Since China fired its first 'official' shot across the Petrodollar bow a year ago, there has been an increasing groundswell of de-dollarization across the world's energy trade (despite Washington's exclamations of 'isolated' non-dollar transactors). The rise of the PetroYuan has not been far from our headlines in the last year, with China increasingly leveraging its rise as an economic power and as the most important incremental market for hydrocarbon exporters, in the Persian Gulf and the former Soviet Union, to circumscribe dollar dominance in global energy – with potentially profound ramifications for America’s strategic position. And now, as AP reports, for the first time in history, China has docked a Navy Destroyer in the Southern Iranian port of Bandar-Abbas – right across the Straits of Hormuz from 'US stronghold-for-now' Bahrain and UAE.

 

The rise of the PetroYuan has not been far from our headlines in the last year:

China Fires Shot Across Petrodollar Bow: Shanghai Futures Exchange May Price Crude Oil Futures In Yuan

 

Guest Post: From PetroDollar To PetroYuan – The Coming Proxy Wars

 

The Rise Of The Petroyuan And The Slow Erosion Of Dollar Hegemony

And now, as AP reports, for the first time in history, China has docked a Navy Destroyer in a Southern Iranian port of Bandar-Abbas – right across the Straits of Hormuz from 'US stronghold-for-now' Bahrain and UAE.

Adm. Hossein Azad, naval base chief in the southern port of Bandar Abbas, said the four-day visit that began Saturday saw the two navies sharing expertise in the field of marine rescue.

 

"On the last day of their visit while leaving Iran, the Chinese warships will stage a joint drill in line with mutual collaboration, and exchange of marine and technical information particularly in the field of aid and rescue," said Azad.

 

The report said the destroyer was accompanied by a logistics ship, and that both were on their way to the Gulf of Aden as a part of an international mission to combat piracy.

 

…

 

Last year a Russian naval group docked in the same port on its way back from a Pacific Ocean mission.

 

The move is also seen part of off efforts by Iran to strike a balance among foreign navies present in the area near the strategic Strait of Hormuz, the passageway at the mouth of the Persian Gulf through which a fifth of the world's oil is shipped.

U.S. Navy's 5th Fleet is based in nearby Bahrain, on the southern coast of the Gulf.

*  *  *

Here's why it matters…

 

*  *  *

As we concluded previously,

History and logic caution that current practices are not set in stone. With the rise of the “petroyuan,” movement towards a less dollar-centric currency regime in international energy markets—with potentially serious implications for the dollar’s broader standing—is already underway.

 

As China has emerged as a major player on the global energy scene, it has also embarked on an extended campaign to internationalise its currency. A rising share of China’s external trade is being denominated and settled in renminbi; issuance of renminbi-denominated financial instruments is growing. China is pursuing a protracted process of capital account liberalisation essential to full renminbi internationalisation, and is allowing more exchange rate flexibility for the yuan. The People’s Bank of China (PBOC) now has swap arrangements with over thirty other central banks—meaning that renminbi already effectively functions as a reserve currency.

 

Chinese policymakers appreciate the “advantages of incumbency” the dollar enjoys; their aim is not for renminbi to replace dollars, but to position the yuan alongside the greenback as a transactional and reserve currency. Besides economic benefits (e.g., lowering Chinese businesses’ foreign exchange costs), Beijing wants—for strategic reasons—to slow further growth of its enormous dollar reserves. China has watched America’s increasing propensity to cut off countries from the U.S. financial system as a foreign policy tool, and worries about Washington trying to leverage it this way; renminbi internationalisation can mitigate such vulnerability. More broadly, Beijing understands the importance of dollar dominance to American power; by chipping away at it, China can contain excessive U.S. unilateralism.     

 

China has long incorporated financial instruments into its efforts to access foreign hydrocarbons. Now Beijing wants major energy producers to accept renminbi as a transactional currency—including to settle Chinese hydrocarbon purchases—and incorporate renminbi in their central bank reserves. Producers have reason to be receptive. China is, for the vastly foreseeable future, the main incremental market for hydrocarbon producers in the Persian Gulf and former Soviet Union. Widespread expectations of long-term yuan appreciation make accumulating renminbi reserves a “no brainer” in terms of portfolio diversification. And, as America is increasingly viewed as a hegemon in relative decline, China is seen as the preeminent rising power. Even for Gulf Arab states long reliant on Washington as their ultimate security guarantor, this makes closer ties to Beijing an imperative strategic hedge. For Russia, deteriorating relations with the United States impel deeper cooperation with China, against what both Moscow and Beijing consider a declining, yet still dangerously flailing and over-reactive, America.

