Gaza Flotilla Raid: "What's the Big Deal?"

says Joe Biden, who, by the way, is a self-declared Zionist.

What's the big deal?

Here's what, from Karen Kwiatkowski over at Lewrockwell.com:

"The blockade of Gaza is in the world news, but thanks to a healthy, well-financed and deeply entrenched political fifth column for all things Likud, not so much here in the United States. I suspect that fewer than one person in 1 million in this country knows what Israel’s government has already shared: the Freedom Flotilla was unarmed beyond poles and kitchen knives; two former US ambassadors and a retired American Army colonel were on board and taken prisoner, the Israeli attack occurred 85 miles off shore in international waters on a clearly marked Turkish-flagged ship, and that a young American citizen was shot in the head four times at close range, with a fifth coup de grâce to the chest. Honestly, I don’t know the order of the five shots. The boy is dead, and he was one of ours. There has been more media coverage on the death of the Gore marriage, or the status of a Kuwaiti blogger this week than the Israeli murder on the high seas. I’m almost tempted to wonder if the Israelis have heard of tasers? But as the Gaza and West Bank situations have testified for decades, proportionality of response isn’t an Israeli forte. Kind of like living with an alcoholic parent, I guess." [Emphasis is mine.]

And the vice president of the United States asks "What's the big deal?"

Guess nothin' to you, Joe.

With extrajudicial killing of US citizens by the US government openly authorized by his boss, I guess it's no big deal. I guess we should be thanking Israeli commandos for doing our CIA's work. (Of course hardly anyone in MSM paid a bit of attention to the fact that Obama had authorized the assassination of US citizens, even though it was openly discussed in a Congressional hearing.)

For those who still care, you can read Karen Kwiatkowski's article "Gazan Survivalism" (6/5/2010 Lewrockwell.com). She is a retired USAF lieutenant colonel who writes about defense issues with a libertarian perspective.

And for more on "a healthy, well-financed and deeply entrenched political fifth column for all things Likud" that Dr. Kwiatkowski talks about, here's Glenn Greenwald's latest article on Salon.com.

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OT: Paint it Black

During the market today, it sort of felt like this particular song...

I see a red door and I want it painted black
No colors anymore I want them to turn black
I see the girls walk by dressed in their summer clothes
I have to turn my head until my darkness goes
I see a line of cars and they are all painted black
With flowers and my love both never to come back
I see people turn their heads and quickly look away
Like a new born baby it just happens every day
I look inside myself and see my heart is black
I see my red door and it has been painted black
Maybe then Ill fade away and not have to face the facts
Its not easy facin up when your whole world is black

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News That Has Gone Very Quiet Very Quickly

In no particular order...

H1N1 swine flu
Now the reports say WHO exaggerated the threat, influenced by the pharmaceutical industry. Oh really? What a surprise.

Global 'warming' and Climategate
The Gores are splitting, and CBS blames George W. Bush.

Panty-bomber on Christmas Eve last year and terrorists from Yemen (and US military's involvement in that country)
CIA later admitted he was allowed to board the plane under CIA's order. No matter. No one paid attention to that part. All we got out of this shady affair is the pornographic total body scan, thanks in part to the peddling by Michael Chertoff, former Homeland Security chief.

Greece sovereign debt crisis
While Greece decided to sell off national assets to pay the bankers, evil 'speculators' have moved on to the next target, Spain. Italy next? Or France next? I guess they'll need a break before attacking a major country. Maybe take a detour in Hungary?

Heath care insurance "reform" bill actually passed and signed into law
Remember that one, which will force you to purchase insurance you don't want under the threat of fines because it is your right? ('Newspeak' at its best.) Doctors sure seem to remember that well, as an increasing number of them will be calling it quits. Canadians are finding out that the government-mandated health care is not really 'free' of charge. Duh. (Why do they think Newfoundland's minister came to the US for his heart surgery?)

Times Square non-bomber (if you can call that a bomb, you are scientifically challenged)
The news died off even quicker than the panty bomber. As a reward, Pakistan will be targeted by the Obama administration for "unilateral military action".

Second wave of mortgage default due to ARM reset
I don't think that even compares with the much bigger subprime disaster that's coming, via almost insolvent FHA and Ginnie Mae, both of which are fully backed by the US government (i.e. taxpayers).

