China economic growth winding down?

Major shifts underway in the Chinese economy that Stratfor has forecast and discussed for years have now drawn the attention of the mainstream media. Many have asked when China would find itself in an economic crisis, to which we have answered that China has been there for awhile -- something not widely recognized outside China, and particularly not in the United States. A crisis can exist before it is recognized. The admission that a crisis exists is a critical moment, because this is when most others start to change their behavior in reaction to the crisis. The question we had been asking was when the Chinese economic crisis would finally become an accepted fact, thus changing the global dynamic.

Last week, the crisis was announced with a flourish. First, The New York Times columnist and Nobel Prize-recipient Paul Krugman penned a piece titled "Hitting China's Wall." He wrote, "The signs are now unmistakable: China is in big trouble. We're not talking about some minor setback along the way, but something more fundamental. The country's whole way of doing business, the economic system that has driven three decades of incredible growth, has reached its limits. You could say that the Chinese model is about to hit its Great Wall, and the only question now is just how bad the crash will be."

Later in the week, Ben Levisohn authored a column in Barron's called "Smoke Signals from China." He wrote, "In the classic disaster flick 'The Towering Inferno' partygoers ignored a fire in a storage room because they assumed it has been contained. Are investors making the same mistake with China?" He goes on to answer his question, saying, "Unlike three months ago, when investors were placing big bets that China's policymakers would pump cash into the economy to spur growth, the markets seem to have accepted the fact that sluggish growth for the world's second largest economy is its new normal."

Read it all here.

 

Nigeria Emerging Economic Power

"Africa has more than one story. When we get to know it well and completely, we surprisingly discover a continent that is big, joyful, generous, enthusiastic and optimistic. It is today the darling of many foreign investors, and the world's superpowers are competing to lay first claim to it, not now as lords as in times past, but with a desire to be first to be regarded Africa's friends. So much has it grown in many facets, economy included, that it portends hope for many peoples.

A one-word Ibo proverb "Nkoli" loosely translates to "tell your own story". Harambee blog sets out to contribute local brush strokes to build the real story about Africa told by Africans themselves.

There is much hope Africa can offer the rest of the world; from its love of life and family, to the heroic examples of people who have withstood great odds with a smile on their lips, and great stories of innovation achieved with limited resources." --Eugene Ohu, a Nigerian freelance journalist

_______________________________

From his office overlooking the Bank of England and the Shard, Charlie Robertson, one of the leading emerging market economists in the City, shows me his charts and graphs. According to his research, what started as a boom for raw materials will culminate with the complete transformation of the African continent by 2050.


Nigeria’s reinforced foundations

The Nigerian economy will eclipse South Africa, which by then will become just a regional player. I query whether the growth in countries like Nigeria, is built on shaky foundations, and whether corruption will undermine its prospects.

“All I can talk about is what I’ve seen,” says Robertson. He points to Sanusi Lamido Sanusi, Nigeria’s Central Bank Governor since 2009, “who is remarkable. I haven’t heard anyone suggest that he’s in any way corrupt.”

And Sanusi is not alone. “If you go to the central government side, you’ve got Ngozi Okonjo-Iweala who could have been the World Bank chief, if the Americans and Europeans hadn’t stitched up who gets the top job at the IMF and the World Bank…she’s that good.”

There is also the agriculture minister, “who looks great,” the trade and industry minister, the stock exchange chairman. “You seem to have a whole load of people with global and western skills in Africa pushing for change in the right direction.”

However, he concedes that Nigeria’s reputation for corruption is something that cannot be brushed aside. “I’m not naïve,” he says. “One of the key things I talk about is corruption and I say, well there’s a lot of corruption. This is normal at this income level, and inevitable, but you have got countries that are making a big difference.”

He points to a chart showing corruption linked to per capita GDP, with scores of 1 to 10 given by Transparency International. “Now the thing about all of these countries that are getting a good score, is that they are all rich…If you are poor, if your per capita GDP is $7000 or less, you are perceived to be corrupt.”

This suggests that the growth of the middle class in many Sub-Saharan African countries will mean an increase of educated people who are starting to question the government, demanding accountability.

“Basically we’re all pretty badly behaved when we’re poor, and as you get richer you begin to demand more transparency and more improvement. It’s not even about democracy versus dictatorship, because a lot of these countries like Qatar and Singapore don’t get great scores on democracy. But they are nonetheless seen to be quite un-corrupt, compared to poor countries,” says Robertson pointing to his chart.

“So my argument is that corruption is a problem and it will continue to be a problem until Sub-Saharan GDP is at $10,000, which we’re not going to get to for another 20 years, before you start to record scores in a three to six range instead of a 2 to 4 range. It’s going to be a very long process I suspect.”

“So my first point is corruption does exist, it is an obstacle. However, you’ve got good people in place to do the right thing. If you look at transparency scores for Nigeria, in 2001 it had a score of 1, today it’s got a score of 2.4. That was the 3rd best improvement of any country since 2001.”

