Saudi Arabia’s Terminal Decline

By: Stewart Brennan

Saudi Arabia has 25% of the Worlds known oil reserves and that's a huge amount, because global economics depends heavily on oil energy to foster growth…but what happens when after 70 years of extraction the oil in Saudi Arabia goes into terminal decline? The answer is economic collapse…

BREAKING NEWS!

Saudi Arabia to sell off their oil assets to the tune of 2Trillion Dollars

The above headline should have raised the attention and anxiety levels of many people around the world...but this very significant statement seems to have passed by without much notice...but it should be a huge wake up call.

“OIL” is the sole natural resource that Saudi Arabia possesses, so their plan to sell off all their oil assets tells me that they have now passed a critical point in their oil production and have entered a serious phase of “Terminal Decline”…You can be sure that the oil left in the ground is not worth 2 Trillion dollars so I would caution and say “Buyer Beware!” but also caution that if Saudi Arabia has indeed gone past their peak, then the world is in for a very bumpy ride as indeed the Saudi’s have already dragged us through their insane extremist mindset in Syria, Yemen, Libya, and many other places across Asia, Africa and the Middle East to hide this fact…

The panic within the house of Saud is there for all to see and became evident in a 2013 open letter by Prince Alwaleed, the nephew of deceased king, Abdullah, where he revealed that “92% of the Saudi government budget relies on oil revenues”. He also expressed that "Revenue diversification is a must, and that it necessitates a clear vision that should be implemented immediately," He also called on Saudi authorities to prepare plans to generate nuclear energy and renewable energy to "reduce local consumption of oil as soon as possible". These startling concerns point to the Saudi’s being in an advanced state of “Terminal Decline” and that the action required by the Saudi regime was extremely urgent.

For a country that claims to be swimming in oil, the alarm here is quite clear, that there just isn’t going to be enough oil for the country to sustain its future needs. The timing of the announcement is also interesting as their total financial support of the ISIL terrorist army had not yet come into being, nor had they declared war on Yemen at that point...and oil was trading well over $100.00 per barrel.

Today, the oil revenue of Saudi Arabia does not even cover the Saudi government budget so we must look at all the reasons for why that is.

Saudi Arabia ramps up austerity to avoid budget deficit

The original Video and the News channel of Press TV were victims of Western censorship and removed from YouTube to cover up the crimes of Saudi Arabia. Where possible, I will insert a mirror video of the report.

Video Source: Press TV

Low Market Price for Oil

Much has been said about Saudi Arabia keeping their oil output high to drive global prices lower to keep shale oil competition out of the market…that would be true if the Saudi’s were in a strong financial position to launch such an economic war…but they clearly were not in good financial shape and they knew it…And since the Saudi’s needed money it would have been better for them to reduce their production and drive the market prices higher rather than keeping the price low through a higher production…It makes no logical sense that they would lower the price of oil when they knew it would cause them economic disaster…this is one area that panic could have influenced their actions…but they knew that losing this economic gamble would drive them to financial ruin…now they are in a position that they need to sell off all their oil assets…and they are indeed in a panic.

Also of special note, within Prince Alwaleed’s open letter is that he calls for the acquisition of nuclear energy as an alternative to oil…this statement should give everyone pause considering the sociopathic and sadistic actions this regime has employed against the people of the region through their outright sponsoring of terrorism and twisted belief in supremist ideology.

Another big give away that I believe furthers the argument of Saudi Arabia’s Terminal oil Decline was that in November 2013, the Saudi’s announced that they were going to deport hundreds of thousands of foreign workers who mostly worked in the oil industry, and its supporting community. They cited that it was to create jobs for their own people and yet the deportations were brutal and massive in scope. As most managerial people know, training unskilled workers to do the jobs that skilled and experienced workers held before them is a very costly and time consuming process…especially when a large segment of the skilled foreign worker pool is replaced…results don't happen overnight so things just don’t add up unless the thought of peak oil comes into the picture…

Saudi Arabia to deport thousands of Egyptian workers - (2013)

The original Video and the News channel of Press TV were victims of Western censorship and removed from YouTube to cover up the crimes of Saudi Arabia. Where possible, I will insert a mirror video of the report.

Source: Press TV

When a nation deports people on a massive scale such as this, they are preparing for an economic calamity and or an immanent war. This was a very drastic and paranoid move by the Saudi government in 2013…and as we look back, the war on Yemen and their own economic collapse had not happened yet. 

Corruption in the House

Going back to an article from 2003 titled “The Fall of the House of Saud” written by ex CIA officer “Robert Baer” in “The Atlantic”, the number of family members in the house of Saud, was between 10,000 to 12,000 and rising. He reports that they were emptying the royal treasury by their increasing demand for royal stipends while also boldly engaging in criminal activity.

Fraud certainly took its toll on the Saudi government budget, but I have no doubt, that some of those criminal schemes were put to an end by King Abdullah while he was building and funding his terrorist army and training schools in other nations.

Indeed, the Saudi’s support and funding of fanaticism, terrorism, and war throughout the Middle East, Africa, and Eurasia has taken a severe toll on Saudi money reserves, so much so that they have actually had to borrow billions of dollars to meet this years budget.

The Saudi’s were the largest exporter of oil to the world, with 25% of known global oil reserves. They made a lot of money over the past 45 years and it looks increasingly clear that many of the Saud family members have squandered their entire fortune on maintaining a lavish criminal lifestyle while also shouldering the cost of their violent ideology while warring on neighbouring countries…all while the general population of Saudi Arabia lives in a state of brutal abject poverty…

Documentary - Saudi Arabia Uncovered

Saudi Arabia is now trying to ward off national bankruptcy by implementing austerity measures. According to the IMF, the Saudi’s would need the selling price of oil to be around $106.00 per barrel just to avoid a budget deficit. But in 2013 according to the IMF, Saudi Arabia needed $89.00 per Barrel to balance its budget and in 2012 it needed $78.00 per barrel to balance its budget.

