GI SPECIAL 5I21:
[Thanks to Mark Shapiro, who sent this in.]
Kiss The Bankrupt Empire Goodbye:
Fears Of Dollar Collapse Grow As Saudis Take Fright
20/09/2007 By Ambrose Evans-Pritchard, International Business Editor; Financial Times
Saudi Arabia has refused to cut interest rates in lockstep with the US Federal Reserve for the first time, signalling that the oil-rich Gulf kingdom is preparing to break the dollar currency peg in a move that risks setting off a stampede out of the dollar across the Middle East.
“This is a very dangerous situation for the dollar,” said Hans Redeker, currency chief at BNP Paribas.
“Saudi Arabia has $800bn in their future generation fund, and the entire region has $3,500bn under management. They face an inflationary threat and do not want to import an interest rate policy set for the recessionary conditions in the United States,” he said.
The Saudi central bank said today that it would take “appropriate measures” to halt huge capital inflows into the country, but analysts say this policy is unsustainable and will inevitably lead to the collapse of the dollar peg.
As a close ally of the US, Riyadh has so far tried to stick to the peg, but the link is now destabilising its own economy.
The Fed’s dramatic half point cut to 4.75% yesterday has already caused a plunge in the world dollar index to a fifteen year low, touching with weakest level ever against the mighty euro at just under $1.40.
There is now a growing danger that global investors will start to shun the US bond markets.
The latest US government data on foreign holdings released this week show a collapse in purchases of US bonds from $97bn to just $19bn in July, with outright net sales of US Treasuries.
The danger is that this could now accelerate as the yield gap between the United States and the rest of the world narrows rapidly, leaving America starved of foreign capital flows needed to cover its current account deficit - expected to reach $850bn this year, or 6.5% of GDP.
Mr Redeker said foreign investors have been gradually pulling out of the long-term US debt markets, leaving the dollar dependent on short-term funding.
Foreigners have funded 25% to 30% of America’s credit and short-term paper markets over the last two years.
“They were willing to provide the money when rates were paying nicely, but why bear the risk in these dramatically changed circumstances? We think that a fall in dollar to $1.50 against the euro is not out of the question at all by the first quarter of 2008,” he said.
“This is nothing like the situation in 1998 when the crisis was in Asia, but the US was booming. This time the US itself is the problem,” he said.
Mr Redeker said the biggest danger for the dollar is that falling US rates will at some point trigger a reversal yen “carry trade”, causing massive flows from the US back to Japan.
Jim Rogers, the commodity king and former partner of George Soros, said the Federal Reserve was playing with fire by cutting rates so aggressively at a time when the dollar was already under pressure.
The risk is that flight from US bonds could push up the long-term yields that form the base price of credit for most mortgages, the driving the property market into even deeper crisis.
“If Ben Bernanke starts running those printing presses even faster than he’s already doing, we are going to have a serious recession. The dollar’s going to collapse, the bond market’s going to collapse. There’s going to be a lot of problems,” he said.
The Federal Reserve, however, clearly calculates the risk of a sudden downturn is now so great that it outweighs dangers of a dollar slide.
Former Fed chief Alan Greenspan said this week that house prices may fall by “double digits” as the subprime crisis bites harder, prompting households to cut back sharply on spending.
For Saudi Arabia, the dollar peg has clearly become a liability. Inflation has risen to 4% and the M3 broad money supply is surging at 22%.
The pressures are even worse in other parts of the Gulf. The United Arab Emirates now faces inflation of 9.3%, a 20-year high. In Qatar it has reached 13%.
Kuwait became the first of the oil sheikhdoms to break its dollar peg in May, a move that has begun to rein in rampant money supply growth.
Fed chief Ben Bernanke
IRAQ WAR REPORTS
New York Soldier Killed In Baghdad
U.S. Army Spc. Jonathan Rivadeneira, of Jackson Heights, N.Y., 22, died on Sept. 14, 2007, in Baghdad, after an improvised explosive device detonated near his vehicle. Rivadeneira was assigned to the 6th Squadron, 9th U.S. Cavalry, 3rd Brigade Combat Team, 1st Cavalry Division at Fort Hood in Texas. (AP Photo/Illinois Lt. Gov. Pat Quinn’s Office)
U.S. Soldier Killed In Diyala, Another Wounded
09-21-2007 Multi National Corps Iraq Public Affairs Office, Camp Victory RELEASE No. 20070921-04
TIKRIT, Iraq – A Task Force Lightning Soldier was killed in Diyala Province Thursday when an explosion occurred near his vehicle.
