All posts by Moderator

China will not allow G20 to discuss Hong Kong, says foreign minister

Foreign powers have no right to interfere in ‘internal affair’, says Zhang Jun, as Beijing also calls for trade compromise

China has said it will not allow the G20 nations to discuss the Hong Kong issue at its summit this week, assistant foreign minister Zhang Jun said on Monday.

Millions of people demonstrated on the streets of the city this month against a bill that would allow people to be extradited to the mainland to face trial in courts controlled by the Communist party.

Related: Hong Kong’s elite fear extradition law could harm their reputation

What is the proposed extradition law?

Related: Forget China – it’s America’s own economic system that’s broken | Robert Reich

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The Best Smart Gadgets For Your Home

What are the must-have home gadgets of 2019? Technology innovations such as artificial intelligence and machine vision are now entering our home gadgets, and in this post, I look at the best home-tech gadgets available this year.

Escobar: One Quadrillion Reasons Why Washington Fears Iran’s “Maximum Counter-Pressure”

Authored by Pepe Escobar via The Strategic Culture Foundation,

Sooner or later the US “maximum pressure” on Iran would inevitably be met by “maximum counter-pressure”. Sparks are ominously bound to fly…

For the past few days, intelligence circles across Eurasia had been prodding Tehran to consider a quite straightforward scenario. There would be no need to shut down the Strait of Hormuz if Quds Force commander, General Qasem Soleimani, the ultimate Pentagon bête noire, explained in detail, on global media, that Washington simply does not have the military capacity to keep the Strait open.

As I previously reported, shutting down the Strait of Hormuz would destroy the American economy by detonating the $1.2 quadrillion derivatives market; and that would collapse the world banking system, crushing the world’s $80 trillion GDP and causing an unprecedented depression.

Soleimani should also state bluntly that Iran may in fact shut down the Strait of Hormuz if the nation is prevented from exporting essential two million barrels of oil a day, mostly to Asia. Exports, which before illegal US sanctions and de facto blockade would normally reach 2.5 million barrels a day, now may be down to only 400,000.

Soleimani’s intervention would align with consistent signs already coming from the IRGC. The Persian Gulf is being described as an imminent “shooting gallery.” Brigadier General Hossein Salami stressed that Iran’s ballistic missiles are capable of hitting “carriers in the sea” with pinpoint precision. The whole northern border of the Persian Gulf, on Iranian territory, is lined up with anti-ship missiles – as I confirmed with IRGC-related sources.

We’ll let you know when it’s closed

Then, it happened.

Chairman of the Chiefs of Staff of the Iranian Armed Forces, Major General Mohammad Baqeri, went straight to the point; “If the Islamic Republic of Iran were determined to prevent export of oil from the Persian Gulf, that determination would be realized in full and announced in public, in view of the power of the country and its Armed Forces.”

The facts are stark. Tehran simply won’t accept all-out economic war lying down – prevented to export the oil that protects its economic survival. The Strait of Hormuz question has been officially addressed. Now it’s time for the derivatives.

Presenting detailed derivatives analysis plus military analysis to global media would force the media pack, mostly Western, to go to Warren Buffett to see if it is true. And it is true. Soleimani, according to this scenario, should say as much and recommend that the media go talk to Warren Buffett.

The extent of a possible derivatives crisis is an uber-taboo theme for the Washington consensus institutions. According to one of my American banking sources, the most accurate figure – $1.2 quadrillion – comes from a Swiss banker, off the record. He should know; the Bank of International Settlements (BIS) – the central bank of central banks – is in Basle.

The key point is it doesn’t matter how the Strait of Hormuz is blocked.

It could be a false flag. Or it could be because the Iranian government feels it’s going to be attacked and then sinks a cargo ship or two. What matters is the final result; any blocking of the energy flow will lead the price of oil to reach $200 a barrel, $500 or even, according to some Goldman Sachs projections, $1,000.

Another US banking source explains:

“The key in the analysis is what is called notional. They are so far out of the money that they are said to mean nothing. But in a crisis the notional can become real.  For example, if I buy a call for a million barrels of oil at $300 a barrel, my cost will not be very great as it is thought to be inconceivable that the price will go that high.  That is notional.  But if the Strait is closed, that can become a stupendous figure.”

BIS will only commit, officially, to indicate the total notional amount outstanding for contracts in derivatives markers is an estimated $542.4 trillion. But this is just an estimate.

The banking source adds, “Even here it is the notional that has meaning.  Huge amounts are interest rate derivatives. Most are notional but if oil goes to a thousand dollars a barrel, then this will affect interest rates if 45% of the world’s GDP is oil. This is what is called in business a contingent liability.”