 

For several years, China has paid for some of its oil imports from Iran with renminbi; in 2012, the PBOC and the UAE Central Bank set up a $5.5 billion currency swap, setting the stage for settling Chinese oil imports from Abu Dhabi in renminbi—an important expansion of petroyuan use in the Persian Gulf. The $400 billion Sino-Russian gas deal that was concluded this year apparently provides for settling Chinese purchases of Russian gas in renminbi; if fully realised, this would mean an appreciable role for renminbi in transnational gas transactions.

Looking ahead, use of renminbi to settle international hydrocarbon sales will surely increase, acceleratin
g the decline of American influence in key energy-producing regions. It will also make it marginally harder for Washington to finance what China and other rising powers consider overly interventionist foreign policies—a prospect America’s political class has hardly begun to ponder.

via Zero Hedge http://ift.tt/1tOV28S Tyler Durden

LBMA Plans New Gold Fix – Desperate Attempt To Maintain Status Quo

The London Bullion Market Association (LBMA) is quietly planning its new gold fix in a desperate attempt to maintain the status quo. 

Queen Elizabeth Surveys Gold Bars in Bank of England Vaults

Reuters reported Friday that according to the LBMA, there are at least 15 companies interested in running the upcoming replacement to the London ‘Gold Fixing’ auction. Like the recently introduced replacement to the ‘Silver Fixing’ which is now being run by the CME Group and Thomson Reuters, the LBMA has appointed itself as the coordinator for a new London Gold Price auction and is currently soliciting Requests for Proposals (RfPs) from interested parties.

When the new silver fixing auction was being debated in the summer, the World Gold Council (WGC) took the initiative and organised a conference of gold market participants including miners and refiners to work out the key features of a new gold price auction. This WGC initiative appears to have been shot down by the LBMA who felt threatened that a gold mining representative organisation was muscling in on the London gold ‘price discovery’ mechanism.

In advance of the LBMA choosing the winning bid, which may well be CME Group/Thomson Reuters again, the LBMA will be holding another seminar for ‘market participants’ that will feature presentations from the short-listed candidates.

As per a similar LBMA Silver Price seminar that was held in June, the upcoming LBMA gold price seminar will no doubt include various concerned regulators attending as ‘observers’ such as the Bank of England and the Financial Conduct Authority (FCA), as well as the International Swaps and Derivatives Association (ISDA).

ISDA will be concerned about how ‘price discovery’ in the new LBMA Gold Price auction will impact the huge outstanding pile of gold price related derivatives that ISDA coordinates. Since gold is a monetary metal and is strategic as the basis of all fiat currencies, the Bank of England will no doubt be sending senior representatives to the seminar to protect the Bank’s interests.

And since trade ‘clearing’ of the phenomenally large volume of loco London unallocated account gold fixing trades is so important for the six bullion bank members of London Precious Metals Clearing Limited, it will be a given that HSBC, JP Morgan, Deutsche Bank, Barclays,  ScotiaMocatta and UBS will attend the LBMA seminar in an attempt to preserve the City of London’s unallocated account clearing status quo.

LBMA Gold and Silver Forward Curves Withdrawn From Next Monday (22nd September 2014)
From next Monday, September 22, the London Bullion Market Association (LBMA) will cease to publish and supply end-of-day forward curve data for gold and silver forward trades to the London Metal Exchange (LME) and LCH.Clearnet.

Therefore, today is the last business day that this long dated forward pricing data will be supplied by the LBMA.

Forward trades are over the counter trades where the two participants agree to buy/sell gold or silver now and sell/buy it back at a later date, usually with one leg of the trade being gold or silver and the other leg being US dollars.

Since the LME will no longer have this data, they cannot price forward trades and so cannot provide a clearing service for London gold forwards since they will not have pricing data to ‘mark to market’ any outstanding gold forwards for their clients.

This forward curve data had been supplied by the eight LBMA forward market makers since 2009, and then by seven market makers after Deutsche Bank dropped out earlier this year.

The CME Group also provides a clearing service for gold forwards and it is unclear how the cessation of the pricing data to the LME might affect the CME’s service. The CME Group was recently appointed by the LBMA to be the calculation agent and platform provider for the new LBMA Silver Price.

Shorter term gold forward data, in the form of Gold Forward Offered rates (GOFO) will continue to be supplied by the forward market makers and published by the LBMA. Therefore, the gold/silver forwards decision by the LBMA and its associated Market Makers will not affect (GOFO) data. GOFO data will still, for the time being, be published in London each business day at 11am.

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via Zero Hedge http://ift.tt/1rf4L7m GoldCore

While everyone debates if the Fed will, once again, be wrong in its forecasts about a rate hike cycle starting some time in mid-2015 (spoiler alert: it will be), we decided to take a look in the other direction.

