The Barack Obama Inauguration: We can try making lemonade

I am breaking radio silence to report on what might be a cosmic comment about the Obama presidency.

In honor of Barack Obama's inauguration as the 44th President of the United Socialist States of America, I turned on the television this morning and vowed to keep the channel tuned to the Food Network all day.

Now it is true I've never done that before, so for all I know it's not an unusual occurrence to see one show after another on the Food Network highlight lemons. But I have never seen so many lemons in my life as I have seen today.

Every time I walked past the TV, there was another Food Network chef squeezing, zesting, boiling, baking or sauteing lemons. Baked lemon zucchini, rigatoni sauce with sour cream and lemon, lemon crisp, lemon ricotta cookies. Lemons, lemons, lemons.

The saying is that if the Lord hands you a lemon, make lemonade. There is only one possible way to make something useful out of the lemon that George Soros and his go-fers sold the American electorate, and that's to put under a microscope Obama's every decision as President and never let up the criticism.

That's the only chance Americans have got to avoid sucking lemons.

Note

I'll be away until February 15.

Best regards to all,
Pundita

"The Obama Administration Inherits the Iran Threat"

Waiting for Tehran by John Batchelor at 9:17 PM ET. [See the post at his site for pictures, links, and video]:

The New York Times reports for Sunday 11 that the Bush administration nixed an Israeli request in 2007-2008 for bunker buster bombs ... and permission to fly over Iraq. The US presumption was that the IDF was going to launch an air strike on the nuclear fuel cycle program at the Natanz site ...

Instead, goes the report, the Bush administration approved a covert operation to interrupt the supply chain for the Iranian nuclear fuel cycle and to slow down the development of a nuclear weapon. These details are left out of the article. Identified of special interest is an Iranian nuke weaponeer named Mohsen Fakrizadeh, who is said to be leading the weapons building team. The IAEA at Vienna is said to have briefed on one of Mihsen Fakrizadeh's projects that was a missile launch that ended with a warhead exploding 650 yards above ground -- "approximately the altitude from which the bomb dropped on Hiroshima exploded."

Why this Report Now?

The NYT is giving enough detail to convince anyone that Tehran has an active nuclear weapons program. This is not news except perhaps to the American electorate (and to candidate Obama?) that wanted to ignore the fact and use the 2007 bizarrely misleading NIE report as a genuine document.

What this report does now is make the very good case that the Bush administration chose to ignore and avoid Tehran's nukes these last years. Why? My best signals source calls it "the Faustian deal." The US promised Tehran that we would not attack its nukes, or challenge its long term plans in the region, in exchange for Tehran letting the US leave Iraq with a victory. Or at least leave Iraq with the Iraqis who work for Tehran (P.M. Maliki is the Iranian viceroy in Iraq) in charge.

The bargain worked. The Bush administration ends its watch with the Iraqi army taking control of the Green Zone and Iraq security. At the same time, Tehran has an estimated 4000 or more P2 centrifuges working which will soon enough produce material for many bombs.

Waiting for Tehran

What is not part of the bargain is the IDF's campaign against Hamas in Gaza. This is a blow to Tehran's plans to surround and defeat Israel and establish Iran as the regional hegemon.

My best signals source tells me that the Wednesday 7 meeting between Tehran's agent Ali Larijani and Hamas boss Khaled Meshal ... in Damascus was to discuss Tehran's response to Israel's aggression. Tehran has been caught unprepared for the IDF's offensive. The small rockets into northern Israel were a calling card. In this news cycle, Meshal announced from Damascus that Hamas will never surrender and that the IDF action is a holocaust and that this ends any chance for a settlement. Strong words. Perhaps he is trying to influence Tehran's decision.

The IDF says that it wants another 20 days to degrade and destroy Hamas and its rocket capability. The UN resolution did not try to solve the rockets or the smuggling. Cairo wants Hamas destroyed but at the same time is aware that Tehran remains a long term threat.

Everyone in the region looks to be waiting for Tehran. Is the Obama administration waiting, too? Mrs. Clinton testifies to the Senate panel on her nomination next week. What will she say about Tehran's nukes, about Tehran's support for Hamas, about the threat of Tehran to Israel? Is the Clinton Doctrine a new Tehran Doctrine? Or is it the Bush Doctrine of no decision?

John Batchelor Sunday Show: "The Slumdog Trillionaire Special"

Wow is all I can say, after reading the schedule for tomorrow's show. When Batchelor is on the air the radio medium beats out TV six ways from Sunday -- but just think what he could do with a televised news show.

Here's the lineup for the January 11 spectacular, which also stuffs in news about Gaza, another visit from the chronicler of the U.S.S Bunker Hill's finest hour, and Rick Warren's battle against AIDS in Africa.

Re the Slumdogs, take note of 'India's Enron' disaster. The difference with democracy is that at least the scandals can find the light instead of festering in the darkness of state silence. I watch and wait and worry about the China Enrons that won't see the light until they bring down global markets.

