Total Pageviews

Friday, February 12, 2016

Turkey Shells Aleppo, Says "Massive Escalation" In Syria Imminent As Saudis Ready Airstrikes

Even as all sides - including the US, Russia, Saudi Arabia, and select rebel groups - pretend to be working towards a ceasefire and a diplomatic solution to the five year conflict in Syria, actions speak louder than words, and to put it as succinctly as possible, everyone is still fighting.

In fact, the fighting is more intense than ever. Russia and Hezbollah are closing in on Aleppo, the country’s largest city and a key urban center where rebels are dug in for what amounts to a last stand. If the city is liberated by the government (and yes, “liberated” is more accurate than “falls” because occupied territory belongs to the Syrian government, not to Sunni extremists), Assad will have regained control of the country’s backbone in the west.

That would effectively mean the end of the rebellion and the Gulf monarchies, not to mention Turkey, are not happy about it. “The main battle is about cutting the road between Aleppo and Turkey, for Turkey is the main conduit of supplies for the terrorists,” Assad said in an interview with AFP on Friday.

That supply line has been severed and now, it’s do or die time for the rebels’ Sunni benefactors in Ankara, Riyadh, and Doha. Either intervene or watch as Hezbollah rolls up the opposition under cover of Russian airstrikes, restoring the Assad government and securing the Shiite crescent for the Iranians.

As we documented extensively this week, the Saudis and the Turks are now set to invade. Assad has promised to “confront them”, which of course means that the IRGC and Hassan Nasrallah's army are set to come into direct contact with Turkish and Saudi troops, setting the stage for an all-out sectarian war that will almost invariably end up pitting NATO against the Russians. Note that this is different from Yemen, where Tehran fights via proxies rather than directly against the Saudi military.

On Saturday the stakes were raised when Turkey said Saudi Arabia is set to send warplanes to Incirlik.

As a reminder, access to Incirlik was the carrot Erdogan used last summer to convince NATO to acquiesce to Ankara’s brutal crackdown on the PKK. “Let me wage war against my political rivals, and you can use our airbase,” is a fair approximation of Erdogan’s proposition. 


Video: Turkey’s Military Intervention in Syria
By South Front

During the video production, Southfront: Analysis & Intelligence also recieved information that at least one Saudi motorized brigade equipped with about 90 armoured vehicles were moved to Iraqi border. 

This force could become a core of a joint force which could be used by the Saudi-led coalition to support Turkish military intervention to Syria.

The military balance in Northern Syria is shifting rapidly. The Syrian Army and local militias supported by the Russian Air Force have cut terrorists from major supply lines from Turkey and almost encircled the militant forces in the Aleppo city. This has become possible due to the actions of the Russian Aerospace Defense Forces which have been destroying the terrorists’ sources of funding since 2015. Thus, we could observe a breakdown on the battlefield which leads to a full collapse of the terrorists forces in Syria step by step. This also dished schemes of the foreign players interested in overthrowing of the Assad government.

In the contemporary situation the Erdogan’s regime acts as a main sponsor and creator of a terrorist threat in the Middle East. Turkey is a crucial part of terrorist logistics network which allows terrorist groups in Syria to receive arms supplies and reinforcements. The Turkish elites have a strong business ties predominantly oil smuggling with ISIS and other terrorists in Syria. The Erdogan’s imperial ambitions in the Middle East also plays an important role in the conflict. Erdogan believes that a breakdown of Syria will allow him to set a protectorate or even occupy the northern part of the Arab country. 


'New cold war inches closer' after Turkey bombs Syria following Russia threat
By John Shammas

Vladimir Putin, Syria

Turkey's military has provoked Russian president Vladimir Putin by bombing targets in Syria, just hours after the Kremlin warned that such action could lead to a "new cold war".

The country's army targeted Kurdish militia near the town of Azaz in northern Syria.

A Turkish government source confirmed the attack, despite the Kermlin's warning earlier today that Turkey and Saudi Arabia's proposed anti-ISIS action in the country could lead to a major world conflict.