Nevertheless, when it comes to Africa, it is, of course, not all plain sailing. Robertson admits there is a risk of countries going backwards, but he says: “That’s true for almost all the African countries.”


Democracy happens at $6000 GDP

There is an element that Robertson refers to as the democratisation risk. When per capita GDP reaches US$6000 p.a. all countries become democracies other than oil exporters, but before the country reaches that level of GDP there are inherent risks of failure in the system.

To support this theory he points to the fact that every country in the world which had a per capita GDP above $6000 in 2009 is a democracy of sorts, apart from six countries. The exceptions are China, which he predicts will democratise within a decade, Belarus, Cuba and Singapore. Tunisia and Thailand the other two of those six countries are now both democracies. “Tunisia which obviously led the whole Arab revolution, and the reason it led it in my view, was because their per capita GDP was over $6000, the middle class was ready for democracy.”

“Now that’s good, as you get richer, democracy gets stronger, and never ever dies. There is no case in history of a country above $10,000 losing democracy, it’s never happened. But sadly if you’re at $2000 or less of GDP, there’s quite a high chance, in fact, in any given year there’s about an 8 per cent chance of losing democracy,” Robertson explains. Hence the democratisation risk.

“A year ago when I started writing this book an 8 per cent chance, basically told me that one or two of them were likely to fall to a coup in any given year. And they did, Mauritania and Mali, and there should be, statistically, another coup this year in a nice but fragile democracy.”

Read it all here.

 

USA: Education, Jobs and Family

Digital textbooks. That is the latest idea from the White House for lifting the performance of American schools -- a strategy on which Korea and other countries are already ahead. Something certainly needs to be done; a new report from the Harvard Business School identifies the education system from kindergarten through to the end of high school (K-12) as one of the root causes of the country’s decline in business competitiveness.

Whether technology really is the solution, however, is in doubt. A must-read book published last week warns that America is coming apart culturally and not just economically. Marriage, the work ethic, respect for the law and religious practice are values increasingly absent from even white working class homes, while very much holding their own among the upper class, says author Charles Murray.

But without those supports it is difficult for children to benefit even from the best schools. And when they don’t, it is not only bad news for them but another nail in the coffin of US competitiveness.

In the 1980s US business was losing ground against Japan; today it’s the world, especially the developing economies where there is not only cheaper unskilled labour but also, according to 1700 Harvard Business School alumni personally involved in decisions about where to place business activities and jobs last year, “better access to skilled labour”.

Among those respondents, two-thirds of their decisions about placing business went against the US, say Michael E Porter and Jan W Rivkin, directors of the school’s US Competitiveness Project, in their report, Prosperity at Risk. Two thirds. “Facilities involving large numbers of jobs, high-end work [research, development and engineering], and groups of activities located together moved out of the US much faster than they moved in.”

When asked what they saw as the main problems with the US business environment the business leaders put the K-12 eduction system at the top of the list along with America’s tax code and political system. It was one of six weaknesses they viewed as getting worse.

What exactly they thought was wrong with education is not reported, but clearly the system is not turning out sufficiently skilled, productive and adaptable people. The businessmen themselves agree that they can and must be part of the solution -- by supporting educational institutions and investing in workforce sills, among other things. But to fully address these practical issues they need to look deeper.

As a number of academics and scholars have pointed out, America (and the West in general) has been running down its human and social capital for some decades now. Charles Murray is just the latest to point out that the effects have been distributed in a very lopsided way. He writes:

When Americans used to brag about "the American way of life"—a phrase still in common use in 1960—they were talking about a civic culture that swept an extremely large proportion of Americans of all classes into its embrace. It was a culture encompassing shared experiences of daily life and shared assumptions about central American values involving marriage, honesty, hard work and religiosity.

Over the past 50 years, that common civic culture has unraveled. We have developed a new upper class with advanced educations, often obtained at elite schools, sharing tastes and preferences that set them apart from mainstream America. At the same time, we have developed a new lower class, characterized not by poverty but by withdrawal from America's core cultural institutions.

The withdrawal of the working class from marriage (just 48 per cent of 30- to 49-year-old adults with only a high school education are now married), divorce, the rise of single-parenthood and cohabitation, the loss of community and moral support from church attendance and membership of other civic groups, combined with rising crime, unemployment and erosion of a work ethic -- all this has put a huge swathe of children at a disadvantage in the education system.

Murray’s work confirms the landmark 2010 study, When Marriage Disappears: The Retreat from Marriage in Middle America, by W Bradford Wilcox and colleagues. Their report sounded the alarm that the erosion of marriage had reached deep into American society, affecting the 58 per cent of the population that is moderately educated, threatening “the American Dream” of economic mobility and, in particular, the emotional and social welfare of children. They said:

“We know, for instance, that children who grow up in intact, married families are significantly more likely to graduate from high school, finish college, become gainfully employed, and enjoy a stable family life themselves, compared to their peers who grow up in non-intact families.”

