‘Israel’s attempts to change Jerusalem status should be annulled’

Israel’s attempts to change Jerusalem status should be annulled, the Palestinian ambassador urged.

The State of Palestine asked the UN General Assembly to get Israel to annul all measures to change the status of Jerusalem which under international accords should remain a capital of two states.

All Israeli measures, including the extension of the so-called ‘basic law’ should be cancelled immediately, Palestinian permanent observer at the UN Riyad Mansour said.

‘The basic law’ which Israel’s unicameral national legislature Knesset adopted in 1980 proclaims united Jerusalem the capital of Israel.

Several countries have expressed deep concern over the rising tensions in Arab-dominated East Jerusalem, stressing the need for restraint and avoidance of provocation.

Marking the International day of solidarity with the Palestinian People, India called for dialogue as the “only viable option” for a durable, comprehensive and peaceful solution to the Palestinian issue.

“We hope that both sides will demonstrate the necessary political will to return to the negotiating table and resume dialogue,” he said, adding that India supports a negotiated solution, resulting in a sovereign, independent, viable and united State of Palestine with East Jerusalem as its capital, living within secure and recognized borders, side by side and at peace with Israel.

India called for the blockade on Gaza to be fully lifted and humanitarian supplies and desperately-needed materials for reconstruction be allowed in without restrictions.

The fighting, which raged from July 8 to August 26, saw entire neighbourhoods in the Strip flattened, and almost one-third of Gaza’s population uprooted.

The violence killed more than 2,100 Palestinians, including more than 500 children, and more than 70 Israelis while also damaging or destroying over 100,000 homes.

India is implementing development projects in Palestine, jointly with Brazil and South Africa within the framework of IBSA, and has pledged a million dollars for a new project to reconstruct the Atta Habib medical centre in Gaza.

Fear grips India after announcement of first ebola case

Fear has gripped India after an Indian national, returning from Liberia, tested positive for the Ebola virus. The person was isolated at the Health Organization Quarantine Center at Delhi Airport.

India’s Union Health Minister JP Nadda has said that things are under control and there is no need to panic after the first case of the Ebola virus has been detected in the country.

“I want to appeal to everybody that there is no need to panic. Things are well in control,” Nadda told reporters on Tuesday.

The first reported case of the Ebola virus has caused serious concern in India, especially because a lot of Indians live in the Ebola-affected West Africa, which may result in the deadly virus reaching India if these nationals decide to return.

The current Ebola outbreak occurred in southern Guinea at the end of 2013 and soon spread to Liberia, Sierra Leone, Nigeria and Senegal. The latter two countries have recently been announced free of the virus.

According to estimates by the World Health organization (WHO), the virus resulted in the deaths of over 5,000 people and in over 14,000 confirmed, likely and suspected cases.

Russia stockpiles gold

Russia has taken advantage of lower gold prices to pack the vaults of its central bank with bullion as it prepares for the possibility of a long, drawn-out economic war with the West.

The latest research from the World Gold Council reveals that the Kremlin snapped up 55 tonnes of the precious metal – far more than any other nation – in the three months to the end of September as prices began to weaken.

Vladimir Putin’s government is understood to be hoarding vast quantities of gold, having tripled stocks to around 1,150 tonnes in the last decade. These reserves could provide the Kremlin with vital firepower to try and offset the sharp declines in the rouble.

Russia’s currency has come under intense pressure since US and European sanctions and falling oil prices started to hurt the economy.

Revenues from the sale of oil and gas account for about 45pc of the Russian government’s budget receipts.

The biggest buyers of gold after Russia are other countries from the Commonwealth of Independent States, led by Kazakhstan and Azerbaijan.

In total, central banks around the world bought 93 tonnes of the precious metal in the third quarter, marking it the 15th consecutive quarter of net purchases. In its report, the World Gold Council said this was down to a combination of geopolitical tensions and attempts by countries to diversify their reserves away from the US dollar.

By the end of the year, central banks will have acquired up to 500 tonnes of gold during the latest buying spell, according to Alistair Hewitt, head of market intelligence at the World Gold Council.

“Central banks have been consistently adding to their gold holdings since 2009,” Mr Hewitt told the Telegraph. In the case of Russia, Mr Hewitt said that the recent increases in its gold holdings could be a sign of greater geopolitical risk that has arisen since it seized Crimea sparking a dispute with Ukraine and the West.

Overall, the World Gold Council said that global demand for gold was down 2pc year-on-year to 929 tonnes in the third quarter amid signs that buying in China, one of the main markets, had tailed off. Jewellery demand in the quarter ending in September was down 39pc to 147 tonnes, signalling weaker consumer sentiment in the world’s second-largest economy.

However, demand for gold in India has rebounded sharply since the election earlier this year of prime minister Narendra Modi. Demand for jewellery in the world’s most populous democracy grew by 60pc year-on-year to 183 tonnes in the third quarter.

Gold prices have fallen about 7pc since October to trade at around $1,160 per ounce and the asset class is expected to post its second straight yearly loss. The precious metal has bounced since hitting a four-year low at the beginning of the week but sentiment remains weak despite the World Gold Council’s latest outlook.

