EDITORIAL
The Collapse of the Roman Empire—Today
Feb. 8 (EIRNS)—Look at the trans-Atlantic financial system. Reports from Europe and the U.S. today reveal a financial system which is dead, with puppet masters pulling strings attached to the corpse to make it appear to be alive. More quantitative easing, negative interest rates, a European Finance Ministry to remove any remaining economic sovereignty from the member nations—all simply trying to make the mass of worthless derivative debts appear to have some value, when they have none.
Look at the military situation. Obama’s closest allies in the Middle East the would-be Sultan Erdogan and the feudal potentate King Salman, planning an invasion of Syria on behalf of their British controllers, frantically trying to stop the drive to victory against terrorism being carried out by the rejuvenated Syrian Army with Russian air support. The Turks’ last supply line into their Al Nusra and ISIS assets is nearly closed off as the Damascus government moves to liberate Aleppo.
Look at the cultural collapse in the U.S. and Europe. The greatest heroin epidemic in history is sweeping the United States, while President Obama is orchestrating an agreement with the world’s leading supplier of cocaine, heroin and marijuana, the FARC narco-terrorists in Colombia, while legalizing drugs across the country.
Lyndon LaRouche today made the point today that the trans-Atlantic nations of the 21st Century are in precisely the same situation as Europe in the 5th Century, with the collapse of the Roman Empire.
Fortunately, there is a new paradigm in the world, led by China and Russia, which offers a path to escape the descent into economic hell and thermonuclear war—if the nations of the West choose to learn from them. While Obama has shut down America’s once great space program, China is building a capacity to colonize the Moon and reach out to Mars, calling all the nations of the world to collaborate.
While Russia is facing down the terrorist scourge created by the British/Obama regime-change wars, Russia itself is threatened from without and from within. Sergei Glazyev, one of Putin’s leading advisors, has openly challenged the monetarists at the Russian Central Bank and their supporters for failing to defend the national currency, and adopting the policies demanded by the City of London—even charging that the foreign exchange market is in the hands of foreign speculators. Glazyev wisely calls on Russia to follow the Chinese model.
Will the people of the U.S. and Europe be as wise? It is a question of creativity, LaRouche argued today. The failure of the West is not due to Mankind’s nature, but due to his corruption. Creativity is expressed in the process of awakening creativity in others, in carrying forth man’s true mission, in each generation—to create a new state of the universe. If people can be brought to recognize the reality that the world is careening into chaos and thermonuclear war in front of our eyes, then they will be capable of clearing out the killer in the White House, shutting down the speculators on Wall Street, and joining with the BRICS in building a new world order based on the common aims of Mankind.
STRATEGIC WAR DANGER
British Troops Train for War against Russia
Feb. 8 (EIRNS)—According to a report in the Telegraph, 1,600 British troops, with 300 armored vehicles, are on their way to Jordan, but they won’t be training to fight ISIS in Syria or Iraq. “Exercise Shamal Storm could be a dry run for one day having to send a large armored force of up to 30,000 British troops to Eastern Europe if there was ever a Russian confrontation with NATO, sources told the Telegraph.” The Telegraph notes that the exercise comes after American commanders last year said they were concerned defense cuts would mean Britain was no longer be able to send a division-strength force of troops to join an allied operation as it did during the Iraq 2003 campaign. A source said: “This isn’t a counter-ISIL exercise. If anything, this is much more about us being prepared to join the U.S. in Ukraine than it is in Syria.”
Turkey’s Erdogan: U.S. Must Choose, It’s Me or the “Terrorists”
Feb. 8 (EIRNS)—During his return flight from an Ibero-American tour, yesterday, Turkish President Recep Tayyip Erdogan denounced the visit of Brett McGurk, Obama’s special envoy to the anti-ISIS coalition, a couple of weeks ago to Kobane inside Kurdish-controlled Syria, during which he met with the leadership of the Kurdish Democratic Union Party/People’s Protection Units (PYD/YPG). While the U.S. is supporting the YPG as effective fighters against ISIS, the Turkish government calls them terrorists, and refused to allow them to attend the aborted Geneva meeting on Syria.
“Just during the meetings in Geneva, [McGurk] travels to Kobane. He receives a plaque from a so-called general in Kobane,” Erdogan ranted, according to Hurriyet. “How will we trust? Am I your partner or are the terrorists in Kobane?”
