Archive for December, 2007

December 27th, 2007

Murdered: Benazir Bhutto

Posted in Geopolitics, Mideast & Oil by ed

She was known as Happy Bhutto at Harvard.

Michael Winterbottom’s recent film about Daniel Pearl (the WSJ journalist murdered in Pakistan a few years ago) — A Mighty Heart — gives a sympathetic portrait of good people trying to hold the country together.

I sense that for such people Bhutto was John F. Kennedy, a sophisticated ray of hope.

Pakistan was a basket case politically from birth. Got worse during the Soviet-Afghan war, as the US used Pakistan as the staging area of its war on the Soviet forces; the CIA bred the Paki secret police (ISI), as decades before it had bred Iran’s Savak. In this mileau both Al Qaeda (such as it is and was) and the BCCI octopus were born and raised.

When post 9/11 Bush-Cheney embraced Musharraf a la mode mafiosi, a fissure opened, in Paki politics and society, that perhaps will never seal. The state for many practical purposes was already partitioned before Bhutto’s murder today. Will it lead to more or less “unity”?

I remember feeling sorry for Musharraf during the months after the 9/11 attacks: a man compelled by force of circumstances to Seem Tough for television while sitting on a time bomb.

It seems the most dangerous place on earth. [Oops, I see in the 12/29 NY Times that Joe Biden has been saying this repeatedly on the campaign trail. Well, I concur...] Who can have any confidence about its nuclear weapons? Perhaps one will find its way to New York or Washington or Houston or Tel Aviv, perhaps sooner now than later.

December 27th, 2007

737 wing tip knocks over a truck

Here’s a clip of the tip of the wing of a trundling 737-700 knocking over a truck without pause, and with hardly any damage to the wing (see closeup late in the clip).

Recall that the wings of the 757-200 — a heftier jet (255,000 lbs vs 155,000) — that supposedly flew into the Pentagon on 9/11 supposedly folded up like closing scissors upon hitting the concrete walls and disappeared into a 16-20 foot wide hole (there to disintegrate), with little damage to the walls where the length of the wings and the engines made contact.

Wing span 124 feet.

December 25th, 2007

President of France has a Merry Christmas


December 19th, 2007

Our Man in Moscow

Posted in Geopolitics, Reading by ed

Time Mag has named Vladimir Putin its Man of the Year. Interesting.

He gave a remarkable speech this past May, quoting and broadly echoing FDR’s famous “quarantine the aggressors” speech at Chicago in 1937. The theme then and now was international law, such as it is, and the need of civilized powers to band together against the aggressors. For FDR in 1937 the targets were Germany and Japan (which had just invaded China). For Vlad seventy years later, the target was the United States.

Here is Putin’s speech. Here is Roosevelt’s. Remarkable, eh what?

The Time piece (linked above) repeatedly reports that Putin has little charm. Yet if one watches the video interview, one sees humor, charm, intelligence, and an ability to converse on his feet reminiscent of Bill Clinton.

One can’t help but compare … The United States is led by a prairie apparatchik stuffed with paranoia and small ideas, operating behind a folksy yankee/cowboy schiz competent to run a tavern. Russia is led by a competent statesman.

Here is a piece capsulating Putin’s rise and the gnat’s life of democracy in Russia by Sergei Kovalev, who labored in the vineyards of Moscow as a democrat in the 90s before things fell apart.

Kovalev says he knows no one who likes Putin personally, but that his grip on the reins seems secure for the duration. Current plans are for Putin to move from the presidency to become prime minister next year.

My own affections for Putin are rooted in my fear and loathing of Bush-Cheney. Since we cannot control the latter ourselves, we need somebody overseas to do it for us. Our Man Vlad.


December 18th, 2007

Go see: I’m Not There

Posted in Movies, Music by ed


The Dylan film is beginning to show across country.

Should/must be seen in a theater — the music and images flow and surround.

Tell me what you think. (My thoughts linked above)

December 18th, 2007

Pfaff re U.S. torture

William Pfaff, one of our best thinkers about foreign affairs, seems to have been blacklisted in stateside newspapers, after many years with the L.A. Times, because, one imagines, his views are so sound and so at odds with the drip of the mainstream media.

Curiously, however, the NY Times Company continues to publish his column in The International Herald Tribune (which it owns), in Paris.