Source: The Telegraph

How Churchill starved 4 million Indians

By Ramtanu Maitra

Madhusree Mukerjee’s book [Churchill’s Secret War: The British Empire and the Ravaging of India during World War II, New York, Basic Books, 2010] is not a denunciation of British rule of India, but a meticulous chronicling of the role of the British Raj in furthering a famine in Bengal, and suppressing the fact that this deliberate holocaust took 4 million lives. British historians, including Sir Winston Churchill in his five-volume memoir, glossed over this rather ‘irrelevant incident.’ Historians around the world have made little effort either to find out how many lost their lives in the 1943 famine, or what role the British colonialists played to cause this man-made famine.

However, in 1999, Dr. Gideon Polya, a professor at La Trobe University in Victoria, Australia, made the following observation in an interview: “The wartime Bengal Famine has become a ‘forgotten holocaust’ and has been effectively deleted from our history books, from school and university curricula and from general public perception. To the best of my knowledge, Churchill only wrote of it once, in a secret letter to Roosevelt dated April 29th 1944 in which he made the following remarkable plea for help in shipping Australian grain to India: ‘I am no longer justified in not asking for your help.’ Churchill’s six-volume History of the Second World War fails to mention the cataclysm that was responsible for about 90% of total British Empire casualties in that conflict, but makes the extraordinary obverse claim: ‘No great portion of the world population was so effectively protected from the horrors and perils of the World War as were the people of Hindustan. They were carried through the struggle on the shoulders of our small island.’”

Mukerjee, a Bengali herself, has conducted extensive research to document what she writes, and also interacted with those who survived the holocaust and lost their parents, children, and other relatives. In Bengal, millions were dying because of food shortages caused by British looting to feed the troops engaged in World War II, and partly due to nature’s fury in the midst of a well-developed independence movement, which led to the end of the British rule in 1947. She documents the British War Cabinet’s role, Churchill’s, in particular, in exacerbating the food shortages, stonewalling attempts to send food from other countries to alleviate the crisis, and, in fact, justifying the necessity to cull those who are not only ‘inferior,’ but who breed like rabbits.

The author points out that Churchill, explaining why he defended the stockpiling of food within Britain, while millions died of starvation in Bengal, told his private secretary that ‘the Hindus were a foul race, protected by their mere pullulation from the doom that is their due.’ Pullulation, Mukerjee notes, means rapid breeding.

Mukerjee cites the notes from the British War Cabinet meetings that were released in 2006, which show that Churchill’s decision not to send food to starving Bengal was anchored on the analysis that, after the war, Europe would need a lot of food, and food prices would be high, and for Britain to import food at that time would prove costly. Moreover, surplus stocks built up in Britain by the denial of food to Indians would be worth a lot more on the world market after the war. On the basis of this analysis, Churchill resolved in 1942 to build up a stock of 27 million tons through civilian imports.

The British East India Company

The author reaches back in history to document the looting of Bengal by the rapacious British East India Company, which began in the mid-1750s to form the backbone of what became the mighty British Empire, and which made Bengal, once a much more prosperous province than the entire British Isles, so vulnerable later. The book does not deal, however, with the devastation of the region’s farmlands, Bengal and Bihar, in particular. These farmlands had been wrecked by opium cultivation and indigo plantation by the British. To learn about that barbaric role of the British, one must read Amitav Ghosh’s Sea of Poppy, and Dinabandhu Mitra’s Nil Darpan (Mirror to Indigo Cultivation), written in Bengali in the mid-19th century.

However, Mukerjee does provide some figures of the looting by the East India Company that filled the coffers in London. Bengal fell under East India Company control in 1757, and ‘within five years,’ the author reports, ‘Bengal became India’s poorest province.’ The Company directors were looting freely and paying His Majesty’s Government £400,000 annually. For centuries, gold and silver had poured into Bengal, but, by 1769, all that was gone. Between 1766 and 1768, the author notes, Bengal imported £624,375 worth of goods and exported £6,311,250: The amount going out was ten times that which was coming in.

Churchill, or Hitler: Take Your Pick

One of the interesting aspects in this book is the author’s observation that when it came to India, there was hardly any difference between Hitler and Churchill. Both were avowed racists and killers; both loved wars and had a particular hatred for the Indian people; and both were eager to see Mohandas Karamchand Gandhi, known as Mahatma Gandhi, or Gandhiji, killed. The author notes that Hitler was a great admirer of Britain and the British Raj. Indeed, the British bankers did a yeoman’s job to get Hitler to seize power and build his Third Reich.

Hitler’s and Churchill’s common view on how to deal with the growing demand of the Indian leaders, Gandhi in particular, is most revealing. In November 1937, Hitler, during his meeting with the Viscount of Halifax (formerly Lord Irwin, Viceroy of India), advised him to ‘shoot Gandhi, and if this doesn’t suffice to reduce them to submission, shoot a dozen leading members of Congress; and if that doesn’t suffice, shoot 200 and so on until order is established… You will see how quickly they will collapse as soon you make it clear that you mean business.’

Gandhi was eventually assassinated in January 1948, a few years after Hitler had shot himself, and a few months after the British finally left India. While Hitler was advising fellow representatives of a ‘superior race’ to shoot Gandhi and other Congress Party leaders, Churchill was spitting venom against Gandhi. In 1931, after Gandhi was released from one of many times that he was imprisoned, Churchill charged Viceroy Irwin with ‘craven capitulation.’