Another Soldier was wounded and transported to a Coalition medical facility for treatment.
One Romanian Soldier Killed, Five Wounded Near Tallil
Sept. 21 (Xinhua)
One Romanian soldier was killed and five others were wounded early on Friday in Iraq, the Defense Ministry of Romania said.
Defense Minister Teodor Melescanu said the Romanian soldier was killed by the explosion of a makeshift device when he was on a patrol mission outside the Tallil military base. Another five Romanian troops were wounded in the blast when traveling in an armored personnel carrier.
Soldier Dies In “Non-Combat Related” Incident
09-21-2007 Multi National Corps Iraq Public Affairs Office, Camp Victory RELEASE No. 20070921-05
TIKRIT, Iraq – A Soldier assigned to Task Force Lightning died in a non-combat related incident in Kirkuk province Sept. 20.
Falls County Fallen Hero
September 21, 2007 By Christine Kern, Staff Writer, The Marlin Democrat
On September 5, Corporal William “Billy” T. Warford III, 24, of Lott was killed supporting Operation Iraqi Freedom in Balad, Iraq.
He was assigned to the 215th Brigade Support Battalion, 3rd Brigade Combat Team, 1st Cavalry Division, out of Fort Hood. His family misses him, but say that Warford would want them to take comfort in knowing that he was fighting for a cause, his country and his family. “He did it so we didn’t have to,” Crystal Bethke, his sister, said. “It was just his time.”
Letters from some of the men Warford fought with reveal that he was loved and revered by all.
His wish for them was to go on and remember to continue fighting, he will be there by their side. His family retell stories about the last time he was home for leave, about how he loved watching the kids in Iraq and handing them candy.
Warford was a tank mechanic, but changed military occupations after being asked to join on patrols with the unit.
Warford leaves his wife, Shea Warford, and two children, Abbey Warford, 6 and Anthony Warford, 2, along with his mother, Jere Beal and father William Warford II and his sister, Crystal and husband Michael Bethke.
Those he left behind know he is still riding along side his brothers in Iraq, looking out for them until they too can come home.
ENOUGH OF THIS SHIT;
COME HOME NOW
Weary US “surge” troops from 1-30 Infantry Battalion return to their patrol base following a search for illegal weapons along the Tigris river, south of Baghdad, 02 September 2007. (AFP/File/David Furst)
AFGHANISTAN WAR REPORTS
French Soldier Dies In Attack In Kabul
September 21, 2007 Sayed Salahuddin, Reuters
A car bomber targeted a convoy carrying NATO troops on Friday in the Afghan capital, killing one French soldier of the alliance and wounding several Afghan civilians, police said.
A Taliban spokesman said the attack was carried out by a member of the group which is fighting to oust the Afghan government and drive out foreign troops from Afghanistan.
DV Grad: ‘A True Soldier, Warrior And Infantryman’
Pfc. Mykel Miller: Photo illustration by Emily Behrendt
September 14, 2007 By Doug Murphy, Ahwatukee Foothills News
During a security patrol in Afghanistan, Mykel Miller, a 2006 graduate of Desert Vista High School, brought an Etch-A-Sketch to a rural school to entertain students by drawing pictures. “He was mobbed by Afghan children,” wrote Sgt. 1st Class Steven Bowers of Coolidge, Miller’s platoon sergeant in Afghanistan. “It was like magic to them. They seemed more amazed by its ability to erase by shaking it than anything, and Miller relished showing it to Afghan children,” said Bowers, the younger brother of former Arizona State Sen. Rusty Bowers.
Miller, 19, a private first class, was killed instantly Sept. 6 in Zabul Province when his Humvee rolled over an improvised explosive device. Also wounded in the same attack was the Humvee gunner, PFC Joseph Gracia of Phoenix.
Both were in the Arizona National Guard’s 1st Battalion 158th Infantry, which has been in Afghanistan since March.
A nearby Romanian unit responded to the attack on the Arizona Guardsmen and Sergeant Major Aurel Marcu, 31, died when the armored personnel carrier he was riding also ran over an IED while rushing to help. Two other Romanian soldiers were also injured in that attack.
Miller is the second local high school graduate to die in the war on terrorism. In 2005 Marine Lance Corporal Christopher Poston, 20, a 2003 graduate of Mountain Pointe High School, died in Hit, Iraq, in a vehicle accident.