Goldman Sachs has projected a feasible, possible $1,000 a barrel a few weeks after the Strait of Hormuz being shut down. This figure, times 100 million barrels of oil produced per day, leads us to 45% of the $80 trillion global GDP. It’s self-evident the world economy would collapse based on just that alone.

War dogs barking mad

As much as 30% of the world’s oil supply transits the Persian Gulf and the Strait of Hormuz. Wily Persian Gulf traders – who know better – are virtually unanimous; if Tehran was really responsible for the Gulf of Oman tanker incident, oil prices would be going through the roof by now. They aren’t.

Iran’s territorial waters in the Strait of Hormuz amount to 12 nautical miles (22 km). Since 1959, Iran recognizes only non-military naval transit.

Since 1972, Oman’s territorial waters in the Strait of Hormuz also amount to 12 nautical miles. At its narrowest, the width of the Strait is 21 nautical miles (39 km). That means, crucially, that half of the Strait of Hormuz is in Iranian territorial waters, and the other half in Oman’s. There are no “international waters”.

And that adds to Tehran now openly saying that Iran may decide to close the Strait of Hormuz publicly – and not by stealth.

Iran’s indirect, asymmetric warfare response to any US adventure will be very painful. Prof. Mohammad Marandi of the University of Tehran once again reconfirmed, “even a limited strike will be met by a major and disproportionate response.” And that means gloves off, big time; anything from really blowing up tankers to, in Marandi’s words, “Saudi and UAE oil facilities in flames”.

Hezbollah will launch tens of thousands of missiles against Israel. As Hezbollah’s secretary-general Hasan Nasrallah has been stressing in his speeches, “war on Iran will not remain within that country’s borders, rather it will mean that the entire [Middle East] region will be set ablaze. All of the American forces and interests in the region will be wiped out, and with them the conspirators, first among them Israel and the Saudi ruling family.”

It’s quite enlightening to pay close attention to what this Israel intel op is saying. The dogs of war though are barking mad.

Earlier this week, US Secretary of State Mike Pompeo jetted to CENTCOM in Tampa to discuss “regional security concerns and ongoing operations” with – skeptical – generals, a euphemism for “maxim pressure” eventually leading to war on Iran.

Iranian diplomacy, discreetly, has already informed the EU – and the Swiss – about their ability to crash the entire world economy. But still that was not enough to remove US sanctions.

War zone in effect

As it stands in Trumpland, former CIA Mike “We lied, We cheated, We stole” Pompeo – America’s “top diplomat” – is virtually running the Pentagon. “Acting” secretary Shanahan performed self-immolation. Pompeo continues to actively sell the notion the “intelligence community is convinced” Iran is responsible for the Gulf of Oman tanker incident. Washington is ablaze with rumors of an ominous double bill in the near future; Pompeo as head of the Pentagon and Psycho John Bolton as Secretary of State. That would spell out War.

Yet even before sparks start to fly, Iran could declare that the Persian Gulf is in a state of war; declare that the Strait of Hormuz is a war zone; and then ban all “hostile” military and civilian traffic in its half of the Strait. Without firing a single shot, no shipping company on the planet would have oil tankers transiting the Persian Gulf.

Oregon Militias Threaten Violence Over GOP Carbon Credit Standoff; Capitol Closed For Safety

Oregon militias have reportedly threatened violence over an ongoing standoff between GOP and Democratic state legislators over climate change legislation, according to the Wall Street Journal

“The State Police Superintendent just informed the Senate president of a credible threat from militia groups coming to the Capitol tomorrow,” reads a text message sent out to senators on Friday. “The Superintendent strongly recommends that no one come to the Capitol.”

It is unclear what the threats were, as the state’s Democratic leadership did not provide evidence of their claim. 

On Saturday, Oregon State Police said that they were monitoring threats and that they were closing the building. 

The safety of legislators, staff and citizen visitors could be compromised if certain threatened behaviors were realized,” said state police captain Tim Fox. 

On Thursday, the Three Percenters, a group that joined the armed takeover in the Malheur National Wildlife Refuge in 2016, said it would do whatever was necessary to keep the Republican senators safe. The Republicans said they wouldn’t accept the group’s help. –Wall Street Journal

What began as a disagreement over a cap-and-trade bill that exacerbated a growing divide between city-dwelling Oregon liberals and their conservative rural counterparts erupted into a full-fledged standoff after eleven GOP senators banded together and are refusing to show up for the vote

Despite holding an 18 to 12 supermajority in the House and Senate, Democrats cannot approve the bill without at least two Republicans present. After several days of heated debate between the two sides, eleven GOP members mutually agreed to boycott the vote. 