As always, both the New York and Los Angles portions of the show can be heard online (See John's website for links) and podcasts are available. John's website has the New York podcast; see KFI-AM website for the Los Angeles one.

Vote for Uppity Woman, Riehl World View, and Pundita

I have never mistaken a paper doily for dessert but often I am so lost in thought that I have been known to leave the house wearing a business suit and bedroom slippers. This would probably happen more often if I could remember where I left the slippers after I took them off or if I didn't inadvertently toss them in the trash.

I tried to solve the problem by purchasing the biggest slippers I could find -- these being fuzzy affairs with huge floppy ears and a rather demented-looking rabbit face on both slippers. But I soon found it's just as easy for me to lose track of bunny slippers as any other.

Thus, I was very interested to learn from reading Uppity Woman's Poverty Recipes section that there is a completely different approach to solving my problem: Why not make scores of bedroom slippers from Maxi Pad sanitary napkins?

In this way it's no great loss if such slippers get tossed, and with so many slippers around I can always find two to make a pair. And if worst comes to worst, I can make a new pair in moments flat.

If you are looking for a cheap present for your friends and family members, or you have my same problem, the directions for making the Maxi Pad bedroom slippers (from unused napkins, of course) from Uppity reader "Typewriterstreaming" are found about halfway down the Poverty page at the 9:27 time. And while you're there add your own best poverty-stricken food recipe (cooking old leather shoes in a crockpot for six hours has already been posted).

All this is by way of explaining that the deadline for voting in the annual Weblog awards is almost upon us, and I've just remembered that I wanted to ask you to vote for Uppity Woman for the Weblog poll's "Best New Blog."

If you have seen Uppity Woman's competition in the new blogs listed for voting in the poll, you'll know that cronyism alone does not prompt my request.

The tough-minded woman who is the sole proprietor of Uppity Woman is a Democrat who does not fail to take her own party to task, and she's been on the front lines of the battle to expose the truth about Barack Obama's career.

You can vote for Uppity Woman once every 24 hours in the Weblog poll here. The poll closes January 13.

All this reminds me that I also forgot to ask you to vote for Dan Riehl's Riehl World View blog in Andrew Sullivan's Malkin Award poll. I can't stand Sullivan so my absent-mindedness in this case might have been due in part to my unwillingness to send traffic to his site.

It's too late now; the poll is closed with Ben Stein the winner and Riehl World View the runner-up. Because the poll was not limited to bloggers I can't complain too much about Stein's TV fans eking out a win for him against a real blogger.

But Dan Riehl is a "blogger's blogger" as well as a stalwart of the GOP part of the blogosphere. The best advice I ever got about communicating my ideas to the public via blogging came from Dan, who applies his marketing savvy to the task of communicating his POV, and very often with hilarious results.

It's also because of Dan Riehl's encouragement that I kept blogging after Hurricane Katrina's strike on New Orleans exposed the living situation in the city and the politics of Louisiana, which matched those of the most corrupt third world countries.

Dan never knew how much he helped me get through a bad patch, so this is a good place to mention it and thank him.

Dan has given encouragement to many other new and little-known bloggers, and he has done much to keep blogging to high standards. So while you can't vote in Sullivan's Malkin poll, you can still vote for Dan by visiting Riehl World View.

All this has also reminded me that I forgot to ask you to vote for Pundita blog in Gay Patriot's Grande Conservative Blogress Diva poll.

It's too late now; Pundita came in dead last ("You actually got ten votes when we add together the first and second polling," Dan at Gay Patriot told me soothingly). But as I noted before it was an honor to be nominated and a finalist in the poll, although I think all the nominees ended up finalists.

All this has reminded me that I forgot to keep up the Pundita Weblog Awards, which I started in 2005 then, well, forgot about in 2006 and 2007. And 2008.

I started my own awards because all the finalists for the 2005 Weblog Awards "Best Blog" bored me to tears. You can find the polite version of my 2005 awards here or the impolite one here.

The 2005 Pundita Awards were well received by readers because they highlighted some interesting bloggers who would never make it into that other weblog poll.

Well, it's not too late for me to come up with a 2008 Pundita Weblog Awards, which I'll work on this weekend. If I remember.

Is the US dollar going the way of the pengo?

From the Wikipedia article on hyperinflation:

The largest denomination banknote ever officially issued for circulation was in 1946 by the Hungarian National Bank for the amount of 100 quintillion pengő (100,000,000,000,000,000,000).

[...]

Governments will often try to disguise the true rate of inflation through a variety of techniques. These can include the following:

> Outright lying in official statistics such as money supply, inflation or reserves.

> Suppression of publication of money supply statistics, or inflation indices.

> Price and wage controls.

> Forced savings schemes, designed to suck up excess liquidity. These savings schemes may be described as pensions schemes, emergency funds, war funds, or something similar.

> Adjusting the components of the Consumer price index, to remove those items whose prices are rising the fastest.

For the first time I wish you could see me. I am laughing so hard, tears are streaming down my face. I guess it was the surprise at finding such refreshing bluntness in an article about economic matters that set me off.