Here are his thoughts about the Shock, Shock in D.C. re not so much that the CIA tortures people but that they burnt some video.

His longer pieces do appear now and then in The New York Review of Books (our best periodical).

Here, for example, on the Bush-Cheney warmongery redux post 2006 elections. An interesting discussion but one that proceeds, in my humble opinion, from the false premise that the makers of the Iraq war were motivated by desire to bring freedom and democracy to the people of that hard land.

December 16th, 2007

Lone Gunmen episode that forecasted 9/11 attack on WTC

I had heard about this Lone Gunmen episode before but never saw any of it until today. It was actually the series pilot, and aired March 4, 2001.



The story was about terrorists seizing control of an airliner with remote avionics, and flying it into the World Trade Center.

And it turned out that the terrorists were native: a “faction” within the U.S. national security apparat.

Their motive: to restart the cold war arms merchandizing. This seems (IMHO) the only element of the forecast to have been a bit off.

Recall Rice’s statement while testifying before the 9/11 Commission that no one in U.S. intel had anticipated terrorists flying jetliners into buildings. Seems the Octopus doesn’t watch television.

The series was an X-Files spinoff featuring the cool nerds (known to friends as the Lone Gunmen) who’d occasionally hack computers to aid the X-Files FBI paranormal team.

The X-Files (for those even less familiar with TV than me) was mostly about aliens in league, since Roswell, with certain Washington powers.

Here’s something: Journal of 9/11 Studies

December 16th, 2007

Hamlet: the first novel

Posted in Death, Reading by ed

1. Several years ago, while ruminating upon the question of who wrote Shakespeare, I realized that Hamlet is not a play, but a novel.

This is why it’s all but impossible to satisfactorily stage and perform.

And why, nevertheless, with its bounty of psychology and its inviting hero (the stuff of novels), it’s so popular and beguiling (provoking more commentary over the centuries since Gutenberg than any piece in English aside from the bible).

2. The first part of Don Quixote was offered for publication in 1604, according to this (oft dubious) source.

Defoe’s Robinson Crusoe, pub’d in 1719, is often named as the first novel in English.

Same source observes “The era of “romances” had ended before 1719 and “novels” had been appreciated as an alternative as early as 1613, the date when the Novelas Exemplares were published.”

It would seem, then, that Hamlet was the first novel.

Wonder who wrote it …

December 15th, 2007

Krugman re banking crisis

Posted in Money by ed

The most excellent Mr Krugman pens a simple overview of what’s wrong with the banks.

December 12th, 2007

David Shulman book on waging peace in Palestine

Posted in Mideast & Oil, Reading by ed

See the New York Review of Books piece on Shulman’s new book. One’s heart goes out …

December 12th, 2007

Bilderbergers nixed Iran attack / Nationalism

Posted in Geopolitics, Mideast & Oil by ed

1. Daniel Estulin is the author of the bestselling European book on the Bilderbergers (finally out this fall in the U.S.). He’s been reporting on the conferences since the early 90s. His reports are based on info from BB members who leak because they think it should be public.

Here’s a radio show he did a few weeks ago, during which he says among other things that the Russian, Chinese and French BB members “drew a line” around Iran at the 2007 meeting in Ottawa.

He concludes that the BB consensus is against an attack, but emphasizes the Americans (in June) still wanted to attack. He compares the situation to 2002 re the proposed attack on Iraq, which Euro BB members stridently opposed at that year’s meeting. He guesses the Americans will not attack, but also warns that if they do there will be “blood in the water.”

Offered as context for the rather surprising events last week — with the US intel octopus abruptly estimating that Iran stopped its nuclear weapons program in 2003, and Bush the next day flailing at a press conference trying to rescue the casus belli.

2. If you listen to Mr Estulin’s interview, you will find he is a rather doctrinaire Nationalist. I don’t share his perfect confidence that the nation-state is (historically has been) the best guarantor of the rights of individuals.

The Ottoman empire, for example, multinational, multireligious in flesh and law, was a more temperate administrator of the Balkan peninsula than the Byzantine, Bulgar and Serbian christian kingdoms that preceded it, and the nation-state “structure” that followed its collapse. (And it seems war is again brewing in the Kosovo region of the state of Serbia, where muslim Albanians are in the large marjority.)

