Saturday, December 22, 2007

[russia-britain-europe] like the steps of a dance

Click on pic to zoom

First the news:
The European Union has called on Russia to reconsider its order to shut down two British Council offices. The Russian government said this month that the offices in St Petersburg and Yekaterinburg had broken laws, including tax rules.

In a statement, the EU expressed its concern, citing the importance of culture in the "EU-Russia partnership". Relations between Britain and Russia have worsened dramatically since the London murder of Russian exile, Alexander Litvinenko, in November 2006.
Some comments

This is more complex than it at first appears. It involves alliances and written agreements. It also flies in the face of attempts to create good relations. Any Russia-watcher would know that when an article like this appears in Pravda, then this is a fair barometer of government intention overall.

It is essential that Russia listens to Europe and yet bilateral agreements should be exempt from being tied into other issues. In practice, of course, they are not mutually exclusive.

Britain thinks Russia was out of order to bump off Litvinenko within Britain. And yet this has not been proved and further, this man and others like Berezovsky were using their privileged status behind their British immunity to attack Russia.

America was faced with the same situation in Cuba. Would they have been justified in attacking the missile sites in Cuba? This is not the same question as whether they would have been justified in invading Cuba. The question is: "How far is a nation justified in eliminating a threat to its security, especially when that threat is hidden behind a host nation's immunity?"

This is the question behind Al Qaeda, behind Gaddafi and Lockerbie, behind Iraq, behind Iran.

And who is in the best position to judge a nation's security interests? Is it that nation itself or that of the people within the country from whence the threat is coming? Example - imagine that a group of Brits in, say, Holland, are hell bent on hurting Britain's interests by stymying trade deals, security cooperation and whatever else between Britain and Holland.

Holland acts to protect these elements. How far would Britain be justified in intervening? Leaving aside the wrongs and rights of the issue itself, surely Realpolitik dictates that somewhere down the track there'd be a lot of aggravation involving alliances and commitments to assist.

Whilst neither Britain nor Holland would desire this state of affairs, international conventions would dictate that things must proceed along certain lines. So both sides would foresee worsening relations but what choice would there be, when those elements being protected in Holland are continuing to harass and nobble Britain?

As a Brit, naturally I see our point of view. Living here so long and being on terms with certain people in government here, I see the other side too. What I can't see is an immediate solution to the issue.

Thoughts on the map at the top

The map is what Europe might have looked like today if the Nazis had, in fact, won. It can be seen that both the United Kingdom and Russia are unresolved issues. From historical documents, it appears that Britain would have enjoyed semi-autonomous status, not unlike what they will have when the EU formally takes over in 2010. This would undermine British nationalists' ability to muster and motivate anti-union forces.

Russia is another matter. The view here is that there was no doubt Germany intended to subjugate the Russians and use them as slave labour, the less useful going to the gas chamber. Hence the added piquancy to their resistance at Stalingrad. They were, in their own eyes, fighting for survival or oblivion. Churchill's own warning.

In Britain, this would possibly not have been the case and the noted sympathies between the aristocracy in Britain and the Nazi machine, which have been commented on so negatively, might have been a softening factor in Nazi eyes.

It seems more likely that the disintegration of the Nazi Empire might have begun within Germany itself. Interesting topic.

18 comments:

Welshcakes Limoncello said...

Very interesting to read your take on the that-man-whose-name-I-can-never-spell issue, James and I can understand how you would see both sides of it. I never thought it was as clear-cut as it seemed, either.

Bretwalda Edwin-Higham said...

I'm most certainly torn, Welshcakes and desire the normalcy of relations.

Anonymous said...

Twenty billion dollars here, $20bn there, and a lush half-trillion from the European Central Bank at give-away rates for Christmas. Buckets of liquidity are being splashed over the North Atlantic banking system, so far with meagre or fleeting effects.

As the credit paralysis stretches through its fifth month, a chorus of economists has begun to warn that the world's central banks are fighting the wrong war, and perhaps risk a policy error of epochal proportions.

"Liquidity doesn't do anything in this situation," says Anna Schwartz, the doyenne of US monetarism and life-time student (with Milton Friedman) of the Great Depression.

