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Tuesday 09.04.2012

The coming Bond Market collapse and Silver bull run
Commodity Online
It is no secret that paper money has lost its cherished value long ago. It became self evident the moment the Western United States state of Utah allowed gold, silver coin to be used as legal tender.
As the interest rates are maintained at record lows and QE after QE take turns, inflation becomes a given. Currency begins to shed value. And in order to maintain your position on the right side of the inflation curve, you begin to dig deep into precious metals.
So, what will you opt; poor man's gold that is silver, or rich man's privilege that is gold? You may already be aware that you can get 50 times of silver for the same price of gold.

Bernanke Speaks, Precious Metals Surge
By Tim Iacono - SeekingAlpha.com
Following an impressive technical breakout the week prior that constituted the biggest combined jump in gold and silver prices in ten months, precious metals moved sharply higher again last week, capped by a late-week surge spurred by heightened expectations of more central bank money printing after Fed Chief Ben Bernanke defended previous easy money policies, what many viewed as paving the way for more of the same.
After surging nearly $40 an ounce on Friday, the gold price ended at a five-month high while posting its biggest monthly gain since January, and silver jumped more than $1.00 an ounce after the Fed Chairman spoke, rising to its loftiest level in four months.

Bernanke Fails To Move Gold Market Lower
By Jeff Nielson - SilverBearCafe.com
Following the solid gains in the price of gold last week and the much more explosive rise in the price of silver, all expectations (even among normally bearish commentators) were that bullion prices would continue rising this week. That all changed Monday morning, however.
At that point the Corporate Media released their Script for this week (written by the banking cabal itself). They "predicted" that B.S. Bernanke would "disappoint the market" when his prepared remarks would be released to the world on August 31st.

How Long Will the Dollar Remain the World's Reserve Currency?
By: Congressman Ron Paul - GoldSeek.com
We frequently hear the financial press refer to the U.S. dollar as the "world's reserve currency," implying that our dollar will always retain its value in an ever shifting world economy. But this is a dangerous and mistaken assumption.
Since August 15, 1971, when President Nixon closed the gold window and refused to pay out any of our remaining 280 million ounces of gold, the U.S. dollar has operated as a pure fiat currency. This means the dollar became an article of faith in the continued stability and might of the U.S. government.

What Bernanke Couldn't Quite Say
By Robert Kuttner - SeekingAlpha.com
Federal Reserve Chairman Ben Bernanke used his much-anticipated Friday speech at the Fed's annual end-of-summer conference in Jackson Hole, Wyo., to sound almost like the last Keynesian. As he put it: "Monetary policy cannot achieve by itself what a broader and more balanced set of economic policies might achieve; in particular, it cannot neutralize the fiscal and financial risks that the country faces."
Commentators made much of the fact that Bernanke said that he considered the economy dangerously soft; that unemployment was far too high for this stage of a recovery; that housing continued to be a major drag, as well as state and local budget cuts. Fed chairmen are famously Delphic. But Bernanke was blunt:

Federal Reserve has already started QE3,
says investor Jim Rogers
Veteran US investor Jim Rogers believes the Federal Reserve has already launched a third round of quantitative easing, despite chairman Ben Bernanke failing to mention stimulus measures in his Jackson Hole speech last week.
By Andrew Trotman - Telegraph.co.uk
Mr Rogers, who co-founded the Quantum Fund with George Soros, believes that America's central bank is secretly printing money to avoid "getting egg on their face again" after previous attempts to kickstart the faltering economy with $2 trillion of QE failed.
"I do not know if they [the Fed] will announce it," he told India'sEconomic Times. "I know they are going to print more money. They already are. If you look at their balance sheets, you will see that something is happening, assets are building on their balance sheets and they are not coming from the tooth fairy.

The Consequences of Easy Monetary Policy
By: John Mauldin - GoldSeek.com
We heard from Bernanke today with his Jackson Hole speech. Not quite the fireworks of his speech ten years ago, but it does offer us a chance to contrast his thinking with that of another Federal Reserve official who just published a paper on the Dallas Federal Reserve website. Bernanke laid out the rationalization for his policy of ever more quantitative easing. But how effective is it? And are there unintended consequences we should be aware of? Why is it that the markets seem to positively salivate over the prospect of additional QE?