The Saudi argument in 2013 for their budget deficit was that the shale oil Industry in the USA was responsible for their decline in oil sales, but today the shale oil industry is in complete decay. The amount of cash required for a barrel of oil, to balance the Saudi budget, has risen exponentially year on year. Where more than 90% of the budget is dependent on the sale of oil…

Here’s the thing, once an oil pocket recedes past a certain point, water has to be pumped in to maintain the outflow…however, as the oil is extracted, more water has to be pumped in to maintain pressure and therefore more water has to be separated from the oil which in turn increases the cost of extracting it. The costs rise exponentially until the oil well is no longer productive. Once the increased cost of oil extraction passes the actual market price per barrel then it is no longer profitable…if your budget requires $106.00 per barrel and the price of oil is below that, then losses are going to occur. Today’s oil prices are hovering between $30.00 and $40.00 per barrel…. UMMMM, Houston, they have a problem…

If the Saudi’s need money, then ideally, all they have to do is cut production to drive the oil price up, but instead they will sell their oil assets? It doesn’t add up, unless they have gone into terminal decline and need to sell off their oil assets to secure some sort of future…

The global economy is contracting and therefore oil is not in as big a demand as it would be with a growing economy, and that really is the global situation today, economic contraction worldwide…but it doesn’t answer the question as to why the Saudi’s would sell off their ONLY resource and their only future, because oil powers economic growth, not just for the present, but for the future as well…there are many things the Saudi's could do to save money...one would be to stop buying weapons from all the western countries, and cut some of those royal stipends that seem to find their way into offshore accounts...

Maybe the Saudi’s should not invest themselves in criminal wars! After all, funding global terrorism and waging war on other countries like Syria and Yemen does drain a treasury dry now doesn’t it...just ask the Americans…add to that the internal fraud, lavish lifestyles and the funded projects of its twisted Ideology all over the World…but I digress…

I believe that Saudi oil is in severe terminal decline, and since the US dollar is deeply connected with Saudi Arabia who controls OPEC, the American’s might be trying to distance themselves from the Saudi’s as we are witnessing with the list of people just thrown under the bus by the planned leak of the “Panama Papers”. 

The leaked documents include the Saudi King along with some of his associates from Qatar, Jordan, and U.A.E. How wonderfully convenient if you are trying to distance yourself from a few used up dictators and their involvement of war crimes and crimes against humanity by having a leak…adding Petro (Petrol) Poroshenko means he is no longer useful as well…

Could they be preparing for an immanent stock market crash? After all, a sharp decline of 25% in global oil production will certainly have an effect on the global stock markets. Anyone who is in debt will want to be sure that they are liquid when it happens, but don’t stash your cash in Panama…because one might find themselves shaken down in the upcoming lawsuits that will help the US recover some of their 19 Trillion dollar deficit before they go down in flames…

Then again, maybe the US is desperate to find a way back into the Middle East and offered Putin a bribe or a blackmail threat when John Kerry showed Vladimir Putin what was in his briefcase…judging by all the smirks, the Russians already knew what John Kerry was up to…

Video Source: Russia Today

If the Saudi’s are in terminal decline, and I believe they are, then the US Oligarch’s will do anything to retain their power and that means they need a way back into the Middle East but at the moment, they have no choice but to deal with Russia or continue in the same direction that the Saudi Regime is headed…bankruptcy…after all, oil is what powers an economy and the US must import a great deal of oil to power its military and keep their economy afloat…the energy future belongs to Russia…
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Dedicated to Michael C. Ruppert

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LINKS:

Saudi Arabia to sell off their oil assets to the tune of 2Trillion Dollars

Saudi ramps up austerity to avoid budget deficit

Saudi Arabia requires an 8 Billion dollar loan to meet their2016 budget.

Saudi Arabia braces for $39bn deficit, to cut wages due to low oil prices

The Fall of the House of Saud (2003) – Robert Baer

US Senator at the Council on Foreign Relations “Saudi Arabia spreads Extremist Ideology”

Saudi Arabia Uncovered

Prince Alwaleed open letter

Alwaleed warns over impact of falling oil price

Saudi Arabia to deport thousands of Egyptian workers (2013)

Saudi minister admits foreign workers expulsion hurts market

PP Papers

The Rise and Fall of the House of Saud

Saudis defeated comprehensively in Yemen: Expert

Michael C Ruppert - Collapse

Saudi Arabia passes draconian law that criminalizes opinion as terrorism

Saudi Arabia criminalizes ‘terrorists’ defaming state’s reputation, disturbing order

 

Source: Russia Today

http://rt.com/news/saudi-arabia-counterterrorism-law-556/

Actions that threaten Saudi Arabia’s unity, disturb public order, or defame the reputation of the state or the king – will be considered acts of terrorism under a new counterterrorism law which has come into force in the gulf kingdom.

The new legislature was ratified by King Abdullah on Sunday after being approved by the Cabinet in December, following the initial proposal by the Interior Ministry and advisory Shura Council.

It defines terrorism as “any act carried out by an offender … intended to disturb the public order…to shake the security of society… stability of the state… expose its national unity to danger… suspend the basic law of governance or some of its articles,” according to its text as cited by Human Rights Watch (HRW).