As for external relations: The world wars were caused by nation-states shanghaied by militarists. And the world-shaking turmoil in the mideast is in good part an effect of the creation of a nation-state there in 1948 with a war of conquest (which has never ceased), and, in particular, of the seizure by that new nation-state of multicultural Jerusalem.

The term “nation-state” is so broadly misused that perhaps it’s worth defining. Klutzes everywhere seem to use it as a synonym of “state.”

All one needs is to recall that “nation” means people, not a polity. The Cherokee Nation is the body of Cherokee people, not whatever political structures they may have erected.

A nation-state then is a state that unites a People in a single polity. And the big move in the 19th century, when this modern Nationalism seized Europe’s mind, was to define a People by language — an idea that feels right, yet has proven problematic in many applications.

Italy, for example — a curious case. The language is more or less the same tongue throughout the peninsula (Sicily excluded), but whether the Italian Nation yet exists is a question. The “unification” in the late 19th century was a conquest, by the Piedmontese in the far north, of the south. And for the past two decades there has been a movement in the north to secede from the state that Garribaldi cobbled together with a few flashy victories on the field of battle. Northern Leaguers resent the corruption and poverty of the southern culture, which they consider foreign.

People can still be found who proudly call themselves not Italians but, eg, Eugubbini (the people of Gubbio, in Umbria). Or Tadese (of the nearby hamlet of Gualdo Tadino). Bolognese. Milanese. People in Sicily still think of Rome as a foreign occupier. Those in Naples, mezzo mezzo.

Young Churchill famously predicted the unprecedented violence of the world wars as a consequence of the Nationalist revolution in Europe. It seems the passions of people are more easily manipulated and harnessed for war by a Nationalist government than a multinational one that bears less fleshy relationship to the individuals throughout the state.

How odd this strikes our ears in 2007, after thirty years (in the States) of Identity Politics. Who might think that the least dangerous government may be one composed of aliens rather than one’s own quite specific type, down to gonads, skin tone and appetites?

Money and mad scientists are the central problems. Whether these can be controlled better with (and within) nation-states or multinational states or a world government seems a question not susceptible to a priori reasoning. Rather, working democracy seems the essential ingredient (and we certainly don’t have it at the federal level in the U.S.).

Purists of Nationalism theorize that the ideal structure is a nation-state that unites all the individuals of the Nation under one sovereign.

Consider modern German. Formed as Bismarck gathered skeeteen hundred german-speaking principalities under a single king. The nazis then perfected the nation-state by seizing neighboring lands where German speakers predominated: Austria, the Sudetenland of Czech-oslovakia, and bits of western Poland.

But that meant war, which led to the division of the nation-state into entities redrawn based on other doctrines and realities consequent to the Soviet Union’s possession of Berlin and most of Europe east of the Elbe. In 1991 the nation-state of Bismarck was reconstituted.

There seems little reason to characterize the United States as a nation-state. We were from the start multinational, and immigration makes us more so decade by decade, particularly since Identity Politics have shouted down the old Melting Pot ideal.

Then again, the term “the american people” rather clearly denotes a body of individuals; and the U.S. is clearly the state that contains them.

But “nation-state” implies cohesion — social care — among a country’s constituent classes which is missing more and more in the U.S. as the decades descend. Since the supposed Gilded Age certain Americans have boasted “The business of America is business.” This was mitigated in the 30s, when the Depression momentarily knocked the businessmen back on their heels.

But since their rejection of Fordism and the New Deal in the 1980s, and with the influx of foreign capital since, the owner-operators of the USA have come to have too little in common with the general populace to exert the kind of care that the societies of healthy bona fide nation-states exhibit. The whole point of Nationalism is to protect the People. The United States is a labor camp and a military- industrial complex.

True nation-states: The Scandavian countries. And those that fell out of Yugoslavia. Indeed, all of Balkania. (The adjective “balkanized” is a pejorative synonym of “nationalized.”) Japan. Germany. Poland. France, I guess. The Czech Republic, and old mate Slovakia. And jolly old England, before the creation of multinational Great Britain.

The list is long. The Nationalism idea did indeed conquer Europe in the 19th century, then spread to the third world — and the first half of the 20th century might be seen as a test of the idea. Does the European Union mean that the test was failed?

Theorists sometimes argue that the best of all possible worlds would be composed entirely of nation-states. The aging multinational empires of the 19th century were the first targets here — the Ottoman and Austro-Hungarian.