The chart below shows the key global events that have influenced monetary policy for the 4 major legacy central banks: the US, UK, Germany and Japan since the mid-19th century. Because if there is one thing to “learn” from the history of monetary policy it is that there is nothing to learn from the history of monetary policy: after all, “this time is always different” when the voodoo priests in charge of it all try to make a bubble-blowing, kneejerk-response “science” out of something that only a mother could call art.

Source: Goldman

via Zero Hedge http://ift.tt/1qXLw3n Tyler Durden

USDJPY has been on a tear in recent weeks. Since China unleashed QE-lite, JPY and CNY have greatly diverged with USDJPY breaking above 109 and pushing six-year highs. This recent 'relative strength' is the most extreme overbought for the currency pair since early 2001 – which saw USDJPY plunge 30% in the following six months. The tick-for-tick rise in Japan's stock market also broke a 9-month almost-perfect analog with the last time the nation raised its consumption tax. Perhaps even more worrying in the world of FX trading, ECB Governing Council member Ignazio Visco told the G-20 that it may not need to add stimulus measures after steps in the past three months pushed down the euro noting that "there may not be a next step," since he explains, the ECB was "bold enough to reduce interest rates to a level that was unexpected to the market." The extent of the exchange rate’s fall is "more or less, given the moves that were done between June and September, the right response," said Visco, who also heads Italy’s central bank, but added very Japan-like, "the ECB isn’t targeting any exchange-rate level." That is not what the EUR shorts will want to hear.

 

USDJPY is at six-year highs with RSI at its most extreme overbought since 2001 – which saw a 30% decline in the next 6 months.

 

9 months of almost perfect correlation with the period 17 years ago when Japan last raised its consumption tax has diverged dramatically in thge last few days as USDJPY exploded higher…

Its different this time… for now.

*  *  *

Then there is the EUR, which it appears was played by the ECB once again… (as Bloomberg reports)

The European Central Bank may not need to add stimulus measures after steps in the past three months pushed down the euro, said Governing Council member Ignazio Visco

 

“Inflation expectations have to be back where they were,” Visco said in an interview in Cairns, Australia, where he is attending a meeting of Group of 20 finance chiefs. “This doesn’t mean that there will be a next step. We have been bold enough to reduce interest rates to a level that was unexpected to the market.”

 

The single currency has dropped about 6 percent since early June, when the ECB introduced a negative interest rate on excess reserves and presented a four-year lending program to fuel credit. Policy makers reduced borrowing costs further earlier this month and committed to buying asset-backed securities and covered bonds to boost the ECB’s balance sheet by as much as 1 trillion euros ($1.3 trillion).

 

 

The extent of the exchange rate’s fall is “more or less, given the moves that were done between June and September, the right response,” said Visco, who also heads Italy’s central bank. The ECB isn’t targeting any exchange-rate level, he said.

*  *  *

Of course, when have these markets ever reacted in negative response to the fact that what was promised by a central banker (drove massive momentum shifts) does not occur…

via Zero Hedge http://ift.tt/1wWQiR0 Tyler Durden

USDJPY has been on a tear in recent weeks. Since China unleashed QE-lite, JPY and CNY have greatly diverged with USDJPY breaking above 109 and pushing six-year highs. This recent 'relative strength' is the most extreme overbought for the currency pair since early 2001 – which saw USDJPY plunge 30% in the following six months. The tick-for-tick rise in Japan's stock market also broke a 9-month almost-perfect analog with the last time the nation raised its consumption tax. Perhaps even more worrying in the world of FX trading, ECB Governing Council member Ignazio Visco told the G-20 that it may not need to add stimulus measures after steps in the past three months pushed down the euro noting that "there may not be a next step," since he explains, the ECB was "bold enough to reduce interest rates to a level that was unexpected to the market." The extent of the exchange rate’s fall is "more or less, given the moves that were done between June and September, the right response," said Visco, who also heads Italy’s central bank, but added very Japan-like, "the ECB isn’t targeting any exchange-rate level." That is not what the EUR shorts will want to hear.

 

USDJPY is at six-year highs with RSI at its most extreme overbought since 2001 – which saw a 30% decline in the next 6 months.

 

9 months of almost perfect correlation with the period 17 years ago when Japan last raised its consumption tax has diverged dramatically in thge last few days as USDJPY exploded higher…

Its different this time… for now.

*  *  *

Then there is the EUR, which it appears was played by the ECB once again… (as Bloomberg reports)

The European Central Bank may not need to add stimulus measures after steps in the past three months pushed down the euro, said Governing Council member Ignazio Visco

 

“Inflation expectations have to be back where they were,” Visco said in an interview in Cairns, Australia, where he is attending a meeting of Group of 20 finance chiefs. “This doesn’t mean that there will be a next step. We have been bold enough to reduce interest rates to a level that was unexpected to the market.”

