Tuesday, June 4, 2013

Brew OK, Packaging Stinks! Marines to Jordan, Rice Rewarded!

This is Mychal Massie, who lambasted Obama in the previous memo.



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These are pictures of Muslims  and it is evident they do not support freedom, hate the West and long for the day when they will impose their own Caliphate upon those who do not embrace their beliefs.

Seems to me they have profiled themselves.





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Assad and Hezballah seem to have gained the upper hand and this increases the threat to Israel. (See 1 below.)
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An update from Porter Stansberry. (See 2 below.)
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A friend and fellow memo reader asked my thoughts regarding Christie's decision. This is what I think:

In my opinion Christie is trying to get re-elected Governor and thus, in a black and blue state, must appeal to liberals.  This is why he kisses up to Obama and now has chosen to allow the voters to select their next Senator rather than appoint a Republican, as he has every legal right to do.

Christie reminds me of McCain. You really never know where he is coming from.

In seeking to get re-elected, governor Christie has probably shot himself in the foot should he wish to seek the presidential nomination under the Republican banner so he might switch parties at some future date. Time will tell. (See 3 below)

A very dear friend and fellow memo reader thinks otherwise.

In a chat with him today he said Christie is electable at the national level and Republicans need to get away from placing themselves in the corner - the right corner - because they will only lose.

He also went on to say Republicans need to change their nominating process and quit allowing New Hampshire and Iowa to determine their candidates. Better they divide the nation into three geographic groups and hold the nominations collectively according to that break down.

He also asked whether I had heard that Hillary was in the hospital.  My friend is well connected politically.
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The Rice appointment appears to be pay back for having been thrown under Obama's bus. She does not have to be approved by the Senate

Her appointment is neither good for America and/nor Israel.  Her level of competence is questionable and her bias is evident.

Rice's appointment is in keeping with Obama's desire either to be surrounded by incompetents so he will appear competent and/or it fits his desire to downgrade America as a nation to be reckoned with. You decide.
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Obama quietly sent in the Marines to Jordan. (See 4 below.)
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Poll indicates Republicans are out of step with Millenials.

The real question is, if Republicans re-brand themselves will the Millenials , who are mostly out of step with reality, embrace Republican policies because these policies are what produced most of America's wealth?  Also. can Republicans stick to their principles and policies even if they re-brand themselves?

There is nothing wrong with fiscal responsibility, spending less on entitlements, reducing the size of government, allowing individuals to make more choices and enjoy more freedom  both to fail and succeed and to go back to feeling patriotic about being an American.

The brew is a good one.  The packaging stinks! (See 5 below.)
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Dick
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1) Battle for Damascus is over. Is Israel intelligence slow on Syrian war?


When Israeli Defense Minister Moshe Ya’alon informed a Knesset panel Monday, June 3, that Syrian rebels still occupied four Damascus districts, intelligence sources reported that the battle for the Syrian capital was all but over. Barring small pockets of resistance, Bashar Assad’s army had virtually regained control of the city in an epic victory. From those pockets, the rebels can’t do much more than fire sporadically. They can no longer launch raids, or pose threats to the city center, the airport or the big Syrian air base nearby.

The Russian and Iranian transports constantly bringing replenishments for keeping the Syrian army fighting can again land at Damascus airport after months of rebel siege.
The rebels fell back in Damascus after being outflanked in a pincer movement in Damascus’s eastern outskirts executed by the Syrian army’s 4th and 3rd Divisions and a “Fuji” commando unit . Most of the rebels were pushed outside the city.

Military sources report  as of Tuesday, June 4, Assad’s army controls all the capital’s road connections and its western districts. It has also cleared opposition forces out of areas west of Damascus through the Zabadni region and up to the Lebanese border.
To the northwest, Hizballah and Syrian units have tightened their siege on the rebels holding out in the northern sector of al Qusayr; other units have completed their takeover of the countryside around the town of Hama; and a third combined Syrian-Hizballah force has taken up positions around Aleppo.
Senior IDF officers criticized the defense minister’s briefing on Syria Monday to the Knesset Foreign and Defense Committee in which he estimated that Bashar Assad controlled only 40 percent of Syrian territory as misleading. They said he had drawn on a flawed intelligence assessment and were concerned that the armed forces were acting on the basis of inaccurate intelligence. Erroneous assessments, they feared, must lead to faulty decision-making. They cited two instances:

1. On May 5, the massive Israeli bombardment of Iranian weapons stored near Damascus for Hizballah, turned out a month later to have done more harm than good. It gave Bashar Assad a boost instead of weakening his resolve.
2.  Israel has laid itself open to unpleasant surprises by its focused watch on military movements in Syria especially around Damascus to ascertain that advanced missiles and chemical weapons don’t reach Hizballah. Missed, for instance, was the major movement by Hizballah militia units towards the Syrian-Israeli border. Our military sources report a Hizballah force is currently deployed outside Deraa, capital of the southern Syrian province of Horan. Reinforcements are streaming in from Lebanon. The Hizballah force and Syrian units are getting ready to move in on the rural Horan and reach the Israeli border nearby through the Syrian Golan.

Their coming offensive, which could be only days away, will find Israeli face to face for the first time with Hizballah units equipped with heavy arms and missiles on the move along the Syrian-Israeli border and manning positions opposite Israel’s Golan outposts and villages. 
The early calculus that the Syrian battlefield would erode Hizballah’s strength held Israel back from obstructing the flow of Hizballah military strength into Syria. It has been proven wrong. 

Instead of growing weaker, Iran’s Lebanese proxy is poised to open another warfront and force the IDF to adapt to a new military challenge from the Syrian Golan.
Unlike its previous wars against Israel, this time Hizballah will not confront Israel alone. On May 30, when the Syrian ruler spoke of “popular” demands to mount “resistance” operations against Israel from the Golan, he didn’t mention Hizballah because he was referring to demands coming from inside Syria.
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2)
A Major Update to the
"End of America"
By Porter Stansberry

Bear with me…

Today's essay addresses what I believe is the core financial issue of our generation. These concerns are so important, they dwarf all other financial considerations.

Unfortunately, few journalists have any idea what these things mean. So you likely haven't heard of most of these things. So please… allow me a bit of basic reporting.


Last April… in a little-noticed move… Australia announced it was transferring 5% of its currency reserves from the U.S. dollar to the Chinese yuan.

The deal was part of a broader currency agreement between the two countries that allows Australia's leading banks to handle trade settlements between the two countries without the use of the U.S. dollar as a reserve currency.

As CBS Marketwatch explained, "The agreement does away with the need for companies and currency traders to first convert their Australian dollars or yuan into U.S. dollars."

Similar direct-exchange agreements, swap lines, and bilateral trade agreements have now been established between China and virtually every major economy in the world: Japan, Brazil, Russia, India, Britain, and France – not to mention every economy in Asia. These agreements will allow China, the world's dominant consumer of commodities, to completely avoid using the U.S. dollar in virtually all of its raw-material sourcing.

Similar "dollar exclusion" agreements have been formed by Russia with its major trading partners. London-based HSBC, one of the world's largest banks, now predicts that by 2015, the Chinese yuan will equal the U.S. dollar and the euro in cross-border transaction volume.

In December 2008, I began warning about the risk that the U.S. could lose its "world reserve currency status," something I termed the "End of America." It's worth looking at what I wrote almost five years ago because so much of what I feared would happen has come true.

In the days following the huge crash of the stock market and the near-collapse of the world's banking system, I warned readers about what I saw coming. Before you continue… you should go read that essay.

As you'll see, almost everything I foresaw in December 2008 has happened. The Fed went on to print and spend more than $3 trillion. The prices of stocks and commodities soared. The dollar fell versus sound currencies around the world. And the prices of U.S. goods and services, even domestically made products, soared.

Now, some folks who have followed my research from the beginning might point out that I predicted the U.S. would begin suffering from severe inflation as early as 2009. With the consumer price index hovering around 1%, isn't that inflation overdue?

If you look beyond the government's manipulated numbers and focus on the real prices people are paying… you'll see price inflation is here and getting worse…

As I've written extensively… inflation is found everywhere in our economy, except in the government's statistics. Corn, the most important food crop in America, is up 75% since 2008. Gasoline is up from $2.25 a gallon to more than $3 a gallon – an increase of more than 30%. The nationwide minimum wage is up by 40%. Rents are up by 25% nationwide and up 40% in most urban markets.

