US Forces on Alert in Response to Libya

This could be quite an intelligence trove for the Chinese should the U.S. be called to action in Libya, given the US Military is now reliant upon their communication satellites.

WASHINGTON – Marines and other U.S. forces in Europe are on a heightened state of alert in response to a deteriorating security situation in the Libyan capital of Tripoli, two U.S. officials said Friday.

The alert order applies to a U.S. special operations team based in Stuttgart, Germany, as well as a Marine group of air and ground forces based in Moron, Spain, according to the officials, who were not authorized to discuss the matter publicly and spoke on condition of anonymity.

Spain jobless rate hits record 27.2%

Spain’s National Statistics Institute says the country’s unemployment rate shot up to a record 27.2 percent in the first quarter of 2013.

The agency said Thursday the number of people unemployed rose by 237,400 people in the first three months of the year compared to the previous quarter, taking the total to 6.2 million.

The huge sums poured into the global financial system by major central banks have eased bond market pressure on Spain, but the cuts Madrid has made in spending to regain investors’ confidence have left it deep in recession.

What happened to the European dream?

The European Union no longer exists, at least not as we know it. And the question is not what will be the form of the new Union, but rather why this Europe, which was the focus of so many of our dreams no longer exists. The answer is simple: today, all of the pillars that served to build and justify the existence of the European Union have collapsed.

Chief among these was the memory of the Second World War. A survey of German secondary school students in the 14-16 age bracket, which was published a little over a year ago, showed that a third of these young people did not know who Hitler was, and 40 per cent were convinced that human rights had been respected to an equal degree by every German government since 1933. This in no way implies that there is a nostalgia for fascism in Germany. No, it simply means that we now have to contend with a generation that has nothing to do with this history. Today the conviction that the EU continues to derive legitimacy from its roots in the war is in an illusion.

Gerald Warner: Cyprus caught in proxy war between old enemies

When Angela Merkel – to cut out the middlemen – feels entitled to arrest the bank accounts of individuals and institutions in another country and help herself to 10 per cent of their deposits, then the rule of law has become a folk memory in German-occupied Europe. Is this what was meant by negative interest rates? The sheer irresponsibility of risking a bank run, not just in Cyprus but ­potentially in Greece, Spain, Portugal, Italy and everywhere else the dominoes might ­topple, betrays the stupidity of those ­shoring-up the deluded euro project.

Cyprus—the Russian Angle

Creating a foundation to project power through the Mediterranean and into the Middle East by wrestling Cyprus out of Russian hands is the goal.

Sometimes a non-mainstream observer of the world scene comes up with real food for thought. Such was the case this week when British blogger Alexander Boot reflected on the actions of Russia and Germany in regard to the Cyprus situation.

Boot asks an obvious question, “The question is why the ECB and IMF, which is to say Germany, made this raid a precondition for the bailout of Cyprus? After all, they were more lenient when bailing out Portugal, Ireland, Greece and Spain. Why single out Cyprus for rough treatment?” (March 19).

Attending to his own question, Boot retorts, “The answer is obvious: Cyprus is a floating refuge and laundromat for dirty Russian money.”

Europe Riots Against … What?

Across Europe, the people are protesting. But they’re not fed up with a particular party or person. They’re rallying against the whole political system.

Between 100,000 and 200,000 people turned out to protest in Bulgaria last Sunday. That’s a lot of people for a small country—around 2 percent of the whole population. “Bulgarians rarely overcome their apathy to go out on the streets,” notes the EU Observer. “They don’t usually believe they can make a difference by protesting.”

What prompted them to turn out this time? The government had already stepped down a few days earlier. They were protesting against no one.

WARNING: the EU Crisis is BACK and Will Be Worsening in the Coming Weeks

As the article hits out, the only thing propping up the European financial system are politicians — likely the same for the U.S., South American and Asian economies as well. This means they are the last line of defense, armed with nothing more than half-truths and artificial propping of the economies via central banks to keep the citizens nice, happy, calm and in the dark. If this is the case, it shouldn’t be long before a collapse comes. One could say a litmus test for the article would be to watch the reaction of the markets when another scandal breaks out among the said politicians, at home or abroad.

I want to issue a major warning to investors: the EU Crisis is going to get worse in the coming months.

I realize that most investors and analysts believe that the EU Crisis is over. Then think that because the S&P 500 is closing in on its all-time highs that things are fine in the system.
They are wrong.

The only item that held Europe together in 2012 was the credibility of EU politicians and ECB President Mario Draghi. Please note that nothing fundamental improved for the EU’s financial system: EU GDP has since re-entered a recession and EU unemployment has a hit a new record.