Terrorists can also be considered those individuals who “insult the reputation of the state or its position… inflict damage upon one of its public utilities or its natural resources,” or those who attempt to force “governmental authority to carry out or prevent it from carrying out an action, or to threaten to carry out acts that lead to the named purposes or incite [these acts].”

The legislation, made up of 40 clauses, allows the security forces to arrest and detain suspects for up to six months with the possibility to extend the confinement for another six months. Suspects are allowed to be held incommunicado for 90 days without the presence of their lawyer during the initial questioning.

Internet surveillance and phone tracking are also allowed under the new legislature, as well as the right for the security services to raid the homes of suspected terrorists, without prior approval from a judge. People suspected of financing terrorist activities could also be prosecuted.

The interior minister, rather than any judge, is empowered to suspend sentences or drop charges and release a person on trial.

When the legislature was approved in December, HRW lashed out against the Kingdom’s strive to limit freedom of speech and criticized the monarchy over its very vague definition of terrorism.

“Vague and overbroad legal provisions cannot be the basis for overriding a broad array of fundamental rights,” HRW said in a statement in December. “Saudi Arabia’s denial of the rights to participate in public affairs, and freedom of religion, peaceful assembly, association, and expression, as well as its systematic discrimination against women greatly exceed any notion of justifiable restrictions.”

Activists are worried that the law will first of all be applied to silence the liberal opposition in the country. Saudi activist Abdulaziz Al Shubaily from the Saudi Association for Civil and Political Rights (HASEM) described the law as a “catastrophe”.

“If I call for the release of someone from jail for being held longer than their sentence, I can be tried for “asking the state to take action,” Shubaily said. “When I call for a constitutional monarchy, I can now be charged with terrorism.”

“They characterize you as a terrorist because you ask the kingdom to do something it does not want to do,” he added.

HRW researcher Adam Coogle said, that the new law is “draconian in spirit and letter, and there is every reason to fear that the authorities will easily and eagerly use it against peaceful dissidents.”

Saudi women who are seen driving can now be accused of disturbing public order for defying a driving ban imposed on females and face punishment under a new law. In October last year, several images emerged online of women getting in cars and going around the city as part of a unified protest.

Additional Info:

The Rise and Fall of the House of Saud

http://worldunitednews.blogspot.ca/2013/01/the-fall-of-house-of-saud.html

Peak Oil is here and it will Break Economies - BP Geologist

 

By: Nafeez Ahmed

http://www.theguardian.com/profile/nafeez-ahmed
News Source: The Guardian
http://www.theguardian.com/environment/earth-insight/2013/dec/23/british-petroleum-geologist-peak-oil-break-economy-recession

Industry expert warns of grim future of 'recession' driven 'resource wars' at University College London lecture.

A former British Petroleum (BP) geologist has warned that the age of cheap oil is long gone, bringing with it the danger of "continuous recession" and increased risk of conflict and hunger.

At a lecture on 'Geohazards' earlier this month as part of the postgraduate Natural Hazards for Insurers course at University College London (UCL), Dr. Richard G. Miller, who worked for BP from 1985 before retiring in 2008, said that official data from the International Energy Agency (IEA), US Energy Information Administration (EIA), International Monetary Fund (IMF), among other sources, showed that conventional oil had most likely peaked around 2008.

Dr. Miller critiqued the official industry line that global reserves will last 53 years at current rates of consumption, pointing out that "peaking is the result of declining production rates, not declining reserves." Despite new discoveries and increasing reliance on unconventional oil and gas, 37 countries are already post-peak, and global oil production is declining at about 4.1% per year, or 3.5 million barrels a day (b/d) per year:

"We need new production equal to a new Saudi Arabia every 3 to 4 years to maintain and grow supply... New discoveries have not matched consumption since 1986. We are drawing down on our reserves, even though reserves are apparently climbing every year. Reserves are growing due to better technology in old fields, raising the amount we can recover – but production is still falling at 4.1% p.a. [per annum]."

Dr. Miller, who prepared annual in-house projections of future oil supply for BP from 2000 to 2007, refers to this as the "ATM problem" – "more money, but still limited daily withdrawals." As a consequence: "Production of conventional liquid oil has been flat since 2008. Growth in liquid supply since then has been largely of natural gas liquids [NGL]- ethane, propane, butane, pentane - and oil-sand bitumen."

Dr. Miller is co-editor of a special edition of the prestigious journal, Philosophical Transactions of the Royal Society A, published this month on the future of oil supply. In an introductory paper co-authored with Dr. Steve R. Sorrel, co-director of the Sussex Energy Group at the University of Sussex in Brighton, they argue that among oil industry experts "there is a growing consensus that the era of cheap oil has passed and that we are entering a new and very different phase." They endorse the conservative conclusions of an extensive earlier study by the government-funded UK Energy Research Centre (UKERC):

"... a sustained decline in global conventional production appears probable before 2030 and there is significant risk of this beginning before 2020... on current evidence the inclusion of tight oil [shale oil] resources appears unlikely to significantly affect this conclusion, partly because the resource base appears relatively modest."

In fact, increasing dependence on shale could worsen decline rates in the long run:

"Greater reliance upon tight oil resources produced using hydraulic fracturing will exacerbate any rising trend in global average decline rates, since these wells have no plateau and decline extremely fast - for example, by 90% or more in the first 5 years."

Tar sands will fare similarly, they conclude, noting that "the Canadian oil sands will deliver only 5 mb per day by 2030, which represents less than 6% of the IEA projection of all-liquids production by that date."

