LARGER CONFLICT
Obviously the Middle East situation is serious and all the countries in the region are using the Palestinians as their tool to achieve their goals. The recent use of rockets by Hamas is said to be at the prompting of Syria and Iran in an attempt to draw more blood in the region and complicate any move to remove Assad from power.
Israel needs to respond strongly in this situation to achieve their own political motivation as there is an election coming and PM Netanyahu must strengthen his position and solidify his support amongst rival political parties.
DISTRACTION IS THE TOOL OF CHOICE
Egypt's new leadership will play a familiar set of cards where they blame Israel and make every effort to make its neighbor's life hard. Why take ownership and responsibility for how you lead your country when you can create a distraction about how evil the people are in the country across the way? We are beginning to see the delicate balance that the Muslim Brotherhood must walk where they have very strong ideological feelings on one side, but the harsh reality of actual war on the other. In a sense, the radical Egyptian leadership suddenly sees how difficult it is to really rule and manage tough situations. The good news is that at this point they haven't gone "all in" nutso like Syria and Iran and still value life somewhat and their hate of Israel isn't strong enough for them to sacrifice the lives of their people for their ideas. The bad news is that for decades we haven't had to worry about the level of fanaticism in Egypt, but now we do.
GIVE ME POWER
Hamas, is well, Hamas where they will gladly shoot off thousands of rockets and bring retaliation on their people all in the name of "struggle" which is actually simply a tool to reinforce their power within the Gaza strip. They make political calculations and gamble with the lives of innocent civilians knowing that their attacks will result in the deaths of many of their own.
If the situation in Israel and the Middle East wasn't so dangerous, it would be funny.
Here is a perspective on Hamas you should see.
GOATMUG
Goatmug is an investor that cares about you and your family. Goatmug's Blog - Financial Perspectives From The Mountain Top is a collection of thoughts on our economy and how it impacts the lives of investors and average people. While several specific investments are named in many of his posts, these articles are simply invitations for you to do your own research and reference to these securities does not constitute financial advice. Your situation is complex and unique and you should seek professional assistance with your trading and investing. Please visit Goatmug and share your comments athttp://www.goatmug.blogspot.com/
I've been thinking about the following topic for about three weeks now and the discovery of the following video from FOX NEWS spurred me to actually put my thoughts down here. Before you roll your eyes and click over to some other blog because I'm going to go deep into my political rants, stop, wait, and hear me out. I'm going to briefly highlight this because it is important and is going to help us today and in the future.
Watch a few minutes of Fox here where they put together two years worth of video and created the illusion that Ron Paul is booed vehemently as he is announced the winner in 2011. The only problem with the video is that he wasn't booed in 2011, the boos were provided in 2010! Fast forward to 4:45 in the video to see the actual reaction to the announcement at the 2011 convention.
The CPAC attack on Ron Paul by Fox News is just an example of how we live in a world where "what they show us" becomes reality. This is why state run media in Russia, China, Iran, and North Korea is so effective at framing a picture of reality for their people. After viewing the video you walk away with the idea that Ron Paul may have won, but he sure is a poor candidate because he has a lot of people that are not supporters.
Readers of the Goatmug Blog know that as a history buff I relish the views of thinkers like J.R. Nyquist who writes on the geopolitical landscape with an emphasis on Russia, the plague of Communism, and the tactics used by them to obtain power and achieve their goals. Mr. Nyquist's latest offering provides details about the possibility that the Egyptian revolution may have been hijacked or at least sponsored by people that didn't have a genuine quest for liberty.
In his post, Nyquist reveals that bloggers from the Ukraine couldn't find a majority of people that supported the uprising and in fact could find many Coptic Christians that felt a transition could be a bad thing.
I've found the original blog post he referenced from the Ukranian bloggers and have translated the text with the help of a translator (it's still a bit rough).
"Domestic and international media broadcast the one-sided interpretation of the U.S. government concerning the events in Cairo. Most reporters in the hotel for security reasons, and looks at what is happening through the eyes of CNN and the BBC.
We visited Egypt and study in detail the situation on the ground. Having talked with hundreds of residents of Cairo and other Egyptian cities came to a single conclusion: a nationwide uprising against President Mubarak does not exist.
Most of the population, even if it does not support the current government, a negative attitude toward anti-presidential parties shares. In particular, the Copts, are the largest Christian community in the Middle East believe that, if successful coup significantly worsen the situation of Egyptian Christians. And why the Copts are not allowed the protesters to their quarters.
In fact, the Egyptian rebellion is limited to one area of Cairo. Statements made in Tahrir Square can not be considered massive - they account for up to twenty thousand members, but for the millions of Cairo is extremely small.
The Egyptian army is not against the protesters, not because Mubarak has lost his grip on power but because the position of Mubarak - not to irritate the Americans. Participants in the uprising - nice people, but their protest, they rely solely on the support of the U.S. government."
What if this was true, that the revolt was led by a small group of minorities that had more sinister reasons yet were championed by naive reporters in the media? We need to keep in mind that the reporters want and need juicy stories that play well for the camera. The need for a good story line is why you kept hearing that these were "youths" rallying for freedom. Where was the coverage of the Muslim Brotherhood that cried for an Islamic state for Egypt that could unite all Muslims under one rule? That is what we heard from the Muslim Brotherhood leader Monday. Interesting that we didn't hear that before the fall of Egypt's leader. We wouldn't want the global media machine to let facts get in the way of an inspiring story would we?