 

The single currency has dropped about 6 percent since early June, when the ECB introduced a negative interest rate on excess reserves and presented a four-year lending program to fuel credit. Policy makers reduced borrowing costs further earlier this month and committed to buying asset-backed securities and covered bonds to boost the ECB’s balance sheet by as much as 1 trillion euros ($1.3 trillion).

 

 

The extent of the exchange rate’s fall is “more or less, given the moves that were done between June and September, the right response,” said Visco, who also heads Italy’s central bank. The ECB isn’t targeting any exchange-rate level, he said.

*  *  *

Of course, when have these markets ever reacted in negative response to the fact that what was promised by a central banker (drove massive momentum shifts) does not occur…

via Zero Hedge http://ift.tt/1wWQiR0 Tyler Durden

Submitted by Mark St.Cyr,

We didn’t get what I first postulated yet (4 C’s That Could Change The Financial World As We Know It, Again. Those 4 C’s are: Confirmation, Crisis, Contagion, Catastrophe), what we did might be even more illuminating.

In my earlier article the 4C’s I set up the premise that if a Yes vote took place in Scotland there were possible ramifications within the markets than what was being expressed, as well as reported, throughout the financial media.

Well it turns out the cause for any worry has now been voted and booted away so far down the road it would make a can envious. However, what did we really get?

In my opinion we might have been shown there is even far more need to be concerned, for once again, the powers that be have seemingly demonstrate they truly are – the one’s in control.

What happened this week was exactly what a great many (including myself) expected out of the Federal Reserve’s meeting and press conference. i.e., Confirmation it was not only more of the same, but that the world was, and will be, “fine” under their guided hands of policy dictates. Strike a win for the first of the four C’s: confirmation.

However, for the remaining three? i.e., crisis, contagion, catastrophe? The markets were delighted to find any hints of turmoil now brushed firmly and neatly aside.

Crisis became calm. Contagion became cured. And last but not least catastrophe morphed into an even grander state of complacency.

On this note one could hear the call sounded Friday throughout Wall Street: Release the algos! (I mean hounds) And tip the pool boys extra at our Hamptons retreat and tell them to keep the pool open for another week! For these are truly glorious times to be buying the all time highs!!! Forget dips. Who cares about dips – we don’t need no stinkin’ dips!

Although that’s tongue in cheek (not by much I’ll argue) it was the reaction.

Again this issue alone might become more informative as to illustrate why even more concern and prudence should be taken with everything we now know as “the financial markets.”

Today, just the calling to attention these or other varying types of systemic time bombs by people like myself and others is met with a sheer total and wanton disregard for any rationale push back. Now nearly any, if not all, is met with glaring scorn and worse. It’s as if 2008 never happened.

Let’s forget about the market maven crowd for the moment and view the way all of this is being sliced, diced, and served up to the public at large. i.e., Anyone not on some form of public assistance that are trying to keep, save, or build what they now have left. Whom I might add; are the real group of people who if something were once again to happen as it did in 2008 and they indeed do pull any remaining funds – there would be no need for 70% (if not more) of all the financial world as it is now known.

For who needs brokers, advisers, financial media outlets, High Frequency Trading companies, et al if the markets hiccup in a fashion reminiscent of 2008 – and nobody comes to the blue light sale? At any price.

The issue today where this meme of “All clear everything is ducky!” is in that: its more acute with the potential of causing exponentially even more damage to both the wallets and psyche of a great many that make the economy work than possibly before. i.e., Business owners, 401K holders, people both currently working as well as those actually trying to get back to work.

Again, even with a systemic issue causing an event only 2/3rds in size of the prior fall; now, at these levels, with what they’ve been told to believe as gospel? (i.e.,”it was a once in a generation event”) What few remaining holders of any worth would do near immediately (if not sooner) is too pull anything and everything out and as far away from anything Wall Street related for a minimum of a generation. Period.

What leads me to say what many in financial media would call “hyperbolic” “Chicken Little-esque?” Easy.

Just look at what is currently being portrayed as “financial analysis” and “instructive insights” across most of the financial media today.

If you have the tenacity or testicular fortitude as to dare state that regardless of what is being portrayed as an economic success: you are pilloried, denounced, and if your lucky – you get off the set before the tomatoes arrive.

It doesn’t matter if you can logically and methodically present the case why caution should be of the first order. Even when you preface your argument and viewpoint stating fully and honestly that you understand that as of today the market has proved you “wrong.” Expect no absolution to discuss any relevant points further. For you have now opened the doors  for an inquisition reminiscent of centuries past.