Why The Fed Will Ease In September
By Michael Ashton - SeekingAlpha.com
On Friday, the long-awaited Jackson Hole speech by Ben Bernanke finally happened. With bated breath, investors waited for news of his oration. Unfortunately, most investors don't speak "Fed," so it was manifestly unclear, or clearly unmanifest, what the Chairman was necessarily getting at. Some investors seemed to be expecting him to say "start the choppers, boys, and let's light this candle."
Well, that's not how Fed Chairmen…or economists…or humans, except for Nicolas Cage…speak. But what Bernanke actually said is still fairly clear to those who have listened to Fedspeak for a long time. An important part of Fedspeak is that the speaker assumes the listener is completely aware of the context, and the subtext, of his remarks. So let us forget our predispositions for the moment, about what the FOMC may decide next month, and dispassionately analyze the arguments currently before the Committee – which constitute the context in which the Chairman delivered his remarks.

Can Draghi Be Believed?
By Simon Tilford - Project-Syndicate.org
LONDON – Mario Draghi, the president of the European Central Bank, has repeatedly claimed that the ECB will do everything necessary to save the euro. Nothing has been formally agreed yet, but the ECB is expected to announce a new government bond-buying program following next week's meeting of its Governing Council. Will it work?
To have a significant impact on Italian and Spanish borrowing costs, the latest effort must be big enough to dispel the convertibility risk that underlies the extreme polarization of government bond yields across the eurozone: investors are loathe to hold Spanish and Italian debt, because they fear that both countries might be forced to leave the currency union. Unfortunately, it is highly unlikely that the ECB will do enough to persuade investors that membership is unequivocally forever, not least because Germany's Bundesbank opposes any open-ended commitment to capping borrowing costs.

"ECB Bazooka Needed" as Pressure on Spain
"Set to Intensify", Central Bank Action "Good for Gold"
By: Ben Traynor - GoldSeek.com
SPOT MARKET gold prices hovered close to $1690 an ounce during Monday morning's London trading, close to five month highs hit after Friday's speech by US Federal Reserve chairman Ben Bernanke, in which he noted the US economic situation is "far from satisfactory".
"Central banks are still hurtling towards more cash-printing," one Hong Kong dealer told newswire Reuters Monday.
"They are under pressure to be doing something actively, which is good for gold."

Merkel, Monti Lead Diplomatic Push
As Draghi's Plan Takes Shape
By Andrew Frye - Bloomberg.com
European leaders are stepping up shuttle diplomacy this week as they brace for their central banker's plan to defend the euro from bond-market turmoil.
European Union President Herman Van Rompuy is traveling to Berlin for talks with German Chancellor Angela Merkel today as Italian Prime Minister Mario Monti welcomes French President Francois Hollande to Rome. They were all given a hint about what may be in store when European Central Bank President Mario Draghi told officials yesterday he would be comfortable buying three-year government bonds to bring down borrowing costs for nations in financial distress.

US companies get ready for 'the unthinkable' -
a Greek euro-zone exit
Whether it's trucking in cash or reorganising computer systems, firms are making plans
NY Times via SCMP.com
Even as Greece desperately tries to avoid defaulting on its debt, US companies are preparing for what was once unthinkable: that Greece will soon be forced to leave the euro zone.
Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency.

Is Spain Running Out Of Cash?
Submitted by Tyler Durden - ZeroHedge.com
Some hours ago Spain finally bit the bullet, and after months of waffling had no choice but to hand over €4.5 billion (the first of many such cash rescues) in the form of a bridge loan to insolvent Bankia, which last week reported staggering losses (translation: huge deposit outflows which have made the fudging of its balance sheet impossible). As a reminder, in June Spain formally announced it would request up to €100 billion in bailout cash for its insolvent banking system, which subsequently was determined would come from the bank rescue fund, the Frob, which in turn would be funded with ESM debt which subordinates regular Spanish bonds, promises to the contrary by all politicians (whose job is to lie when it becomes serious) notwithstanding.

Euro shorts smell blood
By Alasdair Macleod - GoldSeek.com
Within the eurozone there are great stresses. At one extreme there are punitive costs of borrowing for Greece, Cyprus, Portugal, Ireland, Spain and Italy; at the other there is zero or negative interest rates for Germany, the Netherlands and Finland. Doubtless the first group begets the second, as captive investors in euros have to buy government bonds, and this requirement is being funnelled away from risk into safety.