Yet today we have most of non-EU Europe, and many countries beyond, even Turkey, scrambling to enter the EU, which has already achieved something like sovereign parity with the member states, and is about to go one better with new powers of foreign policy. All of which Mr Estulin — a Russian who lives in Spain with a Canadian passport — decries.

Yet today, too, the dutch-speaking Flemish are moving to reconstitute Flanders out of Belgium, thinking to leave the latter rump state to the french-speaking Walloons. And francophone nationalists in Quebec want to carve their nation-state out of Canada.

Here’s a good view by Roger Cohen of the NY Times about Belgium and Europe generally, where Nationalism and its opposites seem Mix-Mastered to hell at the moment. Read, e.g., the Scot, who would like to see Scotland secede from Great Britain, but enter the European Union.

William Pfaff wrote an excellent book about all this in the early 90s, as Yugoslavia (a nation-state in name but in spirit multinational, despite a common tongue) was disintegrating under pressure from Serbian (chiefly), Croatian and Slovenian nationalists: The Wrath of Nations: Civilization and the Furies of Nationalism (1993).

Pfaff seems now blacklisted in stateside newspapers, after a long career as a columnist at the L.A. Times. Perhaps his other recent books make clear why:

– The Bullet’s Song: Romantic Violence and Utopia (2004)

Fear, Anger and Failure: A Chronicle of the Bush Administration’s War against Terror from the Attacks of September 11, 2001 to Defeat in Baghdad (2004)

Barbarian Sentiments: America in the New Century (2000) — a revision of Barbarian Sentiments: How the American Century Ends (1989)

But you can read Mr Pfaff regularly in the International Herald Tribune — eg here, recently, on topic — and on occasion in the NYROB.

December 12th, 2007

Greenspan overview of current crisis

Posted in Money by ed

The Wall Street Journal has a piece by Alan Greenspan today. Many people blame him for creating the credit bubble that’s currently popping. I tend to think the Fed is not that big.

Meanwhile, this morning the new Fed announced a half-baked loan measure as if in reaction to the lousy reaction it got to its FOMC move yesterday. Markets careering. People sense nobody’s in charge. If yesterday’s lows break before Christmas, it seems a tumultuous downdraft is in the works.

December 12th, 2007

Can’t happen here?

Posted in These United States by ed

Learning from New Orleans

by Theodore Hamm

Some may consider New Orleans after Katrina to be a tragedy—full of sorrow, fatally flawed by its geography, and now lacking any good options in terms of what to do next. However, after going there this past month, I would simply call it a national disgrace. The present plight of New Orleans results much less from the city’s own historic problems than from the politics of inequality shaping 21st-century American life. And only a fool would say that some variation of Katrina can’t happen here in New York City.

click for remainder of article

December 11th, 2007

Fed Bank delivers coal

Posted in Money by ed

Wow, the Fed today provided zero comfort to the ailing financial and housing industries: the bare minimum in interest rate cuts, .25 on the inter-bank rate, and .25 on the rate banks can borrow directly from the Fed at. The latter was perhaps the larger shock. Basically means closing that window. Stiff arm. Feed yourselves.

The Bank of England cut .25 last week but the Euro Central Bank did not. This left it hard, apparently, for US Fed to radically cut — for the discrepancy between US and Euro rates is a main driver now of the Euro-Dollar exchange rate. And everyone beyond US borders is sick of the dollar going down.

That is: Given a choice between (i) strengthening domestic economy and (ii) (a) pleasing foreign investors who buy US things (eg Treasury bonds) with dollars and (b) keeping in rough sync with the Euro central bank (ie Bilderberger set: Euro-American unionizers), the Fed went with (ii).

Grinchlike. Recession, bank failures (or bailouts), bankrupt homebuilders … and, more generally, another harsh leg down in the stock markets between now and Christmas. Coal in yer stocking.

If Bush-Cheney had not reinstituted reaganomics, bloating the annual federal deficit after Clinton & co. had whittled it down to notional zero — where the Treasury actually stopped issuing 30-yr bonds and began for the first time since ….??? to retire debt… If THAT had continued in the new century, then the Fed would have leeway in the current crisis to worry much less about how foreign investors feel about the dollar. Thus could cut to bolster domestic life. But it’s clear they’re now at an impasse, and (given Bush-Cheney) the war must go on, and continue to be funded by our (mostly) asian creditors.