"It cannot deal with the underlying fear that lots of firms are going bankrupt. The banks and the hedge funds have not fully acknowledged who is in trouble. That is the critical issue," she adds.

Lenders are hoarding the cash, shunning peers as if all were sub-prime lepers. Spreads on three-month Euribor and Libor - the interbank rates used to price contracts and Club Med mortgages - are stuck at 80 basis points even after the latest blitz. The monetary screw has tightened by default.

York professor Peter Spencer, chief economist for the ITEM Club, says the global authorities have just weeks to get this right, or trigger disaster.

"The central banks are rapidly losing control. By not cutting interest rates nearly far enough or fast enough, they are allowing the money markets to dictate policy. We are long past worrying about moral hazard," he says.

"They still have another couple of months before this starts imploding. Things are very unstable and can move incredibly fast. I don't think the central banks are going to make a major policy error, but if they do, this could make 1929 look like a walk in the park," he adds.

The Bank of England knows the risk. Markets director Paul Tucker says the crisis has moved beyond the collapse of mortgage securities, and is now eating into the bedrock of banking capital. "We must try to avoid the vicious circle in which tighter liquidity conditions, lower asset values, impaired capital resources, reduced credit supply, and slower aggregate demand feed back on each other," he says.

New York's Federal Reserve chief Tim Geithner echoed the words, warning of an "adverse self-reinforcing dynamic", banker-speak for a downward spiral. The Fed has broken decades of practice by inviting all US depositary banks to its lending window, bringing dodgy mortgage securities as collateral.

Quietly, insiders are perusing an obscure paper by Fed staffers David Small and Jim Clouse. It explores what can be done under the Federal Reserve Act when all else fails.

Section 13 (3) allows the Fed to take emergency action when banks become "unwilling or very reluctant to provide credit". A vote by five governors can - in "exigent circumstances" - authorise the bank to lend money to anybody, and take upon itself the credit risk. This clause has not been evoked since the Slump.

Yet still the central banks shrink from seriously grasping the rate-cut nettle. Understandably so. They are caught between the Scylla of the debt crunch and the Charybdis of inflation. It is not yet certain which is the more powerful force.

America's headline CPI screamed to 4.3 per cent in November. This may be a rogue figure, the tail effects of an oil, commodity, and food price spike. If so, the Fed missed its chance months ago to prepare the markets for such a case. It is now stymied.

This has eerie echoes of Japan in late-1990, when inflation rose to 4 per cent on a mini price-surge across Asia. As the Bank of Japan fretted about an inflation scare, the country's financial system tipped into the abyss.

In theory, Japan had ample ammo to fight a bust. Interest rates were 6 per cent in February 1990. In reality, the country was engulfed by the tsunami of debt deflation quicker than the bank dared to cut rates. In the end, rates fell to zero. Still it was not enough.

When a credit system implodes, it can feed on itself with lightning speed. Current rates in America (4.25 per cent), Britain (5.5 per cent), and the eurozone (4 per cent) have scope to fall a long way, but this may prove less of a panacea than often assumed. The risk is a Japanese denouement across the Anglo-Saxon world and half Europe.

Bernard Connolly, global strategist at Banque AIG, said the Fed and allies had scripted a Greek tragedy by under-pricing credit long ago and seem paralysed as post-bubble chickens now come home to roost. "The central banks are trying to dissociate financial problems from the real economy. They are pushing the world nearer and nearer to the edge of depression. We hope they will eventually be dragged kicking and screaming to do enough, but time is running out," he said.

Glance at the more or less healthy stock markets in New York, London, and Frankfurt, and you might never know that this debate is raging. Hopes that Middle Eastern and Asian wealth funds will plug every hole lifts spirits.

Glance at the debt markets and you hear a different tale. Not a single junk bond has been issued in Europe since August. Every attempt failed.

Europe's corporate bond issuance fell 66pc in the third quarter to $396bn (BIS data). Emerging market bonds plummeted 75pc.

