Archive for September, 2010

September 30th, 2010

Pakistan shuts Khyber Pass
to US war machine as
September to Remember closes

Ed Note: See here for background reaching back to August 2008, when the CIA commenced bombing Pakistan with drone missiles.

And see comments below to follow events henceforth, including the Peace Talks that turned out to have been attended by a Flim Flam Man in the guise of the Taliban. How long can this travesty go on?

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Pakistan today closed off the main Khyber Pass portal that the US and its meagre coalition-of-the-willing use to supply their war efforts in Afghanistan, after the latest of recent US helicopter attacks killed three uniformed Paki servicemen.

Across the three days prior to the latest attack, Islamabad had expressed outrage at the helicopter raids, which at that point had killed many civilians among some sixty dead.

As the border closing was announced,

The Pakistani interior minister, Rehman Malik indicated that NATO strikes in Pakistan were being taken extremely seriously. “We will have to see whether we are allies or enemies,” he said Thursday.

The move to challenge the Americans also comes just two days after Pakistan’s top generals and American officials all expressed loud displeasure with the Islamabad government led by Benazir Bhutto’s widower, Asif Ali Zardari:

American officials, too, say it has left them increasingly disillusioned with Mr. Zardari, a deeply unpopular president who was elected two and a half years ago on a wave of sympathy after the assassination of his wife, former Prime Minister Benazir Bhutto. …

In a meeting on Monday that was played on the front page of Pakistan’s newspapers, the army chief, Gen. Ashfaq Parvez Kayani, confronted the president and his prime minister, Yousaf Raza Gilani, over incompetence and corruption in the government.

According to the press and Pakistani officials familiar with the conversation, the general demanded that they dismiss at least some ministers in the oversized 60-member cabinet, many of whom face corruption charges.

The civilian government has so far resisted the general’s demand. But the meeting was widely interpreted by the Pakistani news media, which has grown increasingly hostile to the president, as a rebuke to the civilian politicians and as having pushed the government to the brink.

After the meeting, the president’s office issued a statement, approved by all the men, saying they had agreed “to protect the democratic process and to resolve all issues in accordance with the constitution.”

A Pakistani official close to the president who was familiar with the conversation but did not want to be identified, said, “The president made it clear that he would not leave, come what may.”

“Sanity had prevailed,” the official added. …

In his most recent visit to Pakistan, Richard C. Holbrooke, the American special representative for Afghanistan and Pakistan, said the international community could not be expected to provide all the billions of dollars needed to repair the flood damage, a warning interpreted here as a rebuke of the civilian government and its mismanagement.

But Washington, not unlike Pakistan’s military, is caught, American officials say, because there is no appetite for a return of military rule. Nor is there desire to see the opposition politician and former prime minister, Nawaz Sharif, resume power.

The last is interesting in that Sharif would be popular and even more difficult for Washington to control. But the Times report reports he has no interest in stepping up at the moment given the general chaos.

So it seems that just as Washington has abandoned President Karzai in favor of a perhaps imaginary reprise of Northern Alliance (non-Pashtun) so-called warlords, so across the border it may be looking for a collection of Men We Can Work With.

And as Fletcher Prouty pointed out (while discussing the assassination of President Diem of Vietnam in 1963), when Washington withdraws support of an allied leader, the latter’s native enemies soon swarm and conduct a coup. This may be the week that President Zardari became a walking dead man slated to join his wife in martyrdom. Or perhaps friends in Paris.

Along those lines, note that two weeks ago, September 17, in London, emigre Paki leader Imran Farooq was murdered, leading to great unease in Karachi (the New York of Pakistan), where the MQM party, which he once led and still helped manage, is a major power:

As [Robert Mackey's] colleague Carlotta Gall explained last week, the M.Q.M. represents families who moved to what is today Pakistan when India was partitioned in 1947:

“Political power struggles in the country’s sprawling port city of Karachi have degenerated into an ethnic turf war between two parties in the governing coalition, the Muttahida Qaumi Movement, whose support base is drawn from Urdu-speaking immigrants, and the Awami National Party, whose base is mostly Pashtun. Targeted killings left 165 dead people in August, including some senior political figures.

Now tens of thousands of people displaced by the floods, most of them ethnic Sindhis, are arriving in Karachi, adding a volatile new element to the political dynamic there. While Sindhi nationalists are welcoming them, opponents, like M.Q.M. members, warn that they will create more violence.”

In 2007, the BBC explained that the M.Q.M.’s leaders have effectively run large parts of Karachi from London for years. At the time, a party spokesman said it was not necessary for the city’s leaders to actually be in Pakistan, since, “in these days of high-tech communication why not govern Karachi from London? It’s a new form of outsourcing.”