At Desert Vista, the staff remembered Miller’s sense humor and big smile.
“That’s the thing I’ll never forget, the smile that had,” said Shawna Thue, now a Spanish Teacher at Desert Vista, who called Miller “full of life.”
Miller joined the Arizona National Guard after graduation and was called into active duty in January with the rest of the battalion. They trained at Ft. Benning, GA, before shipping out to Afghanistan.
Miller was the youngest solider in 2nd Lt. Brett Yeater’s platoon, but Yeater said he could see the Ahwatukee Foothills teenager growing into a man during the training and deployment in Afghanistan.
“He was admired and respected by all of the soldiers in the platoon. He was a true soldier, warrior, and Infantryman,” wrote Yeater from Afghanistan.
But he was also an active teenager.
“Mykel was a cocky, good-humored young man. Always quick with a comeback,” wrote his platoon sergeant, Bowers.
And, on occasion, he would entertain the rest of the platoon during the long stretches of boredom that are part of the life of an infantryman.
“Miller would frequently play music for the rest of us, and the entire platoon would chuckle when he would jump upon the hood of the Humvees and begin dancing,” said Yeater, who is from Tucson.
Bowers wrote that Miller would talk endlessly about motorcycles and tease his squad leader, Phoenix Police Officer Marcell Cox, that when he got back to Phoenix he would speed by Cox and see if he could catch him.
The 600 citizen-soldiers in the battalion are the largest overseas deployment of Arizona National Guardsmen since World War II. They come from Ahwatukee Foothills, Phoenix, the East Valley, Tucson and other parts of Arizona.
Also in Afghanistan is the Arizona National Guard’s 1st Battalion of the 258th Aviation Regiment, flying Apache helicopters. That unit is also made up of 500 men and women from Phoenix, Tucson and rural communities in Arizona.
A wake for Mykel Miller is scheduled on Monday from 6 to 8:30 p.m. at Corpus Christi Catholic Church, 3550 E. Knox Road. The funeral mass is set for 9:30 a.m. Tuesday, Sept. 18 at Corpus Christi.
A vehicle procession will leave Corpus Christi at 2 p.m. for the graveside services and internment at the National Cemetery, 23029 N. Cave Creek Road, in north Phoenix.
The family has asked that in lieu of flowers, mourners donate to the Pfc. Mykel Miller Memorial Fund at the Parish of Saint Benedict, 16223 S. 48th St., Phoenix, 85048.
TROOP NEWS
THIS IS HOW BUSH BRINGS THE TROOPS HOME:
BRING THEM ALL HOME NOW, ALIVE
The casket of Army Cpl. Jason Hernandez, Streetsboro, Ohio, Sept. 17, 2007. Hernandez was killed by a roadside bomb on Sept. 7, his 21st birthday, while serving in Mosul, Iraq. (AP Photo/Amy Sancetta)
Double Betrayal:
1. The Traitor Gates Moves To Stop More Dwell Time For Combat Troops
September 20, 2007 BuzzFlash.com
When it comes to the cynical and phony mantra of the GOP to “support our troops,” you would think the Pentagon would be Ground Zero for taking care of our GIs. Apparently not.
Secretary of Defense Robert M. Gates took to the airwaves to denounce legislation to ensure that our soldiers receive appropriate training, rest, and rotation. On a Sunday talk show, Gates said “he would recommend a veto of a Senate proposal that would give troops more rest between deployments in Iraq, branding it a dangerous ‘backdoor way’ to draw down forces.”
Talk about betraying our troops; this is what it looks like.
MORE:
2. The Democrat Traitors Who Run The Senate Kill The Proposal Rather Than Debate It
September 19, 2007 Associated Press
The Senate blocked legislation today that would have regulated the amount of time troops spent in combat.
The 56-44 vote was four votes short of reaching the 60 needed to cut off debate.
The legislation would have required that troops spend as much time at home training with their units as they spend deployed in Iraq or Afghanistan.
MORE:
The Troops And Their Families Pay The Terrible Price Of Endless Deployments:
“In Vietnam, The Standard Tour Of Duty Was 12 Months”
“He Won’t Go. We’ve Already Decided As A Couple. We Will Not Do This Again”
“One month (extension) stretched into two, two months stretched into three,” Kelly recalled. “… The unknowing, the guessing, that makes you crazy. It makes the soldiers crazy.”