And my favorite example, the base price of a Ford F-150, the best-selling passenger vehicle in America, has gone from $18,225 to $23,670 – a 30% increase. That's a domestically sourced and manufactured product… its price is completely dominated by the value of the U.S. dollar.

Meanwhile… the government says there is no inflation… and that continuing to print $85 billion to buy government and mortgage debt is merely "interest-rate policy by other means." What could go wrong?

Billionaire investor Warren Buffett has sagely warned that buying all of those bonds and manipulating interest rates to stupidly low levels will prove to be much easier than selling them. The fact is, the moment our central bank begins to sell U.S. Treasury bonds, the whole world will follow. After all, our dollars aren't needed in trade for most of the big commodity countries. So the free ride will be over. All the traders who've enjoyed the free ride on the back of the Fed's buying will surely change course the moment it starts to sell.

And what, you might wonder, have our noble leaders done with all the money and credit they've created?

Mostly, they have expanded the welfare state at the fastest pace in history, creating more dependency in your fellow citizens than has ever existed before in the history of our country. There are now almost 100 million people collecting food stamps, disability, or long-term unemployment. Barely 60% of the adult population of America bothers to go to work, even on a part-time basis.

On the backs of the poor schleps in America who paid their mortgages and still go to work, a gargantuan pile of debts and obligations have been piled higher and higher over the last five years. Total debt now approaches $60 trillion. Federal debt has nearly doubled in the last five years, from $9 trillion to $17 trillion. And our governments (state, local, and federal) continue to take up more and more of our economy – comprising more than 40% of our roughly $15 trillion gross domestic product (GDP) today.

It seems completely obvious that none of this is sustainable. The few Americans who still work and pay taxes can't possibly support the income demands of nearly 40% of the population… especially considering the debt load our economy suffers under. We cannot possibly afford our existing debts, if we were to pay them back at a fair rate of interest in sound money.

And so… we race toward a day of reckoning when the Fed cannot continue to print new dollars to bail us out because our trading partners have abandoned our currency.

Of course, not every American is an economist. Most people don't understand why the real value of their wages continues to fall, even as the government swears there's no inflation. I doubt even one in 100 Americans understands the risks our country faces as we attempt to manage total debts (public and private) that represent about 400% of GDP (not counting any of the future costs of the entitlement programs) while our trading partners abandon our currency as the reserve standard.

But… most people know something is wrong.

Gun ownership in America now stands at 47% of all adults – that's near the highest percentage ever recorded by Gallup. It marks a significant increase since 2008. The percentage of self-described liberals who own guns has grown from 30% to 40% in that period. So even folks who don't believe you should own a gun have been buying them.

I believe most people know that something isn't right… that we can't go on like this forever… printing money day after day. Most people simply know that far too many people are on the dole. And they can see that our Treasury has fallen into the hands of the voters, a fact that has spelled doom for every democracy in history.

So while they might not fully understand all the factors that I've written about here… they can see the hallmarks of a crisis. And that's why… despite the central banks' efforts to manipulate the paper price of gold down… there are never any gold coins left to buy. That's why the price of farmland has soared (as I predicted it would). That's why more and more wealthy people are leaving America. And that's why… I firmly believe… this ongoing bull market will end very, very badly.

Many people who read my End of America warnings over the years replied that it would take decades for America to lose its world reserve currency status. But if you simply look at the data on cross-border currency exchanges, you'll find that so far this year, more than 40% of the exchanges involved the euro. Only 33% involved the dollar.

Today, more than 60% of bank reserves around the world are still held in U.S. dollars. Mark my words: In less than a year, the dollar will no longer make up even a majority of these reserves.

The End of America isn't coming. It is here.

Regards,

Porter Stansberry
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3)John Bolton: Christie Decision to Hold Special Election 'Mind-boggling'

By Bill Hoffmann



Former Ambassador John Bolton says he's perplexed at New Jersey Gov. Chris Christie's surprise decision to hold a special election to replace late Sen. Frank Lautenberg instead of appointing a Republican.


"I'm mystified by this decision," Bolton told "The Steve Malzberg Show" on Newsmax TV.

"It is just mind-boggling and it will expose him to criticism from nearly everybody — and that's what happens when you make a decision that's too cute by half."