"The kind of upheaval observed in the international money markets over the past few months has never been witnessed in history," says Thomas Jordan, a Swiss central bank governor.

"The sub-prime mortgage crisis hit a vital nerve of the international financial system," he says.

The market for asset-backed commercial paper - where Europe's lenders from IKB to the German doctors and dentists borrowed through Irish-based "conduits" to play US housing debt - has shrunk for 18 weeks in a row. It has shed $404bn or 36pc. As lenders refuse to roll over credit, banks must take these wrecks back on their books. There lies the rub.

Professor Spencer says capital ratios have fallen far below the 8 per cent minimum under Basel rules. "If they can't raise capital, they will have to shrink balance sheets," he said.

Tim Congdon, a banking historian at the London School of Economics, said the rot had seeped through the foundations of British lending.

Average equity capital has fallen to 3.2 per cent (nearer 2.5 per cent sans "goodwill"), compared with 5 per cent seven years ago. "How on earth did the Financial Services Authority let this happen?" he asks.

Worse, changes pushed through by Gordon Brown in 1998 have caused the de facto cash and liquid assets ratio to collapse from post-war levels above 30 per cent to near zero. "Brown hadn't got a clue what he was doing," he says.

The risk for Britain - as property buckles - is a twin banking and fiscal squeeze. The UK budget deficit is already 3 per cent of GDP at the peak of the economic cycle, shockingly out of line with its peers. America looks frugal by comparison.

Maastricht rules may force the Government to raise taxes or slash spending into a recession. This way lies crucifixion. The UK current account deficit was 5.7 per cent of GDP in the second quarter, the highest in half a century. Gordon Brown has disarmed us on every front.

In Europe, the ECB has its own distinct headache. Inflation is 3.1 per cent, the highest since monetary union. This is already enough to set off a political storm in Germany. A Dresdner poll found that 71 per cent of German women want the Deutschmark restored.

With Brünhilde fuming about Brot prices, the ECB has to watch its step. Frankfurt cannot easily cut rates to cushion the blow as housing bubbles pop across southern Europe. It must resort to tricks instead. Hence the half trillion gush last week at rates of 70bp below Euribor, a camouflaged move to help Spain.

The ECB's little secret is that it must never allow a Northern Rock failure in the eurozone because this would expose the reality that there is no EU treasury and no EU lender of last resort behind the system. Would German taxpayers foot the bill for a Spanish bail-out in the way that Kentish men and maids must foot the bill for Newcastle's Rock? Nobody knows. This is where eurozone solidarity stretches to snapping point. It is why the ECB has showered the system with liquidity from day one of this crisis.

Citigroup, Merrill Lynch, UBS, HSBC and others have stepped forward to reveal their losses. At some point, enough of the dirty linen will be on the line to let markets discern the shape of the debacle. We are not there yet.

Goldman Sachs caused shock last month when it predicted that total crunch losses would reach $500bn, leading to a $2 trillion contraction in lending as bank multiples kick into reverse. This already seems humdrum.

"Our counterparties are telling us that losses may reach $700bn," says Rob McAdie, head of credit at Barclays Capital. Where will it end? The big banks face a further $200bn of defaults in commercial property. On it goes.

The International Monetary Fund still predicts blistering global growth of 5 per cent next year. If so, markets should roar back to life in January, as though the crunch were but a nightmare. There again, the credit soufflé may be hard to raise a second time.

Anonymous said...

GAINING CONTROL OF THE FOOD SUPPLIES

In 1998 at a meeting of Agriculture Ministers in Brussels the EU’s long term plans for Britain were unfolded They said; Live stock farming in the Britain would be abolished and changed to Arable farming. This would take place without the consent of the British people.


FORWARD PLANNING

The abolition of our Abattoirs .

In the 1990s many British abattoirs were closed because they did not reach EU standards. A few larger ones were built instead; this is why animals have to travel long distances for slaughter.