And note that two days before Farooq was killed, the former Paki president General Pervez Musharraf announced he would return from friendly exile to start a new political party.

Meanwhile the long delayed NATO offensive to cleanse Kandahar of people who don’t side with the Kabul government of Karzai (whom the americans themselves have been steadily defaming for more than a year) seems to have muddled but continues. It began in mid August. Two days ago the American commander Petraeus told the press of peace talks of some sort . between Karzai and that loose coalition of unwilling various Afghans in arms referred to in the press as the Taliban.

All this comes against the great disaster of the summer in Pakistan — flooding of biblical proportions, which the western world reacted to largely with a yawn, but which since beginning in late July has (says the Times) “ruined just about every physical strand that knit this country together — roads, bridges, schools, health clinics, electricity and communications.”

Has Pakistan this September, under such pressures, begun to cease to exist as the state we’ve dealt with since the Soviet invasion next door?

September 26th, 2010

The Bonds of August:
Refinancing the Twin Towers
on the eve of destruction

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James Bamford’s latest book, The Shadow Factory, about the National Security Agency shortly before and since the 9/11 attacks, leaves his first two re same (The Puzzle Palace and Body of Secrets) seeming quaint, jolly, the Good Old Days. That Obama has only elaborated what Bush-Cheney began means we are surely beyond the pale and point of return.

But for the moment, a look back, to the weeks preceding the attacks.

Mr Bamford writes that:

– Mohammed Atta & co bought their airline tickets August 25-29, 2001.

– Up until then, across the summer, Atta had been refusing pressure from his Al Qaeda contact to set the date of the attack and git it done.

The first point is in tune with the FBI’s public chronology of the alleged terrorists’ actions. But the second point is new to my eyes.

Mr Bamford writes that Atta, on July 8, with all his fellow hijackers now safely on US soil, flew to Spain to meet Ramzi Binalshibh — “his former roommate and the man who was helping bin Laden and Khalid Sheikh Mohammed coordinate the operation from his base in Germany.” (p59)

Binalshibh told Atta that bin laden wanted the attacks carried out as soon as possible because he was concerned about the large number of operatives in the US at the same time. But Atta said he was still unable to provide an exact date for the attacks because he was too busy organizing the arriving soldiers. In addition, he still needed to coordinate the timing of the flights so that the crashes would occur simultaneously. Atta said he needed about five to six more weeks before he could provide an accurate attack date. (p60)

The rationale for delay seems rather weak.

Note that Mr Bamford does not provide a single citation for the chapter in which he tells this story of how Atta finally came to select the date and set the attacks in motion. Given Bamford’s history, readers seem invited to assume the sources are NSA intercepts (phone calls and emails) and deep background interviews with the NSAyers who handled them.

This newly public story of the date’s selection folds into old thoughts about the leasing and securitization of the Twin Towers, a refinancing project with curious consequences which — in contrast to Atta — was racing across that summer toward the day of infamy in September.

So then.

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Two things to note about the date of the attacks:

– The nexus of military exercises those early days of that week in September was such that most of the east coast was stripped of jet fighter protection. (Webster Tarpley’s book is perhaps the best source for this.)

– the complex deal that financed the long-term leasing of most of the Trade Center by Silverstein Properties Inc had only recently closed — on August 21 — when the Twin Towers were securitized in a bond issuance.

Housekeeping note: The leasing by SPI (agreed to in the spring and finalized on July 24) and the bond sale by its banker that followed in August, each encompassed WTC buildings 1 and 2 (the towers) and 4 and 5 — four of the seven that comprised the Trade Center complex. (References henceforth to “Twin Tower bonds” are to the whole package, ie, bonds based on the securitization of buildings 1, 2, 4, and 5.)

Not part of the deal were: Building 3 — a big hotel on site. Building 6 — the US Custom House. And building 7 — the Spook House, where about every police and secret police agency one might call to mind rented space.

WTC 7 is the odd man out for a number of reasons. It was not truly part of the WTC complex, having been built across the street during the 80s — by none other than Larry Silverstein, the principal of SPI. The building was then refinanced by a (separate) securitization and bond sale in 1999. And, of course, shortly after 5 pm on 9/11, the building, having suffered only minor damage in the attacks, suddenly collapsed in its footprint in what looks to have been a professional demolition.

And now, our featured presentation.

There are three details worth noting about the August securitization of WTC 1-2-4-5.

(1) The SECURITIZATION was RUSHED and SHABBILY DONE.

In particular, the insurance coverage for the buildings required by the securitization was inconsistent with the coverage required by the lease. And a good deal of the insurance coverage stipulated was not contracted before the securitization closed — even though such coverage was a precondition to the sale of the bonds.

