A very interesting story has popped up over the weekend. Seems North Korea is planning to launch a satellite in coming weeks, and this comes on the heels of a food program ironed out with a promise by the NK’s not to push ahead of nuclear weapons development. BUT what didn’t seem to make it into the fine print was a prohibition of missile development, and in particular, launching something that can go orbital, since that means it could also be used as an ICBM – with some conditions from the physics labs.
All of which puts the US into a touchy spot leaving president Obama to warn further against Iranian nuclear weapons development on the one hand, and against North Korean missile work on the other.
The strategy is quickly coming into focus: Iran and North Korean, who already have been working on joint weapons programs have arrived as a serious juncture here, since the missile launch is expected in April. The US position is this would violate UN resolutions. But the NK position is no, they are launching a peaceful satellite.
What it comes down to is Iran and North Korea working together to play “Thread the Needle” by using one of the West’s most potent tools: Lawyerly weasel-wording.
We therefore have to conclude that a strike against Iran (and possibly North Korea) is not so much speculation as accomplished fact awaiting only a date.
Meantime, like Pavlov, the West is trying to “food train Korean” and if it doesn’t work we figure the headlines will tell us. Don’t remember how many times Ivan Pavlov got bit. We live in a one-bite world, nowadays.
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And rubbing salt in the wounds here, the Jerusalem Point mentions in today’s editions that “German TV broadcasts Iranian Holocaust denial” comments, which is just more gasoline on the fire. And it just keeps the date with destiny from being moved back into the future.
Uncertain Dollar Future
Another thing which is going on in background is, if I may quote from an article sent along from the Jim Sinclair website (here):
“Brazil, Russia, India China and South Africa are meeting next week because of the use of SWIFT as a weapon of war. Expect the formation of a competitive SWIFT system in three blocks. The dollar will test .7200 USDX and fail on the third tap.”
Clearly, as pressure ramps up on Iran – being cut off from SWIFT – and as their oil production continues to fall by a reported 14% – a number of highly complex, inter-related economics pressures seem likely to work out:
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The US/West has to find some way to maintain dollar (and to a lesser degree Pound and Euro) dominance.
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The BRIC countries are moving toward a marketbasket of currencies and commodities if I’m reading that part right.
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And if the West can just play its cards right, inflation to some degree is acceptable provided it keeps a lid on NK and Iran.
Two other forces at play this morning: The European markets were mixed in early trading, so that $1.7 euro central bank stimulus may have worn off quickly and except for end-of-quarter window-dressings, markets are once again running into headwinds with the pause we mentioned last week.
The good news about inflation? It could very well make both stocks and gold rise and once modest inflation appears, the bond market could drop and money comes back into markets to ride things on to new highs. If it works out that way…no telling just yet since a war in the Middle East would throw everything up in the air.
Fake Gold Bars
We had talked about this before (scroll down to the headline “All that Glitters” in our week ending March 6, 2010) but here it is, two years later and what’s this? The story about “fake gold bars” is making the rounds again.
Curiously timed, since there’s also a story that popped up on the Houston Chronicle website last week saying “Scarcity makes Tungsten Stocks Winners, According to Financial Web site Penn Stock Detectives.“ Depending on how much is going into fake gold bars, that could account for a lot of demand.
Might also have something to do with gold popping $20 in the preopen.
Supreme Corps Hear Obamacare
Likely three days of arguments will be held this week on whether Americans, who near as I can figure never specified federal authority to put a gun to your head (financially speaking) and force you to buy health insurance, can be forced to do so.
Not that I’m against universal healthcare – I’m all for it. BUT I am not in favor of having to buy it from the Insurance Cabal when the V.A, just to name one, is a federal healthcare system that seems to have been dramatically improved in recent years.
But that makes it clear (at least to me) why the US Supreme Corps will rule Obamacare legal: The corporate interests will get to keep pocking dough and besides, will go an undercurrent argument, think of all the unemployment and cutbacks in advertising we’d have to endure without such a profitable plan…
Gas Price Rebellion Goes Global
Little noticed by the MSM is that gasoline prices are (pardon this) pissing people off all over the world. Our Indonesian Bureau Chief Bernard Grover fills us in:
“Hiya Chief!
Maybe of interest: Tomorrow, all the gas stations in Jakarta will shut down due to the threat of a mass demonstration over rising gas prices. On April 1st, the government subsidy will be reduced (yet again) causing gas prices to rise a dime or so. For perspective, gas is roughly $1/liter here, or about $4/gallon. The new price will be in the range of $4.20/gallon. This is cause for thousands of folks to take to the streets this week in mass demonstrations. One TeeVee news report interviewed a guy from Papua who told the Java dwellers to get over it. They pay north of $12/gallon, but can’t get enough gas to regularly fill the pumps. It’s a common theme for folks on other islands to complain about the Javanese getting all the goodies, which is more or less true.
At any rate, tomorrow should be interesting. If the demos actually come off (if it rains, no one will show), it could either make the hellish Jakarta traffic disappear, or push it beyond the realm of hellish. Remains to be seen which will happen. The lines are the pumps tonight are causing gridlock all over the city, as folks tank up in anticipation.
I’ll let you know how it goes. And so it goes…
Sampai jumpa,
Bernard D. Grover
Chief Editor – Indonesia Bureau
The role of globalism in all this is often under-reported. Beside job-jacking, who can resist owning a distribution system where $12 a gallon is up for grabs?
Sillytics
Although a lot of the MSM focus is on how Rick Santorum needs 74% of remaining republicorps convention delegates to win, I find the results of this weekend’s delegate counting a bit perplexing. CNN’s story was linked to from the Drudge Report this morning off their headline “Rick Needs a Miracle: 74% of Remaining Delegates.”
Must be something I missed in math back when, because when I hit the NY Times poll page, what I see is Santorum has 273 out of a needed 1,144 to win the convention. Ergo, Santorum needs 871. The NYTimes page says there are 1,258 delegates remaining, Which to me sort of implied 871 out of 1,258 – 69.23% to win, or in the case of Newt Gingrich, it seems to push out to 1144-135= 1,009 and this would be 80.2% of the remaining 1,258.
OBVIOUSLY the Drudge Report folks know math better than me and I must not be thinking clearly because it’s Monday, early, yada, yada.
Still, I guess what strikes me is the oddity of the anti-Santorum pile-on when a disgraced ex-house speaker is planning to stay in it till the bitter end with an even worse set of numbers all the way to Tampa. Makes me wonder who in the MSM wants Santorum out before Newt…
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One thing a close study of American politics does reveal is American’s lack of critical thinking. I guess a country which lets its time dribble out on Facebook would find such antics important and get all riled up about it. It’s all filed here in a big folder labeled “Drool.”
Nuclear Nightmares
Starting to make the rounds again is a familiar story, which has been around since the end of the Cold War came into view in the late 1980′s. The latest iteration seems to be the article “Missing Presumed Dangerous – the World’s Missing Nuclear Materials.”
The definitive first book on this was Andrew and Leslie Cockburn’s One Point Safe
If the “average” is 99% of all illicit materials are being recovered, then Ures truly won’t lose any sleep whatsoever on this. But, if the batting average is 5% successful interdiction efforts, then flash-goggles on any trip to a big city move up the packing list. And reality? Probably somewhere in-between.
The Weak Ahead
Special two-fer tomorrow morning when you get a regular report and then a special update about 8″:15 AM Central when the Case Shiller/S&P Housing report is due out.
Markets this morning are set for a big pop up at the open, but whether this is buy the rumor, sell the news, on Housing sales, will be answered by mid-session tomorrow.
More after this:
