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Which European Countries Will Suffer The Most If Russia Turns Off The Gas | Zero Hedge

Which European Countries Will Suffer The Most If Russia Turns Off The Gas | Zero Hedge.

With the Sunday Crimean referendum seemingly unstoppable now, its outcome certain, it is set to unleash a chain of events that is not entirely predictable but is at best, ominous, as it will involve the launch of trade, economic and financial sanctions against Russia (despite China’s stern disapproval), which will lead to a “symmetric” response in kind by Moscow. And in a worst case escalation scenario, should game theory completely collapse and everyone starts defecting from a cooperative equilibrium state, the first thing to go will be European gas exports from Russia, anywhere from one day to indefinitely. So which European countries are most exposed to the whims of Gazprom? The following map from the WSJ, shows just how reliant on Russian gas exports most European countries are.

One wonders just how “stern” any sanctions these countries support and enforce against Russia will truly be. Then again, as the WSJ reports, Europe somehow believes that despite its massive reliance on Ukraine for energy, it can weather a storm:

Mr. Oettinger says Europe is now in a stronger position to withstand possible disruptions in supplies, thanks in part to a mild winter, more storage capacity and pipeline infrastructure that allows more gas to flow from west to east.

But he has also said that the EU should reach out to other gas exporters and build more terminals for liquefied natural gas, and that countries should also start exploratory work on shale gas.

“The Russians are now more dependent on our money than we are on their gas,” said Mr. Wieczorkiewicz, adding that around half of Russia’s revenues are derived from oil and gas sales. “The EU could also explore ties to Norway, Algeria and Qatar as alternative suppliers, increase the use of coal and import LNG.”

But in the short term, others argue that the EU is short of options if it wants to use energy as a tool against Moscow. “Russia remains the largest exporter of gas to the EU; there’s no way of [quickly] sourcing those amounts of gas elsewhere,” said Simon Pirani of the Oxford Institute for Energy Studies.

“Europe has to ask itself how important is the economic relationship with Russia, which provides that cheap energy, and how important is the political protest that it wants to make” about Crimea, he said.

So who wins in the end: the provider of the commodity, or the buyer who pays with infinitely dilutable fiat, especially if any further escalation by the west against Russia will merely bring China and Russia together even closer. Somehow we think our money is on the KGB spy instead of the clueless and insolvent European bureaucrats.

Merkel Warns Putin Of "Massive Damage", Russia Continues Piling Troops, Pro-Russia Oligarch Arrested, Gazprom Speaks | Zero Hedge

Merkel Warns Putin Of “Massive Damage”, Russia Continues Piling Troops, Pro-Russia Oligarch Arrested, Gazprom Speaks | Zero Hedge.

It’s crunch time for Ukraine.

With just over two days to go until the Crimea referendum, all the actors are stepping up the diplomacy to a fever pitch in a desperate attempt to talk Putin out of formally annexing the peninsula following results which are well-known in advance will show the population’s allegiance to mother Russia. But while the generic rhetoric is well-known, one surprising place of escalation over the past 24 hours has been Germany’s Angela Merkel, who for the most part had been willing to stay on the sidelines in the war of words, has suddenly stepped up her own phrasing, and warned Moscow on Thursday that it risked “massive” political and economic damage if it refused to change course on Ukraine, saying Western leaders were united in their readiness to impose sanctions on Russia if necessary.

Reuters reports that the chancellor, using her strongest language since the start of the crisis and removing any suspicion that Germany might seek to avoid a confrontation with President Vladimir Putin, said his actions would lead to “catastrophe” for Ukraine and much more.

“We would not only see it, also as neighbours of Russia, as a threat. And it would not only change the European Union’s relationship with Russia,” she said in a speech in parliament. “No, this would also cause massive damage to Russia, economically and politically.”

Merkel has acknowledged that her efforts to persuade Putin to negotiate via a “contact group” with the transition government in Kiev – which he accuses of ousting Russian-backed president Viktor Yanukovich unlawfully – have failed and time is running out.

“To be absoultely clear, none of us want it to come to such measures but we are all ready and determined to if they are unavoidable,” said Merkel.

Germany receives over a third of its gas and oil from Russia and over 6,000 German firms are active there. A poll last week showed that a majority of Germans oppose sanctions against Russia. So is Merkel doing the Western thing, and bluffing in a last-ditch effort to convince Putin she isn’t, or does Putin still believe he has all the trump cards, and can bring the German economy to a crawl if Merkel acts out on her threat? We will known as soon as Sunday night.

Elsewhere, John Kerry headed out to London for some last ditch Russia talks on Ukraine. Expect this “effort” too to lead exactly nowhere.

In the meantime, Russia’s response is well known, which is more of the same – and the Russian Ministry of Defense made it quite clear what the next steps are when it announced that the large-scale maneuvers near the Ukraine border now involve some 8,500 troops, 270 tanks and 180 APCs.

An indication of how “seriously” Russia takes the diplomatic threats was the news that it is ready to impose counter-sanctions. WSJ reported that Russia’s economy ministry is looking at what the consequences of possible sanctions from the West would be and stands ready to impose similar penalties, deputy economy minister Alexei Likhachev said Thursday.

We are ready for any developments, all options are being considered. But we hope that it will impose specific political sanctions but not a wider range of some trade and economic decisions,” Mr. Likhachev said.

 

Mr. Likhachev said Europe is unlikely to impose harsh sanctions against Russia as both sides have strong business and trade ties.

 

Unlike Europe, which is Russia’s major trading partner, the U.S. has more room to impose sanctions, he added.

 

“Our sanctions will be symmetric,” Mr. Likhachev said.

But it wouldn’t be a Russian response if Gazprom didn’t make an announcement or two. Which it did:

  • Gazprom CEO: Ukraine’s Failure to Repay Gas Deliveries Debt Puts Company Dividend Policy At Risk
  • Gazprom CEO: Ukraine Debt for Gas Deliveries Now at $1.8 Billion, Keeps Growing
  • Gazprom CEO: Ukraine Political Crisis Detrimental For Company’s Investment Program
  • Gazprom CEO Seeking Clarity On Gas Payments From Ukraine
  • Gazprom CEO Doesn’t “Want A Gas Crisis”
  • Gazprom CEO Doesn’t Address Cutting Off Gas Supplies In Statement

And while diplomacy is failing all around, and a trade and all too real war are potentially on the horizon, the real issue was and continues to the money. Which is why it was surprising to learn that earlier today the a Ukrainian oligarch, Dmytro Firtash, was arrested in Vienna this week at the request of U.S. authorities, the Austrian government sources said on Thursday.  Reutersreports that Firtash, 48, is one of Ukraine’s richest men,an oligarch whose close links to Russia and involvement in the gas, chemicals, media and banking sectors gave him substantial influence,notably during the administration of recently ousted, Moscow-backed President Viktor Yanukovich.