Goldman Sachs civil and criminal charges
How can they be blamed for what everyone else was doing? By the way, according to Goldman, today's job number was going to be 700K. I guess they were just following the Obama administration's lead (that Friday's job number would be great). How can they be blamed for following Obama?

Audit the Fed
Senator Sanders blinked and watered down his bill in the last minutes to just a slap on the wrist, if that. He blinked on the day of 'flash crash'. Oh it's just a coincidence, isn't it?

'Flash crash' and (unwanted) attention on high frequency trading
Boy this story disappeared so quick. Nothing to see here (which is very true of the stock market - nothing is supporting it but algo bots working in milliseconds), move right along. Nonetheless, the SEC is implementing a new circuit breaker system starting next week, which I suspect will only benefit the high frequency traders more. (More on this later.)

Euro crisis and $1 trillion bailout plan
Remember this? It was announced on May 10 before the markets in Asia opened. The effect of the announcement lasted about 12 hours for euro. The currency closed at about 1.28 (against USD) on May 10. It closed today at 1.1964, the level last reached in 2006, despite incessant central bank intervention in the last 3 weeks.
.
North Korea's threat to go on all-out attack
I think it made the headline for a day or two. Poor Kim Jong Il, upstaged by the Israeli navy commandos only days later.

This must be the "new normal", in which one crisis every few days makes a peaceful, easy week. We would only panic when we have more than 3 or 4 reported crises per day. If they are not reported by MSM, we don't care, do we?

Move along, nothing to see here.

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Employment Grew by 431,000 Jobs in May

411,000 of them were the census workers who may have been counted double or triple (if not more) if this allegation is true ("Census Worker Claims Job Numbers Are Being Inflated", 6/3/2010 Real Clear Politics).

Job creation in the private sector was statistical zero.

The president hails the report as the evidence as "the economy is getting stronger by the day".

He must be wagging his finger at the private sector for not doing enough, like he has done so successfully. (OK, let's have the census every single month.)

The stock market isn't sharing his optimism. Dow Jones Industrial Average is currently down 223 points. When I heard the other day about the 'whisper' number for the job creation in May from Goldman Sachs (which was a whopping 700K, 200K above consensus), I had my doubts, to say the least.

(Sad, isn't it, when you cannot take the words from the government and from the premier crime organization, oops banking institution, in the world at face value?)

I'm sure those algo bots who ended up causing the 'flash crash and dash' in May will try their best to salvage the market today, so that we can have a peaceful weekend. I'm not sure they will succeed.

Investors are running for liquidity (US Treasury) and quality (gold) and away from just about anything else.

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How Oil Breaks Down in Water

Popular Mechanics explains how the oil spill may be taken care of by the ocean.

How Oil Breaks Down in Water (Cassie Rodenberg, 5/7/2010)

"Nature has its own chemical processes to minimize oil's impact in seawater—can human dispersant efforts measure up?

"Initiatives to scrub the Gulf of oil are moving forward. One method includes spraying chemicals to break up and sink globs of oil before the slick spreads to the shorelines—but using chemicals to clean up the ocean is controversial because the environmental consequences are unknown. The sea has its own way of handling the problem, but researchers worry that the water's processes won't act fast enough to save coastal shores from damage. Of course, science informs the debate. Here's what happens on a molecular level when oil hits ocean water.

"As soon as oil hits water, the ocean begins its deconstruction. In fact, the marine environment handles oil much like a human body handles alcohol: destroying, metabolizing and depositing the excessive compounds —in oil's case, hydrocarbons—then transforming the compounds into safer substances, says Stanislav Patin, chairman of the Aquatic Toxicology Committee under the Russian Academy of Sciences and international expert on marine pollution.

"Here's how it breaks down.

"In a 10-minute span after spilling into the sea, 300 gallons of oil can spread to a radius of 160 feet and create a slick a fourth of an inch deep. After that, how far and fast the oil spreads depends upon the water's surface tension—how much the molecules in the water are attracted to one another—and the oil's thickness.

"The day after it enters the water, chemicals in the oil begin to transform, both at the water's surface and farther into the water column. Trace elements lurking in water can speed or slow the process while the sun fuels the breakdown, decomposing even the most complex of oil's components over time. The warmer the water temperature and the more sun exposure, the faster the oil breaks down.