China Strongly Protests U.S.-South Korea THAAD Plans
Feb. 8 (EIRNS)—The Chinese Vice Foreign Minister Liu Zhenmin Sunday summoned South Korean Ambassador Kim Jang-soo to protest against Seoul and Washington’s agreement to begin talks on deploying a U.S. Terminal High-Altitude Area Defense (THAAD) battery in South Korea, Korea Times reported today. Ambassador Kim is a former Defense Minister.
A Chinese Foreign Ministry statement expressed “deep concern,” about the THAAD discussions. “China’s position on the issue of anti-missile is consistent and clear,” the statement said. “Countries, when pursuing their own security, should take into account others’ security interests as well as regional peace and stability.”
It is abundantly clear to the Chinese—and to the U.S. for that matter—that the THAAD missiles are useless against North Korea, and are only intended as part of Obama’s escalation toward war with China. Reuters reports that “the Pentagon concedes it has yet to be tested” against the type of rockets developed by North Korea.
U.S. protestation that the THAAD, if deployed in South Korea, “would be focused only on North Korea,” carries as much weight as the line that the ABM systems being deployed on Russia’s border in Europe were not aimed at Russia, but defending against Iran.
The Chinese English-language daily Global Times responded in an editorial, calling it a “feeble” cover story. “It is widely believed by military experts that once THAAD is installed, Chinese missiles will be included as its target of surveillance, which will jeopardize Chinese national security,” the editorial said.
The UN passed a resolution Feb. 7 condemning North Korea’s satellite launch as an “intolerable provocation,” but they put off a decision on any new sanctions. Russia and China will reject any sanctions that threaten serious destabilization of North Korea.
The U.S. and South Korean military announced that their annual Key Resolve and Foal Eagle joint exercises will be the largest ever, involving the highest tech weaponry and the USS John Stennis aircraft carrier. The North has repeatedly said that it would curtail tests if the U.S. curtailed its military exercises with the South.
U.S. POLITICAL AND ECONOMIC
Gen. Barry McCaffrey Warns of Dangerous Consequences of Obama’s Deal with the FARC Cartel
Feb. 8 (EIRNS)—Gen. Barry McCaffrey (ret.), who headed the Office of National Drug Control Policy (ONDCP) in the cabinet of President Bill Clinton, said on Feb. 3 that he was very concerned about the agreement that Barack Obama has personally orchestrated with Colombia’s FARC drug cartel, in collaboration with Colombian President and British asset, Juan Manuel Santos.
As reported by PRNewswire, McCaffrey pointed out that the 15th anniversary celebration Feb. 4 at the White House of “Plan Colombia,” demonstrated its success. Plan Colombia was the program that McCaffrey personally formulated, and on which he coordinated closely with Colombian military and civilian leaders to wipe out the FARC narcoterrorists and restore stability to that country. “Cooperation with the government of Colombia led to massive cocaine transit reduction to the U.S., reduced crime, and improved Colombian stability,” McCaffrey underscored.
But, as for the pending agreement with the FARC, tentatively scheduled to be signed in March, General McCaffrey said he fears it would allow the FARC “to maintain or increase cocaine and heroin production, ease transit restrictions and enforcement, keep enormous profits for the FARC, worsen the heroin crisis in our country, threaten the security of Colombia and increase U.S. drug abuse.” Note that most of the heroin entering the U.S. today comes from either Mexico or Colombia—not from Afghanistan.
McCaffrey’s fears are justified. British tool Obama, whose drug-legalization policies have been instrumental in destroying the population—especially youth—of the United States, has personally overseen negotiations with the FARC. He sent his special envoy, former State Department official and now private equity executive Bernard Aronson, to participate in negotiations with the FARC leaders in Havana. According to the New York Times Feb. 5, Aronson was crucial in moving negotiations forward when “they appeared in danger of stalling.”
Who is Aronson? Former Assistant Secretary of State for Inter-American Affairs under George H.W. Bush, he was involved in the 1989 invasion of Panama, and was a strong supporter of the drug-trafficking Contras in Nicaragua, whom he called “freedom fighters” against Soviet expansion.