The Federal Criminal Office, had identified the man taken into custody only as Dmitry F. and said he had been under investigation by the U.S. Federal Bureau of Investigation since 2006.

As a reminder, Stratfor’s take on the richest Ukrainians was that they would play a “decisive role” in the conflict:

With presidential elections set for May 25 and parliamentary elections likely to be held later in the year, Ukraine’s current administration will need the continued support of the oligarchs. More immediately, with Crimea on the verge of leaving Ukraine, the new government’s urgent challenge is to keep mainland Ukraine together. Eastern Ukraine is crucial to this — the region is a stronghold for pro-Russia sentiment and the main site of opposition, after Crimea, to the Western-backed and Western-leaning government.

 

The oligarchs are key to keeping control over eastern Ukraine, not only because Ukraine’s industrial production is concentrated in the east — thus anchoring a shaky economy — but also because many of the oligarchs have a stronger and more manageable relationship with Russia than the current government, which Moscow sees as illegitimate. Many of these business leaders hail from the industrial east. They have business ties to Russia and decades of experience dealing with Russian authorities — experience that figures such as Klitschko and Yatsenyuk lack.

 

So far, the new government has been able to maintain the support of the country’s most important oligarchs. In general, the oligarchs want Ukraine to stay united. They do not support partition or federalization, because this would compromise their business interests across the country. But this support is not guaranteed over the long term. There have been recent complaints about the new government, for example over the arrest of former Kharkiv Gov. Mikhail Dobkin. Akhmetov came out in Dobkin’s defense, saying the government should not be going after internal rivals right now, but rather focusing on concerns over Russia. This can be seen as a warning to the new administration: The oligarchs’ loyalty to the current regime is conditional and should not be taken for granted.

 

Ultimately, the biggest threat to the oligarchs is not the current government, over which they have substantial leverage, but Russia. The oligarchs stand to lose a great deal if Russia intervenes in eastern Ukraine. If Russia takes over eastern territories, it could threaten the oligarchs’ very control over their assets. Therefore they have an interest in bridging the gap between Russia and Kiev, but it is Moscow they fear more. The oligarchs have substantial power to shape the Ukrainian government’s decision-making as it moves forward. Their business interests and the territorial integrity of the country are at stake.

As always, follow the money, especially when some of the richest money ends up directly in prison in a country far away, under the orders of that global moralizer, the United States.

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Merkel Warns Putin Of “Massive Damage”, Russia Continues Piling Troops, Pro-Russia Oligarch Arrested, Gazprom Speaks | Zero Hedge

Merkel Warns Putin Of “Massive Damage”, Russia Continues Piling Troops, Pro-Russia Oligarch Arrested, Gazprom Speaks | Zero Hedge.

It’s crunch time for Ukraine.

With just over two days to go until the Crimea referendum, all the actors are stepping up the diplomacy to a fever pitch in a desperate attempt to talk Putin out of formally annexing the peninsula following results which are well-known in advance will show the population’s allegiance to mother Russia. But while the generic rhetoric is well-known, one surprising place of escalation over the past 24 hours has been Germany’s Angela Merkel, who for the most part had been willing to stay on the sidelines in the war of words, has suddenly stepped up her own phrasing, and warned Moscow on Thursday that it risked “massive” political and economic damage if it refused to change course on Ukraine, saying Western leaders were united in their readiness to impose sanctions on Russia if necessary.

Reuters reports that the chancellor, using her strongest language since the start of the crisis and removing any suspicion that Germany might seek to avoid a confrontation with President Vladimir Putin, said his actions would lead to “catastrophe” for Ukraine and much more.

“We would not only see it, also as neighbours of Russia, as a threat. And it would not only change the European Union’s relationship with Russia,” she said in a speech in parliament. “No, this would also cause massive damage to Russia, economically and politically.”

Merkel has acknowledged that her efforts to persuade Putin to negotiate via a “contact group” with the transition government in Kiev – which he accuses of ousting Russian-backed president Viktor Yanukovich unlawfully – have failed and time is running out.

“To be absoultely clear, none of us want it to come to such measures but we are all ready and determined to if they are unavoidable,” said Merkel.

Germany receives over a third of its gas and oil from Russia and over 6,000 German firms are active there. A poll last week showed that a majority of Germans oppose sanctions against Russia. So is Merkel doing the Western thing, and bluffing in a last-ditch effort to convince Putin she isn’t, or does Putin still believe he has all the trump cards, and can bring the German economy to a crawl if Merkel acts out on her threat? We will known as soon as Sunday night.

Elsewhere, John Kerry headed out to London for some last ditch Russia talks on Ukraine. Expect this “effort” too to lead exactly nowhere.

In the meantime, Russia’s response is well known, which is more of the same – and the Russian Ministry of Defense made it quite clear what the next steps are when it announced that the large-scale maneuvers near the Ukraine border now involve some 8,500 troops, 270 tanks and 180 APCs.

An indication of how “seriously” Russia takes the diplomatic threats was the news that it is ready to impose counter-sanctions. WSJ reported that Russia’s economy ministry is looking at what the consequences of possible sanctions from the West would be and stands ready to impose similar penalties, deputy economy minister Alexei Likhachev said Thursday.

We are ready for any developments, all options are being considered. But we hope that it will impose specific political sanctions but not a wider range of some trade and economic decisions,” Mr. Likhachev said.

 

Mr. Likhachev said Europe is unlikely to impose harsh sanctions against Russia as both sides have strong business and trade ties.

 

Unlike Europe, which is Russia’s major trading partner, the U.S. has more room to impose sanctions, he added.

 

“Our sanctions will be symmetric,” Mr. Likhachev said.

But it wouldn’t be a Russian response if Gazprom didn’t make an announcement or two. Which it did:

  • Gazprom CEO: Ukraine’s Failure to Repay Gas Deliveries Debt Puts Company Dividend Policy At Risk
  • Gazprom CEO: Ukraine Debt for Gas Deliveries Now at $1.8 Billion, Keeps Growing
  • Gazprom CEO: Ukraine Political Crisis Detrimental For Company’s Investment Program
  • Gazprom CEO Seeking Clarity On Gas Payments From Ukraine
  • Gazprom CEO Doesn’t “Want A Gas Crisis”
  • Gazprom CEO Doesn’t Address Cutting Off Gas Supplies In Statement

And while diplomacy is failing all around, and a trade and all too real war are potentially on the horizon, the real issue was and continues to the money. Which is why it was surprising to learn that earlier today the a Ukrainian oligarch, Dmytro Firtash, was arrested in Vienna this week at the request of U.S. authorities, the Austrian government sources said on Thursday.  Reutersreports that Firtash, 48, is one of Ukraine’s richest men,an oligarch whose close links to Russia and involvement in the gas, chemicals, media and banking sectors gave him substantial influence,notably during the administration of recently ousted, Moscow-backed President Viktor Yanukovich.