He said: ‘It is alarming and also nauseating to see Mr. Gandhi, a seditious Middle Temple lawyer, now posing as a fakir [selfless person] of a type well known in the East, striding half-naked up the steps of the Viceregal palace, while he is still organizing and conducting a defiant campaign of civil disobedience to parley in equal terms with the representative of the King-Emperor.’ In 1944, British historian Penderel Moon recorded Churchill saying: ‘He [Gandhi] is a thoroughly evil force, hostile to us in every fiber, largely in the hands of native vested interests.’ On another occasion, Churchill sent a note to then-Viceroy Archibald Wavell, asking why Gandhi was not dead yet.

What is also revealing is that Churchill’s major domo in his aggressive service of the British Empire was Frederick Alexander Lindemann (1886-1957), a German-born and English-bred racist, anti-Semite, and physicist. His German origins were somewhat covered up when he was made Baron Cherwell (1941), while serving in the Statistics Division or S branch. Lindemann attended War Cabinet meetings as Churchill’s science advisor, and saw Churchill almost daily during the war.

Mukerjee writes: On most matters, Lindemann’s and Churchill’s opinions converged, and when they did not, the scientist worked ceaselessly to change his friend’s mind.’ Naturally, his objective was to provide rationales for whichever course the prime minister as interpreted by the professor wished to follow. As a result, when the famine was raging in Bengal and starved bodies littered the rural areas, with people lacking strength of their own to bury them, Lindemann would pronounce judgment on the best use of shipping space, the inadequacy of British supplies, the optimal size of mustard gas stockpiles, and the necessity for carpet bombing of German cities. And, when the time came, Professor Lindemann would expound the pointlessness of sending famine relief to Bengal.

Churchill’s Dr. Mengele

Mukerjee pointed out, in an article published elsewhere, ‘that Lord Cherwell considered the rescuing of imperial subjects to be an inefficient use of resources may be deduced from the drafts of a lecture he had delivered during the 1930s… In the lecture, he outlined a science-based solution to the challenging problem of perpetuating imperial control over subject peoples. The professor envisioned that technologies such as surgery, mind control, and drug and hormone manipulations would one day allow humans to be fine-tuned for specific tasks. Furthermore, he postulated, at the low end of the race and class spectrum one could remove from ‘helots’ (Greek for slaves) the ability to suffer or to feel ambition” thereby creating a lobotomized subclass that would do all the unpleasant work without once thinking of revolution or of voting rights. The result would be a perfectly peaceable and stable society, ‘led by supermen and served by helots.’

Lord Cherwell evidently considered the existence of certain peoples to be justified only to the extent that they served their racial and class superiors, which may explain his reluctance to expend resources on imperial subjects who were unimportant to the war effort. Churchill himself may have subscribed to such a view. After attending one of the War Cabinet debates on sending famine relief, for instance, Field Marshal Wavell noted in his diary that Churchill wanted to feed ‘only those [Indians] actually fighting or making munitions or working some particular railways.’

Lord Cherwell was so allergic to people with dark skin colour that after his retirement he wanted to settle in a warm country such as Jamaica, but the thought of spending his days with black people was too much, so he stayed shivering at Oxford.

Famine That Killed 4 Million

The 1943 famine was not only man-made, but the outcome of the British Empire’s looting of India, using free trade as one of its vicious weapons. The whitewashing of Indian famines extends to two centuries of famine in British India. How many Indians died in these famines has not been fully established, but one figure indicates that at least 28 million died in the 19th-century famines. A 1933 survey revealed that 41% of India’s inhabitants were ‘poorly nourished,’ and another 20% ‘very badly nourished,’ with the statistics for Bengal being worst of all: 47% and 31%, respectively. By the time World War II hit, India was importing between 1 and 2 million tons of rice a year from Burma and Thailand.

In her book, Mukerjee writes that a more meaningful measure would be life expectancy, which can be calculated after 1871, when the first nationwide census took place. Life expectancy for a newborn Indian hovered around 24 until 1920, and then rose slowly. In contrast, life expectancy in Great Britain improved significantly throughout the Victorian era, to reach 47 by its end. This was mostly due to better nutrition provided by the crops that were raised in British India, and exported to the imperial headquarters. While Indian nationalists demanded that cereals not be allowed to be exported in times of famine, the British authorities pressed home the ‘virtues of free trade,’ and local administrators who curbed exports or otherwise interfered with market forces were severely chastised. Mukerjee points out that even during devastating famines, the government rigorously collected agricultural taxes; thereby feeding whatever harvest there was into the free market.

The crux of the matter was that India’s agricultural exports had become crucial to the British Empire’s economy. In 1905, arguing in favour of free trade, Churchill observed: ‘The harvests of the world are at our disposal, and, by a system which averages climatic risks, we secure not merely a low but a fairly stable price. With that marvelous operation by which the crowded population of this island is fed, we cannot take the responsibility of interfering.’

The famine that killed 4 million Indians in Bengal was orchestrated from outside. ‘Since 1939,’ Mukerjee wrote, ‘the United Kingdom had been drawing grain and manufactures from India for the war effort, and the colonial government had been printing money to pay for these purchases. The resulting inflation had combined with other factors to precipitate famine in early 1943. The following summer, the Government of India asked the War Cabinet for half a million tons of wheat by year-end. The cereal would feed India’s two-million-strong army and workers in war-related industries; if any happened to be left over, it would relieve starvation. The mere news of the arrival of substantial imports would cause prices to fall, because speculators would anticipate a drop in prices and release any hoarded grain to the market. Churchill’s close friend and technical advisor, Lord Cherwell, demurred, however: he erroneously argued that India’s food problem could not be solved by imports. In any case, expending valuable shipping on Indians ‘scarcely seems justified unless the Ministry of War Transport cannot find any other use for it,’ he added in a draft memo. (In the final version, this sentence was changed to a straightforward recommendation against sending grain.)