A man whose speech is characterized by bluntness, and who would also be knowledgeable enough to pen an article on hyperinflation, James Sinclair -- long-time precious metals and currency trader, guide extraordinaire to the mysterious ways of The Casino (aka international monetary system) -- has reissued his August 14, 2008 Dutch Uncle essay, More On the Federal Reserve Gold Certificate Ratio, under the sly observation, "Rentenmark to the Rentendollar."

To appreciate his reference to a 'rentendollar' you'd have to know about the papiermark and the rentenmark.(1,2) The papiermark was the infamous paper money that touched off hyperinflation in Germany in 1922-23. The victor nations in WW1 demanded that Germany pay their war costs. With no gold or currency in reserves the German government cranked up the printing press, causing the value of the mark to collapse. The rentenmark (literally, "security mark"):

... was a currency issued on 15 November 1923 to stop the hyperinflation [... ] the Rentenbank, which issued the Rentenmark, mortgaged land and industrial goods worth 3.2 billion Rentenmark to back the new currency. [...] The Rentenmark was only an intermediate currency and was not legal tender. It was, however, accepted by the population and effectively stopped the inflation. The Reichsmark became the new legal tender on 30 August 1924, equal in value to the Rentenmark.

Can hyperinflation happen today in the United States? Not likely unless the US government collectively goes barking mad, because the US does have gold reserves. James makes that point in his essay, which is to suggest that the crashing waves of economic realities are pushing the US ship of state ever closer to repegging the dollar to gold in some fashion or other.

You may trust that federal governments, the US one incuded, would rather stand in front of a firing squad than give up the currency printing press. But once governments try to print their way out of an economic crisis the specter of runaway inflation always looms.

On the time-tested theory that high inflation and great social unrest go hand in hand, all means must be used to shoo away the specter. No matter poor people are they can put with a lot if they know the money they do have is worth something. Once people get the idea that their money is worthless, that's an easy way for governments to fall in the most unpleasant ways.

A small but ominous sign of inflationary undercurrents is found in the sudden ubiquitousness of the US Presidential one dollar coin, which has been in circulation since 2007. To my American readers: I don't know how it is in your city but here in Washington, DC the subway and bus token booths have been retooled to accept the coin, and it's being used everywhere to make change. So, the push that the coin's usage is receiving, which earlier US dollar coins never received, could be a way signaling that the US one-dollar bill has been devalued to change.

Some of my earliest posts on this blog warned that the Bretton Woods monetary system had collapsed, that a new international monetary system had to come into being, and that this would mean a big and unpleasant adjustment for Americans.

I also mentioned that the 9/11 attack on America was actually a sophisticated attempt to crash the US economy. On its own Saddam Hussein's launch of a petrocurrency war against the US, which he coordinated with the EU and particularly the French government's attempts to push up the value of the euro, couldn't do much to hurt the US in the short term. But in combination with al Qaeda's attack the effect might have been devastating.

The plot was foiled by the fastest thinking and acting I've seen from the US government during my lifetime. Within 72 hours of the attack President Bush, with the help of the Federal Reserve and the EU and British central banks, and through arm-twisting of several governments including an oil kingdom, worked a miracle to stave off a crash.

But America's narrow escape in 2001 from financial devastation reminds me of the mystery bullet that came close to Abraham Lincoln in his youth. It was as if divine intervention pushed the shot that was fated to kill him into the future, when he'd finished leading America through the Civil War.

The collapse in the credit markets in 2008 did not create the economic crisis we're facing today; it was only the tripwire. By August 2008 Jim Sinclair had seen the tripwire, and gave his best advice on how to divert the bullet that had been traveling for years.

Those who would dismiss him as a gold bug are ignorant of the ways of The Casino or studiously ignoring them. Jim is not wedded to gold; he's wedded to survival. So it's wise to ponder his view. Before turning the floor over to him I want to highlight a point in his essay:

After the demise of the Bretton Woods Agreement, everything financial moved towards a floating non-system. The move away from fixed points towards a fully floating financial system was the process of removal of all financial ALARMS. No longer was there a currency parity rate that when hitting the lower or upper bands rang an ALARM. The concept of financial crisis no longer existed.

And that is how the 'Black Swan' of the mortgage meltdown appeared out of nowhere. That is how the Asian and Mexican financial crises appeared of nowhere.

There will be many more Black Swan economic events, until monetary policy is moored to objective criteria. If you learn nothing else from reading Jim's essay, you're ahead of the game.

January 8, 2009 - Jim Sinclair: The US Dollar will replace the US Dollar come The Revitalized and Modernized Federal Reserve Gold Certificate Ratio, not tied to interest rates, but rather gold value held by the Fed/Treasury versus a measure of international liquidity. [...] The Federal Reserve Gold Certificate Ratio is the mechanism of the Rentendollar.

More On the Federal Reserve Gold Certificate Ratio
Author: Jim Sinclair
Posted On: Thursday, August 14, 2008

Why will the effort to call any top in the gold price be a waste of time for the gold-ignorant gurus?