Despite the cautious projection of global peak oil "before 2020", they also point out that:

"Crude oil production grew at approximately 1.5% per year between 1995 and 2005, but then plateaued with more recent increases in liquids supply largely deriving from NGLs, oil sands and tight oil. These trends are expected to continue... Crude oil production is heavily concentrated in a small number of countries and a small number of giant fields, with approximately 100 fields producing one half of global supply, 25 producing one quarter and a single field (Ghawar in Saudi Arabia) producing approximately 7%. Most of these giant fields are relatively old, many are well past their peak of production, most of the rest seem likely to enter decline within the next decade or so and few new giant fields are expected to be found."

"The final peak is going to be decided by the price - how much can we afford to pay?", Dr. Miller told me in an interview about his work. "If we can afford to pay $150 per barrel, we could certainly produce more given a few years of lead time for new developments, but it would break economies again."

Miller argues that for all intents and purposes, peak oil has arrived as conditions are such that despite volatility, prices can never return to pre-2004 levels:

"The oil price has risen almost continuously since 2004 to date, starting at $30. There was a great spike to $150 and then a collapse in 2008/2009, but it has since climbed to $110 and held there. The price rise brought a lot of new exploration and development, but these new fields have not actually increased production by very much, due to the decline of older fields. This is compatible with the idea that we are pretty much at peak today. This recession is what peak feels like."

Although he is dismissive of shale oil and gas' capacity to prevent a peak and subsequent long decline in global oil production, Miller recognises that there is still some leeway that could bring significant, if temporary dividends for US economic growth - though only as "a relatively short-lived phenomenon":

"We're like a cage of lab rats that have eaten all the cornflakes and discovered that you can eat the cardboard packets too. Yes, we can, but... Tight oil may reach 5 or even 6 million b/d in the US, which will hugely help the US economy, along with shale gas. Shale resources, though, are inappropriate for more densely populated countries like the UK, because the industrialisation of the countryside affects far more people (with far less access to alternative natural space), and the economic benefits are spread more thinly across more people. Tight oil production in the US is likely to peak before 2020. There absolutely will not be enough tight oil production to replace the US' current 9 million b/d of imports."

In turn, by prolonging global economic recession, high oil prices may reduce demand. Peak demand in turn may maintain a longer undulating oil production plateau:

"We are probably in peak oil today, or at least in the foot-hills. Production could rise a little for a few years yet, but not sufficiently to bring the price down; alternatively, continuous recession in much of the world may keep demand essentially flat for years at the $110/bbl price we have today. But we can't grow the supply at average past rates of about 1.5% per year at today's prices."

The fundamental dependence of global economic growth on cheap oil supplies suggests that as we continue into the age of expensive oil and gas, without appropriate efforts to mitigate the impacts and transition to a new energy system, the world faces a future of economic and geopolitical turbulence:

"In the US, high oil prices correlate with recessions, although not all recessions correlate with high oil prices. It does not prove causation, but it is highly likely that when the US pays more than 4% of its GDP for oil, or more than 10% of GDP for primary energy, the economy declines as money is sucked into buying fuel instead of other goods and services... A shortage of oil will affect everything in the economy. I expect more famine, more drought, more resource wars and a steady inflation in the energy cost of all commodities."

According to another study in the Royal Society journal special edition by professor David J. Murphy of Northern Illinois University, an expert in the role of energy in economic growth, the energy return on investment (EROI) for global oil and gas production - the amount of energy produced compared to the amount of energy invested to get, deliver and use that energy - is roughly 15 and declining. For the US, EROI of oil and gas production is 11 and declining; and for unconventional oil and biofuels is largely less than 10. The problem is that as EROI decreases, energy prices increase. Thus, Murphy concludes:

"... the minimum oil price needed to increase the oil supply in the near term is at levels consistent with levels that have induced past economic recessions. From these points, I conclude that, as the EROI of the average barrel of oil declines, long-term economic growth will become harder to achieve and come at an increasingly higher financial, energetic and environmental cost."

Current EROI in the US, Miller said, is simply "not enough to support the US infrastructure, even if America was self-sufficient, without raising production even further than current consumption."

In their introduction to their collection of papers in the Royal Society journal, Miller and Sorrell point out that "most authors" in the special edition "accept that conventional oil resources are at an advanced stage of depletion and that liquid fuels will become more expensive and increasingly scarce." The shale revolution can provide only "short-term relief", but is otherwise "unlikely to make a significant difference in the longer term."

They call for a "coordinated response" to this challenge to mitigate the impact, including "far-reaching changes in global transport systems." While "climate-friendly solutions to 'peak oil' are available" they caution, these will be neither "easy" nor "quick", and imply a model of economic development that accepts lower levels of consumption and mobility.

In his interview with me, Richard Miller was particularly critical of the UK government's policies, including abandoning large-scale wind farm projects, the reduction of feed-in tariffs for renewable energy, and support for shale gas. "The government will do anything for the short-term economic bounce," he said, "but the consequence will be that the UK is tied more tightly to an oil-based future, and we will pay dearly for it."

 

Yuan outperforms euro, becomes 2nd most popular trade finance currency

AFP Photo/Frederic J. Brown

Source: Russia Today

The yuan has replaced the euro to become the second most widely used currency in global trade in 2013, according to the SWIFT network responsible for international financial transactions.

The share of the yuan in global trade finance has jumped from 1.89 percent in January 2012 to 8.66 percent in the form of letters of credit and collections in October 2013, the Society for Worldwide Interbank Financial Telecommunication (SWIFT) data shows.

The share of trade settlements in the euro fell from 7.87 percent to 6.64 percent in the same period. The US dollar still leads with 81.08 percent of foreign trade payments using the American currency in October.