Christie on Tuesday set a special election for October to fill the seat of Lautenberg, a move that could cost taxpayers as much as $20 million. He will appoint someone to temporarily fill in, but hasn't said who yet.


"One of the important aspects of electing a state governor is the prospect that he can fill vacancies in U.S. Senate seats," Bolton said.

"Even the state legislature's own research body concluded that Christie would be well within his discretion to appoint somebody through the November 2014 election.

"To say that he's then going to change basically a practice he established last year and hold a special election at the cost of $20 to $25 million . . . is just mind boggling."

Bolton — whose run as President George W. Bush's temporary U.S. Ambassador ended when the Senate failed to confirm him to the post — called it a "fact of political life" that governors appoint senators when vacancies occur.

But it's a mystery as to why he didn't turn to the qualified Republican for an appointed replacement, he said.

"This just may be a case where Christie said, 'Oh, I don't want to do anything controversial.' But it ends up . . . that decision turns out to be the most controversial of all," Bolton said.


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4)
Large US Marine force lands in Aqaba to deploy on Jordanian-Syrian border


A large American military force disembarked Tuesday, June 4, at the southern Jordanian port of Aqaba - ready for deployment on the kingdom’s Syrian border. T
he force made its way north along the Aqaba-Jerash-Ajilon mountain road bisecting Jordan from south to north, under heavy Jordanian military escort.

The American force numbers 1,000 troops, the largest to land in Jordan since the Syrian civil war erupted in March 2012. They are members of the 24th Marine Expeditionary Force carried aboard the USS Kearsage amphibious assault ship, which has been anchored off neighboring Israeli Eilat since mid-May. Upon landing, the marines took to the road in a convoy of armored vehicles including Hummers.

Washington and Amman have imposed a blackout on their arrival. The Pentagon has only let it be known that the annual joint US-Jordanian “Eager Lion 2013” military exercise is due to begin later in June and last two months, with the participation of US F-16 fighter jets and Patriot missile defense systems.
According to our US sources, the arrival of the US force in Jordan was not directly related to the regular exercise but decided on at an emergency meeting at the Pentagon on May 31, which was attended by top military and civilian Defense Department officials. Defense Secretary Chuck Hagel, who is away from Washington, took part by video conference.

The meeting decided that the military situation evolving in Syria and threats it posed to Jordan – including widening evidence of chemical weapons use in Syria - were urgent enough to warrant the dispatch of extra American military strength to Jordan, over and above the contingents participating in the joint exercise. The Israeli Air Force will provide air cover for the force until the F-16 jets are in place for the drill.

The US Central Command spokesman Lt. Col. T.G. Taylor in a statement to the US media said only: “In order to enhance the defensive posture and capacity of Jordan, some of these assets may remain beyond the exercise at the request of the government of Jordan.”

That request, according to our sources, was for the US to leave behind when the exercise ended and the troops departed - not just some of the weapons systems but all of the equipment which arrived with the marines Wednesday, as well as the F-16 fighters and Patriot missiles.
There is no official word about Washington’s response to this request. However, the Obama administration is not expected to turn it down.
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5) 

College Republican National Committee Report Has Grim Findings for GOP


Here’s what many millennials don’t like: the ‘closed-minded, racist, rigid, old-fashioned’ GOP. That’s the finding of a sober study by the College Republican National Committee. Jon Favreau says it’s a wake-up call.



)If you were among the roughly 97 percent of Americans who didn’t tune into one of the Sunday shows this weekend, you might not realize that the only two issues currently worthy of sustained national debate are the stupidity of some IRS bureaucrats and theoverzealousness of some certain federal prosecutors during an investigation of leaks that may have jeopardized U.S. assets within al Qaeda and North Korea.

Perhaps you are old-fashioned and have additional concerns that are a bit more naive, even trite. For example, what is the political system doing to help businesses create jobs or lift incomes? What are both parties proposing to help people afford a decent education, buy a home, or save for retirement? Who, if anyone, is offering a compelling agenda that speaks to the aspirations of younger generations?


How cute. And yet, while one Sunday show was asking panelists to analyze painfully awkward clips of IRS employees line dancing (please stop that), the College Republican National Committee was busy launching a sober, thoughtful, well-researched conversation about the future of a major political party that is now viewed favorably by only 33 percent of Americans under 30.