Global crisis moves East as China suffers rapid downturn
China's industrial output is contracting at the fastest pace since the depths of the global financial crisis, with knock-on effects spreading across the Far East.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"It just keeps getting worse," said Alistair Thornton and Xianfang Ren from IHS Global Insight. "The government has underestimated the pace of the slowdown and is behind the curve."
The HSBC/Markit manufacturing index for China fell to 47.6 in August, the lowest since the onset of Great Recession in late 2008. Inventories are rising. The index for new export orders fell to the lowest since March 2009. "Beijing must step up policy easing to stabilise growth," said Hongbin Qu from HSBC.

China Is Going to Save Us – Again
BY PATER TENEBRARUM - FinancialSense.com
Mrs. Merkel has just visited China, a big delegation in tow, for extensive talks with Wen Jiabao and his government. Germany has good reason to keep in close touch with China: it is one of its biggest export destinations these days. Since 1999 Germany's exports to China have risen nearly ten-fold and today amount to 2.5% of its GDP. The rest of the euro area is also exporting quite a bit to China, and conversely, the euro area is also China's biggest customer.
Back in 2007, when Berlin invited the Dalai Lama, the relationship with Beijing chilled considerably, but that is all forgotten today. Business has become the major issue, and China is understandably worried about the crisis its main trading partner goes through.

Treasury Yields Touch Month Lows Before ISM Factory Data
By Masaki Kondo and Sharon Chen - Bloomberg.com
Treasury yields touched one-month lows before U.S. data forecast to show manufacturing is struggling to recover, fanning speculation the Federal Reserve will expand monetary easing.
Rates slid on Aug. 31 after Fed Chairman Ben S. Bernanke said he wouldn't rule out a third round of bond buying in so- called quantitative easing to spur growth. The policy-setting Federal Open Market Committee will next meet on Sept. 12-13.
"Treasury yields will decline." said Hiromasa Nakamura, who invests in U.S. debt from Tokyo at Mizuho Asset Management Co., which oversees the equivalent of $41 billion. "The U.S. economy is very fragile."

For how much longer can we
keep kicking the can down this road?
David Davis was at his most lucid today in arguing the case for a smaller state and a much bolder deregulatory agenda, though he was strangely silent on reform of the planning system, a real blind spot for many on the Tory right.
By Jeremy Warner - Telegraph.co.uk
Ignoring the inconsistencies, this was nevertheless a welcome call to arms which the Government would be well advised to heed. The one-time contender for leadership of the Conservative Party is right; Britain is not condemned to inevitable economic decline but it requires much more radical action than we have seen to date if such an outcome is to be avoided.

Morgan Stanley faces imminent failure & ruin,
may see first private stock account thefts
By Jim Willie - SilverBearCafe.com
Begin with a preface to a meaningful event that could change the entire US landscape, a redux of what happened four years ago. Consider the next Wall Street financial firm failure. It is in progress. It is not avoidable. It will have numerous ramifications. It will open the door to account thefts, the burial of documents, the ransack of undesired leveraged positions, the concealment of wrecked derivatives, and a path toward the merger of surviving (selected core) firms. It will urge an extreme defensive posture.

More older workers making up labor force
Many seniors are staying on the job or returning to the workforce, leaving less room for younger workers and reducing their purchasing power.
By Don Lee, Los Angeles Times
WASHINGTON — Millions of workers in their prime have dropped out of the labor market in recent years, but many older Americans are delaying retirement and being added to the workforce in record numbers.
Nearly 1 in 5 Americans ages 65 and older are working or looking for jobs — the highest in almost half a century.
The labor participation rates for other age groups have slid since the recession began at the end of 2007, most sharply for younger adults but also for people in their prime working years, their 30s to 50s.

Denver Public Schools pilot program
to push 'social action,' 'social justice'
By Eric Owens - DailyCaller.com
In addition to reading, writing, and arithmetic, the Denver public schools system are adding a fourth 'r' to the curriculum: rebellion.
According to NBC affiliate KUSA, Denver Public Schools is implementing a new system to evaluate teachers. In order to achieve a coveted "distinguished" rating, teachers at each grade level must show that they "encourage" students to "challenge and question the dominant culture" and "take social action to change/improve society or work for social justice."