The source said: "The Turkish Armed Forces fired shells at PYD positions in the Azaz area" referring to the Kurdish Democratic Union Party (PYD), which Turkey regards as a terrorist organisation.

Read more: Russia warns of 'new Cold War' as Saudi Arabia and Turkey 'threaten anti-ISIS ground offensive in Syria'

Earlier today the Russian Prime Minister Dmitry Medvedev said he was fed up of Russia being accused of war crimes in Syria. 


Turkey strikes Kurds in Syria, mulls ground attack with Saudi Arabia
AFP, Beirut

Turkish artillery on Saturday shelled areas of Aleppo province in northern Syria held by Kurdish forces, a monitor said, as Ankara said it could launch a ground assault alongside Saudi troops.

The Syrian Observatory for Human Rights said Turkish artillery struck areas of Aleppo, including Minnigh airbase recently taken by the Kurdish People’s Protection Units (YPG) militia from Islamist rebels.

Ankara considers the Syrian Kurdish Democratic Union Party (PYD) and its YPG militia to be branches of the Kurdistan Workers Party (PKK) which has waged a decades-long insurgency against the Turkish state.

The shelling came shortly after Turkish Prime Minister Ahmet Davutoglu said Ankara would, if necessary, take military action against the PYD.

“We can if necessary take the same measures in Syria as we took in Iraq and Qandil,” he said in a televised speech.

The premier was referring to Turkey’s bombing campaign last year against PKK targets in their Qandil mountain stronghold in northern Iraq.

A YPG source told AFP that the Turkish shelling targeted the strategic Minnigh airbase, which Kurdish forces retook late on Wednesday.

Turkey’s Foreign Minister Mevlut Cavusoglu, quoted in Turkish newspapers, said Riyadh and Ankara were coordinating plans to intervene in Syria, where Russia has been backing a successful regime offensive against rebels.

“If there is a strategy (against the Islamic State jihadist group), then Turkey and Saudi Arabia could enter into a ground operation,” he said. 


Turkish military shelled Kurdish militia in Syria

aku-APA. Turkey's military has shelled Kurdish militia targets near the town of Azaz in northern Syria, a Turkish government source told Reuters on Saturday, without elaborating on the extent of the shelling or why it had been carried out, APA reports quoting Reuters.

"The Turkish Armed Forces fired shells at PYD positions in the Azaz area," the source said, referring to the Kurdish Democratic Union Party (PYD), which Ankara regards as a terrorist organisation.

The Syrian Observatory for Human Rights reported that the shelling had targeted a Syrian air base and a village captured from insurgents in recent days by the YPG militia, which is backed by the PYD.

A Kurdish official confirmed the shelling of northern Aleppo's Menagh air base, which he said had been captured by the Kurdish-allied Jaysh al-Thuwwar group rather than the YPG. Both are part of the Syria Democratic Forces alliance. 


***Saudi Arabia deploys fighter jets to Turkish air base
By Simeon Kerr — Dubai

Saudi Arabia is deploying fighter jets to the southern Turkish air base of Incirlik as the kingdom prepares to take part in an intensified campaign against Sunni militants Isis.

People aware of the matter confirmed reports in Turkey that Saudi air force jets were moving to Turkey, saying it was part of a planned “intensification” of aerial bombardment of Sunni militant group Isis in Syria.

Turkey’s foreign minister was quoted in local media saying Ankara and Riyadh might launch ground operations against Isis, saying Saudi Arabia was “ready to send both jets and troops” to Incirlik.

Saudi officials declined to comment on the planned deployment.

Saudi Arabia has been considering inserting special forces into the Syrian conflict alongside its close Gulf ally, the United Arab Emirates, to help the Sunni Arab states’ rebel allies in their fight against Syrian President Bashar al-Assad, who is backed by the Russian military, Iran and Lebanese Shia militia Hizbollah.

The US and Russia are working towards a nationwide cessation of hostilities in Syria, identifying areas under so-called terrorist control that would remain subject to air strikes. The deal, agreed on Friday, is intended to pave the way for renewed peace talks in Geneva.