The only difference in days past and today is that now instead of being placed on “the rack” in helping to persuade one into accepting a canonized religion – you’re now placed staring down the hypothetical barrel of the Federal Reserve’s money blasting howitzer while trying tenaciously to hold onto what you believe is the equivalent of all you have left of your wealth (i.e., cash) while being asked by the inquisition panel led by Chair Yellen, “Well, do you feel lucky punk?”

Blatant examples of this thought process personified was seen on none other than the once darling of mom and pop 401K viewers CNBC™.

During a segment interview the host Jackie DeAngelis unabashedly posed a rhetorical ambush styled question/statement to a well-respected Wall Street veteran Bill Fleckenstein.

In a condescending snark laced tone the seemingly sister in arms inquisitor asked, “At what point are you willing to concede that you’ve misunderstood monetary policy?”

The whole problem with both this show host and the people who think like her is: That question should be asked of themselves! For it is they who both believe and are acting as if this new religion of monetary policy is what should be canonized. And if you don’t convert? Let the inquisition begin!

Maybe if they televised those with questioning viewpoints either on a rack or hung from ceiling chains they could get their viewership numbers out of the gutter, but that wont happen if this is where their journalistic morals are going to remain. Just saying.

As blatant as the above was there was also just as an alarming exchange between host and guest that went unnoticed that occurred during this same week.

On Bloomberg Surveillance™ the host Tom Keene (TK being one of the few I have high regards for) asked a pointed question to then guest Frederick Lane of Raymond James™. The question was in relation to how investors feel about corrections in today’s markets and how many are now looking (or have the expectation) for a correction-free market. The response was, in my opinion, a pure instructive lesson on how and why those on Wall Street are not breathing rarefied air – they’re sucking on their own exhaust.

Here are few takeaways that just left me slack-jawed.

First: As far as news related events? You can pay attention because its “interesting” and probably informative, but if there’s something traumatic that happens, fine, pay attention. If there&rsqu
o;s really a sea change, fine pay attention to that, but (and it’s a very big but) He does not equate volatility and risk.

I hung my head and thought: Here, it comes….wait for it! And I was not disappointed. He continued….

Risk is about diversification, volatility is markets go up and markets go down. The investor needs to ignore that. ( I wonder what category the outbreak of thermonuclear war or Janet Yellen pulling the punch bowl away all at once fits into? I only need the category, for I know the effect is the same for Wall Street. But I digress.)

And the coup de gras? When asked about investors emotional state when dealing with markets like when the market is down 5 or 6 or 7%, and he hears from an investor “Oh my god I lost money!” he thinks that’s an “odd phrase” for someone who’s already made 20% or 30% or 40% by being an investor.

He goes on: “No – you didn’t lose money. You lost value.” Then proceeds to say later in relation to a point being made about “gloomy.” If you’ve been an investment banker from that perspective the markets haven’t been that gloomy. (Insert what should be the greatest thank you homily ever sung to Janet, Ben, and everyone at the Federal Reserve here)

Is an “investor” no longer the individual mom and pop, small business owned entrepreneurs, professional executives, dentists, doctors, lawyers, solo practitioners, and others that try desperately to sock away their hard-earned money in a 401K or other vehicle?

Or, are they just the schlub and schleps that make up the fuel for the “investment banker” to pool and use to their advantage and liking? I know – it’s rhetorical, and redundant.

I would suggest you take the time and here it for yourself rather than take my opinion. You can find the original broadcast via many venues at http://ift.tt/1v6D687. (The segment appeared Tue. Sept. 16th, 2014 titled “James’ Lane Sees No Other Place”)

Back in 2007 when the economy appeared to truly have legs, as always, Wall Street made their case why you, me, and anyone with a dollar should be “invested.” For it was expressed everywhere that the average Joe and Jane Schmo were the most important Wall Street players with their booming and ever-growing 401K’s.

Flipped a house? Got a raise? Sold your business? Put your profits here (on Wall Street) and do it again! Rinse, repeat seemed to be the new war cry. Then 2008 happened.

What were many told when in October 2008 when the markets first began selling off 5, 6, 7% ? You know it – the same as they’re being told to do today. Only then it was “average in” not the more common moniker it is known as today – JBTFD. (just buy the f’n dip!)

If you did follow that advice only 5 short years ago, you lost 50% of your money and wealth over the next 12 months. And that was if you were lucky. Some lost far more, and some lost all.

Oh wait, how foolish of me. They didn’t lose money – “they lost value.” Whew, thank the Lord for that, because the mortgage, car payment, kids tuition, ex-wife’s alimony, child support, not to mention the credit cards, and utility payments are all due. And being so close to retirement if not just retired they might be a little nervous when they look at their balance over those next 12 months or so.