Prior to being reduced to zero percent and then removal from the books, there was a direct link between the value of US Treasury gold held (a fixed price of gold then) as a percentage of the growth of the US money supply. As an example, when the cover was deemed to be 25% that meant that as the money supply expanded the value of gold had to be expanded by 25% as well.

Because the price of gold was fixed, the gold cover clause as this device was known, mandated an automatic change in the Federal Reserve Discount rate in order to depress the demand for funds in the US economic system.

There is an argument that says as the dollar was becoming a primary reserve currency and world trade was growing at record rates, the automatic changes in a monetary system were restraining the true wishes of the Administration and Federal Reserve.

After the demise of the Bretton Woods Agreement, everything financial moved towards a floating non-system. The move away from fixed points towards a fully floating financial system was the process of removal of all financial ALARMS. No longer was there a currency parity rate that when hitting the lower or upper bands rang an ALARM. The concept of financial crisis no longer existed.

The movement of any currency up or down, as the Euro recently did, would have been considered a financial crisis.

We have just witnessed multiple central bank interventions that are accepted by the establishment's international investment community as a dandy deed in the cover up of other serious systemic weaknesses. As a result, upper and lower bands have been considered and implemented. To benefit the plan, the lower limit of $1.49 will not be defended yet in time the market will. $1.49 is only a point after which no great undertaking of intervention will be applied. Let the apples fall from the tree, if they please, as per today.

There is no return to a FIXED anything, but there is a clear indication of a return to the relationship of floating financial alarms, a marriage between the thesis of Bretton Woods and the floating sins of our Financial Fathers.

The Revitalized and Modernized Federal Reserve Gold Certificate Ratio will be tied to a broad measure of money supply, M3 or another new definition of liquidity.

The gold that the US Treasury has held primarily at the New York Federal Reserve will be valued at market at the time of adoption of this mechanism. Please understand that regardless of the arguments concerning the number of ounces the Federal Reserve/Treasury holds, since it will never be audited, accept what is said as correct.

Now the floating increase or decrease in monetary aggregates will mandate a change in the value of the gold held by the US Treasury.

The US Treasury will never have to buy or sell any gold because vehicles will be created that are immediately traded on exchanges that will speculate on the changes in the broad base monetary aggregate in terms of the gold price. That will serve the needs as the aggregates increase.

This is in fact a public way to view the aggregate change by changing the value of another asset, which is a means of balancing the balance sheet of the USA as it was at the day of adoption.

It is not convertibility. It floats and is not fixed.

When the need is greatest (.52 USDX or $2 Euro)) it will be seen as an acceptable return to a form of disciplined central banks actions. It will be a reinstatement of an alarm mechanism but with parts that float.

The market value of gold on that day will be a pendulum-starting point, not a fixed price. The broad measure of money supply on that day will be 100 on the liquidity index.

Assuming the dollar is at .5200, the adoption of this mechanism could mark the low of the US dollar for this chapter of the financial history of the USA.

There are other items that will have to fall into place if that is to be the dollar saver from a complete Weimar Experience. This is the major criterion for success.

I assume it is January the 14th, 2011 and gold is trading at $1,650 or higher. Then I would assume the price of gold to trade $100 above and below the price of gold on that day according to changes in the liquidity index.

If the USA would like to avoid a Weimar experience in the US dollar this is the key ingredient to preventing that.

The US dollar is headed in the direction of the Weimar Experience in order to satisfy significant financial failures. Some smaller entities will be rescued by Federal Money, exploding the US Federal Budget deficit and putting the weight of more newly created dollars on the inherently weak dollar.

There is a 70% possibility that since central banks have moved to floating currency parities that the modernized and revitalized Federal Reserve Gold Certificate Ratio will follow under the pressure of future systemic and grave financial circumstances.

I will close by quoting more passages from the Wikipedia article on hyperinflation, and which are not one bit funny:

The main cause of hyperinflation is a massive and rapid increase in the amount of money, which is not supported by growth in the output of goods and services. This results in an imbalance between the supply and demand for the money (including currency and bank deposits), accompanied by a complete loss of confidence in the money, similar to a bank run.

Enactment of legal tender laws and price controls to prevent discounting the value of paper money relative to gold, silver, hard currency, or commodities, fails to force acceptance of a paper money which lacks intrinsic value. If the entity responsible for printing a currency promotes excessive money printing, with other factors contributing a reinforcing effect, hyperinflation usually continues. Often the body responsible for printing the currency cannot physically print paper currency faster than the rate at which it is devaluing, thus neutralizing their attempts to stimulate the economy.[...]

Hyperinflation effectively wipes out the purchasing power of private and public savings, distorts the economy in favor of extreme consumption and hoarding of real assets, causes the monetary base, whether specie or hard currency, to flee the country, and makes the afflicted area anathema to investment. Hyperinflation is met with drastic remedies, such as imposing the shock therapy of slashing government expenditures or altering the currency basis. [...]