Indeed, the only reason things even looked better was because various Government engaged in massive interventions. In the case of Spain, this included raiding 90% of their social security fund to buy Spanish bonds so that yields would fall.

Spain Plunders 90% Of Social Security Fund To Buy Its Own Debt

With Spanish 10Y yields hovering at a ‘relatively’ healthy 5%, having been driven inexorably lower on the promise of ECB assistance at some time in the future, the market has become increasingly unsure of just who it is that keeps bidding for this stuff. Well, wonder no longer. As the WSJ notes, Spain has been quietly tapping the country’s richest piggy bank, the Social Security Reserve Fund, as a buyer of last resort for Spanish government bonds - with at least 90% of the €65 billion ($85.7 billion) fund has been invested in increasingly risky Spanish debt. Of course, this is nothing new, the US (and the Irish) have been using quasi-government entities to fund themselves in a mutually-destructive circle-jerk for years – the only difference being there are other buyers in the Treasury market, whereas in Spain the marginal buyer is critical to support the sinking ship. The Spanish defend the use of pension funds to buy bonds as sustainable as long as it can issue bonds – and yet the only way it can actually get the bonds off in the public markets is through using the pension fund assets. The pensioners sum it up perfectly “We are very worried about this, we just don’t know who’s going to pay for the pensions of those who are younger now,” or those who are older we would add.

Via Wall Street Journal: Spain Drains Pension Fund In Borrowing Spree

Spain has been quietly tapping the country’s richest piggy bank, the Social Security Reserve Fund, as a buyer of last resort for Spanish government bonds, raising questions about the fund’s role as guarantor of future pension payouts.

Spain’s house prices to fall another 30pc as glut keeps growing

Spain’s property slump will deepen for much of the next decade, and tracts of buildings along the Mediterannean coast will have to be demolished, the country’s top consultants have warned.

…

“The market is broken,” said Fernando Rodríguez de Acuña, the group’s vice-president. “We calculate that there are almost 2m properties waiting to be sold. We have made no progress at all over the past five years in clearing the stock,” he said.

“There are 800,000 used homes on the market. Developers are sitting on a further 700,00 completed units. Another 300,000 have been foreclosed and 150,000 are in foreclosure proceedings, and there are another 250,000 still under construction. It’s crazy.”

…

 

EU Needs Military to Become a Superpower, Says Poland

Although it’s going through a crisis, the new economic infrastructure groundwork is already being laid in for the next phase. The political differences are being worked out between nations who are willing to forge a new alliance and merge economic contributions. Some nations within the EU will stay, some will be shed. Many will be surprised to hear that China won’t be the next world leader. Enter the next superpower and make way for the United States of Europe — a last day’s 10 nation bloc with an army that no man has ever witnessed since the beginning of time. Today it’s being called upon and tomorrow it shall be formed.

Europe needs a new military structure to coordinate its combined operations, five EU nations said in a joint communique after a meeting in Paris on November 15. The foreign and defense ministers of France, Germany, Italy, Poland and Spain published the document to “confirm our readiness to foster an ambitious European policy in the field of security and defense.”

Poland’s Foreign Minister Radek Sikorski was surprisingly clear on his reasons for wanting a military. “If the EU wants to become a superpower, and Poland supports this, then we must have the capability to exert influence in our neighborhood. … Sometimes we must use force to back our diplomacy,” he said, according to the EU Observer.

EU Plans to Create New Military Headquarters

France plans to use the European Union’s military mission in Mali as a “Trojan horse” to create an EU military headquarters, the Telegraph reported November 11, citing a “senior French Defense Ministry source.” France is also planning a “major offensive” to stop individual nations from being able to veto defense issues.

The report comes ahead of a meeting between Germany, Italy, France, Spain and Poland in Paris to discuss how to move forward on European defense.

Welcome to Berlin, Europe’s new capital

You’re not only looking at the de facto leader of Europe, which still most people don’t realize it for what it is, but you’re also looking at the next potential world leader. Critics can laugh at the notion, but when one is ahead of the curve, today’s jokes are tomorrow’s reality.

Berlin does not feel like an imperial city. The new government buildings – the chancellor’s office, the Bundestag and the foreign ministry – have all been designed with plenty of glass and natural light, to emphasise transparency and democracy. The finance ministry is, admittedly, housed in the old headquarters of the Luftwaffe. But most of the grandest architecture – Unter den Linden and the Brandenburg gate – is a legacy of the Prussian kings. Modern Berlin presents a more welcoming face, and has become a magnet for tourists and teenagers.

Yet while the German capital has deliberately eschewed the trappings of imperial power, the fact is that Berlin is increasingly the de facto capital of the EU. Of course the EU’s main institutions – the commission and the council – are still based in Brussels. But the key decisions are increasingly made in Berlin.