By the late 2000s, they noted, non-marital childbirths accounted for a disturbing 44 percent of children born to moderately educated mothers -- up from 13 per cent in the early 1980s, and 54 percent of children born to the least-educated mothers, but only 6 percent of children born to highly educated mothers. Only 58 per cent of Middle American kids today will grow up with both their mom and dad to the age of 14.

This is the reality that business leaders and Harvard heavyweights need to come to grips with.

If children do not have a stable home, if their parents are not committed to one another, if they split up and a step-parent enters the scene, if the father is absent, the mother struggling alone or in successive relationships with boyfriends -- how much more difficult it will be for them to settle to homework, to get help with it, to focus on the world of learning and think in terms of a college or vocational degree. Chances are they will prefer to escape family tensions by immersing themselves in television or the internet.

(A recent study found that “students who have experienced repeated changes in their family structure status will be less successful academically” even when attending schools with a strong academic culture and support for students.)

And how much less likely children are to learn the virtues that will make them reliable and ambitious workers -- honesty, delayed gratification, industriousness -- when parents themselves do not have the traditional supports for morality, especially the church, or any replacement for them, and this at a time when unemployment, crime and the culturally corrosive power of the mass media are all against them.

Academics, as Wilcox has noted, have been reluctant to accept that the trends affecting family life in much of American society (as elsewhere) are a problem. Many hold to the line that the family is just changing, not declining.

This is not a mistake that business leaders or smart politicians should make. They should let the data talk. Today, 38 per cent of kids from intact families will continue their education and get a college degree compared with only 20 per cent from non-intact families. Children and adults who are not connected to an intact family, says Wilcox, are significantly less likely to strive to succeed and save.

The When Marriage Disappears report suggested that,

Given the current trends, it is not too far-fetched to imagine that the United States could be heading toward a 21st century version of a traditional Latin American model of family life, where only a comparatively small oligarchy enjoys a stable married and family life—and the economic and social fruits that flow from strong marriages. In this model, the middle and lower-middle classes would find it difficult to achieve the same goals for their families and would be bedeviled by family discord and economic insecurity.

That, combined with a North American model of the job market would seem to be the worst of all possible worlds for Middle America, and indeed, for the whole country. Not just America but any nation that wants to compete in the globalised economy will have to first look after the family. Then the family will produce the social capital that will make everything else work. There is no other way.


Carolyn Moynihan is deputy editor of MercatorNet.


Editor's Note:  Every institution in our society has a self-serving agenda and/or ideology that has an impact on the education of students. I teach in a Christian school that is committed to Young Earth Creationism. This ideology, though not supported by the Bible, precludes the offering of courses such as astronomy and geology.  In other words, the school is less committed to a well-rounded education for the students than to an ideology that the Bible itself debunks.



Related reading:  American Higher Education Mimics China; Dorothy Sayers, The Lost Tools of Learning; Diane Ravitch, “The Language Police: How Pressure Groups Restrict What Students Learn,”

Vatican Calls for Financial Reforms

by George Patsourakos

The Vatican called today (October 24, 2011) for radical reform of the world's financial systems -- including the creation of a global political authority to manage the economy -- according to the Huffington Post website.

A proposal by the Pontifical Council for Justice and Peace calls for a new world economic order based on ethics and the "achievement of a universal common good."

The proposal suggests the reform process -- which will take some time to complete -- begin with the United Nations as a point of reference.

"It is an exercise of responsibility not only toward the current but above all toward future generations, so that hope for a better future and confidence in human dignity and capacity for good may never be extinguished," the document said.

From here.

USA-China: Who's Talking Nonsense

Noah Millman

I’m trying to understand, per this post by Matt Yglesias, why when China asks us to reduce our indebtedness that reflects “confusion” on their part (since their currency policy depends on there being lots of American debt to purchase) while when we ask China to reduce their trade surplus we’re just being clear and honest (even though we’re dependent on Chinese debt purchases to keep long-term rates as low as they are).

It seems to me both countries are dependent on a policy that has risks and unpleasant side effects for both countries. I happen to think the short-term costs are more serious for the Chinese while the long-term risks are new serious for us – but it’s pretty clear that both countries manifest a high degree of policy confusion, at least with respect to our public statements. I see no reason to single out the Chinese for talking “nonsense.”

Source:  The American Scene

 

Related reading:  US Government's Addiction to Debt

Who Controls Banking and Oil and...?

The Four Horsemen of Banking (Bank of America, JP Morgan Chase, Citigroup and Wells Fargo) own the Four Horsemen of Oil (Exxon Mobil, Royal Dutch/Shell, BP Amoco and Chevron Texaco); in tandem with Deutsche Bank, BNP, Barclays and other European old money behemoths. But their monopoly over the global economy does not end at the edge of the oil patch.