1) Wikipedia, Papiermark

2) Wikipedia,Rentenmark

The Hanukkah War: Hamas plays The Crying Game

Hamas Blinking

By John Batchelor on January 7, 2009 10:44 PM

Tehran Sends Larijani to Meshaal in Damascus

The report in the last news cycle that Ali Larijani conferred for several hours in Damascus with Hamas gang boss Khaled Meshaal is the first unambiguous indication that Hamas is looking for the best possible deal to save face in Gaza. The so-called talks in Cairo among the players, Egypt, Israel, the Quartet and Hamas are stuck until and if a decision is reached in Damacus.

Hamas wants to know what does defeat look like? The IDF is taking too many prisoners to paper this over with celebrations at funerals in front of film crews hired by Reuters for agitprop.

The POWS are talking. Hamas must secure resupply of cash and weapons in Gaza after the IDF withdraws. But how? The EU is talking about a watchdog force at the border, and the French are offering naval patrols. This is sufferable because it won't last long and can be penetrated over time.

However, Hamas needs to know if it can count on Tehran pushing in large the amount of money it will need right away to sustain its power. Fatah is ready to make a comeback into the vacuum.

All of Gaza, all of the West Bank, all of Jordan, knows that Hamas is blinking, and that Tehran is stumped, and the there are going to be new mysteries soon. This has the possibility of being the worst setback for Tehran since Zarqawi was killed and his Al Qadea in Iraq network fell apart.

The Quartet Remains Unpredictable

Someone very shrewd is slowing down the Quartet and keeping it from imposing a ceasefire on the IDF. My best information 24 hours ago was that Israel could not resist a ceasefire and peace-keepers along the Sinai border. But then there was the odd three hour ceasefire, and more rockets, and now the debate continues.

It is striking and confounding to see the UN Security Council kept out. Is this T. Blair working with G. Bush and using N. Sarkozy as a blocking back? Egyptian President Hosni Mubarak and the Egyptians must have convinced everyone that bleeding Hamas is good policy.

What is left to do in Gaza is the Rafak corridor and the rough neighborhoods outside Gaza City. Chiefly Khan Younis to Rafak. Khan Younis and Rafak are under daily bombardment. Someone or something has yet to make a decision. In the meantime, Hamas continues to torture and execute Gazans who have collaborated with the IDF -- mainly Fatah ops and their cousins.

Hamas is weaker and weaker. It has already lost all its advances since 02. Now it is shrinking.

The Hanukkah War: Game over for Hamas

Here's John Batchelor's latest update, Trapped and Abandoned, published at 2:28 PM today but just now making the rounds. Can Hamas pull a rabbit out of the hat? Not likely when they're the rabbit.

The Hanukkah War: Day 10 in the Diplo and Battle Spheres and the cold reality of Iran's nuke weapon program underlying them both

Reuters Headline: Sarkozy says may be close to deal on Gaza
Reuters Fine Print: Sarkozy says small hope for a deal

In war we take our grim chuckles where we find them, so I'll start with the following unintentionally ironic report; filed at 10:35 AM Eastern Time, it suggests that Sarko the World Savior is temporarily stymied in his quest to bring peace to the Middle East.

TIRI, Lebanon, Jan 6 (Reuters) - French President Nicolas Sarkozy said on Tuesday a deal to end the Israeli offensive in Gaza was "not far".

"I'm convinced that there are solutions. We are not far from that. What is needed is simply for one of the players to start for things to go in the right direction," he told reporters during a visit to French U.N. peacekeepers in south Lebanon.

Sarkozy said he was returning to Sharm el-Sheikh to meet with Egyptian President Hosni Mubarak because there was "small hope" of such a deal.

Let us hope that the hope remains small. With the vise tightening on Hamas, the Israelis would be nuts to call even a temporary halt in the Gaza Battle Sphere. And John Batchelor's Rafak report on the weather in the Diplo Sphere is more realistic about deal-making:

The Arab League is not united about protecting Hamas, and therefore it has not put uniform pressure on the UN. What we may see here is the Saudi regime blocking the Arab League in order to let Iran's puppet Hamas die.

Tehran is without options as it cannot reinforce Hamas though the sealed Sinai border. The longer the UN does not move, the more I am persuaded that the Saudis mean to make an example of Hamas to show their post-Bush, post Iraq strength against Tehran.

That the Saudis now have great incentive to quietly back Israel against Iran is tragically underscored by Caroline Glick's observations for the Jerusalem Post in her January 5 editorial, Iran's Gazan Diversion? (H/T Center for Security Policy).

Leaving aside their usual official condemnations of Israel, Tehran has been curiously out to lunch on the matter of the Israel's war on Hamas. This has created a flurry of speculations about the reason for such a strange state of affairs, which Glick duly notes. However, she ends with this most chilling of speculations:

Alas, there is another possible explanation for Iran's apparent decision to abandon a vassal it incited to open a war [against Israel]. On Sunday, Iranian analyst Amir Taheri reported the conclusions of a bipartisan French parliamentary report on the status of Iran's nuclear program in Asharq Alawsat.