How Plan to Help City Pay Pensions Backfired
A bond sale that was intended to help Stockton, Calif., reduce a shortfall in pension money wound up making the problem worse.
By MARY WILLIAMS WALSH - NYTimes.com
Jeffrey A. Michael, a finance professor in Stockton, Calif., took a hard look at his city's bankruptcy this summer and thought he saw a smoking gun: a dubious bond deal that bankers had pushed on Stockton just as the local economy was starting to tank in the spring of 2007, he said.
Stockton sold the bonds, about $125 million worth, to obtain cash to close a shortfall in its pension plans for current and retired city workers. The strategy backfired, which is part of the reason the city is now in Chapter 9 bankruptcy. Stockton is trying to walk away from the so-called pension obligation bonds and to renegotiate other debts.

The U.S. Drought and Electricity Generation
By John Daly - OilPrice.com
Well, its official – the U.S. government has acknowledged that the U.S. is in the worst drought in over 50 years, since December 1956, when about 58 percent of the contiguous U.S. was in moderate to extreme drought.
According to the National Oceanic and Atmospheric Administration National Climatic Data Center's "State of the Climate Drought July 2012" report, "Based on the Palmer Drought Index, severe to extreme drought affected about 38 percent of the contiguous United States as of the end of July 2012, an increase of about 5 percent from last month… About 57 percent of the contiguous U.S. fell in the moderate to extreme drought categories (based on the Palmer Drought Index) at the end of July… According to the weekly U.S. Drought Monitor, about 63 percent of the contiguous U.S. (about 53 percent of the U.S. including Alaska, Hawaii, and Puerto Rico) was classified as experiencing moderate to exceptional (D1-D4) drought at the end of July."

Economy, not Physical Markets, Driving Oil Prices
By Daniel J. Graeber - OilPrice.com
The U.S. Department of Energy last week issued one crude oil loan from the Strategic Petroleum reserve to Marathon Petroleum Co. as gulf operators dealt with the effects of Hurricane Isaac. The dual effect of the Category 1 storm and the Labor Day holiday in the United States caused a brief spike in energy prices. More than 80 percent of the production platforms in the Gulf of Mexico closed as a result of the storm, causing a ripple effect in the market for petroleum products. Western economies had already expressed concern about the economic fallout from high energy prices. A recent statement from the G7, however, and continued growth in the Chinese economy may suggest there are broader geopolitical concerns at stake than physical market issues.

Why Oil Prices are 10 Times More than in 1998
By Kurt Cobb - OilPrice.com
What were the prices of oil and gasoline in 1998? Do you remember? Without looking them up (or looking below this line), make your best guess.
I've been taking an informal poll to find out what people remember about oil and gasoline prices in that year. So far, only one person has correctly characterized prices back then. Most guesses have clustered around $2.50 to $3 a gallon for gasoline (in the United States). Only one person could come up with a crude oil price which she guessed was around $55 a barrel. The answers show a vague recollection that oil and gasoline were cheaper than they are today. But just how much cheaper has been lost down the memory hole.

NASA to Create Robotic Drilling Rig
By James Burgess - OilPrice.com
Robotic Drilling Systems AS is a Norwegian based company that has just signed a deal with NASA which will help it in its dream of developing a fully automated drilling rig which could position itself using satellite coordinates, erect 14 story steel reinforcements on its own, drill a well then move onto the next site.
Kenneth Sondervik, the sales and marketing vice president at Robotic Drilling Systems said that the process may seem futuristic, but is actually very similar to automated systems used in car manufacturing, or the guidance systems in cruise missiles.

Think hard to fly:
Chinese scientists unveil mind-controlled drone
RT.com
Chinese researchers have unveiled a system that allows users to control drones with their thoughts. The technology was designed to help handicapped people, but could have ample applications in other fields as well.
A video posted to YouTube by researchers at Zhejiang University shows how the system, called Flybuddy2, works. And it appears that you don't have to be a nuclear scientist to build one. All you need is an EEG headset with a Bluetooth connection to a laptop – plus a quadrotor Parrot AR Drone linked to the computer.
"The computer can receive EEG signals via Bluetooth and convert them to specific commands to control the AR drones through WiFi," a presenter explains.

Apple, Google gear up for mobile-wallet war
By Salvador Rodriguez - LATimes.com
Apple and Google appear to be headed toward a new fight, this one involving mobile wallets.
Earlier this week, pictures surfaced of a chip located toward the top of what appear to be parts for the next iPhone. Many believe this chip is for Near-Field Communication technology — or NFC — which allows phones to connect in close range using radio communications.
An example of what NFC can be used for is mobile payments, which Google already does with its Google Wallet service.

Convention security the embodiment of a police state
By Charles Hurt - WashingTimes.com
CHARLOTTE, N.C. — Welcome to the police state.
Interest in the political conventions has plummeted, approval of politicians has reached historic lows and our public treasury is nearly broke. So what does the behemoth bureaucratic government apparatus do?
It erects the most impenetrable wall of security ever amassed to protect and promote the political gatherings that separate the hyper-elite from those out of power, unimportant and irrelevant. In other words, taxpayers.

Debt to hit $16T in time to crash Democratic convention
By Stephen Dinan-The Washington Times
CHARLOTTE, N.C. — Just as Democrats are gaveling in their convention Tuesday, the federal government likely will announce another dubious milestone — $16 trillion in total federal debt.
In an election already focused on domestic issues of jobs, spending and deficits, the $16 trillion number is likely to underscore just how much is at stake in November for both parties, which are offering dramatically different ways to begin to eat away at the deep hole.

Shortage of Labor Day
Semper Vigilo, Fortis, Paratus et Fidelis!
Nate Jackson for The Patriot Post Editorial Team PatriotPost.us

The Foundation
"Work as if you were to live 100 Years, Pray as if you were to die To-morrow." --Benjamin Franklin

For the Record
"Eight years ago, when John Kerry tried to defeat the incumbent George W. Bush, he accused Bush of leading a 'jobless recovery.' When the economy started creating hundreds of thousands of jobs, Kerry and the Democrats then claimed that Bush was creating mostly 'McJobs,' low-wage positions rather than higher-paying jobs for people with significant skills. ... Today, the Obama administration keeps claiming to have added 4.3 million jobs by choosing to start from February 2010 rather than the start of the recovery in June 2009 or the passage of Barack Obama's stimulus package in February 2009. The Obama recovery in full has only added less than 65,000 jobs per month, far below the level needed to keep up with population growth (125K-150K per month), and the civilian population participation rate has fallen to a 30-year low this spring. A new study now shows that even those jobs that have been added are the 'McJobs' that Kerry inaccurately accused Bush's recovery of generating. ... We're not even keeping up with population growth in this recovery.

How the Council on Foreign Relations
Controls Conservative Republicans
by Gary North, Tea Party Economist - LewRockwell.com
I sent a stripped-down version of my movie review of 2016 to my Tea Party Economist list. I knew it would outrage some of them.
Why did I do it? To make sure D'Souza sees it. The list is large. Someone will send it to him. I want him to know that the Old Right isn't buying his thesis that Obama's agenda is somehow uniquely wrong because it is anti-colonialist. Obama is a defender of the American Empire as Bush was. His agenda is that of one of the factions of the Council on Foreign Relations. He is not in bed with the neocons, meaning big on Israel, but the dominant foreign policy objectives of the CFR were pro-oil and therefore pro-Arab long before 1948, let alone the late 1960s, when the neocons showed up.

Is Ron Paul's 'Revolution' Over?
Unquantifiable
by Allan Stevo - LewRockwell.com
At 5:15 p.m. Tuesday, Mitt Romney became the GOP nominee for President.
At about the same time, 5:15 p.m., I watched a man involved with Ron Paul's Louisiana victory box up phones at an outpost of the Ron Paul Revolution – a place from which some of the dispersed grassroots campaigns were run. Boxing up those phones marked the end of the 2012 phone-banking effort in that remote location. A room that I had seen abuzz with volunteer activity for months from early morning until whatever hour it is that Hawaiians start to no longer accept political phone calls was now being packed into a few small boxes and being shipped away. A few small boxes of equipment, a few hundred dollars to keep the lights on, and a dream for freer times ahead filled rooms like that across the country night-after-night. Tuesday that was all packed up.

'Extremists' chase some Republicans toward Obama
By Sean Lengell-The Washington Times
John Martin loves the GOP and wants to remain a Republican. But the party he grew up supporting has changed, he said, and Mitt Romney is doing nothing to keep his loyalty.
The Republican presidential nominee lacks the will or desire to stand up to "extremists" who have gained a sturdy foothold in the party, Mr. Martin said, and President Obama is far from the socialist demon portrayed by GOP leaders.
For that, the politically active New Jersey resident said, he will vote for Mr. Obama.

Obama Lays Foundation For Speech Stressing Choices
By Julianna Goldman - Bloomberg.com
President Barack Obama was 1,600 miles away from delegates gathering at the Democratic National Convention, laying the foundation for a week in which he will draw sharp contrasts with Republican Mitt Romney.
For the incumbent, whose candidacy four years ago was fueled by a theme of hope and change, much of this week at the Democratic convention in Charlotte, North Carolina, will be about setting himself apart from Romney.

Labor Brings Its Frustrations To Charlotte
"Charlotte wouldn't have been our choice as a city." Lee Saunders beats the hell out of a chair.
Rosie Gray - BuzzFeed.com
CHARLOTTE, N.C. — The newly-elected president of the giant public workers' union AFSCME, Lee Saunders, took a page out of Clint Eastwood's book at an Ohio delegation Labor Day breakfast on Monday, speaking to an empty chair that he pretended was occupied by Eastwood. At first it was just a lark.
"He's been sitting here listening to all the speakers before me, he's been listening to me, I want you to give Clint Eastwood a round of applause," Saunders said. "I brought him with me to learn some things, OK? To teach him, to educate him." The audience murmured and laughed.

Liberalism, as We Know It
By George Will - PatriotPost.us
WASHINGTON -- With Americans, on average, worth less and earning less than when he was inaugurated, Barack Obama is requesting a second term by promising, or perhaps threatening, that prosperity is just around the corner if he can practice four more years of trickle-down government. This is dubious policy, scattering borrowed money in the hope that this will fill consumers and investors with confidence. But recently Obama revealed remarkable ambitions for it when speaking in Pueblo, Colo., a pleasant place Democratic presidents should avoid.
After delivering in Pueblo what would be his last extended speech, Woodrow Wilson suffered a collapse that prefaced his disabling stroke. And in Pueblo this summer, Obama announced what should be a disqualifying aspiration.

Obama's Accelerating Downward Spiral For America
By Peter Ferrara, Contributor - Forbes.com
New income data from the Census Bureau reveal what a great jobBarack Obama has done for the middle class as President. During his entire tenure in the oval office, median household income has declined by 7.3%.
In January, 2009, the month he entered office, median household income was $54,983. By June, 2012, it had spiraled down to $50,964. That's a loss of $4,019 per family, the equivalent of losing a little less than one month's income a year, every year. And on our current course that is only going to get worse not better.

New Obama slogan has long ties to Marxism, socialism
By Victor Morton - The Washington Times
The Obama campaign apparently didn't look backwards into history when selecting its new campaign slogan, "Forward" — a word with a long and rich association with European Marxism.
Many Communist and radical publications and entities throughout the 19th and 20th centuries had the name "Forward!" or its foreign cognates. Wikipedia has an entire section called "Forward (generic name of socialist publications)."

Al-Qaeda Leader Strikes Deal With U.S.,
Saudis To Send 5,000 Fighters to Syria
Yemeni Jihadist personally trained by Bin Laden
By Paul Joseph Watson - Infowars.com
A militant who fought alongside Osama Bin Laden in Afghanistan and is now the leader of a group affiliated with Al-Qaeda in South Yemen has struck a deal with the United States and Saudi Arabia to send 5,000 Al-Qaeda fighters into Syria according to reports out of the Middle East.
Tariq al-Fadhli, jihadist leader of the Southern Yemen insurgency and a man personally trained by Bin Laden, has successfully negotiated with U.S. and Saudi officials to send 5,000 jihadist fighters via Turkey to aid Syrian rebels in the attempted overthrow of President Bashar Al-Assad, reports AlAlam. The report was also picked up by AdenAlghad.net.