"During the first few days after a spill, between 20 to 40 percent of oil's mass turns into gases, and the slick loses most of its water-soluble hydrocarbons—what's left are the more viscous compounds that slow down the oil's spread across the water.

"When components of crude oil evaporate and its lighter fractions dissolve or are chemically transformed, oil clumps form. These sticky masses are found in all types of water environments, in open and coastal waters and on beaches. They have an uneven shape and can measure tenths of inches to 4 inches in length. The oily masses serve as a base for developing bacteria and one-celled algae, while invertebrates such as crustaceans, resistant to the impact of oil, use them as shelter. These clumps can exist from months to years in enclosed seas and for years in the open ocean—eventually, they degrade." [The article continues.]

So, the ocean, the sun, oil-loving bacteria and algae can break down the spilled oil, given time. As the article points out, the worry is that "the water's processes won't act fast enough to save coastal shores from damage".

The oil blobs have washed ashore, as everyone feared and knew. Why the affected state governments didn't build a barrier to prevent the oil from washing up the shore is a mystery to me. What were they waiting for? A permission to do something from the federal government, whose head has said he's been in charge and took two vacations since the spill (and will probably take more until the relief wells start to work)?

Popular Mechanics has a beautiful picture of oil spill from the air. Vermilion against deep blue - it is artistic.


(Oh I get it now. The color of shirts those clean-up crew were wearing when they suddenly materialized just in time for President Obama visit the other day! They were either wearing blue shirt or red shirt. The color of the spill! They sure looked stylish, with white pants and hats to match the white sand, and no protective masks.)

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Greece to Sell Assets to Pay the Bankers

This is not much different from AIG having had to post a cash collateral to Goldman Sachs, isn't it?

(It was Goldman Sachs, as now widely known, who arranged the derivatives deal on Greek sovereign debt so that Greece could join the euro zone.)

It's a shakedown, and the bankers, particularly the large, multinational ones, always win partly because they have the central banks to backstop them, and partly because they hold (still-)sovereign nations hostage by exposing them to a huge potential liability by the sheer size of their balance sheet. Therefore, the governments scramble to come up with the bailout plans so that these bankers don't lose. Just like the US government did by effectively nationalizing AIG, Fannie and Freddie, and having the Federal Reserve print so much digital money to provide liquidity.

I don't blame if Greeks start a new wave of protests and riots. In fact, I would be surprised if they didn't. They are literally being sold down the river by their own government. It's not that 'privatization' itself is bad; the private sector generally runs things more efficiently and profitably than the pubic sector does. However, it should be done for that very purpose - to run them better. Greece is going to sell ('privatize') the assets in order to pay the bankers and receive the promised bailout money, which is also to be used to pay the bankers.

Greece to Sell Assets to Help Pay Down Deficit
(David Jolly, 6/2/2010 New York Times)

"Greece announced Wednesday its plans for a big sale of state-owned assets, as the struggling government moved to shrink its huge budget deficit and fulfill the terms of an international rescue package.

"The government will sell 49 percent of the state railroad, list ports and airports on the stock market, and privatize the country’s casinos, the Finance Ministry said after a cabinet meeting in Athens. The government will also sell minority stakes in water utilities serving Athens and Thessaloniki, sell 39 percent of the post office, and combine its vast real estate assets into a holding company to be listed on the stock market.

"The sales are intended to help raise 3 billion euros, or about $3.7 billion, from 2011 to 2013. The government agreed to raise a billion euros a year over that time as a condition of the 110 billion euro aid program it received from the European Union." [The article continues.]

I am just wondering when Chinese and Japanese start demanding part of the US debt they hold be actually repaid.

Never say never...

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Japan's Hatoyama Resigns, Nikkei Jumps

as Japanese yen dumps.

Prime Minister Hatoyama, resigned after only 8 months on the job over his campaign finance scandal and his handling of the US base relocation in Okinawa. He was the first prime minister from the Democratic Party of Japan, who won the last year's Lower House election by the populace demanding "change". After endless missteps since his inauguration, he was perceived as ineffective leader when he was steamrolled by the Obama administration into acquiescing to the US base plan. Party Secretary Ozawa, the kingmaker, also resigned from the post.

I have been critical of the Hatoyama administration on this blog as a mere 'copycat' of the US Democrats and the Obama administration. I'd say good riddance for the Japanese. Goodbye Tokyo University and Stanford University elite "space alien" (Hatoyama's nickname).