The report, which was submitted to French President Nicolas Sarkozy late last month concluded that unless something changes, Iran will have passed the nuclear threshold by the end of 2009 and will become a nuclear power no later than 2011. The report is notable because it is based entirely on open-sourced material whose accuracy has been acknowledged by the Iranian regime.

The report asserts that this year will be the world's final opportunity to prevent Iran from acquiring nuclear weapons. And, as Taheri hints strongly, the only way of doing that effectively is by attacking Iran's nuclear installations.

In light of this new report, which contradicts earlier US intelligence assessments that claimed it would be years before Iran is able to build nuclear weapons, it is possible that Iran ordered the current war in Gaza for the same reason it launched its war in 2006: to divert international attention away from its nuclear program.

It is possible that Iran prefers to run down US President George W. Bush's last two weeks in office with the White House and the rest of the world focused on Gaza, than risk the chance that during these two weeks, the White House (or Israel) might read the French parliament's report and decide to do something about it.

So too, its apparent decision not to have Hizbullah join in this round of fighting might have more to do with Iran's desire to preserve its Lebanese delivery systems for any nuclear devices than its desire to save pennies in a tight economy.

And if this is the case, then even if Israel beats Hamas (and I eat my hat), we could still lose the larger war by again having allowed Iran to get us to take our eyes away from the prize.

I do not share Glick's pessimistic view of Israel's chance for victory in Gaza. If her speculation about Iran is correct, an Israeli victory in Gaza would be a hollow one. But no matter his reasons if the enemy is prepared to sacrifice a useful idiot, accept the gift.

However, the French parliamentary report may explain why Sarko has been running around the Middle East like a chicken with its head cut off.

I am haunted by a conversation that Malcolm Hoenlein had a year or so ago on the radio with John Batchelor about Iran's threat to the EU3 if they didn't halt their attempts to brake Iran's nuclear weapons program.

Malcolm recounted that Iran's President Mahmoud Ahmadinejad said, "Europe, we can set you on fire. Remember Paris?"

I well remember the fires in the 2005 Paris riots and so does all of the European Union. That is more reason to be thankful that German Chancellor Angela Merkel has continued to hang tough in her defense of Israel's invasion of Gaza. She is doing so at grave risk to her political career.

With the stark prognosis of the French parliamentary report before her, perhaps Merkel decided that she has no choice but to stand resolutely by Israel on the matter of Gaza. If so, that would be an acknowledgement that Israel should not be required do all the heavy lifting with regard to Iran's nuclear threat.

(As to where the parliamentary report leaves the famous equivocations in the 2007 NIE summary of Iran's nuclear threat: in history's trash can. Beyond that, what can I say about the 2007 NIE summary that I haven't already said?)

And what of the stand of the third member of the EU3 with regard to Gaza? Today Britain's Prime Minister Gordon Brown has expressed great concern about the humanitarian crisis in Gaza and proposes an immediate ceasefire but with these caveats:

"... an immediate ceasefire, which means of course no rocket attacks into Gaza as well as no Israeli troops in Gaza. It also means an end to the tunnels and the arms trafficking. And it also means something else that is necessary to complete that: the opening up of the borders under international supervision."

Asked what form the international supervision should take, the Prime Minister replied: "We will need international engagement. It is not possible to see a solution to this without some kind of international engagement that will protect the security of the Israeli people and will create the viability for open borders to be given to the Palestinian area in Gaza."

Gaza is honeycombed with hundreds of tunnels, many of them opening into the living quarters of Palestinians. To actually shut down the tunnels would mean room-by-room search and destroy missions. So when his words are stripped of Diplo Speak I venture that Gordo is saying in a pig's eye do I support an immediate ceasefire.

As to international supervision, I hope that he's not referring to the kind of international supervision found at Lebanon's borders. From Glick's Gazan editorial:

In 2006, [Israel's government] supported a ceasefire that empowered outside actors -- in that case the UN and Europe -- to enforce an arms embargo against Hizbullah and to act as Israel's surrogate in preventing Hizbullah from reasserting control over South Lebanon.

In the event, as government critics like myself warned at the time, these outside actors have done nothing of the sort. The European commanded UNIFIL force in Lebanon has instead acted as a shield defending Hizbullah from Israel. Under UNIFIL's blind eye, Iran and Syria have tripled the size of Hizbullah's pre-war missile arsenal. And Hizbullah has taken full control over some 130 villages along the border.

But let us end with a look at the Battle Sphere. From Batchelor's Rafak piece, filed January 5 at 9:47 PM:

Southern Gaza is the battlefield

[...] The IDF has divided the Strip into three segments. The most critical area is from Khan Yuonis to Rafak ... . Much of it is rolling sand dunes that rise from the beach to a flat sweeping sandy field to the wire. What happens in the Khan Younis to Rafak corridor will determine the fate of the Hamas gang.