BSE IN CATTLE. This disease is not a contagious disease between animals and man. In Britain BSE in cattle is caused by painting Organo Phosphate nerve poison onto the heads and spines of cattle at four times the normal strength. The poison was laced with oil to help it penetrate the skin to stop warble-fly damage. This EU practice only took place in BRITAIN and Switzerland, but has now been discontinued. Starting in 1986 this poison was also used in sheep-dip but not in the same strength. Hundreds of farmers have become ill from contamination. 200 have died. This poison was also used in the Gulf War with similar effects.

FOOT AND MOUTH DISEASE.

Early in 2001 the British Press reported the Government Laboratories at Porton Down had lost phials of Foot and Mouth virus. Soon after, came the outbreak of Foot and mouth disease in England resulting in 14 million animals being killed and buried or burnt. Only three million animals were diseased the other 11 million lived within the contamination zones. This is not a killer disease in animals or man. It is a recoverable disease. Vaccination could have been used to save 11 million healthy animals. The Cull was managed from Brussels. Four areas on the map of England had a high concentration of cases, the Solway Firth, Wales and the Midlands and Devon. These areas are shown on a UN map for re-wilding. The Farmer blamed for the outbreak was exonerated in 2007.


In 2007 came a second outbreak of Foot and mouth in England. The Virus was found in the land drains around Government laboratories at Pirbright in Surrey. The outbreak began on a farm 3 miles away to the south west of Pirbright. Local people on TV stated that the water table drains naturally from the Farms towards the laboratories. Not the other way around.

When Foot and mouth has finally run its course there will be fewer farms or farmers left to raise Cattle and sheep and arable farming is a whole new Industry. Grain can only be grown on the flat land of eastern Britain. Western Britain is hilly sheep country and unsuitable for growing crops.

Anonymous said...

2003. A GOVERNMENT WHITE PAPER.

THE ENVIRONMENTAL, TRANSPORT AND REGIONAL AFFAIRS COMMITTEE reported that. “THE ROLE OF RURAL ENGLAND AS A FOOD PROVIDER FOR THE NATION IS NO LONGER AN ESSENTIAL ONE.” To put the Nation’s food supply in the hands of a Foreign government is TREASON. As an Island nation we must ensure that we grow and raise our own food supply. Britains population is estimated to grow to 70 million by 2050. Already we are vulnerable; our milk supply is an important part of our diet for the young and elderly. YET, for years the EU have only allowed our farmers to produce 60% of our requirement the rest must be bought from abroad.


BY STEALTH BRITAIN HAS BEEN EASED INTO THE CONTINENTAL SHOE

In 1973-1975 John Prescott was a delegate to the Council of Europe and from 1975-1979 he was a member of the European Assembly.

In 1999 John Prescot introduced his 30 year old Dream for EU Regions in Britain. Under the EU plan Britain has been divided into 12 Regions. Scotland is a Region, N.I, Wales, London and England. ENGLAND has been divided into eight EU Regions. THEN ENGLAND’S NAME WAS TAKEN OF THE EUROPEAN MAP IN 1997.

In 1998/99. Deputy Prime Minister John Prescot handpicked 60 people in each of the EIGHT ENGLISH REGIONAL DEVELOPMENT AGENCIES to direct the building of 3 Millon new houses. .

Sixty-six volunteer local Councillors were invited to become Members of the ASSEMBLY along with 40 Stakeholders or Partners. Together all three groups are known as the Regional Assembly. There is a support office of Civil Servants.

In 2004 the voters in the Northeast of England voted ‘NO’ to ELECTED. REGIONAL ASSEMBLIES. So the unelected Development agencies combined with one layer of local council will be the new Regional Government. These new Regional Assemblies will work with the “Committee of the Regions”in Brussels, cutting out national Parliament giving the EU Commission direct access to all Regional Assemblies in Europe. All things traditional will be abolished; All sovereignty will pass to BRUSSELS bringing a Foreign government nearer to the people.


15 NOVEMBER 2007. On Friday David Miliband strode into this story bringing it full circle back to the sleeping giant Russia.

In a Speech today he said “THE EUROPEAN UNION SHOULD WORK TOWARDS INCLUDING RUSSIA, THE MIDDLE EAST AND THE NORTH AFRICAN COUNTRIES. He continued THAT THE E.U.WOULD NOT BECOME A SUPER POWER BUT SHOULD BE A ROLE MODEL FOR THE REST OF THE WORLD.