The most active yuan users are Chinese and Hong Kong companies which account for about 80 percent of the total foreign trade operations in the yuan. The remaining 20 percent is spread among Singapore (12%), Germany (2%), Australia (2%) and other countries (4%).

"The renminbi is clearly a top currency for trade finance globally and even more so in Asia," Franck de Praetere, SWIFT’s Singapore-based head of payments and trade markets for Asia Pacific, commented in a statement.

“I think it is more to do with using China as a carry trade – people want to get their money into China,” says Nick Verdi, Asia FX strategist at Barclays. “With global interest rates so low, China really is the only place where you can get such a large carry. Trade finance is one of the key avenues to take advantage of that.”

According to SWIFT, in October the yuan remained the world’s 12th most popular means of payment, its share decreased to 0.84 per cent from 0.86 per cent in September. Even though value of payments grew by 1.5% for the month, payments in all currencies rose by 4.6%

Hong Kong, the largest yuan hub outside China, has accumulated a record 782 billion yuan ($128 billion) in October. The same month the UK’s Chancellor George Osborne announced plans to make London an offshore banking center for the yuan.

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London to become Chinese offshore banking center

A flag hangs from the Bank of China offices in the City of London (Reuters/Toby Melville)

Source: Russia Today

Britain has relaxed stringent rules for Chinese banks willing to set up in London. Beijing in turn opened up its markets to British-based investors, marking the latest move to establish the yuan as one of the world’s key currencies.

“A great nation like China should have a global currency,”said UK Chancellor of the Exchequer, George Osborne, during his official five day visit to China. And the UK is gladly willing to contribute “through the international center of finance: London”.

Under the agreed pilot program, China sanctioned London-based investors to buy up to 80 billion yuan ($13.1 billion) of stocks, bonds and money market instruments directly, avoiding Hong Kong transactions, Reuters reports.

Meanwhile, Britain will let Chinese banks set up wholesale branches in London, easing regulations the country had imposed after the financial crisis broke out. Since 2008, Britain has insisted that most foreign lenders should set up their UK operations as "subsidiaries" rather than branches, which provides greater protection for depositors and taxpayers. Less regulation will be welcomed by Chinese lenders who have always complained the rules made it hard to operate in Britain, prompting them to move much of their business to Luxembourg.

On top of that, London and Beijing will trade the yuan against the dollar directly, avoiding the dollar.

"The Chinese currency, the renminbi [yuan], is not terribly well known in Britain at the moment. But over my lifetime I think it's going to become almost as familiar as the dollar, and I want British businesses involved in trading it, investing in it," Osborne told BBC television in China.

Currently London accounts for 62 percent of yuan trades outside China and Hong Kong, according to data from financial services provider SWIFT. The latest move will give the renminbi a firmer footprint in Europe and strengthen London's platform to develop the offshore RM (renminbi) bond market.

According to an HSBC forecast, within 5 years a third of China’s total trade will be in yuan, which will make it fully convertible and elevate it into the top 3 exchange currencies. According to data compiled by Bloomberg, the yuan has already strengthened 36 percent against the dollar and 47 percent versus the pound since 2005.

Spain, Argentina to discuss move against UK

 

 

Source: Press TV

http://www.presstv.ir/detail/2013/08/12/318326/spain-argentina-to-talk-antiuk-move/

Spain may join Argentina in a diplomatic offensive against Britain over disputed territories, a report says.

Spanish Foreign minister Jose Manuel Garcia-Margallo is to discuss the issue with Argentinean authorities during a trip to Buenos Aires next month, according to a report published by Spanish newspaper El Pais on Sunday.

The report also said that the Spanish foreign ministry is considering taking its complaints over British-held territory Gibraltar to the United Nations Security Council or to its General Assembly.

Furthermore, Spain is looking into the option of denouncing Gibraltar to the International Court of Justice in The Hague for its “illegal occupation” of an area, called Isthmus, which connects the territory to the mainland. The land strip was not included in the 1713 Treaty of Utrecht.

Margallo is scheduled to meet Argentina’s Foreign Minister Hector Timerman, whose administration is also in a long-standing dispute with Britain over the sovereignty of Malvinas Islands.

Spain vowed on August 9 to take all necessary measures to defend its interest in Gibraltar, after reports revealed that Britain is set to send naval ships to the territory.

Tension between the two countries arose after authorities in Gibraltar dumped 70 blocks of concrete in waters close the territory’s coast in mid-July, aimed at creating an artificial reef.

However, Spain denounced the action, saying the blocks had been dumped “without any type of authorization and breaking several environmental norms.”

In addition, Madrid said the concrete blocks seriously damaged the fishery, making it impossible for Spanish fishing boats to work in the area.

Gibraltar is one of the British Overseas Territories, which is on the United Nations list of areas waiting decolonisation.

The British territory was seized from Spain in 1713 and remains a bone of contention between the two European countries.


 

Cypriot parliament votes against deposit levy

Cypriot woman shouts slogans as she holds a placard during a protest against an EU bailout deal outside the parliament in Nicosia (AFP Photo / Patrick Baz)

Source: Russia Today

http://rt.com/business/cyprus-against-deposit-levy-501/

The Cypriot parliament has voted against a revised bank deposit levy. The tax was meant to shave 9.9% off any deposits over €100,000 and has since caused uproar in the country.

Thirty six deputies voted against the proposal to tax bank deposits in the 56-member chamber, while 19 abstained. One deputy was not present for the vote.

"The bill has been rejected," said house speaker Yiannakis Omirou, as thousands of protesters outside the parliament building in Nicosia erupted in cheers.

According to the proposal, a 6.75% rate was to be set for amounts between €20,000 and €100,000. Deposits of up to €20,000 euros were to remain untouched.