The FARC has committed unspeakable atrocities in Colombia. So what? In discussing his involvement in the Havana peace talks, Aronson told the New York Times his strategy was to “simply treat the FARC negotiators with respect, cracking the stereotype of the arrogant imperialist.”
COLLAPSING WESTERN FINANCIAL SYSTEM
Glazyev Assails Central Bank and Speculators
Feb. 6 (EIRNS)—Academician Sergei Glazyev, the economist who is Russian President Vladimir Putin’s advisor on Eurasian integration, has escalated his pointed attacks on the Russian Central Bank for promoting speculators, failing to defend the ruble, and thus violating its Constitutional responsibilities.
The ruble is now hovering at around 78 to the dollar, a 50% collapse since its 2015 high of 50 to the dollar in May, and worse than its January 2015 collapse to 69 after the Central Bank floated the currency in December 2014, along with hiking interest rates sky-high.
“The purpose of the international reserves is to ensure the stability of the national currency—they exist for that very reason,” Glazyev told the official news agency TASS Jan. 21. “Our international reserves are twice the size of the amount of rubles in the economy; it is easy to stabilize the ruble exchange rate, and it would even have been possible to keep it fixed over the course of the past year.” These remarks were highlighted by the Financial Times, in an article gloating over the collapse of the ruble and the IMF’s projection that Russia’s GDP would shrink by 1% in 2016, driven by falling oil prices. The FT quoted Central Bank head Elvira Nabiullina that she was unprepared to take such action because she claimed there was currently no risk to financial stability.
In the past ten days, however, Russian leaders have engaged in fierce debates over Finance Minister Anton Siluanov’s announcement of a need to cut the 2016 federal budget by 10% (half a trillion rubles); over Central Bank and Finance Ministry calls for rapid passage of bail-in legislation to allow the forced conversion of deposits into stock shares, in the many Russian banks now in serious trouble; and over the decision to raise cash by privatizing substantial stakes in remaining state-owned giants like the oil company Rosneft, Russian Railways, and VTB Bank. The privatization plan was put on the agenda by the government in 2012, but blocked at that time by Rosneft CEO Igor Sechin and then-head of Russian Railways Vladimir Yakunin.
Speaking Jan. 30 on a Russian News Service talk show, Glazyev charged that Russia’s foreign exchange market is in the hands of foreign speculators. He said that over the past decade, non-residents made three-fourths of all transactions in Russian financial markets, while in the foreign-exchange segment, non-resident participation is as high as 90%. Glazyev noted that the lure of speculation over productive investment is the “insane profit margins,” which are 80-100%. “Let me note,” Glazyev said, “that the U.S. sanctions do not apply to speculative capital, they relate to only long-term loans, which are banned from being given to our country. As for the speculators—take a loan for 30 days, speculate all you want. Given the fact that the Moscow Exchange is run by speculators, they bet on fluctuations, using credit leverage and insider information. The Moscow Exchange has become a primary profit center in the country, which, in the past year of operations, has become two times the size of GDP, and five times the volume of exports or imports. This despite the fact that economic activity in the country is falling. They are pumping money to the banks, pulling it from the real sector, where the profitability is 5-7%.”
Glazyev has just released a 500-page book, titled The Final World War: The U.S.A. Is Starting It, and Losing.” He presented it at a Jan. 20 Moscow press conference, hosted by the Izborsk Club, at which he was joined on the podium, for discussion, by former Internal Affairs Minister and Accounting Chamber head Gen. Sergei Stepashin and Senator Yevgeni Bushmin, a member of Putin’s United Russia party. During the 90-minute event, Glazyev charged that the Russian economy is in the hands of “incompetents,” and that the Chinese model offers a clear and viable alternative, which could have been chosen by Russia. Glazyev said that it was madness to minimize state investment in the economy on the grounds of a lack of money for this in the budget; that budget spending is not the proper source for investment, but that the Central Bank should create new credit and direct it, through regulation, into the real economy. He noted that the spending on the military, at least, has been a net plus for the real economy, driving innovation and preserving industrial capacity.
