or yuan, has embarked on a quick internationalization process, and is on the way to become a world payments currency, Mark Boleat, Policy Chairman with the City of London Corporation, said in London on Tuesday.In an interview with Xinhua, Boleat said he expected to see the amount of RMB-denominated trade settlement to further increase in the future. “The internationalization of the Chinese currency is helping to increase trade and investment flows between China and the rest of the world,” he added. He noted that China had undergone a number of reforms in its financial system over the last decade, including the introduction of the Qualified Foreign Institutional Investor scheme (QFII), and the Qualified Domestic Institutional Investor scheme (QDII) to allow capital flows. “These sorts of reforms, alongside work to increase international use of the RMB, are important for the development of the Chinese financial system,” he said. According to a report from the City of London Corporation on Monday, European corporate and institutional investors interested in China welcomed the availability of RMB products and services in London, highlighting benefits of adopting the RMB in cross-border trade settlements with China. However, commenting on the possibilities for RMB to become a reserve currency internationally, Boleat said it could take a long time. The RMB may well ultimately become a major global currency on par with the U.S. dollar and the euro, Boleat said. But right now, the focus should be put on increasing the use of the RMB in trade, and on building on Hong Kong’s success in developing RMB investment products. “This is a big job in itself – becoming a reserve currency could only come when RMB has become an internationally used trade and investment currency.” Boleat will leave on Tuesday for a seven-day visit in China, during which he will attend a meeting held by the Shanghai International Financial Advisory Council, and is scheduled to speak at the high-profile Lujiazui Forum on RMB internationalization, and on globalisation of the Chinese financial system. Boleat described the visit to China as an important opportunity for the City of London to engage with key Chinese decision makers and businesses. “Enhancing the financial sector links between the UK and China, supporting the international usage of the RMB for trade and investment, and promoting London’s role as a western hub for the international RMB market are all priorities of my visit and the City of London’s work with China in the long term.”

By Valentina Pop

BRUSSELS – Cyprus on Monday (25 June) became the fifth euro country to ask for help from the zone’s bailout funds, hours after Spain formalised its request for a bank rescue.

“I welcome the formal application for financial assistance that I have received today from the Cypriot authorities,” Eurogroup chief Jean-Claude Juncker said in a statement, adding that the eurozone finance ministers he presides over will respond “swiftly.”

A “necessary policy conditionality” accompanying the bailout – meaning a reform plan – will be drafted by the EU commission and the European Central Bank.

“This will include measures that will address the main challenges of Cyprus’ economy, primarily those of the financial sector and I expect that Cyprus will engage with strong determination in the required policy actions,” he noted.

Earlier that day, Cyprus suffered another downgrade by Fitch ratings agency, which slashed its rating to BB+ – a “junk” category meaning investors need to take extra risk insurance against a possible Cypriot default.

It remains unclear whether it will be a full-blown bailout, as was the case for Ireland, Portugal and Greece, or limited to the banking sector, as with Spain.

The amount has not been specified either, but EU officials quoted by Reuters say it may be around €10 billion.

The Cypriot banking system has been severely hit by the Greek crisis and the associated debt-restructuring deal.

The tiny country has just four days to raise at least €1.8 billion – equivalent to about 10 percent of its domestic output – to meet an EU deadline in recapitalising Cyprus Popular Bank. The island’s second largest lender saw its balance sheet swamped by bad Greek debt.

Cyprus had earlier angled for a bilateral loan from Russia, with which it has close economic ties.

Last year it received €2.5 billion loan from Moscow following an act of negligence, when 13 people were killed and almost a seventh of the country’s GDP was wiped out in an explosion that destroyed the country’s main power plant.

Spanish troubles

Meanwhile, Spain was the first country to ask for a partial bail-out from the eurozone bail-out funds, a novelty under the funds’ new rules allowing for sectoral bail-outs.

But in the two weeks that passed since it first announced its intention to seek up to €100 billion in aid, Spain has seen its borrowing costs go above the seven-percent threshold considered bail-out territory.