Passage of the bill was considered a prerequisite for a €10 billion European Union bailout for the Mediterranean island. EU finance ministers have warned that Cyprus' two biggest banks could go bust if a bailout deal in some form is not forthcoming. The government and opposition parties have scheduled emergency talks on the bailout for Wednesday.

The European Central Bank (ECB) has threatened to end emergency lending assistance for Cypriot banks if a bailout deal was not ensured. However, following the vote, the ECB said it would continue to provide liquidity to Cyprus as needed “within the existing rules,” Bloomberg reports.

Cyprus has discussed the tax with its European creditors. Ministers from the 17 eurozone countries urged protection for savers with €100,000 or less and for them to be spared from the levy, after the prospect brought panic to the markets and had Cyprus dealing with the prospect of Russia withdrawing its rescue loan.

The Cypriot government’s original proposal was to tax all depositors, setting the rate of 6.75% on all deposits under€100,000 and maintaining a 9.9% tax on all deposits above that level.

In the meantime all Cypriot banks have frozen the accounts liable for the tax and stopped all transactions, including electronic and closed for a long weekend until Thursday to prevent panic.

Cyprus needed to raise €5.8 billion euros for its bailout program and was hoping to get the money in the planned bank deposits levy.

Despite the precarious position Cyprus has found itself in, a default might be preferable than a bailout under the present conditions, United Kingdom Independence Party MEP Nigel Farage told RT.

“The EU has been unhappy about so-called tax havens for a very long time. Ironically, whilst continuing to turn a blind-eye to many activities that go on in Luxemburg. I mean Cyprus finds itself right now in a very difficult, desperate position. But I would say that it is better to officially go bankrupt, to default on international bond obligations. And to do that best to keep a banking industry and to keep some confidence in that country,”he said

 

Global Economics: The Truth and a Warning

Source Video: World United News

https://www.youtube.com/watch?v=HHTpRDM96YQ

By: Stewart Brennan
http://worldunitednews.blogspot.com/

 

Every country will face a “Tipping Point” and breakdown of society in the near future due to the crushing economic austerity measures inflicted on the people by the brutal International Banking System that was conceived and designed to acquire wealth and power for an elite few.

When impoverished nations reach their economic tipping point, the governing power structure of those nations will have no options left. They will have to tell those in control of their economic system to bow down to major changes, or they themselves will face the consequences of their inaction.

At the moment, the choice to fix the broken system belongs to those in control of it. I.e.: The International Banking Cartel through the IMF, World Bank, and International Bank of Settlements…however, if the warning is ignored and the choices made by those who govern the system only ensure that the extremely wealthy survive these harsh economic times, then the responsibility to correct the economic disparity will shift to the impoverished masses by virtue of their will to survive.

Be assured that “Civil Unrest” will grow proportionally to the rise in poverty. All one needs for proof is catch a glimpse of what is unfolding in Egypt, Greece, or Spain to see the truth of these words…and there are many other nations at different stages of bankruptcy, poverty and austerity that is being forced upon them by the I.M.F (International Monetary Fund). The victims of the economic system will rise up in their millions because their very survival depends on a just system for all. 

However, the problem is not just that the IMF has taken control of every nations economic sovereignty but that the corporate power structure that comes with the Private banks has also taken control of the natural resources of most countries. 

Making matters worse for the people of the World is that the entire political system in every country, with few exceptions, has been seized at every level by the same corrupt banking system.

Even the opinions on mainstream news are bought and paid for by corporate interests. Don’t believe me? Well Just try to get a differing opinion aired to the public on these mediums and you’ll soon see that it becomes painfully obvious where these news corps feed, because you Will be denied your opinion, just as investigative journalism has been denied when it contradicts the banking or corporate plans of the extremely wealthy that control the mainstream press.

Personally, I no longer watch TV, read newspapers or listen to the radio airwaves anymore because they are arrogantly biased and illogically opposed to common sense.

Call it what you will, but be assured that everyone will wake up to these facts sooner or later and when they do, there will be hell to pay…the degree will depend on how far the banking cartel try to take their illusion.

The Solution:

Nationalize all the private banks in each country to end the existence of “The IMF, World Bank, and the Bank of International Settlements”. Then each country must Nationalize all their natural resources so that the profits go into the nations coffers that supports the communities and the social programs. Reorganize the political structure so that real qualified people govern the nation. Money must not be allowed to affect the political structure ever again.

The World is yours to build, we do not need Private Banks to control it.

Stewart Brennan

World United News
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Fed chairman warns US lawmakers on impact of 'fiscal cliff'

 

US Federal Reserve chairman Ben Bernanke

Source: Press TV

http://www.presstv.ir/detail/2012/11/21/273685/us-lawmakers-alarmed-on-fiscal-cliff/

US Federal Reserve chairman Ben Bernanke has once again warned American legislators to ward off the abrupt and severe combination of legislated tax hikes and federal spending cuts, known as ‘fiscal cliff,’ due to take effect by the end of the year.

In a Tuesday speech at the New York Economic Club, Bernanke described fiscal cliff as a “substantial threat” to the country’s economic recovery and urged US lawmakers to put aside partisan political rivalries to avert the massive financial impact on the nation’s already slow economy.

‘‘Uncertainties about the situation in Europe and especially about the prospects for federal fiscal policy seem to be weighing on the spending decisions of households and businesses as well as on financial conditions,’’ he said, adding, ‘‘Such uncertainties will only be increased by discord and delay.’’

According to reported estimates, the impact of the scheduled federal spending cuts and the expiration of temporary tax breaks will take at least USD 500 billion out of the US economy, threatening to push it back into yet another recession.