At the book presentation, Glazyev also pointed to BRICS as representing a better future. He warned in a Jan. 30 interview with Russian News Service (RNS) however, that Russia’s trade, including with BRICS members, is being thrown into disarray by the Central Bank’s policies. “I’ve been engaged in Eurasian integration, he said. “We successfully developed, we made plans that the ruble will become a reserve currency, we persuaded our partners to trade in rubles…. Now our partners don’t want to hear about trading in national currencies. They believe that the depreciation of the currency is unfair competition.” He concluded by blasting the Central Bank: “The Central Bank is not fulfilling its Constitutional duty of ensuring the stability of the exchange rate. As a result, today we have halted many investment projects…. No one knows what the rate will be tomorrow. In these conditions it is impossible to plan the conduct of business, or to invest, or to conduct trade in rubles.”
Panic Surges over U.S., European Economic, Banking Meltdown
Feb. 8 (EIRNS)—Panic swept through Europe, and Wall Street, today as markets and bank shares plunged to new lows. “Growth Fears Stalk European and Wall Street Stock Indices,” the City of London’s daily Financial Times trumpeted, explaining that “worries about the darkening outlook for global growth spreading across global markets.” Recession risks “are growing everywhere we look,” said one UBS analyst. “Developed and emerging markets are struggling in tandem, leaving no obvious areas to look for growth.”
All European markets plummeted sharply: Paris, down 3.2%; Germany’s DAX, 3.30%, London’s FTSE, 2.71%, Milan, 4.69%, and Athens, a whopping 7.8%. Greek banking shares also tanked, by 27.21% for Piraeus Bank, 17.65% for Alpha Bank, and 29.2% for Eurobank. This was the case throughout Europe, with HSBC-London dropping 2.7%, Germany’s Commerzbank, 6.7%, and Deutsche Bank, 4.7%. No one escaped—BNP Paribas, Société Générale, Crédit Agricole, Barclays—all the big names. With good reason, ZeroHedge website referred it to a “European Bank Bloodbath…Not only is it time to panic, but the panic is ‘contagion’-ing over the sovereign risk market. European banks are in freefall.”
The Guardian today notes the evaluation of the Institute for Fiscal Studies (IFS) thinktank in London, which reports that leading British experts say that the turmoil on the global stock market threatens to leave a €2 billion “black hole” in Chancellor of the Exchequer George Osborne’s deficit reduction plan, “that could force the chancellor to raise taxes or make fresh cuts in spending in order to hit budget targets.
As of mid-afternoon in New York, the Dow Jones was down by 400 points, CNBC reported. Later in the day, it “rebounded,” closing at 178 down. Goldman Sachs, whose shares fell by 6.5% in afternoon trading, was one of the key contributors to the Dow’s fall. “We’re in a very broad-based sell-off. Investors are selling first and asking questions later,” said Adam Sarhan, CEO of Sarhan Capital.
Indicating flight-to-safety patterns, the yield on the 10-year Treasury note is now below 175 (1.74%), as people are getting out of all other assets.
Are Negative Interest Rates for U.S. Coming Soon?
Feb. 8 (EIRNS)—The likelihood that the Federal Reserve will opt for negative interest rates, following Japan’s recent decision, is, Bloomberg reports, much greater now due to the accelerating collapse of the U.S. economy. If the U.S. economy weakens to the point where “traditional measures” don’t work, then the Fed may opt for negative rates, according to Bank of America Corp. and JPMorgan Chase & Co.
Which “traditional measures” they mean aren’t spelled out, but anything short of what Lyndon LaRouche is proposing for a real economic recovery, won’t work in any case. Yet brain-dead analysts argue that five other central banks have implemented this policy—Denmark, the euro area, Japan, Sweden and Switzerland—and everything is going swimmingly. No one is hoarding their cash or refusing to deposit it, they say. And, were the Fed to go with below-zero rates, Bloomberg cheerfully asserts, this “would broaden the Fed’s toolkit beyond what was available during the financial crisis” of 2008.
The geniuses at the Fed have determined that the possibility of negative rates won’t arise unless “the U.S. looks like it’s in a recession … which they don’t anticipate.” Apparently, they haven’t noticed that they’re sitting in the middle of a devastating U.S. economic collapse. In a speech last week, Cleveland Fed President Loretta Mester said she expects the economy to “work through” this latest episode of market turbulence and “soft patch” to regain moderate growth. Yet, a delusional Michael Feroli, JPMorgan’s chief economist in New York, argues that should the economy tank, “the absence of major snafus overseas may have made” negative rates “a more attractive ‘in case of emergency break glass’ option for the Fed.”