Near the end of her book, Mukerjee provides the following anecdote: “In June 1953, after witnessing the coronation of Queen Elizabeth, Churchill found himself standing next to Nehru’s daughter, Indira Gandhi, while they both waited for their cars to drive up. ‘You must have hated the British for the treatment meted out to your father,’ Churchill said. ‘It is remarkable how he and you have overcome that bitterness and hatred.’

‘We never hated you,’ she answered.

‘I did, but I don’t now,’ he replied.

Indira Gandhi might have been generous, or she might have been muttering under her breath: ‘We loathe you.’”

The next time Prime Minister David Cameron and his ilk come prancing to India seeking a bailout of Britain’s dwindled, technologically obsolete industrial sector, Prime Minister Manmohan Singh, or the future powers-that-be, and the Indian people, must demand, not only the return of the crown jewels looted from India, but an admission and apology for the 4 million Indians they starved to death in 1943-45. No compensation would suffice.

This book should be read by those in the West, as well as elsewhere, who have been brought up with the anglophile version of the British Empire. The book documents that those who served the British Empire were not just perfidious; they were killers, just as the Nazis were.

Churchill’s Secret War: The British Empire and the Ravaging of India during World War II

Madhusree Mukerjee; New York: Basic Books, 2010; 332 pages, hardbound, $28.95

Source: http://www.vijayvaani.com/

Oz signs away nuclear material to India

Australia’s agreement to provide India with uranium could leave Canberra with no say on the use of nuclear material shipped to India, the former head of Australia’s nuclear watchdog said Friday.

“[Australian authorities] clearly left out a number of things that the Indians don’t like . . . Where Australia has given reprocessing consent in the past, it’s on the basis that we approve downstream facilities where the plutonium will be used. But under the India agreement, we’re just not doing that,” John Carlson, the former head of the Australian Safeguards and Non-Proliferation Office, was cited as saying by The Guardian.

Plutonium is created from uranium in nuclear reactors and may potentially be used in the creation of nuclear weapons.

According to Carlson, the “reprocessing consent” outlined in the sixth article of the bilateral nuclear cooperation agreement means Australia has no say in how India may choose to use byproducts from energy production.

The deal appeared to waive “standard provisions” relating to nuclear safeguards, Carlson told the newspaper, noting that Australia has been allowed to track the uranium it supplies, and well as its byproducts, under every similar agreement thus far.

An agreement on nuclear cooperation between India and Australia was signed on September 5 during Australian Prime Minister Tony Abbott’s trip to New Delhi. Australia, which holds the largest uranium deposits in the world, has previously refused to sign such an agreement because India is not party to the Nuclear Non-Proliferation Treaty.

India, China ignore climate bait

Five years after over 150 heads of state cobbled up a rickety climate deal that fell through, the one-day UN Climate Summit is another attempt of rich nations to push India and China – responsible for one-third of total carbon emissions in 2013 – to accept some strong measures to check global warming.

But the two Asian giants are not willing to take the bait unless the developed world anchored by the United States and the European Union offers substantial incentives to developing nations for adopting a cleaner growth trajectory, cutting down on emissions.

The rich nations’ commitment to provide US $30 billion between 2010 and 2012 for climate mitigation and adaptation is yet to fructify, resulting in the Green Climate Fund remaining a defunct body.

Officially, Prime Minister Narendra Modi and Chinese premier Xi Jinping are not attending the summit called by UN chief Ban Ki-moon because of conflicting schedules.

But it is, in fact, a snub to the developed nations for pushing climate talks outside the United Nations framework. “It creates confusion and we don’t agree,” environment minister Prakash Javadekar, who will represent the country at the summit, said without mentioning to the event.

China has opted for a relatively senior functionary, vice-premier Zhang Gaoli, for the talks. While some island nations threatened by rising sea levels because of climate change expressed shock and disappointment, this will achieve little as India and China do not expect Obama to deliver generous green currency that would motivate emerging economies to revise their country-centric stands.

Neither the American president, nor the European leaders have the mandate to offer money at the summit like in Copenhagen, 2009.

New data shows carbon emissions in the atmosphere closing in on the threshold level to limit temperature rise by two degree Celsius, and India and China being the fastest-growing emitters, would put the two emerging economies under some pressure.

Source: Hindustan Times

India’s low-cost space mission reaches Mars orbit

India has become the first nation to reach Mars on its maiden attempt after its Mars Orbiter Mission completed its 10-month journey and successfully entered the Red Planet’s orbit.

The Indian Space Research Organization’s unmanned drone, also called Mangalyaan, was programmed by Indian engineers to fire its main engine and eight smaller thrusters for 24 minutes, starting at 0147 GMT in order to make the spacecraft’s final maneuvers into Mars’ orbit.

The spacecraft has executed the arrival sequence autonomously with engineers receiving the telemetry with 12-and-a-half minute delay at ISRO’s control center in Bangalore due to the 139 million miles separating Earth and Mars.