Citing several outside economic assessments on the enormity of the ensuing tax hikes and spending cuts, Bernanke said ‘‘a fiscal shock of that size would send the economy toppling back into recession.’’

This is while the Obama administration and Congress are still negotiating over an agreement to reduce the government's massive budget deficit, which has exceeded USD 1 trillion for a fourth consecutive year.

The last time the debt limit was about to be reached, Republican lawmakers in the US Congress waited until the very last minute before deciding to raise the limit.

Saying "the deficit is on an unsustainable path," the Fed chairman further added, ‘‘As you will recall, the threat of default in the summer of 2011 fueled economic uncertainty and badly damaged confidence, even though an agreement ultimately was reached.’’

‘‘A failure to reach a timely agreement this time around could impose even heavier economic and financial costs,” he warned.

Stocks tumble as congressman predicts economic riots in America

 

Louisiana Republican Rep. John Fleming

Source: Press TV

http://www.presstv.ir/usdetail/272079.html

Stocks tumbled again on fears of the rapidly approaching fiscal cliff in the United States and a failure by eurozone finance ministers and the IMF to decide how Greece will resolve its sovereign debt and pay off the banksters at Société Générale, Deutsche Bank, Eurobank, and other loan sharking institutions.

"This morning the reasons du jour started out with Europe and the kerfuffle over Greece and then you have the fiscal cliff," Michael Holland, chairman of New York-based Holland & Co., told Bloomberg News.

"We're not out of the woods yet," said Guillaume Duchesne, an equity strategist at BGL BNP Paribas SA in Luxembourg. He added that a resolution of the financial crisis threatening to extend the recession for the foreseeable future depends on the leadershipof Obama.

According to Rep. John Fleming, we won't be getting out of the woods anytime soon, especially with Obama at the helm. "It looks like we're going to have to go through the same or similar pain [as Greece] to get real reforms," the Louisiana Republican told the Daily Caller on Sunday.

He said that if the current economic trend is not reversed, "what's going to happen is there's going to be a day of reckoning that gets into a serious situation where we have to make tough choices." Prison Planet

HIGHLIGHTS

Fleming told The Daily Caller that, ever since President Barack Obama's re-election last Tuesday, he has been advising Americans to play it safe financially because he believes the economy - and the state of the country - may soon get much worse. The Daily Caller

Fleming said he's telling concerned constituents and business owners to "not extend yourselves in debt, make sure that you pay off things, don't get into debt with credit cards, stay as liquid as possible. Don't take risks, and don't get into debt. You need to stay less vulnerable economically over the next two to four years, in hopes that the economy will sort itself out, and that Washington will get its act together." The Daily Caller

"What I fear is we're going to be too late, and we're going to run into a Greece-like situation, where we have riots and unemployment levels are up around 11 percent. That's what we've been trying to avoid," Fleming said. The Daily Caller

The so-called "cliff" comes on Jan. 1, when several tax cuts expire, and severe cuts to government spending are triggered. It's also been called "taxmageddon," because an average American family will see their tax bill increase $3,700 next year. ABC News

In total, the measures are set to automatically slash the federal budget deficit by $607 billion or approximately 4 percent of GDP between FY 2012 and FY 2013, according to the Congressional Budget Office (CBO). CFR

Any deal, all agree, would have to include revenue increases as well as budget cuts. A key question is whether any new revenue includes changes in tax rates - specifically, an end to the Bush-era tax cuts for those earning more than $250,000, which is what President Obama has been pushing and Rep. Boehner says "no" to. Christian Science Monitor

The IMF says the U.S. economy could fall back into recession if Congress fails to avert the package of tax hikes and spending cuts. Reuters

China and Russia are Acquiring Gold Dumping US Dollars

 

By: Prof. Michel Chossudovsky

Source: Global Research

http://www.globalresearch.ca/central-banks-are-acquiring-gold-dumping-us-dollars/22672

There is evidence that central banks in several regions of the World are building up their gold reserves. What is published are the official purchases.

A large part of these Central Bank purchases of gold bullion are not disclosed. They are undertaken through third party contracting companies, with utmost discretion.

US dollar holdings and US dollar denominated debt instruments are in effect being traded in for gold, which in turn puts pressure on the US dollar.

In turn, both China and Russia have boosted domestic production of gold, a large share of which is being purchased by their central banks:

It has long been assumed that China is surreptitiously building up its gold reserves through buying local production. Russia is another major gold miner where the Central bank has been purchasing gold from another state entity, Gokhran, which is the marketing arm and central repository for the country’s mined gold production. Now it has been reported by Bloomberg that the Venezuelan Central Bank director, Jose Khan, has said that country will boost its gold reserves through purchasing more than half the gold produced from its rapidly growing domestic gold mining industry.

In Russia, for example, Gokhran sold some 30 tonnes of gold to the Central Bank in an internal accounting exercise late last year. In part, so it was said at the time, the direct sale was made rather than placing the metal on the open market and perhaps adversely affecting the gold price.

China is currently the world’s largest gold producer and last year it confirmed it had raised its own Central Bank gold holdings by more than 450 tones over the previous six years. Mineweb.com – The world’s premier mining and mining investment website Venezuela taking own gold production into Central Bank reserves – GOLD NEWS | Mineweb

The 450 tons figure corresponds to an increase in the gold reserves of the central bank from 600 tons in 2003 to 1054 tons in 2009. If we go by official statements, China’s gold reserves are increasing by approximately 10 percent per annum.