What were the angles we received in the reporting? We consumed lots of the following;
Egyptians were casting off the yoke of economic hardship
The youth were breaking the chains of those that are heartless leaders
While there is truth to this, think deeply, these portraits seem to have been constructed for our eyes, ears, and hearts to compel us to support this version instinctively.
Given the fact that we see a rumored "conservative" media outlet splicing video and creating their own version of an event we must question what that means for us as investors and participants in this "democratic" country.
As Amerikans are pushed to the brink in the near term and the future don't be deluded to believe that all of them are violent terrorists. Many folks like you and me will be forced to stand up against financial tyranny and the lack of representative government in the office of the President, the Senate, and Congress. The disconnect between our "leadership" and the desires of the people is growing, not shrinking. When Amerikans simply cannot stand it any longer you can expect to see edited videos and disinformation about their actions and their message. Amerikans won't riot because they see an erosion of their personal liberties and a decay in their ability to protect and express themselves, no, we are fat sheep. Amerikans will watch idly by as the poor waste away, but citizens will finally rise up when the middle class cannot afford food and gas or something terribly essential like cable or cell phones. When Amerikans do come to their senses and stand up, you can be sure to find the media reporting that these people are trouble makers, quacks, and opposition forces rather than freedom fighters demanding that their government listen. Sounds like how the Tea Party has been characterized doesn't it?
Second, our own government will use the media to continue to lie to us. Ben Bernanke lied right in our face with his testimony that attempted to claim responsibility for the "asset price increases" in stock markets, but dispel any notion that he has the power to lift commodity prices and food prices around the world. How is the Fed all powerful in the one situation but entirely powerless in the other? Doublespeak at its finest! I haven't read 1984 by George Orwell since high school, but I will read it again because these are the days we are living in.
Here are a list of the lies I could find just in this testimony and a quick listening while I was typing.
1:10 in the video - We are not monetizing our debt because it is temporary (there is no way they can reverse this)
3:30 in the video - The US is not responsible for inflation worldwide.
5:25 in the video - We have 1% inflation in the US
In conclusion, I want you to know that I am not a conspiracy theory junky who sees attacks coming from everywhere and evil plots lurking around each corner. I do believe that Amerikans believe what we are presented and we cannot continue to consume the political and economic gruel that is being served. The Fox News story absolutely worries me as Ron Paul is someone who is an enemy of the Fed (at least in the way he speaks, let's see some action), and it is clear that editors at Fox News purposefully framed this to hurt his political support and momentum. I would expect those actions from MSNBC and even Dan Rather with CBS, but it simply puts me on alert to question everything. We already question every statistic released from China, why don't we do the same for statistics from the US?
If everything we see from the media is true, it is a certainty that US citizens will act like these peaceful Iranians starting at :50 in the final video clip where clerics demand the death of imprisoned leaders that called for uprisings in Iran.
As many readers know I've been highlighting the activities of the Fed and how those actions impact the US and the world. In the 2011 Outlook I emphasized how the exporting of inflation would cause oil and gas to go much higher and how food would also be impacted as a result.
Over the last week we have seen the media blitz as Tunisia and Egyptian riots have boiled over due to poor economic conditions like high unemployment, poor wages, and the rising cost of food. Tunisia has overthrown their leadership and it appears as though Egypt will also have new leadership.
The coming changes in Egypt have me wondering what is next. To assist readers, I've included a link here to Stratfor which is an organization that is made up of former intelligence officers that now sell market and world intelligence to Wall Street and other buyers. They have a very informed group that has great insight in world politics and economics. The 8 minute video is worth watching.
There is a ton of great stuff in the interview, but I think the money shot here is that he says that the events in Egypt are of "towering consequence". In other words, "THIS IS BIG". The drama that unfolds there is so interesting because it unveils the conflicting US position where we support strong-men dictators while championing democracy. This is just another opportunity to see how ill prepared Obama (and Hillary Clinton) is to understand and deal with the real-world dynamics of foreign policy. The truth is that the US and Israel have implemented successfully a strategy of playing on the divisions of the people in the Middle East for many years. Think about it, we look to take advantage of the differences between Arabs and non-Arabs, and we play to the divide between Sunnis and Shiites. A homogeneous Middle East dominated by a common "democratically elected" Islamic movement is absolutely not in the best interest of the US, or probably the world. I hope that there is a skillful way for the US to continue to play this game, we absolutely need adept diplomatic leadership now.
I also have a few take aways that I've been thinking about over the weekend;
A change of leadership in Egypt probably ushers in a more overt role by the military.
Muslim (Islamist) elements will gain a larger presence within the government. (Remember, these guys don't have to be the President to impact the direction of the state. They can simply write laws that steer the country in new directions)
The border with Israel is of great concern. Remember, Egypt has played a major role in containing the Palestinians by having a "sealed" border. A government that is more sympathetic to the Palestinians could mean instability for Israel.
The broader question is whether or not the spread of unrest stops in Egypt. If a change of power is made, I believe that it will incite others to attempt to try. The reality is that if new countries are swept up in the move to overthrow current leadership, things could become very nasty and bloody as leaders look to put down to the revolts. Oman is certainly a place to look for this to occur. I've heard that perhaps a move like this may take place in Syria as much of the country is not Islamic yet the government is run by the minority (I don't believe this will happen). As demonstrators have more success, I look for other countries full of disenfranchised youth to try to "Walk Like an Egyptian".
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