As a Democrat who turned 32 on Sunday, which just barely qualifies me as a millennial (1980–2000), I find this conversation hugely important. Young voters, long dismissed by pundits as too cynical and disengaged to vote, famously did so in record numbers in the 2008 election. In 2012, when we were supposed to stay home and sulk because President Obama didn’t take us from near depression to full employment in 45 months (PoliticoYoung Voters Sitting Out This November?”), we surpassed our previous turnout, handing the president his larger-than-expected margin of victory over Mitt Romney.


With the help of the Republican Party’s leading millennial pollster, Kristen Soltis Anderson, the College Republicans set out to discover how to win back some of these Americans in future elections. And what they found is younger voters simply don’t want the current brand of crazy that so much of the national Republican Party has been selling with such fervor.

One of the headlines from the study were the words that up-for-grabs young voters used to describe today’s GOP: “closed-minded, racist, rigid, old-fashioned.” And the party clearly is out of step with millennials on many of the social issues that receive so much media attention. The College Republican survey found that only 30 percent of young voters believe marriage should be legally defined as only between a man and a woman. Even strongly anti-abortion-rights voters said they were disturbed when Republican candidates talked about defunding Planned Parenthood and “redefining rape.” Young people were more likely to value environmental protection than older voters and most frequently listed a path to citizenship as the best way to reform immigration.

The Republican Party cannot keep hiding from an entire generation of voters who expect both sides to address their aspirations with smart, sensible, mainstream solutions.

But to me, the most significant finding in the survey was the wholesale rejection of the national Republican Party’s economic agenda. For four years, Republican candidates have been telling Americans that Obama’s policies are responsible for nearly all their financial ills. Yet a majority of young people believe Republican policies played either a major role or the biggest role in bringing about the Great Recession, giving Democrats a 16-point advantage over Republicans in handling jobs and the economy.


After decades of pushing bigger and bigger tax cuts skewed to the wealthiest individuals and largest corporations, Republicans must face the fact that only 3 percent of the next generation wants more tax cuts for the wealthy. Three percent. In a survey taken afterthe January budget deal that raised taxes on the richest Americans, a majority of young voters still believe those taxes should be even higher.


Despite a push for lower corporate tax rates that has come from both Republicans and Democrats in Washington, only about a third of young people think such a policy would help create jobs or improve their lives. Despite a sustained Republican jihad against even the most basic regulations on Wall Street banks or insurance companies or corporate polluters, only 40 percent of young people believe they’d be better off if business regulations were reduced.


And after the 37th failed vote by House Republicans to repeal Obamacare—a perverse obsession that seems to defy both substantive and political logic—only 37 percent of young Americans believe they’d be better off if the law no longer existed. Today Obamacare is favored by 9 points among young people, 44 percent of whom say “basic health insurance is a right for all people, and if someone has no means of paying for it, the government should provide.”


It’s clear that young Americans are concerned about unnecessary government spending and unsustainable debt. But unlike much of Washington, we have not been afflicted with Simpson-Bowles fetish syndrome. In the College Republican survey, young people want more spending on education, not the massive cuts proposed by nearly every Republican candidate and congressman. We worry about the rising cost of entitlements, but not nearly as much as we worry about the rising cost of college and student-loan debt. In the survey, young people clearly recognize that the president is working to address these challenges while Republicans have been indifferent at best.


So lti s Anderson ends the College Republican report with an admonition: “Economic growth and opportunity policies cannot just be about tax cuts and spending cuts.” Among the next generation of American voters, she has found ample evidence to support that claim. And yet, if a Republican candidate for president said such a thing, he or she would be driven from the race by a horde of torchbearing, pitchfork-waving Tea Partiers.


The truth is, the Republican Party today doesn’t have an economic agenda that goes beyond tax cuts and spending cuts. It can spend the next few years hiding behind investigative witch hunts and over-the-top rhetoric that most Americans don’t take seriously. It can hide behind another 37 failed repeal votes of a health-care program that’s already working as it’s supposed to in states like California. But the party cannot keep hiding from an entire generation of voters who expect both sides to address their aspirations with smart, sensible, mainstream solutions.


As millennials, we’re not stupid, cynical, or naive. We’re educated, we’re engaged, and we’re ready for a serious conversation about our future.
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