“History has been created today,” said Indian prime minister Narendra Modi. “We have dared to reach out into the unknown and have achieved the near-impossible. I congratulate all ISRO scientists as well as all my fellow Indians on this historic occasion.”

On the orbit, the unnamed probe is set to study Mars’ surface and scan its atmosphere for evidence of some sort of life. The probe is expected to circle Mars for six months, about 500 kilometers (310 miles) from its surface. Its five scientific instruments will collect data and send it back to Earth.

The Mangalyaan is equipped with a color imaging camera, a thermal infrared spectrometer to measure the chemical composition of the surface, and instruments to assess the Mars atmosphere, including a methane detector

The Mars Orbiter Mission, a low-cost $74 million project, blasted off from Earth on November 5, 2013, aboard an Indian Polar Satellite Launch Vehicle. At its initial stage, the rocket booster placed the probe into Earth’s orbit before the craft fired the engines to break free of Earth’s gravity en route to Mars.

This is India’s first mission into such deep space to search for evidence of life on the Red Planet. But the mission’s primary objective is technological – if successful, the country will be joining an elite club of nations: the United States, Russia and Europe.

Source: RT

Rigged gold price distorts perception of economic reality

The Federal Reserve and its bullion bank agents (JP Morgan, Scotia, and HSBC) have been using naked short-selling to drive down the price of gold since September 2011. The latest containment effort began in mid-July of this year, after gold had moved higher in price from the beginning of June and was threatening to take out key technical levels, which would have triggered a flood of buying from hedge funds.

The Fed and its agents rig the gold price in the New York Comex futures (paper gold) market. The bullion banks have the ability to print an unlimited supply of gold contracts which are sold in large volumes at times when Comex activity is light.

Generally, on the other side of the trade the buyers of contracts are large hedge funds and other speculators, who use the contracts to speculate on the direction of the gold price. The hedge funds and speculators have no interest in acquiring physical gold and settle their bets in cash, which makes it possible for the bullion banks to sell claims to gold that they cannot back with physical metal. Contracts sold without underlying gold to back them are called “uncovered contracts” or “naked shorts.” It is illegal to engage in naked shorting in the stock and bond markets, but it is permitted in the gold futures market.

The fact that the price of gold is determined in a futures market in which paper claims to gold are traded merely to speculate on price means that the Fed and its bank agents can suppress the price of gold even though demand for physical gold is rising. If there were strict requirements that gold shorts could not be naked and had to be backed by the seller’s possession of physical gold represented by the futures contract, the Federal Reserve and its agents would be unable to control the price of gold, and the gold price would be much higher than it is now.

Gold price manipulation is used when demand for delivery of gold bullion begins to put upward pressure on the price of gold and hedge funds speculate on the rising price of gold by purchasing large quantities of Comex futures contracts (paper gold). This speculation accelerates the upward move in the price of gold. The TF Metals Report provides a good description of this illegal manipulation of the gold market:

“Over a period of 10 weeks to begin the year, the Comex bullion banks were able to limit the rally to only 15% by supplying the “market” with 95,000 brand new naked short contracts. That’s 9.5MM ounces of make-believe paper gold or about 295 metric tonnes.

“Over a period of just 5 weeks in June and July, the Comex bullion banks were able to limit the rally to only 7% by supplying the “market” with 79,000 brand new naked short contracts. That’s 7.9MM ounces of make-believe paper gold or about 246 metric tonnes.” http://www.tfmetalsreport.com/comment/429940

In previous columns, we have documented the heavy short-selling into light trading periods.
See for example: http://www.paulcraigroberts.org/2014/07/16/insider-trading-financial-terrorism-comex/.

The bullion banks do not have nearly enough gold in their possession to make deliveries to the buyers if the buyers decide to stand for delivery per the terms of the paper gold contract. The reason this scheme works is because the majority of the buyers of the contracts are speculators, not gold purchasers, and never demand delivery of the gold. Instead, they settle the contracts in cash. They are looking for short-term trading profits, not for a gold hedge against currency inflation. If a majority of the longs (the purchasers of the contracts) required delivery of the gold, the regulators would not tolerate the extent to which gold is shorted with uncovered contracts.

In our opinion, the manipulation is illegal, because it is insider trading. The bullion banks that short the gold market are clearing members of the Comex/NYMEX/CME. In that role, the bullion banks have access to the computer system used to clear and settle trades, which means that the bullion banks have access to all the trading positions, including those of the hedge funds. When the hedge funds are in the deepest, the bullion banks dump naked shorts on the Comex, driving down the futures price, which triggers selling from stop-loss orders and margin calls that drive the price down further. Then the bullion banks buy the contracts at a lower price than they sold and pocket the difference, simultaneously serving the Fed by protecting the dollar from the Fed’s loose monetary policy by lowering the gold price and preventing the concern that a rising gold price would bring to the dollar.

Since mid-July, nearly every night in the US the price of gold remains steady or drifts higher. This is when the eastern hemisphere markets are open and the market players are busy buying physical gold for which delivery is mandatory. But as regular as clockwork, following the close of the Asian markets, the London and New York paper gold markets open, and the price of gold is immediately taken lower as paper gold contracts flood into the market setting a negative tone for the day’s trading.