Syrian opposition forces, while welcoming the attempt to halt hostilities, have warned the US and its Arab allies to come up with a back-up plan in case the diplomatic breakthrough falls apart.

Saudi Arabia, despite being locked into a war against Iran-allied Houthi rebels in Yemen, has been signalling its willingness to intervene on the behalf of its Syrian rebel allies, who have been put on the defensive by Russian air strikes. 


Turkey Says "Massive Escalation" In Syria Imminent As Saudis Set To Launch Airstrikes


Even as all sides - including the US, Russia, Saudi Arabia, and select rebel groups - pretend to be working towards a ceasefire and a diplomatic solution to the five year conflict in Syria, actions speak louder than words, and to put it as succinctly as possible, everyone is still fighting.

In fact, the fighting is more intense than ever. Russia and Hezbollah are closing in on Aleppo, the country’s largest city and a key urban center where rebels are dug in for what amounts to a last stand. If the city is liberated by the government (and yes, “liberated” is more accurate than “falls” because occupied territory belongs to the Syrian government, not to Sunni extremists), Assad will have regained control of the country’s backbone in the west.

That would effectively mean the end of the rebellion and the Gulf monarchies, not to mention Turkey, are not happy about it. “The main battle is about cutting the road between Aleppo and Turkey, for Turkey is the main conduit of supplies for the terrorists,” Assad said in an interview with AFP on Friday.

That supply line has been severed and now, it’s do or die time for the rebels’ Sunni benefactors in Ankara, Riyadh, and Doha. Either intervene or watch as Hezbollah rolls up the opposition under cover of Russian airstrikes, restoring the Assad government and securing the Shiite crescent for the Iranians.

As we documented extensively this week, the Saudis and the Turks are now set to invade. Assad has promised to “confront them”, which of course means that the IRGC and Hassan Nasrallah's army are set to come into direct contact with Turkish and Saudi troops, setting the stage for an all-out sectarian war that will almost invariably end up pitting NATO against the 

Saudi jets to fly missions in Syria from Turkish base

Saudi Arabia is to deploy military jets and personnel to Turkey’s Incirlik Air Base in the south of the country, Ankara said. The base is already used by the US Air Force for their sorties in Syria.

The deployment is part of the US-led effort to defeat the Islamic State terrorist group, Turkish Foreign Minister Mevlut Cavusoglu said.

"At every coalition meeting, we have always emphasized the need for an extensive result-oriented strategy in the fight against the Daesh terrorist group,” he said, referring to IS by an Arabic-language abbreviation.

Cavusoglu spoke to the Yeni ┼×afak newspaper after addressing a security conference in Munich, Germany, where the Syrian crisis was one of the top issues on the agenda.

"If we have such a strategy, then Turkey and Saudi Arabia may launch a ground operation,” he added, fueling concerns that a foreign troop invasion may soon further complicate the already turbulent situation in the war-torn country. 

KERRY, You are SOOOOOOOOOOOO FUCKING Worthless!!!!!!!!!!!!!!!!!!!!!

Russia casts doubt on Syria ceasefire deal as army gains ground
MUNICH/BEIRUT | By Paul Carrel, Shadia Nasralla and Tom Perry

Russia said on Saturday a Syria ceasefire plan was more likely to fail than succeed, as Syrian government forces backed by Russian air strikes took rebel ground near Aleppo and set their sights on the Islamic State stronghold of Raqqa province.

International divisions over Syria surfaced anew at a Munich conference where Russia rejected French charges that it was bombing civilians, just a day after world powers agreed on the "cessation of hostilities" due to begin in a week's time.

U.S. Secretary of State John Kerry reiterated accusations that Russia was hitting "legitimate opposition groups" and civilians with its bombing campaign in Syria and said Moscow must change its targets to respect the ceasefire deal.

The conflict, reshaped by Russia's intervention last September, has gone into an even higher gear since the United Nations sought to revive peace talks. These were suspended earlier this month in Geneva before they got off the ground.