When the IDF moves in to secure Rafak it is the coup de grace. Rafak is a miniature Fallujah; heaps of poured concrete houses pushed close together in a naked landscape of sand and ruins. House to house, like Fallujah. The IDF taught the Americans how to conduct urban warfare against hired, drugged-up, trapped and suicidal jihadis. Now it is the teacher's turn.

*************************
5:00 PM ET UPDATE
I see that Sarko has not let the ground grow under his feet in Egypt:

SHARM EL-SHEIKH, Egypt (Reuters - 8:56 PM GMT) - Egypt said on Tuesday it was proposing an immediate ceasefire between Israel and the Palestinians in Gaza, to be followed by talks on long-term arrangements including an end to the blockade of Gaza.

Egyptian President Hosni Mubarak presented the proposal in a brief statement after talks with French President Nicolas Sarkozy in the Egyptian resort of Sharm el-Sheikh. [...]

The Reuters report has details of the plan, such as they are.
6:30 PM ET UPDATE
Here's John Batchelor's latest post, Trapped and Abandoned, published at 2:28 PM today but just now making the rounds. Can Hamas pull a rabbit out of the hat? Not likely when they're the rabbit.

The state of jihad: 2008

Bill Roggio's annual country-by-country roundup for Long War Journal.

The Hanukkah War

This morning RBO published a highly informative roundup of news and views on the Hanukkah War, launched by Israel on December 27, on the sixth day of Hanukkah, with air strikes on Hamas strongholds. To which I would add President Bush's unequivocal January 3 speech:

[...] This recent outburst of violence was instigated by Hamas -- a Palestinian terrorist group supported by Iran and Syria that calls for Israel's destruction. Eighteen months ago, Hamas took over the Gaza Strip in a coup, and since then has imported thousands of guns and rockets and mortars. Egypt brokered a ceasefire between Hamas and Israel, but Hamas routinely violated that ceasefire by launching rockets into Israel. On December 19th, Hamas announced an end to the ceasefire and soon unleashed a barrage of rockets and mortars that deliberately targeted innocent Israelis -- an act of terror that is opposed by the legitimate leader of the Palestinian people, President Abbas. [...]

My only quibble with the wording is that Israel's attack is not an "outburst of violence" but a legitimate act of war.

And I note that the fact that the war was launched during Hanukkah has been ignored by the news media and government spokespersons alike. I'm not sure why. Does no one in the press, no one in government, want to bring up a link between the Hamas vow to destroy Israel and the Seleucid sack of Israel, which occurred a very long time before the birth of Mohammed?

Professor Stephen Cohen on John Batchelor Show tonight. Yippee!

My favorite Russia analyst will have two segments on John's show (the KFI portion) to bring the audience up to speed on Russia's doings. From the show schedule:

8:35 PM [Pacific Time]: Stephen Cohen, NYU, re Russia in winter, re Putin and Medvedev and the challenge of the oil plunge, re the nat gas cut-off to Ukraine, re the Russian ambitions in the Black Sea and the Caspian Sea.

8:50 PM: Continued: Moscow and Kiev seek allies in gas dispute; EU adopts low profile during showdown.

The podcast will be available the next day if you can't tune in tonight.

Here's the entire schedule for both portions of the show, both of which can be heard online.

"US communists ... are now in a better position to dictate Democratic Party policy than at any time since the 1930s."

It wasn't until I read Trevor Loudon's latest essay, The Real “Secret” of American Communism, courtesy of RBO, that I realized I'd been wrong to assume America's communist movement is geriatric. Clearly, from Loudon's piece, I was not paying enough attention.

Loudon has been paying very close attention, and what he reveals today about the progress made by the communists in the USA since the late 1990s is a jaw-dropper.

Is he being an alarmist? Let me put it this way: pray that he is. But while you're praying row away from the rocks. Learn about the organizations and names he tosses around, and keep an eye on their public statements during the first years of the Obama presidency.

Just as shocking is the history Loudon provides about the power that the communists gained in New Zealand under the guise of the 'peace' movement. That might explain why he troubled himself to closely follow Obama's rise and the American political scene.

New Zealand bought the T-shirt and the DVD when it came to falling prey to the chameleon tactics of the globalized communist movement. If Loudon's warning is any guide the United States is poised to do the same.

After you visit New Zeal to read Loudon's post, pop in at RBO to see the pictures Procrustes added to the crosspost. And while you're there, why not thank RBO for doing so much to promote Loudon's writings in the USA?

11:45 AM ET UPDATE
At long last, this just in:

RBO apparently reached critical mass on the subject of Obama's Socialist / Marxist / Communist ties and supporters to call for a compilation of links, which will join the master RBO Reading List.

So there it is, in one convenient place: all the stuff I've been putting off reading about Obama and his buddies, and believe you me I've already plowed through a lot of stuff. But after reading Loudon's latest I will put off the chore no longer.

If you'd like to see better news analysis on cable TV, now's your chance

Pundita's favorite mainstream media news analyst, John Batchelor, has been a guest several times on Fox News Channel, but to the best of my recollection his January 2 appearance on Fox & Frends marks his first time on that morning show.

