Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: lurqer who wrote (24905)	8/9/2003 2:26:47 PM
From: stockman_scott	Respond to of 89467

U.S. Tactics Never Pointed Iraq to Peace by Robert Koehler Published on Friday, August 8, 2003 by the Philadelphia Inquirer What is it we're bringing to Iraq? Oh yeah, democracy. One body at a time. Now that two of Saddam Hussein's evil offspring are deader than doornails (whoop! whoop!), majority rule, free and fair elections, constitutional government, maybe even butterfly ballots and $2,000-a-plate fund-raisers - the works - are pretty much right around the corner. Or not. Before we try to topple another dictator and liberate another country, perhaps next time with the help of new-generation, low-yield, precision-guided nuclear weapons, let's thrust a limb into the gears of our trillion-dollar war machine long enough to ponder its basic assumption: that is, that it gets results. We've been at war with Iraq for 12 years now - bluntly, brutally, stupidly. We have a certain amount to show, to be sure, for those dozen debate-free years of draconian sanctions bookended by lopsided military victories: two dead Hussein boys, some toppled statues, and American-British control of the world's second-largest oil reserve (just like the old days). What we don't have is a just peace, the love of the people, or anything that resembles basic social stability there (obligating massive, indefinite U.S. troop presence and a $4-billion-a-month investment at a time when every state in our own country is going bankrupt); or, on the home front, freedom from the fear of terrorism. As we chatter about democracy and debate what to do next, I suggest that we start by asking for forgiveness and owning up, like a recovering alcoholic, to the ghastly mess we've made of things. I refer not to the mess of the last four months but the stunningly unnoticed, underreported mess of the previous decade-plus: the dismantling of a once-prosperous, secular nation with a huge middle class, a 90 percent literacy rate and perhaps the most liberated, educated female population in the Muslim world. United Nations and other observers sounded the alarm for years. The trade embargo we imposed on Saddam Hussein's Iraq after Gulf War I - the "monstrous social experiment," as writer David Sharrock of London's the Guardian put it - brought incalculable misery to the people and solidified the power of the guy we were trying to get rid of. It killed a lot of children - half a million, a million. They died of curable diseases because the country no longer had sufficient medical supplies, proper sanitation or a functioning economy that kept its population adequately fed and housed. What we did in fact accomplish was to obliterate Iraq's middle class (both through destruction of its economic base and mass emigration), halve its literacy rate, create a flourishing black market in the basic necessities of life and reduce the mass of Iraqis to abject dependence on the largesse of Saddam Hussein for their daily bread. We also drove the country into the religious Dark Ages. While democracy takes root in prosperity, religious fundamentalism flourishes in poverty. Iraq's emancipated women gradually lost their rights, the hijab (Muslim head scarf) reappeared as required wear, "honor killings" of women for alleged sexual misconduct increased and prostitution became widespread. Yet Saddam was so entrenched in power after a dozen years of sanctions, so able to preen as a threat to us, that we had to apply massive military shock and awe to his hollow regime before we could lasso his statue off its pedestal. Plenty of repressive regimes and dictators as bad as or worse than Saddam have been removed from power in recent years - in the Philippines, South Africa, Indonesia, Eastern Europe and elsewhere - through often nonviolent "people power." Gandhi called it satyagraha: self-sacrifice and principled refusal to cooperate with injustice. This kind of struggle requires an empowered populace determined to gain their own freedom. Not only did we avoid encouraging any such movement in Iraq these last 12 years, we actively, vigorously sabotaged it (above and beyond our betrayal of the Kurds). Now we blather about democracy and give them road kill. © Copyright 1996-2003 Knight Ridder commondreams.org

To: lurqer who wrote (24905)	8/9/2003 2:33:54 PM
From: Rarebird	Respond to of 89467

The first bubble was the US stock market. It popped once but is once again filling with air as price/earnings ratios are averaging 31 to 33 and climbing to around 40, when the gaping holes in US corporate pension plans are taken into account. The US stock market is most certainly NOT the place to be. The second bubble was (and still is to some extent) dependent upon the first. That was (and partially still is) the US Dollar bubble. This bubble has burst but has still not deflated nearly enough. That can be seen from the ongoing thunderous outflow of US Dollars in the form of the 5.1% of US GDP current account deficit. The US Dollar still - in between rallies - has a long way to fall. The third bubble is the still expanding US housing bubble, fed by the Fed and massively supported by Freddie and Fannie and other lending hillbillies. The fourth and biggest bubble is the US bond market. This one has been inflated by the Fed's enormous "liquidity" operations and outright US Dollar monetary inflation. Lastly, as a fifth "bubble in the making" there are the accelerating deficits of the US federal government. The monetary rate of interest on all commercial bonds and other corporate finance paper feeds off the monetary rate of interest on government bonds and other government finance paper. Since it is by now a convention that government paper is risk free (a huge and fundamental mistake), it follows that corporate bonds have to pay a premium over and above the rate on the government's bonds. But for such businesses to actually be able to pay the commercial rates of interest on all their outstanding bonds presupposes that they can do so after such businesses have covered ALL their other costs. If their earnings are too low to actually do that - pay just the interest due on their bonds - any businesses in this bind has no other alternative than to sell some of their present capital plant and equipment to willing buyers to gain the funds with which to pay the interest due, and maybe even manage to actually repay some of the commercial bonds in order to lower their overall debts. This is where the crunch arrives. With the US economy currently standing with 1 in 4 plants IDLE - plants which anybody could buy for a song - who on earth would actually step forward and pay anywhere near full price for ANY US plants? The US Treasury, itself a huge borrower, has recently reported that tax revenues from individuals are down by 12 percent and corporate tax payments have already fallen to an even greater extent. Treasury paper - the US Treasury's own bonds, bills, notes, etc - are supposed to set the benchmark for US corporate rates. Even more important, they are supposed to set the benchmark for the US Dollar itself. And since the US Dollar is the world's reserve currency, this benchmark extends to ALL other government bonds, bills, notes, etc. So, when worldwide monetary rates of interest SOAR because the worldwide principal value of ALL bonds FALL - as they have done over the last two weeks - the signal has been sent that the GLOBAL natural rate of interest is finally starting to take its delayed economic revenge upon the long manipulated monetary rate of interested as ultimately orchestrated by the US Fed. THE SIGNAL HAS ALSO BEEN SENT THAT FROM NOW ON - ALL BONDS WILL FALL IN VALUE! Behind the "veil of money" and behind the artificially lowered monetary rates of interest lies a REAL physical economy with its structure of production and its time structure. This vast joint structure of real capital has been warped so totally out of shape. Its revenge is always to dump the value of all financial paper and send interest rates SOARING. The simple truth is that with a 74.3% utilisation rate, one plant in four is a capital loss. The money lent to build it is irretrievably lost.