The Federal Criminal Office, had identified the man taken into custody only as Dmitry F. and said he had been under investigation by the U.S. Federal Bureau of Investigation since 2006.

As a reminder, Stratfor’s take on the richest Ukrainians was that they would play a “decisive role” in the conflict:

With presidential elections set for May 25 and parliamentary elections likely to be held later in the year, Ukraine’s current administration will need the continued support of the oligarchs. More immediately, with Crimea on the verge of leaving Ukraine, the new government’s urgent challenge is to keep mainland Ukraine together. Eastern Ukraine is crucial to this — the region is a stronghold for pro-Russia sentiment and the main site of opposition, after Crimea, to the Western-backed and Western-leaning government.

 

The oligarchs are key to keeping control over eastern Ukraine, not only because Ukraine’s industrial production is concentrated in the east — thus anchoring a shaky economy — but also because many of the oligarchs have a stronger and more manageable relationship with Russia than the current government, which Moscow sees as illegitimate. Many of these business leaders hail from the industrial east. They have business ties to Russia and decades of experience dealing with Russian authorities — experience that figures such as Klitschko and Yatsenyuk lack.

 

So far, the new government has been able to maintain the support of the country’s most important oligarchs. In general, the oligarchs want Ukraine to stay united. They do not support partition or federalization, because this would compromise their business interests across the country. But this support is not guaranteed over the long term. There have been recent complaints about the new government, for example over the arrest of former Kharkiv Gov. Mikhail Dobkin. Akhmetov came out in Dobkin’s defense, saying the government should not be going after internal rivals right now, but rather focusing on concerns over Russia. This can be seen as a warning to the new administration: The oligarchs’ loyalty to the current regime is conditional and should not be taken for granted.

 

Ultimately, the biggest threat to the oligarchs is not the current government, over which they have substantial leverage, but Russia. The oligarchs stand to lose a great deal if Russia intervenes in eastern Ukraine. If Russia takes over eastern territories, it could threaten the oligarchs’ very control over their assets. Therefore they have an interest in bridging the gap between Russia and Kiev, but it is Moscow they fear more. The oligarchs have substantial power to shape the Ukrainian government’s decision-making as it moves forward. Their business interests and the territorial integrity of the country are at stake.

As always, follow the money, especially when some of the richest money ends up directly in prison in a country far away, under the orders of that global moralizer, the United States.

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Crimea Bank Runs Begin As "Bail-In" Risks Arise | Zero Hedge

Crimea Bank Runs Begin As “Bail-In” Risks Arise | Zero Hedge.

While the sight of Russian flags, pro-Russian troops, and Russian navy ships in Crimea is now a day-to-day thing; this morning brings a new normal for the eastern Ukraine region – long lines at bank ATMs as the bank runs have begun. We noted last night the dreaded inversion of Ukraine’s yield curve, the greater-than-50% yields on 3-month Ukraine government debt, and the pressures on local bank debt maturities as the ability to garner dollars cost-effectively was becoming a problem but on the heels of concerns by the head of the central bank that moving cash in Crimea was difficult, ATM withdrawal limits have been cut. People in long ATM lines are reported to be concerned because “banks are closing” but it is Deutsche Bank’s comments this morning that raised many an eyebrow as they suggest that Ukraine’s debt is pricing in a “burden-sharing” haircut for bondholders (which as we have seen in the past – in Cyprus – can quickly ripple up the capital structure and become a depositor haircut).

Quiet calm bank runs are beginning in Ukraine…

h/t @MarquardtA

 

As Deutsche Bank raises the prospect of bail-ins and Private-Sector-Involvement (PSI) in bailing-in the banks and government…

…given the recent experience of IMF programs it is natural to ask whether some form of ‘private sector involvement’ (PSI) will be proposed as part of any package of support.

 

 

The IMF itself recently published a consultation paper arguing that private sector debt restructurings had “often been too little, too late” and that the fund should look at ways to avoid its “resources eing used simply to bail out private creditors”. The ongoing consultation process which this paper nitiated is one reason why concerns over IMF-sponsored restructuring are more prevalent for Ukraine now than they have been in similar situations in the past. However, we think it unlikely that there will be  ignificant change in the Fund’s approach towards Ukraine, given that the consultation is still ngoing, views are divided and its outcome remains uncertain. Nevertheless, that does not mean that some form of PSI will not be considered, condoned, encouraged or even mandated and so it is useful to onsider the pros and cons from the perspective of the Ukraine (and its potential official sector inanciers) and the implications for private sector creditors.

[Of course PSI can take on many forms from debt-extensions to bondholder haircuts to further up the capital structure depositor haircuts]

…current market prices are relatively consistent with such a scenario of PSI-lite. Indeed, the current relative pricing of Ukrainian bonds are very unusual: the pricing of short-dated bonds are distressed, implying a relatively high probability that they won’t redeem at par, but on the other hand the narrow range of prices across the curve suggests that the market assumes a high recovery in the event of a default/restructuring.

Such pricing would be fair, considering a baseline scenario involving an IMF program and an orderly adjustment. However, it leaves little compensation for a more disorderly scenario. Tensions with Russia show no sign of abating and could escalate further. Also there is no guarantee that the new government has a strong enough popular mandate to carry through the necessary reforms. PM Yatseniuk has emphasized that the road ahead for Ukraine will not be easy, but only time will tell how united the country will be in following the path he intends to take.

We suspect a brand new populist PM is unlikely to remain in power long if depositor haircts were engaged – and would certainly not imbibe the eastern Ukraine region with the country’s new leader.

 

It is also notable that these bank runs are focused on local Ukraine/Russian banks…

 

PT At nearby BNP Parisbas branch, short ATM line, no limit if accountholder. But passed #Urkaine Oshad Bank, another massive line. #Crimea

— Alexander Marquardt (@MarquardtA) March 13, 2014

Crimea Bank Runs Begin As “Bail-In” Risks Arise | Zero Hedge

Crimea Bank Runs Begin As “Bail-In” Risks Arise | Zero Hedge.