And note that time just kept on flying: A big chunk of the stipulated insurance remained uncontracted when the jetliners arrived on 9/11.

All of this came out at the two insurance trials subsequent to the attacks. The insurance broker for SPI testified at gory length as to the chaos and unprecedented (in his experience) late summer rush to get the bond deal done without dotting Is and crossing Ts. (The best sources here are the insurance trade journals, which covered the trials in depth.)

(2) The KEY MONEY on the LEASE was SUBSTANTIAL.

When SPI finalized its 99-year managerial lease of 1-2-4-5 on July 24, it paid $491 million in cash to the Port Authority in key money.

SPI borrowed borrowed this key money (and more, $563 mm) the same day from its anchor banker, GMAC, the then-proud new-age investment bank run by General Motors. Henceforth much of the monthly rent paid by WTC tenants would go not to the PA or SPI but rather to GMAC, as interest on the loan.

EXCEPT that, a month later, GMAC got all its money back in a lump — by selling $563 million in Twin Tower bonds to institutional investors worldwide. Henceforth much of the monthly WTC rents would flow to these numerous, scattered investors, tagged as interest on their new bonds.

That is: The whole point of the securitization of 1-2-4-5 was to make GMAC whole by transferring the SPI key-money loan to the new bondholders.

(3) The SECURITIZATION had an UNUSUALLY LARGE RESERVE FUND.

That is, an unusually large amount of the proceeds of the bond sale were held in reserve by the bond trustee (Wells Fargo), rather than delivered to the issuer of the bonds (a new shell vehicle, more or less a “trust,” created to issue the bonds on behalf of GMAC).

This reserve fund came in handy when the business-basis of the bonds went up in smoke twenty days after they were sold — the most dramatic instance of “collateral decay” in finance history, one imagines. Despite that calamity, the reserve allowed the bonds to continue paying interest until insurance money started to dribble in.

Perhaps the import of the three points noted above is as clear as mud.

The gist is this: When the bonds were sold on August 21, it completed a two-step deal that:

(a) via the lease, took the Port Authority of NY & NJ — which owned the Trade Center and until July 2001 had always managed it — off the hook for a lot of headaches and for the next five years of rent on 1-2-4-5.

(b) via the August securitization, took GMAC — which had financed the leasing with (in essence) a bridge loan — off the hook.

The Port Authority was off the hook in two simple respects:

(i) The $491 million in key money it received at lease signing constituted over five years worth of rent on 1-2-4-5. If by chance the buildings were to disappear from the face of the earth tomorrow, well, the PA had five years to rebound. And as for the headaches …

(ii) The 99-year managerial lease transferred responsibility for rebuilding in case of mishap from the PA to SPI.

In short sum: The SPI lease had the effect of cushioning the Port Authority from the blast of 9/11.

And the bank that provided the financing to make it happen backed out of the deal twenty days before the jetliners arrived.

Readers of the news wondering or already persuaded that controlled demolition was employed on 9/11 might surmise that somebody wanted the Twin Towers to come down that day, but nobody wanted to destroy the Port Authority of New York and New Jersey in the process.

The leasing & securitization, willy nilly, served that end, by transferring the lion’s share of the risk of owning WTC 1-2-4-5 across the next five years from the PA to the bondholders, the insurance companies and SPI.

Funny — The first interest payment on the bonds was made on September 10. One imagines a proud bondholder, early the next morning, hanging up after confirming the payment with his broker and turning to his wife — “Honey, we got a piece of the Rock!” — while she aghast over the ironing board watches the North Tower burn.

And interesting — The Twin Tower bonds never defaulted. Interest continued to be paid out of the reserve fund, and then the bonds were called and cashed out early, when enough insurance money came in and was approved for the purpose. The bonds were built stronger than the towers, one might say.

To return, then, to the business of selecting a date.

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As seen above, circa July 9 in Spain, Atta told Binalbshih he needed another five or six weeks to pick a date. In emails across the subsequent weeks (Bamford writes) Atta:

suggested that the attacks not happen until after the first week in September, when Congress reconvened. [ED: Again the rationale seems weak.] For months Binalbshih had been communicating bin Laden’s impatience and his desire for a date for the operation, and by mid-August Atta was ready to give it to him. (p71)

About three or five business days before closing a securitization, the “pricing” of the deal occurs. This is the final negotiation among the bankers, the rating agency analysts and (usually) the institutional investors who will buy the bulk of the bonds, which process, when complete, fills in all the blanks — dates, dollar amounts and percentage figures — in tune with current interest-rate and other market variables.