Franco-German Initiative for Creation of EU Finance Ministry
Feb. 8 (EIRNS)—The presidents of the central banks of France and Germany, François Villeroy de Galhau of the Banque de France and Jens Weidmann of the Bundesbank, have published a joint call today simultaneously in Le Monde and Süddeutsche Zeitung, for the creation of a European Finance Ministry, finishing off what little economic sovereignty remains to members of the Eurozone. Coming one day before the session of Franco-German Economic and Financial Ministers Council in Paris, and a few days before the Ecofin meeting of the EU Economic and Financial Affairs Council on Feb. 12, the two insist that “euro-area member states would clearly have to allow a comprehensive sharing of sovereignty and powers at the European level,” as ostensibly the “most straightforward solution to restore confidence in the euro area.”
Their proposals involve the establishing of a real finance ministry for at least the Eurozone, in the last instance, however, for all of the European Union, and “an efficient and less fragmented European administration … These new institutions would restore the balance between liability and control.”
Süddeutsche Zeitung adds that similar, concrete proposals have been made by the European Central bank’s directorate member Benoît Coeuré, that ECB President Mario Draghi is sympathetic to the proposal, and that there are congruences with proposals made earlier by French President François Hollande for the creation of an all-European Economic Government. The proposed transfer of even more sovereignty to “Europe” is certain, however, to face fierce opposition in numerous member states, including in the French and German populations.
Their call, “Europe at the Crossroads,” is also posted in English on the Banque de France and Bundesbank websites.
THE NEW GLOBAL ECONOMIC ORDER
BRICS Is a Significant Global Power Says Russian Deputy Foreign Minister
Feb. 8 (EIRNS)—Russia’s Deputy Foreign Minister Sergey Ryabkov today underscored that attacks on the BRICS grouping is the best indicator of its global importance.
In remarks to TASS today, Ryabkov said, “There is much speculation today, especially in the West, that the economic dynamics of some BRICS members have run out of steam and that the association is not what it used to be.” However, he added, attacks on the BRICS, of which there have been many recently, “are the best sign of the BRICS’ importance and the significance of this structure for international relations. If this had not been the case, BRICS would have been simply ignored.”
He noted that some opponents of Russia suffer from the problem that “they cannot calmly perceive something that does not fit into their own conceptions or their ideas regarding the international relations. If something does not have the label ‘made in the West,’ this causes suspicion and rejection from the outset.” The Western bias of those critics is so obvious, Ryabkov continued, that “it can only bring a smile. People who are ready to perceive a modern and multi-polar world should approach such phenomena as BRICS in a much calmer way,” he concluded.
Greek Prime Minister Completes Highly Successful Official Visit to Iran
Feb. 8 (EIRNS)—Greek Prime Minister Alexis Tsipras completed a highly successful official visit to Iran, the first of a European leader since sanctions were lifted on Tehran. Within his two-day visit on Feb. 7-8, together with other Greek leaders, Tsipras met with Iran’s Supreme Leader Ayatollah Ali Khamenei and President Hassan Rouhani among other high government and institutional figures.
On Feb. 7, Tsipras visited the Pardis Technology Park (PTP) where he stressed that the two countries could work together in the areas of technology, innovation, energy, trade, culture and shipping. He added that Greece will act as a conduit for establishing economic, trade and energy cooperation between Iran and the European Union. Referring to the historic bonds between the two countries, Tsipras said, “Our two countries are joined by the important bonds of two strong cultures but we can also be joined in the future through cooperation in a series of areas, such as new technologies.” He added that Greece has made a “strategic choice” to expand relations with Iran.
Receiving the Greek prime minister, PTP President Mahdi Safarinia said that Tsipras was “the most independent leader in Europe” and invited Greek companies involved in research and technology to participate in the major innovation and technology exhibition taking place in Iran in May.
On Feb. 8 Tsipras met President Hassan Rouhani during which the President remarked that Iran is ready to expand ties with the European Union, but that Iran does not consider Greece as just a member of EU, but at the same time, the two countries have made major contributions to the world scientific development.
Several political and economic agreements were signed. The fact that both Iran and Greece are critical parts of the Chinese New Silk Road process makes the establishment of strong ties between these two historic cultures of great importance internationally.