Gold serves as a warning for aware people that financial and economic trouble are brewing. For instance, from the period of time just before the tech bubble collapsed (January 2000) until just before the collapse of Bear Stearns triggered the Great Financial Crisis (March 2008), gold rose in value from $250 to $1020 per ounce, or just over 400%. Moreover, in the period since the Great Financial Collapse, gold has risen 61% despite claims that the financial system was repaired. It was up as much as 225% (September 2011) before the Fed began the systematic take-down and containment of gold in order to protect the dollar from the massive creation of new dollars required by Quantitative Easing.

The US economy and financial system are in worse condition than the Fed and Treasury claim and the financial media reports. Both public and private debt burdens are high. Corporations are borrowing from banks in order to buy back their own stocks. This leaves corporations with new debt but without income streams from new investments with which to service the debt. Retail stores are in trouble, including dollar store chains. The housing market is showing signs of renewed downturn. The September 16 release of the 2013 Income and Poverty report shows that real median household income has declined to the level in 1994 two decades ago and is actually lower than in the late 1960s and early 1970s. The combination of high debt and decline in real income means that there is no engine to drive the economy.

In the 21st century, US debt and money creation has not been matched by an increase in real goods and services. The implication of this mismatch is inflation. Without the price-rigging by the bullion banks, gold and silver would be reflecting these inflation expectations.

The dollar is also in trouble because its role as world reserve currency is threatened by the abuse of this role in order to gain financial hegemony over others and to punish with sanctions those countries that do not comply with the goals of US foreign policy. The Wolfowitz Doctrine, which is the basis of US foreign policy, says that it is imperative for Washington to prevent the rise of other countries, such as Russia and China, that can limit the exercise of US power.

Sanctions and the threat of sanctions encourage other countries to leave the dollar payments system and to abandon the petrodollar. The BRICS (Brazil, Russia, India, China, South Africa) have formed to do precisely that. Russia and China have arranged a massive long-term energy deal that avoids use of the US dollar. Both countries are settling their trade accounts with each other in their own currencies, and this practice is spreading. China is considering a gold-backed yuan, which would make the Chinese currency highly desirable as a reserve asset. It is possible that the Fed’s attack on gold is also aimed at making Chinese and Russian gold accumulation less supportive of their currencies. A currency linked to a falling gold price is not the same as a currency linked to a rising gold price.

It is unclear whether the new Chinese gold exchange in Shanghai will displace the London and New York futures markets. Naked short-selling is not permitted in the Chinese gold exchange. The world could end up with two gold futures markets: one based on assessments of reality, and the other based on gambling and price-rigging.

The future will also determine whether the role of reserve currency has been overtaken by time. The US dollar took that role in the aftermath of World War II, a time when the US had the only industrial economy that had not been destroyed in the war. A stable means of settling international accounts was needed. Today there are many economies that have tradable currencies, and accounts can be settled between countries in their own currencies. There is no longer a need for a single reserve currency. As this realization spreads, pressure on the dollar’s value will intensify.

For a period the Federal Reserve can support the dollar’s exchange value by pressuring Japan and the European Central Bank to print their currencies with which to support the dollar with purchases in the foreign exchange market. Other countries, such as Switzerland, will print their own currencies so as not to endanger their exports by a rise in the dollar price of their exports. But eventually the large US trade deficits produced by offshoring the production of goods and services sold into US markets and the collapse of the middle class and tax base caused by jobs offshoring will destroy the value of the US dollar.

When that day arrives, US living standards, already endangered, will plummet. American power will have been destroyed by corporate greed and the Fed’s policy of sacrificing the US economy in order to save four or five mega-banks, whose former executives control the Fed, the US Treasury, and the federal financial regulatory agencies.

Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Roberts’ latest books are The Failure of Laissez Faire Capitalism and Economic Dissolution of the West and How America Was Lost.

Dave Kranzler also contributed to this article.

A difficult question: The rigged gold market

In a radio interview recently Alasdair Macleod was asked a question to which he could not easily give a satisfactory reply: if the gold market is rigged, why does it matter?

I have no problem delivering a comprehensive answer based on a sound aprioristic analysis of how rigging markets distorts the basis of economic calculation and why a properly functioning gold market is central to all other financial prices. The difficulty is in answering the question in terms the listeners understand, bearing in mind I was told to assume they have very little comprehension of finance or economics.

I did not as they say, want to go there. But it behoves those of us who argue the economics of sound money to try to make the answer as intelligible as possible without sounding like a committed capitalist and a conspiracy theorist to boot, so here goes.

Manipulating the price of gold ultimately destabilises the financial system because it is the highest form of money. This is why nearly all central banks retain a holding. The fact we don’t use it as money in our daily business does not invalidate its status. Rather, gold is subject to Gresham’s Law, which famously states bad money drives out the good. We would rather pay for things in government-issue paper currency and hang on to gold for a rainy day.

As money, it is on the other side of all asset prices. In other words stocks, bonds and property prices can be expected to rise measured in gold when the gold price falls and vice-versa. This relationship is often muddled by other factors, the most obvious one being changing levels of confidence in paper currencies against which gold is normally priced. However, with bond yields today at record lows and equities at record highs this relationship is apparent today.