THE EU COULD BE A MODEL OF POWER FOR REGIONAL CO-OPERATION, DEDICATED TO FREE TRADE. THE ENVIRONMENT AND TACKLING EXTREMISM.”


David Miliband’s Grandfather Samuel Milliband fled to England from Belgium before the war and at first was refused the right to remain. David’s father Ralph Miliband was born in Belgium he came to England and joined the Royal Navy. Later he became a Professor of Politics at Leeds University and lectured at the London school of Economics.

Anonymous said...

In October 1972 Mr Heath attended a meeting in Paris to negotiate with M.Pompidou (a former employee of Guy Rothschild) the conditions of Britains entry. This included that Britain’s Fishermen should fish under the EEC. quota system and that our maritime limits should be surrendered.

In 1972 Edward Heath invited Victor Rothchild to head-up and choose members for the Central Policy Review staff. Victor Rothschild wrote a white paper on research and development, since that time official Treasury policies have included eradication of our aircraft, shipbuilding, Coal mining, car making, steel making, machine-tool industries and others.

Speaking at a meeting at the time, John Davies the then Secretary of State for Industry said that Britain had agreed with the EEC that UK technology should be merged with European Industry.

In 1962. At Dounray in Scotland a fast breeder reactor power station was begun, it was the first of its type in the world and after 15 years it was closed in 1977. At the same site a second type of fast breeder reactor was begun in 1974 and closed in 1994.The Specialist teams of scientists were dispersed and the nuclear know-how given to France. The Rothschilds acquired much of the available Uranium.

Britain agreed to run down Stirling. Mr Heath agreed to renounce national sovereignty and for Britain to become part of a Federal Europe. He agreed to change the local government structure from counties to Regions also to reorganise Government departments so that the British Parliament could be replaced.

Anonymous said...

Miliband and his brother have been raised from the cradle to be politicians whilst never having roots here.ralph Miliband changed his name when he returned here with his family after the War ended despite the rules which said refugees could not stay. His stay plus all his family staying was made possible by a senior Labour member of Govt after the War. ralph is the name he took to appear British. When he arrived here as a 17 year old refugee he went straight away into a college for three years whilst British lads that age were being called up to fight. Why was he so different?

Raplph Miliband like his father and Marx were communists.

Anonymous said...

Whether Milibands vision of a "society" collective including the Mahgreb, Eastern Med, Russia becomes fact, is for the future.
Behind it all are the Puppet masters.
A federal state, with an ECB is being created for a reason.
The model works.
Puppet masters like good models.

Remember Vladimir Lenins words, when reflecting on the power of bankers.
"The State does not function as we desired. The car does not obey. A man is at the wheel, and seems to lead it, but the car does not drive in the desired direction. It moves as another force wishes"

The Puppet Masters care not whether Russia becomes part of/aligned with, the EU. They take profit from peace, or war.
Control is the objective, and while ever the EU proceeds along its present trajectory, and does their work for them, this time using Communism and its tried and tested methods, they are happy.
Their plans work in measures of decades, even centuries.

It may be that society, given evolving communication methods, would coalesce naturally on similar lines to those which we observe today, without the extremes of communism currently evolving in the EU, perhaps more in line with the freedoms once enjoyed in the UK. These variations of themes are however, irrelevant in the overall control plan.
Communism is merely a useful donkey on which to hitch a ride.
So the English, and Russia may kiss and make up, - will it strengthen the English hand against the EU? - is the major question in my mind.

A partial answer would be, - Not while we have the current crop of Bstds at the wheel!, - but, - is the alternative crop of bstds any better?

In the current Soviet, the money supply is growing at 40% pa. One could argue that Putin is determined not to let his currency appreciate against others, and I wouldn't blame him for that.

But the nature of the modern Soviet State, in terms of this discussion, is best answered by an analysis of the Russian banking system, the Central bank, owners thereof (if any), - a subject I have never even looked at!

Perhaps you are traveling this road James. It would be interesting to read, - if you are!