Adding to this hypothesis in tone displayed where an “investor” is up 20, 30, 40% and is looked upon as speaking “odd” when they express concern when markets today seem to flutter. Ponder this:

You would have not only needed to have held on, but also had not taken a single penny out of that beleaguered nest egg that many thought would be available, and many depended on for income for nearly 4 years till you got back to “even.”

Not made money, not generated income for living expenses, but even. Not until near May of 2013 did the market reach prior levels. Hope you as an “investor” with money under management by this crowd didn’t have any “expenses” over those years. Oh wait – regardless how little was in your account balance in 2009 you might have stopped buying food to reduce expenses, but you would still be liable for their “fee.” Taking food off your table is one thing, but don’t you dare reach for the food on theirs.

This whole thing cuts right to the chase that is just a disaster waiting to happen by the very people who want to tell anyone with any common sense they don’t know what they’re talking about.

The issue is we do know we’ve been “wrong” and not afraid to admit or state it. However, we also know we’ve been wrong for all the right reasons. And: we can not only live with that, we can also function, feel more secure, and be financially stable investors, entrepreneurs, business owners, and mom and pops knowing it.

What we don’t need – nor want – is another bowl of the 2008ish tripe washed down with this years new flavored Kool-aid™.

Here’s what a few of us also know that we are not “wrong” about.

When a monkey throwing darts can outperform most of today’s so-called “best of the best” hedge funds – we’re going to put our money on the monkey, rather than putting it anywhere close to where these people can put their hands on it for their own personal self-serving monkey business.

via Zero Hedge http://ift.tt/1wDqB4U Tyler Durden

 

 

Courtesy of the SlealthFlation Blog:

 

United States Federal Reserve                     September 22nd, 2014

20th Street and Constitution Ave NW

Washington, District of Columbia 20551

 

The Honerable Janet Yellen, Chairman

 

Dear Janet;   

   

If I may be so forward, as a concerned citizen of the United States of America, it is with great consternation that I feel compelled to write you the following distressing note.

Purposely degrading this magnificent Nation’s hard earned reserve currency status, which was so honorably passed on to you by previous generations who built this great country from the ground up through their virtuous and industrious blood, sweat and tears, only to then implement a disgraceful monetary policy that deliberately steals from future unborn generations in order to facilitate living standards beyond our means, so as to sustain an unearned, undeserved and unprincipled culture of grotesque illegitimate debt financed over-consumption, can only be characterized as a deplorable, misguided, unconscionable abomination of Biblical proportion.

,

Respectfully yours,

John Q. Savers

Citizen of the Constitutional Republic of the United States

via Zero Hedge http://ift.tt/1tOpksj Bruno de Landevoisin

Of the stories in the past two days, there is hardly anything more bizarre than that of Omar J. Gonzalez, 42, of Copperas Cove, a veteran had served three tours in Iraq — and relatives said served as a sniper — managed to jump over the White House fence, sprinted more than 70 yards across the Northern Lawn, got to the front double doors of the North Portico, turned the brass knob and stepped inside the vestibule. “There he was grabbed and subdued by an officer standing post inside the door.” He war carrying a folding knife with a serrated blade and was located just feet away from where Obama would have normally been, if only Obama had not just minutes ago taken the wife and kids for yet another weekend mini getaway.

A detailed breakdown of events from WaPo:

On Friday at about 7:20 p.m., Gonzalez did the unthinkable, authorities said. The 42-year-old from Texas climbed over the north fence line along Pennsylvania Avenue, toward the eastern side of the house’s circular driveway. His breach set off the standard security alarm across the compound. Officers rushed to the North Lawn but were unable to reach him on foot as he ran, arms pumping, threading the needle between the fountain and a security guard booth and ignoring their commands that he stop.

 

Officers at the scene considered Gonzalez to be unarmed and likely mentally disturbed, a law enforcement official familiar with the incident said, and thus a low risk. It turned out Gonzalez was carrying the knife in his pants pocket. One source familiar with the incident said a sniper on scene had Gonzalez in his rifle sights just in case.

Which is ironic since Gonzalez himself was supposedly a sniper in his tours of duty.

While initial reports said that Gonzalez had been unarmed, it was in the affidavit filed later in U.S. District Court by a Secret Service (summarized here) where we learned that Gonzalez was carrying a “VG-10 black folding knife,” a pocket knife with a 3.5-inch serrated blade, when he entered the White House.

According to WaPo, “a trained attack dog — the Secret Service’s fail-safe measure for stopping intruders when officers cannot — was not released in this case. The reasons are under investigation.”

