Category: Aggregated

Senate Republicans are shifting the focus from passing an authorization for the use of force against ISIS, to trying to sabotage a diplomatic agreement with Iran. The New York Times reports:

“With so much attention focused on Iran, it is doubtful that Congress can make much quick progress on the use of force measure, which lawmakers were struggling with even before Iran took center stage.”

Politico also reports that Republicans are planning to fast-track a bill which would allow Congress to approve or reject any agreement that the the P5+1 powers reach with Iran — even at the risk of having Democrats who otherwise support the bill, vote against it. When Senate Majority Leader Mitch McConnell announced on March 3 that he is planning to bring anti-Iran legislation directly to the floor without going through the Senate Foreign Relations Committee first, an “outraged” Robert Menendez (D-N.J.) said he’ll vote against his own bill if he has to. Sen. Tim Kaine (D-Va.) blasted McConnell’s push as “rushed and partisan.” Politico reports that McConnell’s drive to bring the legislation quickly to the Senate floor “has two of the bill’s Democratic sponsors in full rebellion mode, potentially presaging a Democratic filibuster on the floor if the bill doesn’t go through the Senate Foreign Relations Committee first.”

As to Congress’s enthusiasm to follow Netanyahu to war against Iran, Washington Post columnist Dana Milbank noted that:

“It’s a rare thing for Congress to declare war — and rarer still to do it at the request of a foreign leader.”

Another Washington Post columnist, Walter Pincus, who is generally aligned with the military-intelligence establishment, wrote a strong attack yesterday on any Congressional interference with Iran diplomacy, not only taking apart Netanyahu’s arguments, but pointing out that any Iran agreement would be hammered out not just by Obama, but by six great powers—Russia, China, Germany, and France, in addition to the U.S. and Britain—which is something Netanyahu never brings up.

Despite whatever US denials there might be, there is a very high expectation in certain circles that the US will soon be supplying weapons to the Kiev regime. US Ambassador to Kiev Geoffrey Pyatt, Victoria Nuland’s partner-in-crime in fomenting the Nazi coup last year, bragged that Congress has already allocated $120 million for building the Ukrainian military. Pyatt said:

“The U.S. Congress has approved the allocation of $120 million this year for training and purchasing equipment. The only question that is still being discussed is whether it should include defensive lethal weapons.”

He also claimed that the United States already has ample evidence of Russia’s participation to the conflict — photos from satellites and other evidence of the presence of Russian troops and military equipment in Donbas, as well as weapons supplies.

An obvious lie: if it were true, they would be broadcasting this evidence to the world.

For former Georgian president Mikhail Saakashvili, acting as an advisor to Ukrainian president Petro Poroshenko, the matter is already “99 percent settled.” He told a Ukrainian TV network:

“The main thing we are trying to achieve in the United States is that Ukraine receives defensive weapons.”

Saakashvili is clearly depending on the “good will” in the US Congress towards Ukraine to make it happen.

“America is a democratic country, so it was very important to hear publicly voices in the Congress and the Senate, and to see a strong call next week regarding provision of defensive weapons for Ukraine. This issue is in the spotlight of all U.S. media. When President Poroshenko raised this issue in the Congress in his triumphal speech in September last year, for many it was a surprise and a lot of people refused even to listen to it. Now, the decision is practically settled 99%. I don’t know when the last and most significant 1% will come — I hope soon, because Ukraine is running short of time.”

The “denial” comes from an anonymous Obama Administration official who told Tass that the US can’t arm the regime through third countries, in an obvious response to Poroshenko’s announcement last week, from Abu Dhabi, that the regime had agreed to an arms deal with the UAE. Ukraine is a sovereign country that has the right to conclude agreements with other countries, the official said.

FDIC Vice-Chairman Thomas Hoenig again called for “separating commercial banking, and its inherent safety net, from broker-dealer and proprietary trading activities,” in a speech to the Institute of International Bankers annual conference in Washington March 2. His speech included a warning on the current status of leveraged loans and derivatives in the U.S. banking system, and a plug for the Glass-Steagall Act.

On junk bonds’ cousins, the “leveraged loans,” Hoenig said that the FDIC’s extensive national review of assets of large banks, known as the Shared National Credit Review, showed very large issuance of leveraged loans in 2014: to an $800 billion bubble from just $280 billion one year earlier. Leveraged loans were “highly criticized” in the review: “Examiners noted excessive leverage against gaps in borrower repayment capacity, questionable evaluations”, etc., “weak underwriting and deficiencies in risk management.” He concluded, “This portfolio has systemic implications, whether held in the originating bank or [securitized].”

Derivatives are a still more serious matter. Hoenig said that

“In recent years commercial banking firms in the United States have been allowed to simultaneously own commodities, trade commodities and their derivatives, and own and control transportation and warehousing of these commodities.”

Citing the dangers, he said that

“the United States has insisted historically that banking remain separate from commerce.”

“The precursor to this conflict [of interest],” he noted, “was the repeal of the Glass-Steagall Act in the late 1990s, which permitted commercial banks to significantly expand their presence in trading derivatives and related contracts.”

Citing the notional value of derivatives contracts at the five most-exposed U.S. banking organizations at roughly $300 trillion, Hoenig says that this corresponds to $4 trillion of unstated assets [“value at risk”] on their balance sheets using international accounting rules.

“Also, among these derivatives contracts are more than $25 trillion of notional amounts of uncleared credit default swaps, equity derivatives, and commodity derivatives, which hold the highest risk to these banks. Derivatives activities conducted in the insured bank at lower costs have proven to be quite profitable, which explains why bank managers are so adamant that they stay there” — referring to the strong-arming and bribing of Congress in December.

“Subsidizing such derivative activity with its unbridled leverage should end,” Hoenig concludes.

In a speech in Berlin last night, Gen. Ben Hodges, commander of the U.S. armed forces in Europe, said that Western diplomacy needed a “muscle” to get the right message to Russia:

“If you don’t have something that gives muscle to the diplomacy, to the economic aspect, then it’s not going to be as effective.”

But, while going on to blast and threaten Russia, Hodges also announced, in an exclusive interview with World Bulletin March 3, that the U.S. was putting on hold its training mission to Ukraine—pre-announced to be 600 troops to work with the National Guard—to see if the Minsk accords succeeded.

Hodges said that helping Ukraine with weapons would increase pressure on President Vladimir Putin at home.

“When mothers start seeing sons come home dead, when that price goes up, then that domestic support begins to shrink.”

Hodges did not specify what weapons could be offered, but said that what Ukraine wants “is intelligence, counter-fire capability and something that can stop a Russian tank.” Russia has 12,000 soldiers and heavy weapons in eastern Ukraine, plus another 29,000 in Crimea, and is maintaining another 50,000 close to the border with Ukraine, Hodges asserted.