Ron Paul is right about so many things. He also understands sanctions are an act of war.
US Sanctions on Russia May Sink the Dollar
By Ron Paul
Ron Paul Institute
August 11, 2014
The US government’s decision to apply more sanctions on Russia is a grave mistake and will only escalate an already tense situation, ultimately harming the US economy itself. While the effect of sanctions on the dollar may not be appreciated in the short term, in the long run these sanctions are just another step toward the dollar’s eventual demise as the world’s reserve currency.
Not only is the US sanctioning Russian banks and companies, but it also is trying to strong-arm European banks into enacting harsh sanctions against Russia as well. Given the amount of business that European banks do with Russia, European sanctions could hurt Europe at least as much as Russia. At the same time the US expects cooperation from European banks, it is also prosecuting those same banks and fining them billions of dollars for violating existing US sanctions. It is not difficult to imagine that European banks will increasingly become fed up with having to act as the US government’s unpaid policemen, while having to pay billions of dollars in fines every time they engage in business that Washington doesn’t like.
European banks are already cutting ties with American citizens and businesses due to the stringent compliance required by recently-passed laws such as FATCA (Foreign Account Tax Compliance Act). In the IRS’s quest to suck in as much tax dollars as possible from around the world, the agency has made Americans into the pariahs of the international financial system. As the burdens the US government places on European banks grow heavier, it should be expected that more and more European banks will reduce their exposure to the United States and to the dollar, eventually leaving the US isolated. Attempting to isolate Russia, the US actually isolates itself.
Another effect of sanctions is that Russia will grow closer to its BRICS (Brazil/Russia/India/China/South Africa) allies. These countries count over 40 percent of the world’s population, have a combined economic output almost equal to the US and EU, and have significant natural resources at their disposal. Russia is one of the world’s largest oil producers and supplies Europe with a large percent of its natural gas. Brazil has the second-largest industrial sector in the Americas and is the world’s largest exporter of ethanol. China is rich in mineral resources and is the world’s largest food producer. Already Russia and China are signing agreements to conduct their bilateral trade with their own national currencies rather than with the dollar, a trend which, if it spreads, will continue to erode the dollar’s position in international trade. Perhaps more importantly, China, Russia, and South Africa together produce nearly 40 percent of the world’s gold, which could play a role if the BRICS countries decide to establish a gold-backed currency to challenge the dollar.
US policymakers fail to realize that the United States is not the global hegemon it was after World War II. They fail to understand that their overbearing actions toward other countries, even those considered friends, have severely eroded any good will that might previously have existed. And they fail to appreciate that more than 70 years of devaluing the dollar has put the rest of the world on edge. There is a reason the euro was created, a reason that China is moving to internationalize its currency, and a reason that other countries around the world seek to negotiate monetary and trade compacts. The rest of the world is tired of subsidizing the United States government’s enormous debts, and tired of producing and exporting trillions of dollars of goods to the US, only to receive increasingly worthless dollars in return.
The US government has always relied on the cooperation of other countries to maintain the dollar’s preeminent position. But international patience is wearing thin, especially as the carrot-and-stick approach of recent decades has become all stick and no carrot. If President Obama and his successors continue with their heavy-handed approach of levying sanctions against every country that does something US policymakers don’t like, it will only lead to more countries shunning the dollar and accelerating the dollar’s slide into irrelevance.
Ukraine Says 45,000 Russian Troops On Border With Tanks, Missiles, Warplanes And Attack Helicopters
Submitted by Tyler Durden on 08/11/2014 10:58 -0400
Another day, another round of the usual warmongering soundbites, because someone clearly is on a mission to escalate the cross border hostilities into all out war. From Reuters:
•UKRAINE MILITARY SPOKESMAN LYSENKO SAYS RUSSIA HAS 45,000 TROOPS ON ITS BORDER WITH UKRAINE WITH TANKS, MISSILE SYSTEMS, WARPLANES AND ATTACK HELICOPTERS
Russia has massed 45,000 troops on its border with Ukraine backed by an array of heavy equipment including tanks, missile systems, warplanes and attack helicopters, Ukrainian military spokesman Andriy Lysenko said on Monday.
“As of 11 o’clock today, about 45,000 troops of the armed forces and internal forces of the Russian Federation are concentrated in border areas,” Lysenko told a briefing.
He said they were supported by 160 tanks, 1,360 armoured vehicles, 390 artillery systems, up to 150 Grad missile launchers, 192 fighter aircraft and 137 attack helicopters.
Apparently Lyesnko does not know how to read an upside profit surprise warning from Raytheon, Lockheed and Boeing.
•RUSSIA’S PUTIN TELLS EU’S BARROSO BY TELEPHONE THAT RUSSIA IS COORDINATING WITH INTERNATIONAL RED CROSS ON SENDING HUMANITARIAN AID TO UKRAINE – KREMLIN
It gets better, from Bloomberg:
•BARROSO WARNS PUTIN AGAINST UNILATERAL MILITARY ACTIONS
Or else the prices of Russian fruits and vegetables will go up as European gas prices explode?