Here is where it gets bizarre: Gonzalez told a Secret Service officer that he was concerned “the atmosphere was collapsing and needed to get the information to the president of the United States so that he could get the word out to the people,” the affidavit said. Perhaps he should have waited until today’s New York City parade to convey his message instead of possibly spending as much as a decade behind bars.

What is stranger is that Gonzalez was neither under the influence of drugs or alcohol when the event took place: at a hearing late Saturday afternoon in D.C. Superior Court, the assistant public defender representing Gonzalez said Gonzalez had no convictions or arrest warrants, had tested negative Saturday for drug use and had been in the military for 18 years.

“This is someone who has provided service to his country and shown commitment in his life,” said the lawyer, Margarita O’Donnell, as she tried unsuccessfully to get Gonzalez released.

In other words, it was just the PTSD flaring up. The good news is that the alleged sniper didn’t put some of his other veteran skills to use when “approaching” the president.

The former soldier faces up to 10 years in prison on a charge of unlawfully entering a restricted building or grounds while carrying a deadly or dangerous weapon, prosecutors said. He couldn’t be reached for comment.

And then came the shocked statements by pretty much everyone that an armed veteran could get within feet of Obama’s living quarters:

“Although last night the officers showed tremendous restraint and discipline in dealing with this subject, the location of Gonzalez’s arrest isn’t acceptable,” a Secret Service statement said on Saturday.

…

“This is totally and wholly unacceptable. . . . How safe is the president if this can happen?” said Rep. Jason Chaffetz (R-Utah), chairman of the House Oversight and Government Reform subcommittee on national security. “I just can’t believe somebody can go that far without being impeded. The perception they are creating is only going to inspire more security breaches.”

…

Rep. Peter King, R-N.Y., said the intrusion was “absolutely inexcusable” and he expected congressional hearings into the incident at one of the world’s most heavily secured buildings.

“This demands a full investigation, an investigation as to what happened, why it happened and what’s being done to make sure it never happens again,” he told “Fox News Sunday.”

And then it was Obama’s turn to “comfort” the public that the Secret Service is still capable of protecting him: the White House released a statement Saturday, saying, “The President has full confidence in the Secret Service and is grateful to the men and women who day in and day out protect himself, his family and the White House. The Secret Service is in the process of conducting a thorough review of the event on Friday evening and we are certain it will be done with the same professionalism and commitment to duty that we and the American people expect from the U.S. Secret Service.”

As Newsday adds, the Secret Service said its Office of Professional Responsibility was carrying out the review. The breach triggered a rare evacuation of much of the White House. Secret Service agents drew their weapons as they hurried White House staffers and journalists out of the West Wing through a side door.

Then again, perhaps the reason for the lax security is far simpler. As it turns out, Gonzalez made it over the fence line just minutes after Obama and the first family took off from the South Lawn on a Marine One helicopter bound for Camp David.

In other words, as has been the case quite extensively in the past several years, Obama was simply not in the White House, and was far more likely to be found “resting” elsewhere, an elsewhere in immediate proximity to a golf course.

So perhaps the question is a simpler one: in order to better defend the president of the free world during his now traditional forays on the rough and to a lesser extent, the green, maybe the secret service has been taking so many lessons in “defending POTUS on and around a golf course” that they have simply forgotten how to do the same while on location at the White House.

In fact, what may be most surprising in all of the above is why Obama picked Camp David as his weekend escape: after all it is well-known that “Obama has rarely visited Camp David, the sprawling, secluded retreat in northern Maryland that has become a regular getaway spot for presidents over the past 70 years.” The reason: Camp David doesn’t have a full golf course, and the president prefers to spend weekends on the links. 

Surely a detailed follow up investigation will answer all these and more questions in short order.

via Zero Hedge http://ift.tt/1tOpiAG Tyler Durden

Of the stories in the past two days, there is hardly anything more bizarre than that of Omar J. Gonzalez, 42, of Copperas Cove, a veteran had served three tours in Iraq — and relatives said served as a sniper — managed to jump over the White House fence, sprinted more than 70 yards across the Northern Lawn, got to the front double doors of the North Portico, turned the brass knob and stepped inside the vestibule. “There he was grabbed and subdued by an officer standing post inside the door.” He war carrying a folding knife with a serrated blade and was located just feet away from where Obama would have normally been, if only Obama had not just minutes ago taken the wife and kids for yet another weekend mini getaway.

A detailed breakdown of events from WaPo:

On Friday at about 7:20 p.m., Gonzalez did the unthinkable, authorities said. The 42-year-old from Texas climbed over the north fence line along Pennsylvania Avenue, toward the eastern side of the house’s circular driveway. His breach set off the standard security alarm across the compound. Officers rushed to the North Lawn but were unable to reach him on foot as he ran, arms pumping, threading the needle between the fountain and a security guard booth and ignoring their commands that he stop.