According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation. [1]

So who then are the stockholders in these money center banks?

This information is guarded much more closely. My queries to bank regulatory agencies regarding stock ownership in the top 25 US bank holding companies were given Freedom of Information Act status, before being denied on “national security” grounds. This is rather ironic, since many of the bank’s stockholders reside in Europe.

Read it all here.

 

 

US Near End of Game on Debt

Ron Robins, Founder & Analyst - Investing for the Soul


It is a simple statistic that continues to warn of huge economic problems ahead for the US. Some economists call it the ‘marginal productivity of debt (MPD).’ It relates the change in the level of all debt (consumer, corporate, government etc.) in a country to the change in its gross domestic product (GDP). However, due to the message it is delivering, most US economists employed in financial institutions, governments and private industry, as well as financiers and politicians, want to ignore it.

And for the US economy and government finances, the MPD (and related variants of it) is continuing to indicate extremely difficult economic times ahead.

I have vague recollections of the MPD concept from my economics classes long ago. But I was re-introduced to it around 2001 by a renowned economist who, during the following few years prior to his passing, became alarmed as to the MPD path of the US. His name was Dr. Kurt Richebächer, formerly chief economist and managing director of Germany’s Dresdner Bank. Dr. Richebächer, was so respected that former US Federal Reserve Chairman, Paul Volcker once said of him that, “sometimes I think that the job of central bankers is to prove Kurt Richebächer wrong," reported the online financial journal, The Daily Reckoning on May 15, 2004.

Investigating Dr. Richebächer’s concern further, I wrote an article on my Enlightened Economics blog on January 23, 2008, titled, Is the Amazing US Debt Productivity Decline Coming to a Bad End? I found that, “for decades, each dollar of new debt has created increasingly less and less national income and economic activity. With this ‘debt productivity decline,’ new evidence suggests we could be near the end-game... ”

Another way of viewing the debt productivity problem is to look at it in terms of how many dollars of debt it took to help create total national income, which is the wages, salaries, profits, rents and interest income of everyone. Again, from my above mentioned article, which quotes Michael Hodges in his Total America Debt Report, that, “in 1957 there was $1.86 in debt for each dollar of net national income, but [by] 2006 there was $4.60 of debt for each dollar of national income - up 147 per cent. It also means this extra $2.74 of debt per dollar of national income produced zilch extra national income. In 2006 alone it took $6.32 of new debt to produce one dollar of national income.”

Such data helps explain why US exponential debt growth—after reaching certain limits—collapsed in 2008 and contributed massively to the global financial crash.

However, whereas the US private sector debt has marginally ‘de-leveraged’ (retrenched) since that crash (which might now be reversing), the US government, as everyone knows, has run up mammoth deficits to purportedly keep the country’s economy from imploding. Thus, the US’s MPD is marching to another, perhaps even more frightening tune, suggesting government financial insolvency and/or debt default.

One fascinating way of looking at the declining MPD of US government debt has just been presented by Rob Arnott on May 9, 2011, in his post, Does Unreal GDP Drive Our Policy Choices? What Mr. Arnott does is to subtract out the change in debt growth from GDP, and refers to this statistic as ‘Structural GDP.’ He finds that, “the real per capita Structural GDP, after subtracting the growth in public debt, remains 10 per cent below the 2007 peak, and is down 5 per cent in the past decade. Net of deficit spending, our prosperity is nearly unchanged from 1998, 13 years ago.”

In its effort to counter the significant economic difficulties since 2008, the US government has added, or will have added, around $4 trillion in deficits (financed by new debt) in its three fiscal years 2009, 2010 and 2011. Yet, all this massive government deficit spending has failed to really ignite economic growth. Most likely this is because of the enormous dead weight of unproductive and onerous private sector debt, particularly that of consumer debt. Hence, real US GDP will have increased probably less than $1.5trn during these years. Including some further economic benefit in the years thereafter, a total GDP benefit of only about $2trn is probable.

So, $4trn borrowed for $2trn in GDP gains. Thus, in very rough round numbers, each new one dollar of US government debt might only produce $0.50 in new economic activity and probably only about $0.08 in new federal tax revenue. (Federal tax revenue as a percentage of GDP is around 15 per cent.) Therefore, the economic marginal return for each new dollar of US government debt is possibly around -50 per cent! If you loaned someone $10 million and they gave you back $5m, you would not be happy!

Hence, it might not be long before those holding or buying US government bonds perceive the reality that the US government, and US economy, are losing massively on government borrowings. This will result in much, much higher US government bond yields and interest costs. Most importantly, it may make the rollover of US debt and new debt issuance incredibly difficult unless either US taxes rise stratospherically to cover the deficits, and/or the US Federal Reserve money printing goes into hyper-drive to purchase the debt the markets will not buy. (Of course US banks, pension funds etc., could also be forced to buy them.)