And concluding the comedy, from Interfax:
•LAVROV SAYS ALL DETAILS OF HUMANITARIAN MISSION AGREED WITH UKRAINE GOVT, EXPRESSES HOPE MISSION WILL TAKE PLACE SOON
RUSSIA HOPES THAT HUMANITARIAN ACTION FOR DONBAS WILL NOT BE OBSTRUCTED BY PARTNERS – LAVROV
•LAVROV: IF MEDIA REPORTS, SAYING THAT BRITISH, FRENCH, GERMANY LEADERS AGREED NO NEED FOR HUMANITARIAN AID EXISTS IN UKRAINE, ARE TRUE, THIS IS OUTRAGEOUS CYNICISM MANIFESTATION
•INTRODUCTION OF FOOD IMPORT RESTRICTIONS CONDITIONED, AMONG OTHER THINGS, WITH SANCTIONS AGAINST RUSSIAN AGRICULTURAL BANK, WHICH COMPLICATES FINANCING AGRICULTURE PRODUCERS – LAVROV
•IT IS HARD TO CALL GOOD PARTNERS THE COUNTRIES UNITING AGAINST RUSSIA – LAVROV
•LAVROV: ONE MAY GET THE IMPRESSION THAT THE COUNTERTERRORISM OPERATION IN UKRAINE AIMS TO WIPE OFF SOUTHEASTERN UKRAINE FROM THE FACE OF THE EARTH AND TO MAKE ALL RUSSIANS GO
Then again, judging by today’s latest plunge in the VIX, it is quite clear that the most recent warning by the TBAC against low vol and complacent markets, almost had an impact.
MH17: Pockmarks look like from very, very heavy machine gun fire, says first OSCE monitor on-scene
By Haris Hussain
KUALA LUMPUR: INTELLIGENCE analysts in the United States had already concluded that Malaysia Airlines flight MH17 was shot down by an air-to-air missile, and that the Ukrainian government had something to do with it.
This corroborates an emerging theory postulated by local investigators that the Boeing 777-200 was crippled by an air-to-air missile and finished off with cannon fire from a fighter that had been shadowing it as it plummeted to earth.
In a damning report dated Aug 3, headlined “Flight 17 Shoot-Down Scenario Shifts”, Associated Press reporter Robert Parry said “some US intelligence sources had concluded that the rebels and Russia were likely not at fault and that it appears Ukrainian government forces were to blame”.
This new revelation was posted on GlobalResearch, an independent research and media organisation.
In a statement released by the Ukrainian embassy on Tuesday, Kiev denied that its fighters were airborne during the time MH17 was shot down. This follows a statement released by the Russian Defence Ministry that its air traffic control had detected Ukrainian Air Force activity in the area on the same day.
They also denied all allegations made by the Russian government and said the country’s core interest was in ensuring an immediate, comprehensive, transparent and unbiased international investigation into the tragedy by establishing a state commission comprising experts from the International Civil Aviation Organisation (ICAO) and Eurocontrol.
“We have evidence that the plane was downed by Russian-backed terrorist with a BUK-M1 SAM system (North Atlantic Treaty Organisation reporting name SA-11) which, together with the crew, had been supplied from Russia. This was all confirmed by our intelligence, intercepted telephone conversations of the terrorists and satellite pictures.
“At the same time, the Ukrainian Armed Forces have never used any anti-aircraft missiles since the anti-terrorist operations started in early April,” the statement read.
Yesterday, the New Straits Times quoted experts who had said that photographs of the blast fragmentation patterns on the fuselage of the airliner showed two distinct shapes — the shredding pattern associated with a warhead packed with “flechettes”, and the more uniform, round-type penetration holes consistent with that of cannon rounds.
Parry’s conclusion also stemmed from the fact that despite assertions from the Obama administration, there has not been a shred of tangible evidence to support the conclusion that Russia supplied the rebels with the BUK-M1 anti-aircraft missile system that would be needed to hit a civilian jetliner flying at 33,000 feet.
Parry also cited a July 29 Canadian Broadcasting Corporation interview with Michael Bociurkiw, one of the first Organisation for Security and Cooperation in Europe (OSCE) investigators to arrive at the scene of the disaster, near Donetsk.
Bociurkiw is a Ukrainian-Canadian monitor with OSCE who, along with another colleague, were the first international monitors to reach the wreckage after flight MH17 was brought down over eastern Ukraine.
In the CBC interview, the reporter in the video preceded it with: “The wreckage was still smouldering when a small team from the OSCE got there. No other officials arrived for days”.
“There have been two or three pieces of fuselage that have been really pockmarked with what almost looks like machinegun fire; very, very strong machinegun fire,” Bociurkiw said in the interview.
Parry had said that Bociurkiw’s testimony is “as close to virgin, untouched evidence and testimony as we’ll ever get. Unlike a black-box interpretation-analysis long afterward by the Russian, British or Ukrainian governments, each of which has a horse in this race, this testimony from Bociurkiw is raw, independent and comes from one of the two earliest witnesses to the physical evidence.
“That’s powerfully authoritative testimony. Bociurkiw arrived there fast because he negotiated with the locals for the rest of the OSCE team, who were organising to come later,” Parry had said.
Retired Lufthansa pilot Peter Haisenko had also weighed in on the new shootdown theory with Parry and pointed to the entry and exit holes centred around the cockpit.
“You can see the entry and exit holes. The edge of a portion of the holes is bent inwards. These are the smaller holes, round and clean, showing the entry points most likely that of a 30mm caliber projectile.
“The edge of the other, the larger and slightly frayed exit holes, show shreds of metal pointing produced by the same caliber projectiles. Moreover, it is evident that these exit holes of the outer layer of the double aluminum reinforced structure are shredded or bent — outwardly.”
He deduced that in order to have some of those holes fraying inwardly, and the others fraying outwardly, there had to have been a second fighter firing into the cockpit from the airliner’s starboard side. This is critical, as no surface-fired missile (or shrapnel) hitting the airliner could possibly punch holes into the cockpit from both sides of the plane.
“It had to have been a hail of bullets from both sides that brought the plane down. This is Haisenko’s main discovery. You can’t have projectiles going in both directions — into the left-hand-side fuselage panel from both its left and right sides — unless they are coming at the panel from different directions.
“Nobody before Haisenko had noticed that the projectiles had ripped through that panel from both its left side and its right side. This is what rules out any ground-fired missile,” Parry had said.