While the sight of Russian flags, pro-Russian troops, and Russian navy ships in Crimea is now a day-to-day thing; this morning brings a new normal for the eastern Ukraine region – long lines at bank ATMs as the bank runs have begun. We noted last night the dreaded inversion of Ukraine’s yield curve, the greater-than-50% yields on 3-month Ukraine government debt, and the pressures on local bank debt maturities as the ability to garner dollars cost-effectively was becoming a problem but on the heels of concerns by the head of the central bank that moving cash in Crimea was difficult, ATM withdrawal limits have been cut. People in long ATM lines are reported to be concerned because “banks are closing” but it is Deutsche Bank’s comments this morning that raised many an eyebrow as they suggest that Ukraine’s debt is pricing in a “burden-sharing” haircut for bondholders (which as we have seen in the past – in Cyprus – can quickly ripple up the capital structure and become a depositor haircut).

Quiet calm bank runs are beginning in Ukraine…

h/t @MarquardtA

 

As Deutsche Bank raises the prospect of bail-ins and Private-Sector-Involvement (PSI) in bailing-in the banks and government…

…given the recent experience of IMF programs it is natural to ask whether some form of ‘private sector involvement’ (PSI) will be proposed as part of any package of support.

 

 

The IMF itself recently published a consultation paper arguing that private sector debt restructurings had “often been too little, too late” and that the fund should look at ways to avoid its “resources eing used simply to bail out private creditors”. The ongoing consultation process which this paper nitiated is one reason why concerns over IMF-sponsored restructuring are more prevalent for Ukraine now than they have been in similar situations in the past. However, we think it unlikely that there will be  ignificant change in the Fund’s approach towards Ukraine, given that the consultation is still ngoing, views are divided and its outcome remains uncertain. Nevertheless, that does not mean that some form of PSI will not be considered, condoned, encouraged or even mandated and so it is useful to onsider the pros and cons from the perspective of the Ukraine (and its potential official sector inanciers) and the implications for private sector creditors.

[Of course PSI can take on many forms from debt-extensions to bondholder haircuts to further up the capital structure depositor haircuts]

…current market prices are relatively consistent with such a scenario of PSI-lite. Indeed, the current relative pricing of Ukrainian bonds are very unusual: the pricing of short-dated bonds are distressed, implying a relatively high probability that they won’t redeem at par, but on the other hand the narrow range of prices across the curve suggests that the market assumes a high recovery in the event of a default/restructuring.

Such pricing would be fair, considering a baseline scenario involving an IMF program and an orderly adjustment. However, it leaves little compensation for a more disorderly scenario. Tensions with Russia show no sign of abating and could escalate further. Also there is no guarantee that the new government has a strong enough popular mandate to carry through the necessary reforms. PM Yatseniuk has emphasized that the road ahead for Ukraine will not be easy, but only time will tell how united the country will be in following the path he intends to take.

We suspect a brand new populist PM is unlikely to remain in power long if depositor haircts were engaged – and would certainly not imbibe the eastern Ukraine region with the country’s new leader.

 

It is also notable that these bank runs are focused on local Ukraine/Russian banks…

 

PT At nearby BNP Parisbas branch, short ATM line, no limit if accountholder. But passed #Urkaine Oshad Bank, another massive line. #Crimea

— Alexander Marquardt (@MarquardtA) March 13, 2014

Deluded Currency Cultists Believe The Dollar Is Invincible

Deluded Currency Cultists Believe The Dollar Is Invincible.

Wednesday, 12 March 2014 05:25 Brandon Smith

At the onset of the derivatives collapse in 2007/2008 it would have been easy to assume that most of America was receiving a valuable education in normalcy bias.

In 2006, the amount of ego on display surrounding mortgage investment was so disturbingly grotesque anyone with any true understanding of the situation felt like projectile vomiting. To watch the smug righteousness of MSNBC and FOX economic pundits as they predicted the infinite rise of American property markets despite all evidence to the contrary was truly mind blowing. When the whole system imploded, it was difficult to know whether one should laugh, or cry.

The saddest aspect of the credit crisis of 2008 was not the massive chain reaction of bankruptcies or the threat of institutional insolvency. Rather, it was the delusional assumptions of the public that the grand mortgage casino was going to go on forever. There is nothing worse than witnessing the victim of a Ponzi scheme defend the lie which has ultimately destroyed him. As much as I am for people waking up to the nature of the crisis, there comes a point when those who are going to figure it out will figure it out, and the rest are essentially hopeless.

The cultism surrounding the U.S. economy and the U.S. dollar is truly mind boggling, and by “cultism” I mean a blind faith in the fiat currency mechanism that goes beyond all logic, reason and evidence.

In recent weeks it has become more visible as global financiers play both sides of the Ukrainian conflict, luring Americans into a frenzy of false patriotism and an anti-Russo-sports-team-mentality. My personal distaste for Vladimir Putin revolves around my understanding that he is just as much a puppet of the International Monetary Fund and international banks as Barack Obama, but many Americans hate him simply because the mainstream media has designated him the next villain in the fantasy tale of U.S. foreign policy.

Open threats from Russia that they will dump U.S. treasury bond holdings and the dollar’s world reserve status if NATO interferes in the Ukraine have been met with wildly naive chest beating from dollar cultists.  I am beginning to see the talking points everywhere.

“Let them dump the dollar, Russia’s holdings are minimal!” Or, “Let them throw out Treasuries, they’ll just be shooting themselves in the foot!” are the battle cries heard across the web. I wish I could convey how insane this viewpoint is, especially in light of the fact that many alternative economic analysts, including myself, have been predicting just such a scenario for years.

Despite the childish boastings of the dollar devout, there is an extraordinarily good possibility that the life of the greenback will be snuffed out in the near term. Here are the facts…

1) Russia will not be alone in its decouple from the dollar system. China, our largest foreign creditor, and India (a supposed ally) have clearly sided with Russia on the Ukranian issue. China has stated that it will back Russia’s play in the event that sanctions are brought to bear by NATO, or if a shooting conflict erupts.

2) China has already been slowly dumping the dollar as a world reserve currency using bilateral trade agreements with numerous countries, including Russia, India, Australia, Brazil, Germany, Japan, etc. These agreements allow FOREX currency swaps and export/import purchases to be made with China without the use of the dollar. China has been preparing itself for a divorce from U.S. economic dependence for at least a decade. The idea that they would actually follow through over political tensions should NOT surprise anyone if they have been paying attention.

3) A total drop of the dollar or U.S. treasury bonds by Russia and China would send shock waves through global markets. Russia is a major energy supplier for most of Europe. China is the largest export/import nation in the world. If they refuse to accept dollars as a trade mechanism, numerous countries will fall in line to abandon the greenback as well. The fact that so many Americans refuse to acknowledge this reality is a recipe for disaster.

The only advantage the U.S. has traditionally offered in terms of international trade has been the American consumer, whose unchecked debt spending partly fueled the rise of the industrialized East, not to mention the biggest credit bubble in history. The role of America as a consumer market is collapsing today, however. The mainstream media and the Federal Reserve can blame the steady decline in retail sales on the “weather” all they want, but negative indicators in global manufacturing often take many months to register in the statistics, meaning, this destabilization began long before the days turned cold.