Thus, the idea that US government debt continues to be ‘risk-free’ is absurd.

For this, and for many other reasons cited above, is why the US financial and political elites want to keep hush-hush about what the MPD and its variants reveal!


Copyright alrroya

The United Religions Initiative

Lee Penn

Bishop William Swing of the Episcopal Church's Diocese of California thinks he is building a religious bridge to the new millennium, and he wants everybody on Earth to cross it with him. His United Religions Initiative (URI) is trying to create a kind of parliament of religions, "a permanent assembly, with the stature and visibility of the United Nations, where the world's religions and spiritual communities will gather on a daily basis, in prayerful dialogue and cooperative action, to make peace among religions and to be a force for peace among nations." As Bishop Swing has said, the world is moving toward "unity in terms of global economy, global media, global ecological system. What is missing is a global soul." And how will this global soul be found or created? By conferences, networking, fundraising, declarations, and press releases.

The URI to date has held three annual summit conferences, each time with more attendees, among them various Christians, Jews, Muslims, Buddhists, Shintoists, Bahá'is, Sikhs, Hindus, Zoroastrians, New Age followers, Wiccans, and representatives of aboriginal religions. (There have been no representatives from the Vatican or from evangelical Protestant churches.) These conferences have called for a 72-hour worldwide religious "cease-fire" on December 31, 1999, and have issued a draft "United Religions Charter." In June of 2000, the URI plans to stage global ceremonies marking the signing of this Charter, for by then the URI hopes to have enrolled 60 million people in what it describes as "a Worldwide Movement to create the United Religions as a lived reality locally and regionally, all over the world."

Read it all here.

World Youth Conference Promoted Radicalism

The United Nation Youth Conference was radical in every sense of the word.  That is it aimed at the root (radix) of human society: the father-mother-child relationship.

The Aug. 23-27 World Youth Conference in León, Mexico featured sexually explicit brochures, an exhibit with sex toys and a youth-produced manifesto calling for gender redefinition.

“They know that if they introduce sexuality at a younger and younger age they have a great chance at taking our children from us,” Ruse said.

Launched in August with a theme of “dialogue and mutual understanding,” the International Year of Youth “aims to promote the ideals of peace, respect for human rights and solidarity across generations, cultures, religions and civilizations,” according to a U.N. release. Three overarching objectives are identified: increasing commitment and investment in youth; increasing youth participation and partnerships, and increasing intercultural understanding among youth.

But Ruse and Catholic Family (C-Fam) point to sexual indoctrination and gender confusion too.

The gathering in Mexico, an initiative of the Mexico government, featured three conferences — one each for youth, governments and parliamentarians — and an exhibit titled the Global Interactive Forum.

Catholic Family's concern prior to the conference was the document that more than 100 government delegations — including the Holy See — were going to be asked to endorse. A U.N. member state provided C-FAM with an advance copy of the document draft — and they didn’t like what they saw.

“This document strikes right at the heart of the parent-child bond,” Ruse wrote in a fundraising letter prior to the conference. “It demands radical and complete autonomy for young people, separate from their parents. The document doesn’t even use the hated word ‘parent.’”

Read it all here.

Coming Soon: Global Trade War?

By Ron Robins, Founder & Analyst - Investing for the Soul

A ‘long depression’ is starting in the US unless massive new stimulus measures are taken to increase consumption and China forced to mark up its currency. This is what renowned Nobel economics laureate Paul Krugman believes. Since any new massive stimulus action is unlikely soon, and if we are to believe what Mr Krugman is saying, then with a depression occurring the ranks of American unemployed could swell by millions more. They, together with the uproar of US unions and politicians, will blame China and others for their woes.

The US Congress would then enact trade tariffs and restrictions beginning round one of the 21st Century Global Trade War!

But have we not learned from the 1930s that a trade war can lead to a depression? Mr Krugman disputes that finding. In a July 10 New York Times post he says that it was not the trade restrictions of the Smoot-Hawley bill that created the depression. The depression had already started and, “protectionism led to falling exports! Indeed. Also falling imports. It’s not at all clear what effect all this had on overall demand. Insofar as it did, it was because tariffs were a form of tax increase — but in that case you should be focusing on the whole range of fiscal actions, not just the tariff hikes.”

As indicated, currently there is little likelihood of Mr. Krugman’s proposal of enacting massive new stimulus measures—he mentions around $1 trillion—as well as for China marking up its currency significantly against the dollar. However, he may still get his way if unemployment or economic stagnation—or worse—takes hold.

If the stimulus is enacted it is highly debatable if it would work any better than previous ones in firing up consumption and investment. Already over the past two years or so, the US government and the Federal Reserve have poured about $4.5 trillion into the American economy. In rough figures, this comprises about $3 trillion in US government deficits and over $1.5 trillion from the Federal Reserve as it bought bonds and other assets to increase cash in the financial system and promote lending. Then there are of course the trillions more in guarantees to various financial and industrial entities such AIG, GM etc.