 

Officers at the scene considered Gonzalez to be unarmed and likely mentally disturbed, a law enforcement official familiar with the incident said, and thus a low risk. It turned out Gonzalez was carrying the knife in his pants pocket. One source familiar with the incident said a sniper on scene had Gonzalez in his rifle sights just in case.

Which is ironic since Gonzalez himself was supposedly a sniper in his tours of duty.

While initial reports said that Gonzalez had been unarmed, it was in the affidavit filed later in U.S. District Court by a Secret Service (summarized here) where we learned that Gonzalez was carrying a “VG-10 black folding knife,” a pocket knife with a 3.5-inch serrated blade, when he entered the White House.

According to WaPo, “a trained attack dog — the Secret Service’s fail-safe measure for stopping intruders when officers cannot — was not released in this case. The reasons are under investigation.”

Here is where it gets bizarre: Gonzalez told a Secret Service officer that he was concerned “the atmosphere was collapsing and needed to get the information to the president of the United States so that he could get the word out to the people,” the affidavit said. Perhaps he should have waited until today’s New York City parade to convey his message instead of possibly spending as much as a decade behind bars.

What is stranger is that Gonzalez was neither under the influence of drugs or alcohol when the event took place: at a hearing late Saturday afternoon in D.C. Superior Court, the assistant public defender representing Gonzalez said Gonzalez had no convictions or arrest warrants, had tested negative Saturday for drug use and had been in the military for 18 years.

“This is someone who has provided service to his country and shown commitment in his life,” said the lawyer, Margarita O’Donnell, as she tried unsuccessfully to get Gonzalez released.

In other words, it was just the PTSD flaring up. The good news is that the alleged sniper didn’t put some of his other veteran skills to use when “approaching” the president.

The former soldier faces up to 10 years in prison on a charge of unlawfully entering a restricted building or grounds while carrying a deadly or dangerous weapon, prosecutors said. He couldn’t be reached for comment.

And then came the shocked statements by pretty much everyone that an armed veteran could get within feet of Obama’s living quarters:

“Although last night the officers showed tremendous restraint and discipline in dealing with this subject, the location of Gonzalez’s arrest isn’t acceptable,” a Secret Service statement said on Saturday.

…

“This is totally and wholly unacceptable. . . . How safe is the president if this can happen?” said Rep. Jason Chaffetz (R-Utah), chairman of the House Oversight and Government Reform subcommittee on national security. “I just can’t believe somebody can go that far without being impeded. The perception they are creating is only going to inspire more security breaches.”

…

Rep. Peter King, R-N.Y., said the intrusion was “absolutely inexcusable” and he expected congressional hearings into the incident at one of the world’s most heavily secured buildings.

“This demands a full investigation, an investigation as to what happened, why it happened and what’s being done to make sure it never happens again,” he told “Fox News Sunday.”

And then it was Obama’s turn to “comfort” the public that the Secret Service is still capable of protecting him: the White House released a statement Saturday, saying, “The President has full confidence in the Secret Service and is grateful to the men and women who day in and day out protect himself, his family and the White House. The Secret Service is in the process of conducting a thorough review of the event on Friday evening and we are certain it will be done with the same professionalism and commitment to duty that we and the American people expect from the U.S. Secret Service.”

As Newsday adds, the Secret Service said its Office of Professional Responsibility was carrying out the review. The breach triggered a rare evacuation of much of the White House. Secret Service agents drew their weapons as they hurried White House staffers and journalists out of the West Wing through a side door.

Then again, perhaps the reason for the lax security is far simpler. As it turns out, Gonzalez made it over the fence line just minutes after Obama and the first family took off from the South Lawn on a Marine One helicopter bound for Camp David.

In other words, as has been the case quite extensively in the past several years, Obama was simply not in the White House, and was far more likely to be found “resting” elsewhere, an elsewhere in immediate proximity to a golf course.

So perhaps the question is a simpler one: in order to better defend the president of the free world during his now traditional forays on the rough and to a lesser extent, the green, maybe the secret service has been taking so many lessons in “defending POTUS on and around a golf course” that they have simply forgotten how to do the same while on location at the White House.

In fact, what may be most surprising in all of the above is why Obama picked Camp David as his weekend escape: after all it is well-known that “Obama has rarely visited Camp David, the sprawling, secluded retreat in northern Maryland that has become a regular getaway spot for presidents over the past 70 years.” The reason: Camp David doesn’t have a full golf course, and the president prefers to spend weekends on the links. 

Surely a detailed follow up investigation will answer all these and more questions in short order.

via Zero Hedge http://ift.tt/1tOpiAG Tyler Durden