4) China has been shifting away from export dependency since at least 2008, calling for a larger consumer based market at home. This process of enriching the Chinese consumer has almost been completed. The lie that China “needs the U.S.” in order to survive economically needs to be thrown out like the utter propaganda it is.

5) China (and most of the world) has ended new dollar purchases for their FOREX reserves, and has no plans to make new purchases in the future.

6) China executed the second largest dump of U.S. Treasury bonds in history in the past month.

7) Russia, China, and numerous other countries, including U.S. “allies”, have been calling for the end of the dollar’s world reserve status and the institution of a new global basket currencyusing the IMF’s Special Drawing Rights (SDR). Even Putin has suggested that the IMF take over administration of the global economy and issue the SDR as a world currency system. This flies in the face of those who argue that the IMF is somehow “American run”. The truth is, the IMF is run by global banks and no more answers to the U.S. government than the Federal Reserve answers to the U.S. government.

 

8) The Federal Reserve has been creating trillions of dollars in fiat just to prop up U.S. markets since 2008, and we are still seeing a considerable decline in global manufacturing, retail, personal home sales, and a general malaise in consumer demand. Without a full audit, there is no way to know exactly how much currency has been generated or how much is floating around in foreign markets. Any loss of world reserve status would send that flood of dollars back into the U.S., most likely ending in a hyperinflationary environment.

9) Another rather dubious argument I see often is the claim that the Federal Reserve and the U.S. Treasury could simply “negate” a Treasury dump by refusing to acknowledge creditor liabilities. Or, that they could simply print what they need to snap up the bonds, much like the German government tried to do during the Weimar collapse. Unfortunately, this plan did not work out so well for the Germans, nor has it worked for any other nation in history, so I’m not sure why people think the U.S. could pull it off. However, this is the kind of cultism we are surrounded by. These folks think the U.S. economy and the dollar are untouchable.

Yes, the Fed and the Treasury could hypothetically erase existing liabilities, but what dollar cultists do not seem to grasp is that the dollar’s value is not built on Treasury purchases. The dollar’s value is built on faith and reputation. If a nation refuses to pay out on its debts, this is called default. A default by the U.S. would immediately damage the reputation of bonds and dollars as a good investment. Global markets will refuse to purchase or hold any mechanism that they think will not earn them a profit. How many investors today are anxious to jump into Greek treasury bonds, for instance?

Finally, it is unwise to operate on the assumption that foreign creditors will accept dollars as payment on U.S. Treasury bonds if they believe the Federal Reserve is monetizing the debt. When Weimar imploded under the weight of currency devaluation, many foreign governments refused to accept the German mark as payment. Instead, they demanded payment in raw commodities, like coal, lumber and ore. Expect that China and other debt holders will demand payment in U.S. goods, infrastructure, or perhaps even land.

10) Most treasury holdings in foreign coffers are not long term bonds. Rather, they are short term bonds which mature in weeks or months, instead of years. Dollar proponents constantly cite the continued accumulation of treasury bonds by other governments as a sign that the dollar is still desirable as ever. Unfortunately, they have failed to look at the nature of these bond purchases. When China rolls over millions in short term bonds and replaces them with other short term bonds, this does not suggest they have much faith in America’s long term ability to service its debt. It would also make sense that if China had plans to remove itself from the dollar system, they would move into short term bonds which can be liquidated quickly.

11) China is on the fast track to becoming the largest holder of physical gold in the world. Russia has also greatly expanded its gold purchases. Whatever losses they might suffer from a dump of their Treasury bond investments; it will be more than made up in the incredible explosion in precious metals prices that would follow.

12) The most common argument against the dollar losing world reserve status has been that such a shift would be “impossible” because no other currency in the world has the adequate liquidity needed to replace the dollar in global trade. These people have apparently not been paying attention to the Chinese yuan. China has been quietly issuing trillions in yuan denominated bonds, securities and currency around the world. Current estimates calculate around $24 trillion created by the PBOC and the banks under its control.

Mainstream talking heads are calling this a “debt bubble.” However, this debt creation makes perfect sense if China’s plan is to create enough liquidity in its currency in order to offer a viable alternative to the U.S. dollar. Linking the yuan to the IMF’s basket currency would complete the picture, forming a perfect dollar replacement while dollar cheerleading-economists stand dumbstruck.

13) China’s retreat away from dollar denominated investments has left a hole in the U.S. bond market.  Recently, that negative space was filled by an unexpected source; namely Belgium.  A country whose GDP represents less than 1% of total global GDP buying more U.S. bonds than China?  The whole concept sounds bizarre.  Where is the capital coming from?

Think about it this way – Belgium is the political center of the European Union and a haven for international financiers.  There are more corporate cronies, lobbyists, bureaucrats, and foreign dignitaries in Belgium than in all of Washington D.C.  But more importantly, Belgium struck a deal with the IMF in 2012 to begin pumping SDR denominated funds into “low income economies”.  I would suggest that this funding flows both ways, and that now, the IMF is feeding capital into Belgium in order to buy U.S. Treasury Bonds.  That is to say, the IMF is going to start using smaller member countries with limited savings as proxies to purchase U.S. debt using IMF money.

The ultimate danger of the IMF (run by internationalists, not the U.S. government) pre-positioning itself as the primary buyer of U.S. debt is that when the U.S. finally defaults (and it will), the IMF is likely to become the “guardian angel” of the U.S. economy, offering aid in exchange for total administrative control of our financial system, and the institution of the SDR as a world reserve replacement for the dollar.

14) The serious prospect of regional conflict or world war over tensions between the Ukraine and Russia, Japan and China, the U.S. and Syria, the U.S. and Iran, the U.S. and North Korea, etc., could make the effort of exposing the plan to shift economic power into a one world system centralized under the IMF almost meaningless.  How many people will truly care about the financial power grab by banking elites if it drifts under the surface of catastrophic engineered wars?  They’ll be too busy hating and fighting artificially created boogeymen to pay attention to the real globalist culprits.

I have been pointing out for quite a long time that globalists need a “cover event”; a disaster, an economic war or a shooting war, in order to provide a smokescreen for the collapse of the dollar. Alternative analysts have been consistently correct in predicting the trend towards the dump of the dollar. Years ago, we were laughed at for suggesting China would shift towards a consumer based economy and away from U.S. dependence. Today, it is mainstream news. We were laughed at for suggesting that nations like Russia and China would drop the dollar as a reserve currency. Today, they are already in the process of doing it. And, we were laughed at for suggesting that Russia or China would use their debt holdings as leverage against the U.S. in the event of a geopolitical conflict. Today, they are openly making threats.