The bill, HB 2020, would make Oregon the second state in the country to set up a cap-and-trade system for all sectors of the economy. California was the first, after passing a similar bill in 2016.

Democrats had scheduled a vote on the bill Thursday, but all 11 Republican senators fled the state. At least 20 senators must be present for a quorum, so Democrats need at least two Republicans present to hold a vote. –Wall Street Journal

After Governor Brown (D) authorized state police to hunt down and wrangle the absentee GOP lawmakers, Sen. Brian Boquist (R) said he was prepared for a bloody standoff if state troopers show up – warning “Send bachelors, and come heavily armed; I’m not going to be a political prisoner in the state of Oregon, it’s just that simple.” 

The eleven senators are also being hit with a $500 daily fine for each day they refuse to show up for the vote. They say they won’t come back until Democrats agree to major changes in the bill, which they have argued would cripple manufacturing and other industries in the state. 

“This bill needs to be referred to the voters” due to its profound impact on Oregon’s economy, said Republican senate leader Sen. Herman Baertschiger Jr., speaking by phone from outside the state.

Sen. Michael Dembrow, one of the Democratic architects of the bill, said manufacturers had already been given major exemptions under the bill and that Republicans were only stalling to kill the bill. Voters could still gather signatures for a ballot measure to repeal the bill, he said, but unlike with a referendum, work on it could proceed in the meantime.

He said the Democrats’ resolve had been strengthened by the Republicans’ flight from the state. “The last thing we can do is make this kind of behavior the norm, because then it’ll happen every session,” Mr. Dembrow said. –Wall Street Journal

Democratic legislators say they will return to the Senate floor Sunday whether or not Republicans had returned.

Dead On Arrival: A Brief Post-Mortem On The US’ Regime-Change Operation In Venezuela

Authored by Joaquin Flores via The Strategic Culture Foundation,

They say hindsight is 20/20, and nothing exemplifies that more than the kind of post-mortem that can be done on the failed attempt by the US to overthrow the government of Venezuela.  Working through the lack of options that the US has in terms of regime-change in Venezuela, should lead towards a higher degree of investor confidence in the Bolivarian Republic.

We understand that there are ultimately only three ways to attack a target state until it collapses:

  1. Supporting an internal coup/revolution or terrorism;

  2. Economic embargo perhaps leading to or justified by 1, and;

  3. Military invasion justified by the government’s reaction to 1

Then we can see that US has failed in the first two. While the US does appear on the rhetorical level to be willing to embargo the rest of planet earth, they would have to effectively do so in order to embargo Venezuela. By promoting globalization as a virtue, at the institutional level, and not simply recognizing it with problems and all as an inherent component of market economies, the US has withered its own ability to control other civilizations and states in the world’s growing multipolar system.

While the US can place sanctions on Venezuela, and get some countries to even go along with these sanctions, it only improves or strengthens the role and power of those middle-man countries like China which act as ‘value transactors’ of Venezuelan commodities into the global economy. Because it is impossible to ‘cut’ China out of the global economy, it is impossible to cut Venezuela out as well.  Given how much China is invested into Venezuela’s economy, as the Wall Street Journal notes, there’s little chance that will change either.

Despite an effort to unseat the democratically elected PSUV government, we were offered some keen insights into the US’s own self-realization regarding their failed process, and publicly so by Pompeo himself.

The level of honesty coming from the Trump administration in the US is refreshing even as it is only half the truth. When we read that Pompeo has explained that the Venezuelan opposition is ‘divided’, this is of course nothing other than good news for those concerned with regional stability, economic development, and a de-escalation of tensions that can lead towards war and instability.

It is also tremendously true, even if Pompeo doesn’t really explain why it’s the case, at least not entirely. But the facticity of the claim in itself reveals that there can be no US sponsored ‘internal regime change’ in Venezuela. Both the governments of Brazil and Colombia – close US allies under their present administrations – have ruled out any sort of military intervention into Venezuela.

Pompeo’s Confession

In comments published by the Washington Post, from an audio recording, it was reported then that Pompeo admitted that:

“We were trying to support various religious institutions so that the opposition would unite,” Pompeo remarked, going on to explain that “they [the opposition] remain divided on how to confront the Maduro regime.”