The news was released on 10:13 AM Japanese Standard Time. Yen tanked on the news, Nikkei jumped. (On USDJPY chart, higher number means weaker yen, just so you know. It shows how many yen it takes to buy one US dollar.)



(Nikkei update)

Euphoria didn't carry into the afternoon session. It's down 40 points for the day..

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America Believes Israel's Account of the Attack on the Aid Convoy to Gaza

It's just a fantasy, it's not the real thing,
But sometimes a fantasy is all you need...

That's Billy Joel. It can be the stock market (particularly when it is going up on thin volume on no news, courtesy of the PPT and algo bots). It can be this:

'We're the only ones who believe them' (Ben Smith, 6/1/2010 Politico)

"A delicate diplomatic maneuver by President Barack Obama to smooth frayed relations with Israel without alienating America’s Arab allies may have been blown out of the water Monday morning by Israel’s botched attempt to enforce the Gaza blockade — and by the lack of condemnation from Washington that followed it.

"For while much about the incident remains unclear, a day of carefully parsed statements from the White House and State Department left at least one irrefutable aftershock: With much of the world expressing fury over the raid, the contrast with Washington’s muted response could not have been more striking.

"“The situation is that they’re so isolated right now that it’s not only that we’re the only ones who will stick up for them,” said an American official. “We’re the only ones who believe them — and what they’re saying is true.”

"The official was referring to Israeli protestations — backed by Israel Defense Forces video — that their solders were attacked by passengers on a ship headed for Gaza with humanitarian aid, when they boarded the ship in what the Israelis concede were international waters." [The article continues.]

And this, also from Politico:

Gingrich: There was ‘no humanitarian crisis’ in Gaza (Laura Rozen, 6/1/2010 Politico)

That's good to know, Newt.

In the meantime, 16 of the 679 activists who have been taken to Israel have refused to identify themselves and thus be deported.

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Yahoo Finance "Strong Job Number on Friday Could Give Market a Boost"

by CNBC links to an article by CNN Money titled "America's Junkiest Cities".

I'm sure it will be corrected shortly, but it's kinda telling...

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Another Unnatural Spike in Euro, Just Another Ordinary Day in the Market

Certain patterns don't happen in nature, and this gotta be one of them. But in the world of global central banks still 'drunk' on Keynesianism, it has become a norm.

Zero Hedge has this chart of euro. That has certainly cheered the stock market, which reversed from the morning low and now is up 66 points on the Dow Jones Industrial Average.

Another Blatant EUR Intervention Leads To 150 pip EURUSD Move In Seconds (Tyler Durden, 6/1/2010 Zero Hedge)

"With all the grace of a drunk Keynesian at an Austrian economists meeting, the Central Banks once again kill the EUR shorts and intervene to prop it up, for a ridiculous 250 pips intraday move. And thanks to Germany's Economics Minister Rainer Bruderle, we now know that the Fed is actively manipulating the FX pairs. Thank you Ben Bernanke for making sure that Atari has some confidence left in the manipulated market, as no humans are left any more."

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Gold-Dispensing ATM Coming to a City Near You

Gold ATM machine - First it was Germany, then Abu Dhabi. Now it is going to Bergamo Airport in Milan, Italy, all major airports in Malaysia, one of Russia's biggest banks and an undetermined location in Turkey.

Gold-dispensing ATMs: Coming to a city near you (5/28/2010 CNN)

"NEW YORK (CNNMoney.com) -- As economic fears drive gold prices to new highs, the creator of a gold-dispensing ATM is attracting attention around the globe.

"Germany-based GOLD to go, which is currently churning out 50 gold machines a month to meet a recent jump in demand, launched its first ATM in Abu Dhabi's Emirates Palace Hotel earlier this month and opened its second in Germany last week.

"The golden ATM's next destinations are the Bergamo Airport in Milan, Italy, all major airports in Malaysia, one of Russia's biggest banks and an undetermined location in Turkey.

"By making gold investing as easy as buying a candy bar from a vending machine, GOLD to go hopes to attract average buyers to the gold market.

""We are going to make gold public with these machines," said Thomas Geissler, CEO of Ex Oriente Lux AG, which owns GOLD to go. "The prices are so easy to control that we're going to de-mystify gold and make it easier for anyone to buy it."