However, the Federal Reserve also says it stands ready to act should the economy weaken further. Would it spend another $1, 2 or 3 trillion? If the trillions spent so far by it and the US government have not worked, how much more will be needed?

Furthermore, the additional government deficits and Federal Reserve actions might alarm holders of US dollar denominated assets about America’s solvency, encouraging them to sell such assets. In fact, China’s new debt rating agency Dagong says the US government is already insolvent.

So, additional stimulus actions might also crash the US dollar. If that were to happen, it would cause dramatically rising prices for oil and other goods. A significant increase in living costs amidst high or growing unemployment will promote social unrest and add further impetus to growing calls for protectionism.

A dollar crash would create conditions for ‘competitive currency devaluations.’ In 2009, when the euro was trading as high as $1.50, Europeans became alarmed. Henri Guaino, right-hand man of President Nicolas Sarkozy remarked, “the euro at $1.50 is a disaster for the European economy and industry… "

Would Europe stand idly by and see their euro go into the stratosphere as the dollar crashed against it? Would the European Union then enter into a currency war with the US? Would Japan be silent seeing its currency rise substantially against the dollar? Of course Japan is famous for intervening in currency markets to lower the yen’s value against the dollar in previous difficult times. Unfortunately, competitive currency devaluations would add fuel to a trade war.

Already Global Trade Alert counts 650 protectionist measures implemented between the advent of the financial crises in 2008 and the June 2010 G20 Toronto meeting.

According to the International Business Times, the G20 communiqué “included a ritual promise to ‘refrain from raising barriers or imposing new barriers to investment or trade in goods and services.’ But missing from the final declaration… was a sentence reportedly included in an earlier draft of the communiqué: ‘Where any protectionist measures have been enacted in the context of the economic crisis, we agree that these should be lifted.’ Somehow that sentence, pledging a rollback of protectionist trade barriers erected during the Great Recession [2008 to today], disappeared sometime between when the draft declaration was leaked to the media by Greenpeace and when the final declaration was released to the press with solemn summit fanfare.”

Furthermore, the G20 in Toronto took off its agenda setting a further date for completing the vital Doha round of global trade talks that have been stuck in neutral for several years. Perhaps the US already staked out its real position - remember the ‘buy American only’ clause in its $787 billion stimulus package.

The woes of the US stem from failing to see its years of over consumption were a problem. Now, economists like Mr Krugman want even more money from their financiers like China, so they can further increase consumption, while blaming China for their overconsumption.

Unfortunately, an extended double dip down recession-depression is increasingly probable and with it rising unemployment. In a few weeks or months, the pressure for more action to stem the economic decline could impel the US government and the Federal Reserve to spend more, much more—and to what effect? The alarm of all this might cause holders of dollar assets to sell, culminating in a dollar crash—and further incite a 21st century global trade war.

From here.

Al Gore: Selective Ignorance?

Al Gore slammed Sarah Palin during an interview with NBC's Andrea Mitchell today. He said "the deniers are persisting in an era of unreality. The entire North Polar ice cap is disappearing before our eyes ... what do they think is happening?"

Well, that's true, but what about the fact that average global temperatures have been falling since 2004?  Let's answer the question.

And what about the fact that the glaciers at the opposite end of the Earth are growing?  Interesting how selective Mr. Gore is in the information he provides. Antarctica has more sea ice now than 30 years ago. Ice levels had been lower throughout much of 2008, but rapidly recovered in the last quarter of that year. In fact, the rate of increase from September 2008 onward is the fastest rate of change on record, either upwards or downwards.

How do you explain that, Mr Gore?  Its due to rebound.  The Earth's cycle of climatic change is complex and still beyond our grasp, but we are learning.  It helps when we consider the facts objectively.  That's what science does.

Worldwide there is more sea ice now than there was in 1980. There is less ice around Greenland because the north Atlantic is in its multi-decadal warm phase (AMO). To counter that, the Pacific is in its multi-decadal cold phase (PDO) so the ice has increased on the Pacific side of the Arctic.

And what about the fact that the Sahara is greening?

Here is yet another example of Sarah Palin being on the peoples' side.  As Michael Barone has noted:  when it comes to global warming, "the elites of academe, the media and big business have been solidly on one side for years."  He points out that "the American public has been moving in the other direction."

Summit on Climate Opens Today

COPENHAGEN, Dec 6: 192 nations will be represented in Copenhagen today to address climate change.

Given the brief history of environmentalism many still wonder what model is being used at the 12-day conference in Copenhagen. Is this summit about science or globalism and economics?

The goal is to cooperate on environmental concerns that have an impact on the weather globally. The members are under pressure to come to an agreement by those who have vested powerful economic and national interests and have contibuted to the Copenhagen summit.