U.S. Is Near Pact to Cut $1 Billion From Egypt's Debt
By STEVEN LEE MYERS - NYTimes.com
WASHINGTON — Nearly 16 months after first pledging to helpEgypt's failing economy, the Obama administration is nearing an agreement with the country's new government to relieve $1 billion of its debt as part of an American and international assistance package intended to bolster its transition to democracy, administration officials said.
The administration's efforts, delayed by Egypt's political turmoil and by wariness in Washington about new leaders emerging from its first free elections, gained new urgency in recent weeks, even as the United States risks losing influence and investment opportunities to countries like China. President Mohamed Morsi chose China for his first official visit outside of the Middle East.

Egypt and Iran, new twin pillars
By Kaveh L Afrasiabi - ATimes.com
Egypt and Iran this week took a giant step toward overcoming their diplomatic estrangement, brought together by the exigencies of a global movement and, even more so, a complex regional calculus that has a long history of being shaped by foreign powers.
In a sign of changing times, the Egyptian President Mohammed Morsi used the opportunity of his participation in the Non-Aligned Movement (NAM) summit in Tehran to put on full display of the delicate yet significant nuances of a "new Egypt" that has unshackled itself from foreign domination and moves according to its own incandescent atmosphere.

Nasrallah says Iran could strike US bases if Israel attacks
"A decision has been taken to respond and the response will be very great," Hezbollah leader says, but adds he doesn't believe Jerusalem will launch a strike on Tehran's nuclear program in the foreseeable future.
Reuters - JPost.com
Iran could strike US bases in the Middle East in response to any Israeli strike on its nuclear facilities, the leader of Lebanon's Iranian-backed militant group Hezbollah said on Monday.
"A decision has been taken to respond and the response will be very great," Sayyed Hassan Nasrallah said in an interview with the Beirut-based Al Mayadeen television.

Washington tries to cut a deal with Iran
'Iran must steer clear of US interests in Gulf'
Washington reportedly sends Tehran indirect message saying it will not back Israeli strike on nuclear facilities as long as Iran refrains from attacking American facilities in Persian Gulf
By Shimon Shiffer - YNetNews.com
The United States has indirectly informed Iran, via two European nations, that it would not back an Israeli strike against the country's nuclear facilities, as long as Tehran refrains from attacking American interests in the Persian Gulf, Yedioth Ahronoth reported Monday.
According to the report, Washington used covert back-channels in Europe to clarify that the US does not intend to back Israel in a strike that may spark a regional conflict.

Iran could strike US bases if Israel attacks: Hezbollah
By Laila Bassam
BEIRUT | Mon Sep 3, 2012 6:35pm EDT
(Reuters) - Iran could hit U.S. bases in the Middle East in response to any Israeli strike on its nuclear facilities even if American forces played no role in the attack, the leader of Lebanon's Iranian-backed militant group Hezbollah said on Monday.
"A decision has been taken to respond and the response will be very great," Hezbollah Secretary-General Sayyed Hassan Nasrallah said in an interview with the Beirut-based Al Mayadeen television.

White House denies Israeli report of secret US-Iran deal
Jay Carney says report in Yedioth Ahronoth paper, which said the US had been in talks with Tehran, is 'completely incorrect'
Reuters in Toledo - Guardian.co.uk
The White House on Monday denied an Israeli newspaper report that accused Washington of secretly negotiating with Tehran to keep theUnited States out of a future Israel-Iran war.
"It's incorrect. Completely incorrect," White House spokesman Jay Carney told Reuters while accompanying President Barack Obama on a campaign trip in Ohio.
"The report is false, and we don't talk about hypotheticals."
Israel's most widely read newspaper, Yedioth Ahronoth, said Washington had approached Tehran through two unidentified European countries to convey the message that the United States would not be dragged into hostilities if Israel attacked Iran over its nuclear program.

Obama will make Bibi pay after elections
Israeli security officials say Pentagon's decision to reduce number of US troops it will send to joint drill with Israel not related to growing tensions with Israel; others claim Washington saying 'you will not drag us into Iran war'
By Attila Somfalvi - YNetNews.com
Israeli security officials on Saturday tried to downplay the Pentagon's decision to significantly scale back its participation in a joint military exercise with Israel next month, but some government officials said the decision came as a response to the growing tensions between Prime Minister Benjamin Netanyahu's office and the Obama administration.
"This is the Obama administration's response to the dinner party Netanyahu held in (Mitt) Romney's honor," a senior member of the political-security cabinet told Ynet, while another official said the Pentagon's decision "isn't boosting deterrence and is not making the Iranians sweat.

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