I have to say, I’ve grown tired of the dollar cultists. How many times can a group of people be wrong and still argue with those who have been consistently right? The answer is that zealots never actually escape their own delusions, even when their delusions lead them and those around them to ruin. I suspect that in the face of complete dollar collapse, they will still be rationalizing the chaos and pontificating on our “lack of understanding” while the theater burns down around them.

The Most Evil and Disturbing NSA Spy Practices To-Date Have Just Been Revealed | A Lightning War for Liberty

The Most Evil and Disturbing NSA Spy Practices To-Date Have Just Been Revealed | A Lightning War for Liberty.

Posted on March 12, 2014

In some cases the NSA has masqueraded as a fake Facebook server, using the social media site as a launching pad to infect a target’s computer and exfiltrate files from a hard drive. In others, it has sent out spam emails laced with the malware, which can be tailored to covertly record audio from a computer’s microphone and take snapshots with its webcam. The hacking systems have also enabled the NSA to launch cyberattacks by corrupting and disrupting file downloads or denying access to websites.

The man-in-the-middle tactic can be used, for instance, to covertly change the content of a message as it is being sent between two people, without either knowing that any change has been made by a third party.

– From Glenn Greenwald’s latest article: How the NSA Plans to Infect Millions of Computers with Malware

The latest piece from Greenwald and company on the unconstitutional spy practices of the NSA may represent the most dangerous and disturbing revelations yet. It’s hard for shadiness at the NSA to surprise me these days, but there was only one word that kept repeating over and over in my head as I read this: EVIL.

As a quick aside, Greenwald points out in the quote above how spam emails are used by the NSA to bait you into clicking dangerous links. This is a timely revelation considering I received one such email yesterday from a friend of mine. The email was sent to a wide list of let’s say “liberty-minded people” and webmasters associated with very popular sites. The link seemed shady so I texted him to ask if he had sent it. He hadn’t.

Earlier this week, during a talk at SXSW, Edward Snowden pleaded with people to use encryption. While he admitted if the NSA targeted you individually they could almost certainly “own your computer,” he stated that if people use encryption on a massive scale it makes the NSA’s attempts to monitor everyone at the same time much more difficult.

Apparently, the NSA is well aware of this threat. Which is why we now know that the agency has been dedicating significant amounts of taxpayer dollars toward an attempt to infect millions of computers with malware in an attempt at “industrial-scale exploitation,” which would lead to them “owning the net.”

As Mikko Hypponen, an expert in malware stated:

“The NSA’s surveillance techniques could inadvertently be undermining the security of the Internet.”

Move along serfs, nothing to see here.

From The Intercept:

Top-secret documents reveal that the National Security Agency is dramatically expanding its ability to covertly hack into computers on a mass scale by using automated systems that reduce the level of human oversight in the process.

The classified files – provided previously by NSA whistleblower Edward Snowden – contain new details about groundbreaking surveillance technology the agency has developed to infect potentially millions of computers worldwide with malware “implants.” The clandestine initiative enables the NSA to break into targeted computers and to siphon out data from foreign Internet and phone networks.

In some cases the NSA has masqueraded as a fake Facebook server, using the social media site as a launching pad to infect a target’s computer and exfiltrate files from a hard drive. In others, it has sent out spam emails laced with the malware, which can be tailored to covertly record audio from a computer’s microphone and take snapshots with its webcam. The hacking systems have also enabled the NSA to launch cyberattacks by corrupting and disrupting file downloads or denying access to websites.

The implants being deployed were once reserved for a few hundred hard-to-reach targets, whose communications could not be monitored through traditional wiretaps. But the documents analyzed by The Intercept show how the NSA has aggressively accelerated its hacking initiatives in the past decade by computerizing some processes previously handled by humans. The automated system – codenamed TURBINE – is designed to “allow the current implant network to scale to large size (millions of implants) by creating a system that does automated control implants by groups instead of individually.”

Mikko Hypponen, an expert in malware who serves as chief research officer at the Finnish security firm F-Secure, calls the revelations “disturbing.” The NSA’s surveillance techniques, he warns, could inadvertently be undermining the security of the Internet.

It sounds like that is precisely their intent…

The NSA began rapidly escalating its hacking efforts a decade ago. In 2004, according to securet internal records, the agency was managing a small network of only 100 to 150 implants. But over the next six to eight years, as an elite unit called Tailored Access Operations (TAO) recruited new hackers and developed new malware tools, the number of implants soared to tens of thousands.

The agency’s solution was TURBINE. Developed as part of TAO unit, it is described in the leaked documents as an “intelligent command and control capability” that enables “industrial-scale exploitation.”

Earlier reports based on the Snowden files indicate that the NSA has already deployed between 85,000 and 100,000 of its implants against computers and networks across the world, with plans to keep on scaling up those numbers.

The intelligence community’s top-secret “Black Budget” for 2013, obtained by Snowden, lists TURBINE as part of a broader NSA surveillance initiative named “Owning the Net.”

The agency sought $67.6 million in taxpayer funding for its Owning the Net program last year. Some of the money was earmarked for TURBINE, expanding the system to encompass “a wider variety” of networks and “enabling greater automation of computer network exploitation.”

Your tax dollars at works slaves.

One implant, codenamed UNITEDRAKE, can be used with a variety of “plug-ins” that enable the agency to gain total control of an infected computer.

An implant plug-in named CAPTIVATEDAUDIENCE, for example, is used to take over a targeted computer’s microphone and record conversations taking place near the device. Another, GUMFISH, can covertly take over a computer’s webcam and snap photographs. FOGGYBOTTOM records logs of Internet browsing histories and collects login details and passwords used to access websites and email accounts. GROK is used to log keystrokes. And SALVAGERABBIT exfiltrates data from removable flash drives that connect to an infected computer.

The implants can enable the NSA to circumvent privacy-enhancing encryption tools that are used to browse the Internet anonymously or scramble the contents of emails as they are being sent across networks. That’s because the NSA’s malware gives the agency unfettered access to a target’s computer before the user protects their communications with encryption.

According to the Snowden files, the technology has been used to seek out terror suspects as well as individuals regarded by the NSA as “extremist.” But the mandate of the NSA’s hackers is not limited to invading the systems of those who pose a threat to national security.

In one secret post on an internal message board, an operative from the NSA’s Signals Intelligence Directorate describes using malware attacks against systems administrators who work at foreign phone and Internet service providers. By hacking an administrator’s computer, the agency can gain covert access to communications that are processed by his company. “Sys admins are a means to an end,” the NSA operative writes.