Another way to describe this relationship is in terms of risk. Banks which dominate asset markets become complacent about risk because they are greedy for profit. This leads to banks competing with one another until they end up ignoring risk entirely. It happened very obviously with the American banking crisis six years ago until house prices suddenly collapsed, threatening to take the whole financial system down. In common with all financial bubbles everyone ignored risk. History provides many other examples.

Therefore, gold is unlike other assets because a rising gold price reflects an increasing perception of general financial risk, ensuring downward pressure on other financial asset prices. So while the big banks are making easy money ignoring risks in equity and bond markets, they will not want their party spoiled by warning signs from a rising gold price.

This is a long way from proof that the gold market is manipulated. But the big banks, and we must include central banks which are obviously keen to maintain financial confidence, have the motive and the means. And if they have these they can be expected to take the opportunity.

So why does it matter if the gold price is rigged? A freely-determined gold price is central to ensuring that reality and not financial bubbles guides us in our financial and economic activities. Suppressing the gold price is rather like turning off a fire alarm because you can’t stand the noise.

Source: cobdencentre.org

India, Pakistan ties sour as cross-border fire heats up

Indian and Pakistani troops intensified firing across the border over the weekend killing at least four, an Indian official said on Sunday, straining ties between the arch rivals who recently called off top-level diplomatic talks.

Last week India said its foreign secretary would not meet with her Pakistani counterpart as scheduled on Monday because of plans by Pakistan to consult separatists from the border state of Jammu and Kashmir ahead of the meeting.

The cancellation dashed any hopes of near-term peace deliberations, chances of which had risen after Pakistani Prime Minister Nawaz Sharif attended the inauguration of Indian Prime Minister Narendra Modi about three months ago.

The Himalayan region of Kashmir has been a bone of contention between India and Pakistan since both countries became independent in 1947. They have fought three wars and came close to a fourth in 2001 and there have been regular clashes on the Line of Control that divides Indian- and Pakistan-controlled Kashmir.

Giving ammunition to hawks on both the sides against resuming talks, firing across the border has picked up.

Source: Reuters

Liberia struggling, India reports 3 suspected Ebola cases

Liberian officials fear Ebola could soon spread through the capital’s largest slum after residents raided a quarantine center for suspected patients and took items including blood-stained sheets and mattresses.

The violence in the West Point slum occurred late Saturday and was led by residents angry that patients were brought to the holding center from other parts of Monrovia, Tolbert Nyenswah, assistant health minister, said Sunday. It was not immediately clear how many patients had been at the center.

West Point residents went on a “looting spree,” stealing items from the clinic that were likely infected, said a senior police official, who insisted on anonymity because he was not authorized to brief the press. The residents took medical equipment and mattresses and sheets that had bloodstains, he said.

“All between the houses you could see people fleeing with items looted from the patients,” the official said, adding that he now feared “the whole of West Point will be infected.”

Some of the looted items were visibly stained with blood, vomit and excrement, said Richard Kieh, who lives in the area.

The incident creates a new challenge for Liberian health officials who were already struggling to contain the outbreak.

Liberian police restored order to the West Point neighborhood Sunday. Sitting on land between the Montserrado River and the Atlantic Ocean, West Point is home to at least 50,000 people, according to a 2012 survey.

Distrust of government runs high in West Point, with rumors regularly circulating that the government plans to clear the slum out entirely.

Though there had been talk of putting West Point under quarantine should Ebola break out there, assistant health minister Nyenswah said Sunday no such step has been taken. “West Point is not yet quarantined as being reported,” he said.

Ebola has killed 1,145 people in West Africa, including 413 in Liberia, according to the World Health Organization.

Other countries across Africa are grappling to prevent Ebola’s spread with travel restrictions, suspensions of airline flights, public health messages and quarantines.

Nigeria appears to be making progress in containing the disease. The country has 12 confirmed cases of Ebola, all of which stem from direct contact with the Liberian-American man who flew to Nigeria late last month while ill. He infected several health workers before dying.

Since then three others have died in Nigeria from Ebola, according to figures released over the weekend.

One Nigerian doctor has survived the disease and was sent home Saturday night and five others confirmed with Ebola have almost fully recovered, said the Health Minister Onyebuchi Chukwu in a statement Saturday night.

The most important part of containing the disease is to track all those who had contact with Ebola patients and to closely monitor them in order to quarantine if they show any symptoms. Nigeria had 242 people under surveillance but now 61 have been cleared and released, after completing the 21-day quarantine period without showing any signs of Ebola, said the health ministry.

In East Africa, Kenya will bar passengers traveling from the three West African countries badly hit by the Ebola outbreak. The suspension is effective midnight Tuesday for all ports of entry for people traveling from or through Sierra Leone, Guinea and Liberia, said Kenya’s Health Ministry. Nigeria was not included in the ban, which also allows entry to health professionals and Kenyans returning from those countries.

Following the government’s announcement Saturday, Kenya Airways said it would suspend flights to Liberia and Sierra Leone. Kenya Airways, a major transport provider in Africa flies more than 70 flights a week to West Africa.

Several airlines have already suspended flights to Sierra Leone, Guinea and Liberia, including British Airways, Emirates Airlines, Arik Air and ASKY Airlines.

Officials in Cameroon, which borders Nigeria, announced Friday it would suspend all flights from all four Ebola-affected countries. Korean Air announced on Thursday it would temporarily halt its service to Kenya despite the fact there are no cases of Ebola in the country.