December 7th, 2007

How bad will the mortgage mess get?

Posted in Money by ed

A mortgage industry fellow speaks.


December 7th, 2007

Cramer: When Everyone is Insolvent, No One is Insolvent

Posted in Money by ed

Here, on the other hand, is Jumpin’ Jersey Jim Cramer’s current view at


When everyone is insolvent, no one is insolvent.

If you took all of the loans in the SIVs and the CDOs and you looked where they really reside, if you look at where all the second-liens reside, if you opened up the books to everything, what you would see is massive insolvency across the board.

And I am telling you to forget about it. When everyone is insolvent, no one is insolvent.

Do you really think it matters? Do you think at this point that the government is going to let Fannie Mae and Freddie Mac fail? You think it has that choice? Can the monolines be left to fail? I don’t even know if they will let Radian fail, that’s how dicey everything is.

People keep telling me “Read this guy to see how bad things really are,” or “Did you see that article about how MBIA is broke, or Washington Mutual is insolvent?” To which I say, no kidding.

I have been saying that for months. It doesn’t matter, at a certain point bad is good, and we are at that point.

We are at the point I was hoping to avoid, which is a massive bailout of the system because Ben Bernanke got it wrong and stopped cutting in October.

Now we will have to spend hundreds of billions of dollars one way or another — maybe through the implicit guarantee of FNM/FRE — to make sure the system just doesn’t’ stop, choked on bad mortgage loans. We have to do that because someone at the Fed said “not this time, we are not going to take rates back down to where the problems began,” and they had to, and they got it wrong.

But understand that insolvency is not bankruptcy as much as you wish it were if you were short Ambac or MGIC. The government stops it from happening.

That doesn’t mean there will be no bankruptcies. It does mean it is time to recognize that they really did know nothing and now they have to do it the hard and expensive way, but they will save the system.

They did it just like this in 1990. They are going to do it now.


The sheer lunacy of the AAA ratings of MBIA shows that there’s not an ounce of truth to the ratings process.

But what is Standard & Poor’s or Moody’s supposed do to? A lot of their now seemingly worthless ratings for toxic mortgage portfolios depend entirely on the MBIA guarantee behind them. If the ratings agencies downgrade the clueless MBIA paper, the ratings agencies’ ratings will be revealed as a joke. Those who are relying on the insurance backstop to be able to continue the fiction of solvency will have a very hard time — even after Paulson’s plan — continuing to pretend there is nothing wrong.

That’s why it is imperative that there be no downgrades of these monolines, particularly MBIA, regardless of the questionable honesty involved. Put simply, this market can’t handle the truth, Moody’s can’t handle the truth, S&P can’t handle the truth and MBIA can’t handle the truth.

So why should they? Why not just keep it AAA, look the other way and let MBIA stay afloat long enough to let someone buy it? It is vital that the truth not be told about these companies and the ratings.

And I am betting the truth will not prevail. It just isn’t feasible right now. So it has to be canned for a later moment when it can’t hurt as badly.

Those who think that this isn’t “right” are simply unwilling to recognize how the game is played. Charles Edward Chaplin, the unbelievably good “acting” CFO, and in this case I am talking Oscars, must not be made to look foolish. His critics must be attacked. The ratings and the patina of solvency may just be a real good bet even as it is wrong, stupid, ridiculous, dishonest and outrageous.

The heck with the truth. Save it for novels.


Approaching insolvency myself, I take succor.

December 3rd, 2007

Jerusalem Post reaction to US intel pipple re Iranian nukes

Posted in Mideast & Oil by ed

Here’s the reaction story at the Jerusalem Post re Hadley’s very public announcement today that the American intel duoctopus (16 agencies, not eight) has concluded that Iran stopped its weapons program in 2003. Although enrichment of uranium continues.

Israeli gov’t reaction in part is that enrichment itself remains a possible casus belli.

At the bottom of the JP page are readers’ comments. Largely telling the Americans to get lost. One often wishes the feelings were mutual.

In context of the photo op earlier this week in Annapolis … Does this mean Bush-Cheney are throwing in the towel on remaking the mideast on Perle’s Clean Break model?

The JP piece suggests we’re in for a new round of Psy Ops re the danger of Iran to the region. As did George Packer in The New Yorker earlier this fall. But … we shall see. Perhaps peace, as last resort, will be given a chance.