China has risen to now be the largest gold producing nation in the world at around 270 tonnes. The amount bought in by the government initially looks like 90 tonnes per annum or just under, 2 tonnes a week. Before 2003 the announcement by the Chinese central bank that gold reserves had been doubled to 600 tonnes, accounted for similar purchases before that date. Why so small an amount you may well ask? We think local and national issues clouded the central bank’s view as it was the government that bought the gold since 2003 and have now placed it on the central bank’s Balance Sheet. So we would conclude that the government has ensured central bank gold purchasing must continue. “How will Chinese Central Bank Gold Buying affect the Gold Price short & Long-Term?” by Julian Phillips. FSO Editorial 05/07/2009

Russia

Russia’s Central bank holdings are in excess of 20 million troy ounces (January 2010)

 

Russia’s Central Bank reserves have increased markedly in recent years. The RCB reported in May 2010 purchasing 34.2 tons of gold in a single month. Russian Central Bank Gold Purchases Soar In May – China Too? | The Daily Gold

The diagram below shows a significant increase in monthly purchases by the the RCB since June 2009.

 

Central Banks in the Middle East are also building up their gold reserves, while reducing their dollar forex holding.

Gold reserves of GCC states is less than 5 percent:

Dubai International Financial Centre Authority economists released a report yesterday calling for local countries to build gold reserves, according to The National.

Despite a high interest in gold, GCC states maintain less than 5 percent of their total reserves in gold. Compared to the ECB, which holds 25 percent of reserves in gold, that leaves a lot of room for growth. http://www.businessinsider.com/gcc-boost-gold-holdings-2010-12#ixzz18FEqpTy3

GCC states should boost their foreign reserve holdings of gold to help shield their billions of dollars of assets from turbulence in global currency markets, say economists at the Dubai International Financial Centre Authority (DIFCA).

Diversifying more of their reserves from US dollars to the yellow metal would help to offer central banks in the region higher investment returns, said Dr Nasser Saidi, the chief economist of DIFCA, and Dr Fabio Scacciavillani, the director of macroeconomics and statistics at the authority.

“When you have a great deal of economic uncertainty, going into paper assets, whatever they may be – stocks, bonds, other types of equity – is not attractive,” said Dr Saidi. “That makes gold more attractive.”

Declines in the dollar during recent months have dented the value of GCC oil revenues, which are predominantly weighted in the greenback. GCC urged to boost gold reserves

According to a report in People`s Daily;

The latest rankings of gold reserves show that, as of mid-December, the United States remains the top country and the Chinese mainland is ranked sixth with 1,054 tons of reserves, the World Gold Council announced recently.

Russia climbed to eighth place because its gold reserves increased by 167.5 tons since December 2009. The top ten in 2010 remains the same compared to the rankings of the same period of last year. And Saudi Arabia squeezed to the top 20.

Developing countries and regions, including Saudi Arabia and South Africa, have become the main force driving the gold reserve increase. … .

The International Monetary Fund (IMF) and the European central bank are the major gold sellers, and the IMF’s gold reserves decreased by 158.6 tons. (China’s gold reserves rank 6th worldwide – People’s Daily Online

It should be understood that actual purchases of physical gold are not the only factor in explaining the movement of gold prices. The gold market is marked by organized speculation by large scale financial institutions.

The gold market is characterised by numerous paper instruments, gold index funds, gold certificates, OTC gold derivatives (including options, swaps and forwards), which play a strong role, particularly in short-term movement of gold prices. The recent increase and subsequent decline of gold prices are the result of manipulation by powerful financial actors.

 

Post-election report shows record surge in Americans using food stamps

 

AFP Photo / Spencer Platt

Source: Russia Today

http://rt.com/usa/news/post-election-food-stamps-476/

The number of Americans relying on food stamps to stay fed has been steadily on the rise, hitting an all-time record this year, with more than 47.1 million Americans using government assistance to obtain food.

The US Monthly Data report, released by the Department of Agriculture (USDA), is normally issued at month's end. But the most recent report, which shows the record-breaking surge in food stamp dependence, was published on November 9 – three days after the presidential election.

About 15 percent of all Americans, or 47,102,780 people, are now enrolled in the federal government’s Supplemental Nutrition Assistance Program (SNAP). This is the highest number on record, and surpasses the number of unemployed Americans who found jobs during the same time period.

Dave Gibson of the Examiner attributes the delayed release to the Obama re-election campaign, claiming the agency waited to release the dreary data, which could have cast a negative light on the president.

“Obviously, this dose of reality would have harmed the Democratic Party’s false narrative of a ‘recovering economy,” he wrote.

When President Obama was first elected in November 2008, 30.8 million Americans were on food stamps. As of August 2012, 47.1 million were – a rise of about 50 percent.

The Washington Post reports that many of the new food stamp users are college students struggling to pay tuition and living expenses. Rather than pay for expensive campus meal plans, college students are increasingly applying for food stamps, “an option that once carried a social stigma on campus but no longer does,” writes Post reporter Breanna Hogan.

“I am receiving about $200 worth of food stamps per month, and I can’t imagine living without them,” said Sheena Vails, a sophomore at the University of Missouri.

About 15 million additional Americans have enrolled in SNAP since Obama took office. And the number could continue to rise, especially since Hurricane Sandy left thousands homeless across New York and New Jersey.

After the storm devastated New York City, Governor Andrew Cuomo ordered $65 million in new food stamp money to be automatically placed into the cards of displaced families who live in storm-affected areas. There are 77 zip codes in the region whose residents are eligible to apply for food stamps as they struggle to put their lives back together.

While the data for November food stamp usage will not be released for some time, the additional applicants could close 2012 with a much higher, record-breaking number of SNAP members – a number that clashes with rising job figures and the narrative of an improving economy.