Meanwhile in India, three persons from Ebola-affected Nigeria, who arrived here Saturday morning, have been admitted to the Ram Manohar Lohia Hospital in Delhi for screening and treatment if required. The three Nigerians, aged 79, 37 and 4 years had fever and their tests were being done at the National Centre for Disease Control (NCDC), Delhi, an official release said here.

In addition to this, a 32-year-old Indian from Durg in Chhattisgarh who returned from Nigeria has been admitted to a hospital in Bhilai. His samples are also being tested at NCDC, the release said. WHO has said air travel, even from Ebola-affected countries, is low-risk for transmission of the disease.

Source: Fox/TNN

India summons top US diplomat about spying

India summoned the top diplomat from the US for the third time about spying.

A new document supplied by Edward Snowden and made public by The Washington Post on Monday showed that Prime Minister Narendra Modi’s Bharatiya Janata Party was among authorised targets for the NSA in 2010 while it was India’s main opposition.

India has complained to the United States on two other occasions, in July and November 2013, over other revelations — including the disclosure that its UN mission in New York and its Washington embassy were snooped on.

“What we have said is that we expect a response and an assurance that this won’t happen again,” a foreign ministry source told AFP on condition of anonymity.

Both times Washington has said it would look into what it can share about its espionage programme but failed to offer any details, the source said.

“We have said that we would like a response, which we haven’t received,” he said.

The new incident comes ahead of a visit to New Delhi by US Secretary of State John Kerry, who is expected to meet members of Modi’s government in the next few months.

Modi, whose party swept to power in May with the first majority in 30 years, will travel to the United States in September for the UN General Assembly and his first meeting with President Barack Obama.

BRICS to set up own IMF

bricsmapVery soon, the IMF will cease to be the world’s only organization capable of rendering international financial assistance. The BRICS countries are setting up alternative institutions, including a currency reserve pool and a development bank.

The BRICS countries (Brazil, Russia, India, China and South Africa) have made significant progress in setting up structures that would serve as an alternative to the International Monetary Fund and the World Bank, which are dominated by the U.S. and the EU. A currency reserve pool, as a replacement for the IMF, and a BRICS development bank, as a replacement for the World Bank, will begin operating as soon as in 2015, Russian Ambassador at Large Vadim Lukov has said.

Brazil has already drafted a charter for the BRICS Development Bank, while Russia is drawing up intergovernmental agreements on setting the bank up, he added.

In addition, the BRICS countries have already agreed on the amount of authorized capital for the new institutions: $100 billion each. “Talks are under way on the distribution of the initial capital of $50 billion between the partners and on the location for the headquarters of the bank. Each of the BRICS countries has expressed a considerable interest in having the headquarters on its territory,” Lukov said.

It is expected that contributions to the currency reserve pool will be as follows: China, $41 billion; Brazil, India, and Russia, $18 billion each; and South Africa, $5 billion. The amount of the contributions reflects the size of the countries’ economies.

Source: Vz.ru

Russia to cut gas deals with China, India

rosneftLast week we reported that while the West was busy alienating Russia in every diplomatic way possible, without of course exposing its crushing overreliance on Russian energy exports to keep European industries alive, Russia was just as busy cementing its ties with China, in this case courtesy of Europe’s most important company, Gazprom, which is preparing to announce the completion of a “holy grail” natural gas supply deal to Beijing.

We also noted the following: “And as if pushing Russia into the warm embrace of the world’s most populous nation was not enough, there is also the second most populated country in the world, India.” Today we learn just how prescient this particular comment also was, when Reuters reported that Rosneft, the world’s top listed oil producer by output, may join forces with Indian state-run Oil and Natural Gas Corp to supply oil to India over the long term, the Russian state-controlled company said on Tuesday.

It said both companies, which work together on Russia’s Sakhalin-1 project, may also join forces in Rosneft’s yet-to-be built liquefied natural gas plant in the far east of Russia to the benefit of Indian consumers of LNG.

We just have one question: will payment for crude and LNG be made in Rubles or Rupees? Because it certainly won’t be in dollars.

Rosneft, which is increasing oil flows to Asia to diversify away from Europe, did not provide any additional details but said it had discussed potential cooperation with Reliance Industries and Indian Oil.

It did not have to: it is quite clear what is going on. While the US is bumbling every possible foreign policy move in Ukraine (and how could it not with John Kerry at the helm), and certainly in the middle east, where it is alienating Israel and Saudi just to get closer to Iran, Russia is aggressively cementing the next, biggest (certainly in terms of population and natural resources), and most important New Normal geopolitical Eurasian axis: China – Russia – India.

There is only one country missing – Germany. Because while diplomatically Germany is ideologically as close to the US as can be, its economy is far more reliant on China and Russia, something the two nations realize all too well. The second the German industrialists make it clear they are shifting their allegiance to the Eurasian Axis and away from the Group of 6 (ex Germany) most insolvent countries in the world, that will be the moment the days of the current reserve petrocurrency will be numbered.

In 2013 only four NATO members—the U.S., U.K., Greece and Estonia—spent at least 2% of GDP on defense.

At 1.9%, France last year fell short of the 2% that is supposed to be the technical requirement for membership. Denmark spent 1.4% of its GDP on defense, Germany 1.3%, Italy 1.2%, and Spain 0.9%. This is what a country spends if it thinks its main “security threat” is Russia.

Source: Zero Hedge