192 members of the UN’s Framework Convention on Climate Change will find it a challenge to broker a deal, and President Obama seeks recognition as one of the world's leaders in this attempt.  The December 19 finale will be attended by over world 100 leaders.

Manipulating Climate Data

When news of climategate first broke and spread across the blogosphere, the reaction from the scientists involved and their many supporters was much like Frank Morgan in The Wizard of Oz, "Do you presume to criticize The Great Oz?" Now that Toto has pulled back the curtain by posting emails, computer codes and other materials online for Dorothy and the world to see, things in the world of climate science will never be the same.

Phil Jones, the man whose emails are now open for all to see, has stepped down as Director of the Climatic Research Centre at the University of East Anglia. East Anglia says it will review the leaked material "to determine whether there is any evidence of the manipulation or suppression of data which is at odds with acceptable scientific practice." Climate scientists who support global warming and the Copenhagen process continue to say there is nothing in the leaks to show data was manipulated and that nothing has changed. Yet the university, one of the premiere institutions for climate science and the one which provided the research backbone to many reports on global warming, says it sees enough to investigate.

Read the full report here.



Stephen M Barr, a professor of physics at the Bartol Research Institute at the University of Delaware, picks up the theme:

Ideologues who would trample down legitimate scientific questions raised by their entirely qualified colleagues are risking terrible damage to science in the long run. If it turns out, as it might, that the global warming fears are overblown or ill-founded, the credibility of the scientific establishment will suffer a grievous blow from which it will be hard to recover. It will open the door for all the real kooks and purveyors of pseudoscience, who will be that much harder to resist in the future. And what if at some point in the future an environmental catastrophe looms about which there really is a solid consensus in the scientific community? And what if at that point it really is only kooks who deny it? Won’t non-scientists be disposed to say: ‘We’ve heard that all before? We believed you the last time and you led us astray?’

Related reading: Scientists Behaving Badly

Uncertain Future of US Dollar

Last autumn's global financial crisis set off an economic earthquake. And we are still feeling the tremors. The latest sign of the ground shifting beneath our feet is our report today of plans by Gulf states, China, Russia, France and Japan to end their practice of conducting oil deals in US dollars, switching instead to a diverse basket of currencies.

It is not hard to see the motivation for oil exporters to move away from the dollar. The value of the US currency has fallen sharply since last year's meltdown. And fears are growing, in the light of a spiralling US government deficit, that a further depreciation is likely. They do not want to sell their wares in return for a currency with an uncertain future.

Read more here.

U.N., Clinton Want Global Food Management

UNITED NATIONS, Sept 27: UN chief Ban Ki-moon and US Secretary of State Hillary Rodham Clinton led on Saturday calls for quick action to ensure global food security as millions suffer from hunger due to the economic crisis and climate change.

Calling chronic hunger and the unrest it can spark “one of the most urgent threats facing our world,” Mrs Clinton said it was imperative to introduce a comprehensive, coordinated approach to the problem focussed at least as much on food production as on emergency aid to prevent famine.

Ms Clinton and Mr Ban were addressing a meeting they co-hosted to discuss ways to boost global food security.

“This is an issue that affects all of us because food security is about economic, environmental and national security for individual homelands and the world,” she said.

“There is more than enough food in the world, yet today more than one billion people are hungry,” Mr Ban said. “This is unacceptable,” he told the event attended by representatives from nearly 100 countries.

Although food shortages that led to rioting in some developing countries in 2008 have subsided, he said they had highlighted serious deficiencies in the current approach to hunger.

“The food crisis is far from over,” Mr Ban said. “Ever more people are denied the food they need because prices are stubbornly high, because their purchasing power has fallen due to the economic crisis or because rains have failed and reserve stocks of grain have been eaten.”

The UN system responded with ‘rapid and robust’ support when the crisis hit, he said, noting for example how the World Food Programme (WFP) built up food and nutrition safety nets and raised record funding to reach the world’s most vulnerable people.

Foreign Minister Shah Mehmood Qureshi said food security challenges could not be addressed without allowing free and fair trade and giving market incentives to farmers.

“Multi-stakeholder partnerships at national, regional and international level supported by timely, adequate and predictable financing is the key to addressing food security challenges on a sustained basis,” he said.

In Pakistan, Mr Qureshi said, the World Food Programme approximated half of the country’s population to be food-insecure.

“Yet, in the face of extreme hardships, serious resource constraints and new challenges posed by the global financial crisis and an ever worsening global climate, we remain steadfast in our political commitment to making sustained financial allocations at the national level to overcome these challenges. We realise that there are three key aspects of the food crisis – food supply, lags in distribution channels and limited access to food”.

Pakistan, he said, had taken the following steps to accomplish the objectives: It raised the support price for wheat to give incentives to farmers to increase wheat production; liberalised import of essential commodities to use market channels to facilitate flow of food commodities into the country; and set up high-level committees to stabilise fluctuations in food prices, and instituted a Rs34 billion Benazir Income Support Programme to provide cash to 3.4 million poor households.