But not all of the NSA’s implants are used to gather intelligence, the secret files show. Sometimes, the agency’s aim is disruption rather than surveillance.QUANTUMSKY, a piece of NSA malware developed in 2004, is used to block targets from accessing certain websites. QUANTUMCOPPER, first tested in 2008, corrupts a target’s file downloads. These two “attack” techniques are revealed on a classified list that features nine NSA hacking tools, six of which are used for intelligence gathering. Just one is used for “defensive” purposes – to protect U.S. government networks against intrusions.

Before it can extract data from an implant or use it to attack a system, the NSA must first install the malware on a targeted computer or network.

According to one top-secret document from 2012, the agency can deploy malware by sending out spam emails that trick targets into clicking a malicious link. Once activated, a “back-door implant” infects their computers within eight seconds.

Consequently, the NSA has turned to new and more advanced hacking techniques. These include performing so-called “man-in-the-middle” and “man-on-the-side” attacks, which covertly force a user’s internet browser to route to NSA computer servers that try to infect them with an implant.

In one man-on-the-side technique, codenamed QUANTUMHAND, the agency disguises itself as a fake Facebook server. When a target attempts to log in to the social media site, the NSA transmits malicious data packets that trick the target’s computer into thinking they are being sent from the real Facebook. By concealing its malware within what looks like an ordinary Facebook page, the NSA is able to hack into the targeted computer and covertly siphon out data from its hard drive. A top-secret animation demonstrates the tactic in action.

The man-in-the-middle tactic can be used, for instance, to covertly change the content of a message as it is being sent between two people, without either knowing that any change has been made by a third party. The same technique is sometimes used by criminal hackers to defraud people.

“The thing that raises a red flag for me is the reference to ‘network choke points,’” he says. “That’s the last place that we should be allowing intelligence agencies to compromise the infrastructure – because that is by definition a mass surveillance technique.”

In many cases, firewalls and other security measures do not appear to pose much of an obstacle to the NSA. Indeed, the agency’s hackers appear confident in their ability to circumvent any security mechanism that stands between them and compromising a computer or network. “If we can get the target to visit us in some sort of web browser, we can probably own them,” an agency hacker boasts in one secret document. “The only limitation is the ‘how.’”

GCHQ cooperated with the hacking attacks despite having reservations about their legality. One of the Snowden files, previously disclosed by Swedish broadcaster SVT, revealed that as recently as April 2013, GCHQ was apparently reluctant to get involved in deploying the QUANTUM malware due to “legal/policy restrictions.” A representative from a unit of the British surveillance agency, meeting with an obscure telecommunications standards committee in 2010, separately voiced concerns that performing “active” hacking attacks for surveillance “may be illegal” under British law.

When even the GCHQ is questioning the legality of a surveillance program you know you’ve gone too far. Way too far.

Full article here.

In Liberty,
Michael Krieger

The Most Evil and Disturbing NSA Spy Practices To-Date Have Just Been Revealed | A Lightning War for Liberty

The Most Evil and Disturbing NSA Spy Practices To-Date Have Just Been Revealed | A Lightning War for Liberty.

Posted on March 12, 2014

In some cases the NSA has masqueraded as a fake Facebook server, using the social media site as a launching pad to infect a target’s computer and exfiltrate files from a hard drive. In others, it has sent out spam emails laced with the malware, which can be tailored to covertly record audio from a computer’s microphone and take snapshots with its webcam. The hacking systems have also enabled the NSA to launch cyberattacks by corrupting and disrupting file downloads or denying access to websites.

The man-in-the-middle tactic can be used, for instance, to covertly change the content of a message as it is being sent between two people, without either knowing that any change has been made by a third party.

– From Glenn Greenwald’s latest article: How the NSA Plans to Infect Millions of Computers with Malware

The latest piece from Greenwald and company on the unconstitutional spy practices of the NSA may represent the most dangerous and disturbing revelations yet. It’s hard for shadiness at the NSA to surprise me these days, but there was only one word that kept repeating over and over in my head as I read this: EVIL.

As a quick aside, Greenwald points out in the quote above how spam emails are used by the NSA to bait you into clicking dangerous links. This is a timely revelation considering I received one such email yesterday from a friend of mine. The email was sent to a wide list of let’s say “liberty-minded people” and webmasters associated with very popular sites. The link seemed shady so I texted him to ask if he had sent it. He hadn’t.

Earlier this week, during a talk at SXSW, Edward Snowden pleaded with people to use encryption. While he admitted if the NSA targeted you individually they could almost certainly “own your computer,” he stated that if people use encryption on a massive scale it makes the NSA’s attempts to monitor everyone at the same time much more difficult.

Apparently, the NSA is well aware of this threat. Which is why we now know that the agency has been dedicating significant amounts of taxpayer dollars toward an attempt to infect millions of computers with malware in an attempt at “industrial-scale exploitation,” which would lead to them “owning the net.”

As Mikko Hypponen, an expert in malware stated:

“The NSA’s surveillance techniques could inadvertently be undermining the security of the Internet.”

Move along serfs, nothing to see here.

From The Intercept:

Top-secret documents reveal that the National Security Agency is dramatically expanding its ability to covertly hack into computers on a mass scale by using automated systems that reduce the level of human oversight in the process.

The classified files – provided previously by NSA whistleblower Edward Snowden – contain new details about groundbreaking surveillance technology the agency has developed to infect potentially millions of computers worldwide with malware “implants.” The clandestine initiative enables the NSA to break into targeted computers and to siphon out data from foreign Internet and phone networks.

In some cases the NSA has masqueraded as a fake Facebook server, using the social media site as a launching pad to infect a target’s computer and exfiltrate files from a hard drive. In others, it has sent out spam emails laced with the malware, which can be tailored to covertly record audio from a computer’s microphone and take snapshots with its webcam. The hacking systems have also enabled the NSA to launch cyberattacks by corrupting and disrupting file downloads or denying access to websites.

The implants being deployed were once reserved for a few hundred hard-to-reach targets, whose communications could not be monitored through traditional wiretaps. But the documents analyzed by The Intercept show how the NSA has aggressively accelerated its hacking initiatives in the past decade by computerizing some processes previously handled by humans. The automated system – codenamed TURBINE – is designed to “allow the current implant network to scale to large size (millions of implants) by creating a system that does automated control implants by groups instead of individually.”

Mikko Hypponen, an expert in malware who serves as chief research officer at the Finnish security firm F-Secure, calls the revelations “disturbing.” The NSA’s surveillance techniques, he warns, could inadvertently be undermining the security of the Internet.

It sounds like that is precisely their intent…

The NSA began rapidly escalating its hacking efforts a decade ago. In 2004, according to securet internal records, the agency was managing a small network of only 100 to 150 implants. But over the next six to eight years, as an elite unit called Tailored Access Operations (TAO) recruited new hackers and developed new malware tools, the number of implants soared to tens of thousands.