So — in Bamford’s “mid August,” when Atta was finally ready to give Binalbshih a date — the Twin Tower bonds were priced. And days later they were sold, on August 21, leaving GMAC whole and closing the two-step process of leasing the Trade Center for 99 years.

Then, Bamford writes:

With the date now set in stone, Atta again flew up to Newark [on August 23] to meet with Hazmi and begin coordinating the complex task of picking just the right seats on just the right flights on just the right type of aircraft … (p 71)

We all recall, I hope, Atta’s picture on the Able Danger corkboard in the Pentagon.

And anyone who has read Welcome to Terrorland by Daniel Hopsicker has reason to believe that Atta was playing at least two sides of the table in the so-called intelligence world.

So readers of the news may wonder:

– if the securitization was rushed and shabbily done because someone with the power to influence it, and with a wish to get GMAC off the hook, knew that the window in early September when the Air Force would be elsewhere was fast approaching; and

– if that same or a similar someone made sure that the reserve fund was fat enough to pay the interest on the Twin Tower bonds for a year or two; and

– if, in order to hit that window in September and to give GMAC time to close its deal, all across the summer the attacks were delayed — frustrating Al Qaeda central — by Atta’s colleagues/controllers somewhere within the world wide web of so-called intelligence operators. Maybe, for instance, the “Pentagon lawyers” who, we are told, turned off Able Danger in 2000 due to concerns for the civil rights of its targets.

Even if all those IFs are in fact counterfactual — it’s fascinating to learn (assuming Bamford is accurate) that Atta organized his calendar such that it fell into sync with those of the Air Force and the WTC leasing project, even as Al Qaeda Central pressed for attacks in summer.

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September 25th, 2010

Curious George Goes
to the War

Curious George Goes to the War

I don’t want the war
Don’t want the war I
Want the war I know
The war I know what
War I know what wars
I know what wars are
Know what wars are like.
I know the destruction and
Know the destruction and death
The destruction and death that
Destruction and death that comes
And death that comes with
Death that comes with them.
I am the one who
Am the one who has
The one who has to
One who has to comfort
Who has to comfort mothers
Has to comfort mothers and
To comfort mothers and widows
Comfort mothers and widows of
Mothers and widows of thee
And widows of the dead.
Of course for us that
Course for us that would
For us that would be
Us that would be the
That would be the best
Would be the best solution.
Besides it would save us
It would save us fifty
Would save us fifty billion.

September 22nd, 2010

Warhol was able to collapse

Posted in Painting, Reading, Writing by ed

Warhol was able to collapse
Was able to collapse high
Able to collapse high serious
To collapse high serious art
Collapse high serious art and
High serious art and low
Serious art and low pop
Art and low pop culture
And low pop culture making
Low pop culture making the
Pop culture making the art
Culture making the art of
Making the art of painting
The art of painting into
Art of painting into a
Of painting into a part
Painting into a part of
Into a part of pop
A part of pop culture
Part of pop culture he’s
Of pop culture he’s an
Pop culture he’s an incredible
Culture he’s an incredible genius
He’s an incredible genius but
An incredible genius but he’s
Incredible genius but he’s the
Genius but he’s the devil.

September 10th, 2010

Counsel
from Nissim Ezekiel

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COUNSEL
For Shri Hariji, Who Said It

Whether you believe or not
Think as if you do
Stop the blind effort

Ask yourself what you need
Success as the moment
Is not in your interest

Turn to silence, nothingness
Where you are
Is where you have to be

Know, you are not wise
This is difficult
Grasp your folly

And you grasp yourself
What you have eaten
Is merely unripe fruit

So, now, learn to fast
Do without, be absent
Keep the eyes closed

Keep the mind steady
What you will see
You will also understand

No visions, except in darkness
Listen to the voice
That is not your own

Then move again
Without remorse or guilt
Love is more concerned

About your fate
Than you have ever been
That is why you have survived

Express your gratitude
By giving what you have to give
You may get nothing in return

And bear your restlessness with grace

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Nizzim Ezekiel
Latter-Day Psalms, 1982

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Nissim died in 2004. Here are two brief memorials.

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September 4th, 2010

Amazing color photos from Russia 1910

Posted in Arts & Private Life, Russia by ed

See more at the Boston Globe.

September 2nd, 2010

9/11: Interesting correlations

Kevin Ryan points to interesting correlations between structural upgrades to the twin towers during 1999-2000 and the impact and failure zones of 9/11/01.

September 2nd, 2010

Down by the riverside and study
war no more

As part of the protracted transition back to Manhattan, I just sold all my Avalon Hill war games to an enthusiast, cutting a tie to passionate childhood, wishing to lay burdens down by the riverside and study war no more.