Ahead of a world summit on food security in November, Mr Ban and Ms Clinton said the new efforts must assist small farmers, many of them women, with expertise to improve crop yields and improve infrastructure to get surplus produce to markets.

In July, the leaders of the G8 leading industrialised democracies pledged $20 billion to promote food security. The US will contribute $3.5 billion to the effort over the next three years and Ms Clinton appealed for other nations to step up.

But participants also heard about some success stories from Rwanda, with Rwandan President Paul Kagame explaining that thanks to irrigation projects and access to micro-credit for farmers “for three years we have realised food surplus.”

Source: Pakistan Dawn

Schools as Vaccination Centers

Schools to Become Mass Swine Flu Vaccination Clinics
"Highly likely" that large scale operations will be implemented in US and UK

Steve Watson Infowars.net
Friday, August 7, 2009


Schools in both the US and the UK are set to serve as mass vaccination sites in the Autumn as government officials on both sides of the Atlantic consider plans that could see a push to inoculate every child in both countries against swine flu.

In the US, Federal officials representing Health and Human Services, the Department of Education and the Department of Homeland Security have briefed twelve heads of education associations, unions and child care providers on plans to implement mass vaccination in schools.
New York State United Teachers president Dick Iannuzzi, who was present at the briefing, told USA Today that it is "highly likely" that schools will be used for student vaccinations.

"That would be the optimum place to have that happen," he said, noting that there was "consensus in the room" about the wisdom of using schools as vaccination sites.

Federal officials put "a much stronger emphasis — stronger than I've heard in years" — on encouraging school districts and local health departments to open schools as immunization centers, said Amy Garcia, executive director of the National Association of School Nurses.

Meanwhile, government ministers in the UK are considering plans to place vaccination posts in every school in the country in what would amount to the biggest mass immunisation in 45 years.
All 8.5 million pupils aged five to 16, could be given the injections at the UK's 33,700 schools, the largest vaccination programme since the 1964 operation against smallpox.

The Department of Health has stated that no decision has yet been made on the programme and that parents would need to give permission for their child to be vaccinated.

Read more here.

Coming Soon: One-World Currency

L'AQUILA, July 10 (RIA Novosti) - Russian President Dmitry Medvedev said on Friday he had been given an example coin of a possible global currency at the G8 summit in Italy, adding that all aspects of reserve currencies were under discussion.

"We are discussing both the use of other national currencies, including the ruble, as a reserve currency, as well as supranational currencies," the Russian leader said at a news conference following the G8 summit.

Medvedev showed reporters an example of a coin of a supranational currency, which he called a "united future world currency."

"This is a symbol of our unity and our desire to settle such issues jointly," Medvedev said, adding that the coin had been made in Belgium.

He also expressed the hope that a day would come when something of the kind would be used for payment.

From here.

Obama's Words From Accra to the World

Judith Michale, Undersecretary of State for Public Diplomacy and Public Affairs, told reporters today that the administration is teaming up with the State Department to combine old media and new media to create a strategy to reach the most people possible.

Before the President’s speech in Ghana last week, a SMS texting service was set up throughout Africa and they invited people to text the president in either English or French -- resulting in nearly 16,000 messages from 87 countries in Africa and beyond. The US embassy in South Africa partnered with a mobile-based social networking site and garnered an additional 200,000 questions and comments from throughout the continent.

As the president spoke on Saturday before parliament in Accra, the administration sent simultaneous SMS highlights of the speech to over 12,000 people in 80 countries in French and English and solicited their feedback via text message. These messages were posted on america.gov, the State Department's public diplomacy web site, and on whitehouse.gov.

Read it all here.

Soaring Global Food Prices

The rising cost of food is affecting millions of families who struggle to stretch their meagre earnings. Among the poorest worldwide the bottom has already fallen out. What can be done? Who will address this ethical concern?

The Christian Science Monitor reports on the shock of rising food prices around the world.

Americans may fret that Wheat Thins cost 15 percent more than a year ago but in poor nations, such price hikes aren't taken lightly. In Ivory Coast last week, women rioted against higher food costs, leaving one person dead.

In Haiti, four people were killed in protests last week over a 50 percent rise in the cost of food staples in the past year. From Egypt to Vietnam, price rises of 40 percent or more for rice, wheat, and corn are stirring unrest and forcing governments to take drastic steps, such as blocking grain exports and arresting farmers who hoard surpluses.

The UN International Fund for Agriculture predicts food riots will become common on the world scene for at least a year. The World Bank says 33 countries face unrest from higher prices in both food and energy.

Even in grain-rich America, wholesale food prices are rising at a rate not seen in 27 years. The most acute "ag-flation," however, is in Asia and Africa, where food costs take up a higher proportion of family income. And the face of hunger is now seen more in cities as a historic shift takes place with more than half of the world's population soon to be living in or near urban areas.

Read it all.