This has fed speculation the Spanish state itself will need to be bailed out.

Adding to the problems, Moody’s ratings agency on Monday downgraded by one to four notches 28 of Spain’s 33 rated banks. The move comes after all three big ratings agencies slashed Spain’s sovereign rating close to “junk.”

At a summit on Thursday, EU leaders are set to look at ways of cutting the link between banks and government debt.

Many Spanish banks having amassed Spanish bonds on their books, while the government itself is dependent on the banks to lower its borrowing costs. But Germany so far has been opposing these moves.

Debt crisis: Angela Merkel dismisses Spain and Italy’s pleas for aid

Pleas from Spain and Italy for urgent financial aid from the eurozone to bring down borrowing costs were dismissed by Angela Merkel as divisions hardened on the eve of a critical summit.

Germany’s Chancellor angrily rejected desperate pleading by Italy and Spain as a Franco-German rift over eurozone debt sharing threatened to unravel efforts to find a fix for the single currency at a meeting of European leaders on Thursday.

Before flying last night to Paris for emergency talks with Francois Hollande, the French President, Mrs Merkel told German MPs that instead of more cash the eurozone needed to step up debt reduction and economic reforms.

“I fear that at the summit we will talk too much about all these ideas for joint liability and too little about improved controls and structural measures,” she said.

Mariano Rajoy, the Spanish Prime Minister, said he would plead with other leaders to allow euro bail-out funds or the European Central Bank to stabilise financial markets by helping to reduce borrowing costs, running at nearly 7pc for Spain.

“We can’t keep funding ourselves for a long time at the prices we’re currently funding ourselves,” he said. “There are institutions and also financial entities that cannot access the markets. It is happening in Spain, it is happening in Italy and it is happening in other countries.”

Interest rate was rigged by Barclays

Mortgage holders, credit card users and small businesses may have been charged too much for their loans after one of Britain’s biggest banks admitted systematically rigging financial markets.

The Telegraph

Barclays was fined a record £290 million for repeatedly distorting basic financial data which are used to set interest rates on millions of loans and other transactions around the world.

Bob Diamond, the Barclays chief executive, said he will give up his multi-million-pound bonus over the scandal but faced calls to resign amid claims that his bank’s actions posed a threat to the global market system.

As MPs suggested that a criminal inquiry should be held, financial regulators warned that other major British banks may also have been involved in attempts to manipulate data about interest rates. Up to 40 global banks face being named and shamed as part of the investigation.

The scandal relates to the London Interbank Offered Rate (Libor), the interest rate that banks pay on money they borrow from one another.

The Libor rate is one of the basic pieces of information on which trillions of pounds of financial transactions are based. It helps determine the interest rate that is applied to loans, including some mortgages, credit cards and business loans.

Read Full Article Here

King Abdullah issued the order in a “top secret” letter addressed to the kingdom’s security and intelligence chiefs as well as the ministers of defense and interior.

A copy of the letter, dated June 27, 2012, has been obtained by Press TV.

The decree, calling for preparation against “foreign or terrorist attacks,” warns the Saudi security forces against any negligence in following the order.

The Saudi Defense Ministry consequently put all armed forces on high alert, saying all the forces inside and outside of the kingdom were ready to take part in an operation dubbed as “al-Farouq.”

Since February 2011, Saudi protesters have held demonstrations on an almost regular basis in the oil-rich Eastern Province, mainly in the Qatif region and the town of Awamiyah, calling for the release of all political prisoners, freedom of expression and assembly, and an end to widespread discrimination.

However, the demonstrations have turned into protests against the Al Saud regime, especially since November 2011, when Saudi security forces killed five protesters and injured many others in Eastern Province.

According to Human Rights Watch, the Saudi regime “routinely represses expression critical of the government.”

HSN/MA/MRS/HJL/IS

Armed rebels abduct 14 Palestinian Liberation Army members in Syria

Press TV

Iran nabs all Israeli-linked terrorists in nuclear assassinations

Press TV

Susanne Posel, Contributor