Anonymous said...

David Rockefeller addressing the Trilateral Commission, 1991.
"We are grateful to the Washington Post, the New York Times, Time Magazine, and other great publications, whose directors have attended our meetings and respected the promises of discretion for almost 4 decades.
It would have been impossible for us to develop our plan for the world if we had been subject to the bright lights of publicity during those years.
But the world is more sophisticated and prepared to march towards a World Government.
The Supranational Sovereignty of an intellectual elite, and world bankers is surely preferable to the National auto-determination practiced in past centuries".


So that tells a story, indeed.

But that was 16 years ago.
Did he "jump the gun"
Were China, Brazil, and India anticipated.
Were Clintons treasonous technology gifts to the Chinese part of the plan?
Was Clinton accepted into "the club"?
And a resurgent Russia, was that foreseen, - it was a heap of economic rubble in 1991?
Whatever!
The game plan remains the same, new players, there may be.

Anonymous said...

"Only the small secrets need to be protected.
The big ones are kept secret by public incredulity".

Marshall Mcluhan, media "guru"

Anonymous said...

The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented.
Banking was conceived in iniquity and born in sin.
Now bankers own the world.

Take it away from them, but leave them the power to create money, and with a flick of the pen they will create enough money to buy it all back again.....

Take the great power away from them, and all great fortunes like mine will disappear, and they ought to disappear, for the world would be a better and happier place to live in.

But if you want to continue to be the slaves of the banks, and pay the costs of your slavery, then let banks continue to create money and control credit".


Quotation from Sir Josiah Stamp, Director, Bank of England, 1928 - 1941. (reputed to be the second richest man in England at the time)

Anonymous said...

Bretwalda said - -
"and desire the normalcy of relations".

I wonder what the normalcy of relations really is, given global competition for resources currently being played out.

Rest assured, the UK, or is it England now, is firmly in the loosing camp, with a history of squandered bargaining chips, and totally corrupt, incompetent leaders.

The future is not good.

Bretwalda Edwin-Higham said...

Thanks, boys - keep it coming and I'll collate it all in a few days. Little matter of Christmas first.

UK Daily Pundit said...

Normalcy of relations would be preferable but neither side seems willing to back down. Hope we'll have plenty more posts on Russia from you over the next twelve months.

Bretwalda Edwin-Higham said...

I'm a little hamstrung on this, UKDP, being connected to Yedinaya Rossiya. :)

Anonymous said...

This team of Eminent Economists are projecting Systemic Collapse of Global Banking in the summer of 2008
It is useful to read the foot-notes to the article too. (Note 10)

It does seem a little early in what I perceive to be the grand plan, but, what do I know?

The US should rapidly speed-up any discussions with $ holding Sovereign Wealth Funds. Bail-outs from these funds seem to be the only viable option at present.
The Fed may choose to activate old laws that enable it to lend directly to smaller banks, but that doesn't restore their asset base so much as their ability to lend on.

Here is a useful pdf from the BIS

Anonymous said...

This is very interesting

Particularly at a time when the NHS is short of cash.

So who is footing the bill for all this altruistic concern?

I know personally a few of the UK staff working in Ghana, and at best I would describe them as charlatans,, and in general terms, no better that the fetish men, or witch doctors shown in the links on the first link, that they are seeking to depose.

The ones I know are particularly poorly educated, with insignificant IQs.

I am aware of Common Purpose intentions of opening a Ghana based "progrom" in 2008, and the recent changes in entry Professional Qualification Requirements in UK based Mental Health Units, and the recent alterations to the powers of recently qualified, erm, umm, inexperienced, low IQ, recruits.



A local NHS trust would not arbitrarily link with mental health training facilities in a foreign country, send NHS staff over to recce, and arrange 4 month residential eduction modules at local UK universities for Ghana nationals.

This must have come from UK Gov't levels

Given planned CP presence in Ghana, can we expect future training of EU paramilitary Gendarmerie in Ghana as payoff?

People, this is a distinctly frightening development, with many ramifications yet to materialise.

Anonymous said...

More details.
I just don't like this. I know the players!!