"GOLD to go's ATM looks like a vending machine and dispenses gold coins and bars weighing up to one ounce at prices updated every 10 minutes based on the real-time spot price of gold." [The article continues.]

The article includes (almost obligatory) detractors; one of them is Jon Nadler of Kitco Metals. He is surprisingly a gold basher on the popular gold site. He doesn't do that openly, but his putdowns are hard to miss. He says it is a gimmick, not for serious (big-money) investors because you cannot "deposit" your gold. He also says the premium charged by GOLD to go may deter the investors.

According to the article, GOLD to go's gold could be had for $1284.13 per ounce, when the spot was $1214. That would be 5.777% premium. His employer, Kitco, sells $1243.80 for 1-ounce gold bar, when the spot gold is $1218.80, 2.051% premium. However, if you add shipping, handling and insurance fees plus $4 surcharge for $1000 worth of gold, then 1-oz gold bar from Kitco would cost $1277.80, 4.841% premium. For small investors, the difference in premiums, when they consider the total cost of acquiring gold, may be negligible.

Greeks have been buying British Sovereigns at 40% premium. The Austrian Mint almost ran out of gold after Germans started buying gold bars and coins in panic. (It mints one of the popular gold coins, Philharmonic.) Gold may just become de facto money, chosen not by the fiat-loving governments but by ordinary citizens of the world, no matter what the so-called experts say (that gold is just another bubbly commodity, that you can't eat gold, blah blah blah).

Who would you trust? The governments and their experts who didn't see any of the crises in the past 2 years coming? Or people buying gold to preserve their wealth?

Got gold?

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Weapons Seized by Israeli Navy Commandos

You can view the weapons found on the convoy ships at this site.

Knives, including what look like kitchen knives
Metal pipes
Sling shots
Hammers, wrenches
One Molotov Cocktail

The first two were apparently used by the activists to fight the Israeli troops.

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Marc Faber: We Ain't Seen Anythin' Yet

at the Mises Circle on Austrian economics and finance. The 1-hour video was posted on Lewrockwell.com, "The Coming Economic Catastrophe" (5/31/2010).

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Israeli Troops Were 'Attached' by Knives and Metal Pipes

and by the gun that one of the civilians on the attacked ship grabbed from an Israeli soldier.

The attack, according to UK's Daily Mail Online, was in international waters.

News blackout has been imposed by the Israeli government.

For more, "Israeli commandos gun down 19 peace activists in raid on Gaza ships with 28 Britons on board" (5/31/2010 Daily Mail). It has pictures of the attack, and the video clearly shot from the Israeli helicopter hovering above.

The video opens with these indignant words: "Demonstrators Aboard the Mavi Marmara [Turkish ship] Use Violence Against Israeli Navy Soldiers"

(Chutzpah, anyone?)

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Israeli Navy Storms Gaza Aid Ship, Several Passengers Killed

Just heard on BBC News.

Israeli forces storm Gaza aid ship (5/31/2010 BBC)

"The Israeli navy has stormed at least one of a convoy of ships carrying humanitarian aid to the Gaza strip, amid reports of casualties on board.

"Some reports say two people have been killed and about 30 injured. Israel has declined to comment.

"The exact location of the interception is unclear. Israel had warned the ships not to enter its territorial waters.

"The ships are carrying 10,000 tonnes of aid to the Gaza Strip in an effort to break an Israeli blockade.

"Turkish TV pictures taken on board the Turkish ship leading the flotilla show Israeli soldiers fighting to control passengers.

"The footage showed a number of people, apparently injured, lying on the ground. The sound of gunshots could be heard. It is not clear whether the fighting is ongoing.

"Al-Jazeera TV reported from the same ship that Israeli navy forces had fired and boarded the vessel, wounding the captain.

"The Al-Jazeera broadcast ended with a voice shouting in Hebrew, "Everybody shut up!". " [The article continues.]

Turkish TV now confirms 10 people are dead, so does Israeli TV Haaretz, according to this site.

Haaretz also says more than 60 people wounded. Israel has seized the cargo (humanitarian aids to Gaza), and is building a detention center for the foreigners on the ships who would refuse deportation.

It's not clear whether the convoy was on international waters when the Israeli navy attacked.

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