This admission came on the heels of the recorded statement to the WP, where he previously explained:

“Our dilemma, which is to keep the (Venezuelan) opposition together, has turned out to be tremendously difficult,”

He continued, saying that:

“At the moment when (Nicolás) Maduro leaves, everyone will raise their hands and say: ‘Choose me, I’m the next president of Venezuela.’”

Subsequent to that comment, he would explain that an excess of 40 different Venezuelan opposition politicians have come forward expressing their view that as Guaido is but a transitional figure, that they ought to be ‘selected’ by the US to win an actual (i.e. staged) election. This would be, ideally for them, an election that comes on the heels of an absolute restructuring of the security apparatus of Venezuela. The idea would be to ensure the marginalization of the PSUV forces from the electoral process, a ‘counter-revolution’ of sorts. The staged elections involving various opposition parties and leaders would be an afterthought in all reality. And still, there is no consensus among this opposition on who should lead.

Pompeo expressed tremendous exasperation with this state of affairs, commenting that his realization of the problem isn’t one that came about recently, but is one in fact he was aware of since he began his work in the Trump administration with the CIA. To that point he stressed that these are problems which not only manifested themselves in “public during these last months, but since the day I became director of the CIA (Central Intelligence Agency), this was something that He was at the center of what President Trump was trying to do. ”

That’s to say, Pompeo understood this problem all along. The whole project was dead on arrival.

There is no military option

Given that Venezuela can’t really be effectively more embargoed than it presently is, the US is left with one option remaining. Yes, that leaves military options, nominally on the table in terms of US pressure tactics and techniques. But the reality is that these are something much less tangible than the US has historically relied upon. A lot of this has to do with the general decline of the US military in comparative terms. While the US maintains something approximating its military capacity in absolute terms, compared to a decade or two ago, it has not managed to maintain that in relative or comparative terms. The ‘gap’ between the U.S and other rising powers, military speaking – and this reflects economic changes as well – has become smaller.  Even the Washington Post, as well as other mainstream US billionaire blogs, has admitted as much.

The fact of Venezuela’s anti-air capabilities in the form of the S-300 system are enough to bring unacceptable levels of material and human loss to the US air forces (Navy/Marine, Army, etc.). These could potentially bring the number of downed US fighters to many dozens in the first hours, of the first sortie. The loss of prestige alongside the scores of Cindy Sheehans this would produce, makes the venture a non-starter from go.

So this leaves the US in something of a conundrum. It has indeed brought Venezuela to the near point of collapse over the course of recent years, creating an economic catastrophe through a combination of sanctions and the manipulation of oil prices. But it failed to push it over the edge, and its thanks to a growing and new international consensus that this was the case.

Venezuelan leadership for its part has admitted also that there are a number of measures and policies that ought to have been in place, long term economic measure in terms of diversifying the economy that would have helped to off-set the worst of the damage done by the manipulated attack on Venezuela’s economy. We’ll recall that Russia experienced similar, based in the same manipulation of oil prices, leading to a temporary ‘shock’ to the Ruble, which plummeted in value relative to the Dollar overnight, stoking a major crisis between June and December of 2014. Russia was in a better position to manage this, and though without hiccups, has managed to avoid the sorts of repercussions that Venezuela has faced.

Strong reasons for optimism and the coming bullish trend

The inability of the US to move further against Venezuela’s economy has only given Caracas time, and organization, to work around them. These work-around measures by Venezuela can improve, but the distance between the economic attacks from the US, and the operationalizing of Guiado in a coup gambit, was too great for the US to use them in combination in an effective way.

It’s worth noting also that the general ‘game plan’ of the US has been effectively written about, expounded publicly, and absorbed by private intelligence agencies and government networks alike. The science and art of regime change has given rise to the science and art of the counter-coup.

When we understand that there is no really viable military option, Caracas knows that it is bracing for further acts of terrorism and sabotage on its critical infrastructure. International help in combatting such state-sponsored terrorism, as reported by Venezuelan state news agency TeleSur has already been had, however, and so we can expect that we will see how effective this has been through the lack of much materializing in this direction.

Taken all together, the essentials for a rebounded Venezuelan economy are in place. Investor confidence and the assurances to Spanish, and therefore by extension German, banking interests operating without the US as a middle-man in Latin America, are well-founded and lead towards a bullish trend.

As a post-mortem on the US’s failed regime change operation in Venezuela, it is an excellent case study in how the international community can properly deal with and respond to the often irrational and potentially destabilizing actions of former global hegemons when in a state of decline. As far as Venezuela is concerned, it’s an excellent case study in sovereignty in the 21st century, despite a west-centric socio-economic focus on globalization.