He provided three commentaries during the appearance; read about them here and see the videos here.

I am unhappy with John's comment that Hillary for Secretary of State was the best political move of 2008. The thought of Hillary Clinton and her husband being in Washington has always made me queasy. The song goes, "Stand by your man," not "Stand by your ghoul."

But I grudgingly concede his point: Obama's pick for the post was the most skillful politicking of the year, which I'll qualify by observing: provided you consider bone tossing a skill.

With that off my chest I'll note that just the other day I told a reader that if he really wanted to see better news coverage on TV, toss enough money to John Batchelor to launch his own cable news show.

I suppose a next best option would be John becoming a regular commentator on Fox & Friends. Here's the email address for the show; if you appreciate the analyses he provided on their Friday show, write and tell them so.

friends@foxnews.com

All the news that's fit to scramble your brains, and a lesson in Global Village Math for unscrambling them

Take a look at the wildly different headlines and lead paragraphs about the reason for the U.S. dollar troubles, as reported in two Bloomberg articles published on December 30, 2008:

Report filed by Ron Harui:

Dollar Declines as Israel-Hamas Conflict May Reduce Oil Supply
The dollar fell the most in almost two weeks against the euro after Israel’s assault on the Hamas-controlled Gaza Strip raised concern that oil exporters will reduce crude supplies to U.S. consumers.

Report filed by Jamie McGee and Michael J. Moore:

Dollar Falls on Bets Fed’s Zero Rate Will Cut Greenback Demand
The dollar declined against the euro and the yen on speculation the Federal Reserve’s zero target lending rate will weigh on demand for the greenback.

Harui does note in his second paragraph that the dollar:

... also dropped versus the yen before a U.S. report today that may show home prices dropped the most on record in October, adding to concern the recession will deepen in the world’s largest consumer of oil.

But if you contrast his analysis with the one filed by McGee and Moore you'll see that he is so focused on the Gaza crisis that his report is virtually worthless when it comes to understanding the dollar's present troubles.

Of course any hot conflict in the Middle East will cause the price of oil to rise on fears of an interruption in the supply of oil from that region, which can impact the USD. But one has to look beyond the oil issue and its relation to the USD to grasp why the dollar is facing long-term weakness. From the McGee-Moore report:

"With the Fed reverting to non-conventional monetary policy, the whole notion of a strong dollar goes out the window,” said Shaun Osborne, chief currency strategist in Toronto at TD Securities Inc., a unit of Canada’s second-largest bank. “The risks are skewed to dollar weakness."

This doesn't mean that Harui's report is useless; on the contrary, it's a clear window on Tokyo's very grave concerns about any crisis that could suspend oil deliveries from the Middle East. How do I know this about the report? Because:

> Ron Harui is based in Singapore and his reporting focuses on financial issues in East Asia, notably China and Japan.

> Three of the four sources he quotes in his report are Japanese based in Japan.

> Japan imports almost all of its oil and is the world's third-largest oil consumer after the United States and China. Since the severe oil crises in the 1970s the Japanese have striven mightily to reduce their dependence on Middle Eastern oil, but they are still heavily dependent on oil from the region.(1)

McGee and Moore, on the other hand, are based in the United States. And while the U.S. and Canada are of course worried about anything that could suspend oil deliveries from the Middle East, the concerns in Washington and Ottawa are not as severe as Tokyo's about the same issue.

So. No use to complain about subjectivity in news reporting and analysis. The situation I outlined above is just the way things are in today's world of news coverage: people study situations from their particular self-interest, and reporters talk to the people on their own beat. But to lessen confusion about differing views in news stories on a major issue, do the math; develop the habit of noting:

> the location and interests of the major sources quoted in a report,

> the reporter's beat (check via Google for a history of the reporter's filings), and

> the official view(s) of the situation under analysis in the region/country that the reporter covers.

Reading news stories in this manner gets easier with practice and soon becomes second nature. The payoff is that you're better able to spot the currents and eddies swirling around the foreign policy decisions of world powers.

And always look for a second opinion from a region of the world not covered in the first report you read. This exercise might seem self-evident when you're trying to understand an event with global impact. But as the example I've given points up, often the contrasting views and the reasons for them are not immediately obvious.

1) Although it's two years old this report from the Asia Times, Oil-hungry Japan looks to other sources, is excellent background on Japan's heavy dependency on Middle Eastern oil and their steps to reduce the dependency.

Psychologically the Japanese have never fully recovered from the 1970s Middle East oil shocks and for good reason: the panic in Japan sent Japanese scrambling to stock up on household necessities for fear that stores throughout the country would run out.
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This entry is crossposted at RBO.

Is Sarko overdue for a visit from the Puffy Head Minders?

The news may come as a complete surprise to you but to start off the New Year on a positive note, I pass along President Nicolas Sarkozy's announcement that during the past six months he has saved the world. Now if he can only brake France's soaring unemployment and stop Le Pen from making snide remarks about him. But let's not sweat the small stuff, eh? Sarko has charged off to Jerusalem to take command of the Gaza situation.