The agency’s solution was TURBINE. Developed as part of TAO unit, it is described in the leaked documents as an “intelligent command and control capability” that enables “industrial-scale exploitation.”

Earlier reports based on the Snowden files indicate that the NSA has already deployed between 85,000 and 100,000 of its implants against computers and networks across the world, with plans to keep on scaling up those numbers.

The intelligence community’s top-secret “Black Budget” for 2013, obtained by Snowden, lists TURBINE as part of a broader NSA surveillance initiative named “Owning the Net.”

The agency sought $67.6 million in taxpayer funding for its Owning the Net program last year. Some of the money was earmarked for TURBINE, expanding the system to encompass “a wider variety” of networks and “enabling greater automation of computer network exploitation.”

Your tax dollars at works slaves.

One implant, codenamed UNITEDRAKE, can be used with a variety of “plug-ins” that enable the agency to gain total control of an infected computer.

An implant plug-in named CAPTIVATEDAUDIENCE, for example, is used to take over a targeted computer’s microphone and record conversations taking place near the device. Another, GUMFISH, can covertly take over a computer’s webcam and snap photographs. FOGGYBOTTOM records logs of Internet browsing histories and collects login details and passwords used to access websites and email accounts. GROK is used to log keystrokes. And SALVAGERABBIT exfiltrates data from removable flash drives that connect to an infected computer.

The implants can enable the NSA to circumvent privacy-enhancing encryption tools that are used to browse the Internet anonymously or scramble the contents of emails as they are being sent across networks. That’s because the NSA’s malware gives the agency unfettered access to a target’s computer before the user protects their communications with encryption.

According to the Snowden files, the technology has been used to seek out terror suspects as well as individuals regarded by the NSA as “extremist.” But the mandate of the NSA’s hackers is not limited to invading the systems of those who pose a threat to national security.

In one secret post on an internal message board, an operative from the NSA’s Signals Intelligence Directorate describes using malware attacks against systems administrators who work at foreign phone and Internet service providers. By hacking an administrator’s computer, the agency can gain covert access to communications that are processed by his company. “Sys admins are a means to an end,” the NSA operative writes.

But not all of the NSA’s implants are used to gather intelligence, the secret files show. Sometimes, the agency’s aim is disruption rather than surveillance.QUANTUMSKY, a piece of NSA malware developed in 2004, is used to block targets from accessing certain websites. QUANTUMCOPPER, first tested in 2008, corrupts a target’s file downloads. These two “attack” techniques are revealed on a classified list that features nine NSA hacking tools, six of which are used for intelligence gathering. Just one is used for “defensive” purposes – to protect U.S. government networks against intrusions.

Before it can extract data from an implant or use it to attack a system, the NSA must first install the malware on a targeted computer or network.

According to one top-secret document from 2012, the agency can deploy malware by sending out spam emails that trick targets into clicking a malicious link. Once activated, a “back-door implant” infects their computers within eight seconds.

Consequently, the NSA has turned to new and more advanced hacking techniques. These include performing so-called “man-in-the-middle” and “man-on-the-side” attacks, which covertly force a user’s internet browser to route to NSA computer servers that try to infect them with an implant.

In one man-on-the-side technique, codenamed QUANTUMHAND, the agency disguises itself as a fake Facebook server. When a target attempts to log in to the social media site, the NSA transmits malicious data packets that trick the target’s computer into thinking they are being sent from the real Facebook. By concealing its malware within what looks like an ordinary Facebook page, the NSA is able to hack into the targeted computer and covertly siphon out data from its hard drive. A top-secret animation demonstrates the tactic in action.

The man-in-the-middle tactic can be used, for instance, to covertly change the content of a message as it is being sent between two people, without either knowing that any change has been made by a third party. The same technique is sometimes used by criminal hackers to defraud people.

“The thing that raises a red flag for me is the reference to ‘network choke points,’” he says. “That’s the last place that we should be allowing intelligence agencies to compromise the infrastructure – because that is by definition a mass surveillance technique.”

In many cases, firewalls and other security measures do not appear to pose much of an obstacle to the NSA. Indeed, the agency’s hackers appear confident in their ability to circumvent any security mechanism that stands between them and compromising a computer or network. “If we can get the target to visit us in some sort of web browser, we can probably own them,” an agency hacker boasts in one secret document. “The only limitation is the ‘how.’”

GCHQ cooperated with the hacking attacks despite having reservations about their legality. One of the Snowden files, previously disclosed by Swedish broadcaster SVT, revealed that as recently as April 2013, GCHQ was apparently reluctant to get involved in deploying the QUANTUM malware due to “legal/policy restrictions.” A representative from a unit of the British surveillance agency, meeting with an obscure telecommunications standards committee in 2010, separately voiced concerns that performing “active” hacking attacks for surveillance “may be illegal” under British law.

When even the GCHQ is questioning the legality of a surveillance program you know you’ve gone too far. Way too far.

Full article here.

In Liberty,
Michael Krieger

You Be the Judge: Huffington Post Censorship?

In attempting to challenge some thoughts from a reply to one of my comments on an article in the Huffington Post, I encountered immediate deletion. I didn’t even receive the standard ‘Due to the potentially sensitive nature of this article, your comment may take longer to appear publicly.’ Here is the thread:

The article I commented upon can be found here.

My original comment:
Orwell would be so proud of our Western ‘leaders’ who live in a world where the unelected ‘officials’ (but Western supported) are legal but a referendum of the people is not.

Reply from Cam D.:
The West isn’t the one with the 30,000 strong occupational force on the ground forcing the issue, “protecting citizenry” while at the same time not allowing in UN monitors. Have you seen the ballot of the so called referendum? There isn’t a choice to stay with the Ukraine. How is that not rigged?

My reply that is not making it past the HP moderators:
First, the Russian troops in the Crimea have been stationed there under treaty for some time. Second, supposed shots fired at the monitors could very easily have been false flag attacks (just as the chemical weapons Assad supposedly used in Syria but were in fact Saudi-supplied and used by the anti-Assad rebels). Third, are you parroting the corporate media take on the referendum question? It seems so. I trust none of them; East or West. However, our leaders are so blatantly hypocritical it’s embarrassing. Remember Iraq? Libya? etc.. The US was born and expanded through violence and occupation, and it continues to use the same approach for hegemonic control of the globe.

Problematic? I think so. After a career as an educator, I know that correcting misperceptions is perhaps one of the strongest teaching tools that can be used to help students learn, question, and think critically. Deletion of such information does nothing to further conversations or ‘enlightenment’.

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