In another sign of that escalation, Turkey's military shelled Kurdish militia targets near the northern Syrian town of Azaz on Saturday, a Turkish military source said. A Kurdish official said the shelling targeted the Menagh air base in the northern Aleppo countryside, which he said had been captured by the Kurdish-allied Jaysh al-Thuwwar group.

The Syrian army also looked poised to advance into the Islamic State-held province of Raqqa for the first time since 2014, apparently to pre-empt any move by Saudi Arabia to send ground forces into Syria to fight the jihadist insurgents. 

Ankara says Turkey, Saudi 'could launch Syria ground operation'
By Stuart Williams

Turkey and Saudi Arabia could launch a ground operation against Islamic State jihadists in Syria, the Turkish foreign minister said Saturday, adding the kingdom was already sending jets to a Turkish base to attack the extremists.

The coordinated plans by Riyadh and Ankara, who are pursuing an increasingly tight alliance, add a new element to the explosive situation in Syria where Russia has been backing a successful regime offensive against rebels.

"If there is a strategy (against IS) then Turkey and Saudi Arabia could enter into a ground operation," Foreign Minister Mevlut Cavusoglu was quoted as saying by the Yeni Safak and Haberturk newspapers after taking part in the Munich Security Conference.

"Some say 'Turkey is reluctant to take part in the fight against Daesh (IS)'. But it is Turkey that is making the most concrete proposals," he said.

Cavusoglu added that Saudi Arabia is also sending planes to the Turkish base of Incirlik, a key hub for US-led coalition operations against IS, already used by Britain, France and the United States carrying for cross-border air raids.

"They (Saudi officials) came, did a reconnaissance of the base. At the moment it is not clear how many planes will come," Cavusoglu said. 

SYRIA...............A Civil WAR with ALL of the Potential of Becoming a ""GLOBAL WAR""!!!!!!!!!!!!!!!!!!!!!!!! 

Russian PM: West rekindling the Cold War
By David Rising, The Associated Press

MUNICH — Russia's prime minister accused the West on Saturday of rekindling the Cold War, telling a meeting of top defense officials, diplomats and national leaders that sanctions imposed after the annexation of Crimea and new moves by the NATO alliance "only aggravate" tensions.

Dmitry Medvedev said Russian President Vladimir Putin told the same Munich Security Conference in 2007 that the West's building of a missile defense system risked restarting the Cold War, and that now "the picture is more grim; the developments since 2007 have been worse than anticipated."

"NATO's policies related to Russia remain unfriendly and opaque — one could go so far as to say we have slid back to a new Cold War," he said.

NATO Secretary General Jens Stoltenberg threw the blame back at Moscow. "Russia's rhetoric, posture and exercises of its nuclear forces are aimed at intimidating its neighbors, undermining trust and stability in Europe," he said.

President Dalia Grybauskaite of Russia's neighbor Lithuania said Moscow "is demonstrating open military aggression in Ukraine, open military aggression in Syria."

"It's nothing about cold," she said. "It is already very hot."

The annual conference is one known for frank talk among top officials, and participants this year include U.S. Secretary of State John Kerry, French Prime Minister Manuel Valls, Ukrainian President Petro Poroshenko, Russian Foreign Minister Sergey Lavrov, British Foreign Minister Philip Hammond, and many others. 

Russia bristles at NATO expansion in Eastern Europe
By Daniel Schearf

Russian Foreign Minister Sergei Lavrov met Friday with the head of NATO, Jens Stoltenberg, on the sidelines of a security conference in Munich, after the Western military alliance and the United States announced plans for the biggest military buildup in Europe since the Cold War.

Russia's TASS state news agency quoted Deputy Russian Foreign Minister Alexei Meshkov as confirming that during the meeting, Lavrov expressed concern about the Western military alliance's plans to strengthen its presence on Russia's borders.

Earlier Friday, Russian news agencies quoted Meshkov as saying that Lavrov and Stoltenberg discussed holding a meeting of the Russia-NATO Council, but agreed that the agenda for the meeting still needs to be worked out.

NATO said on its website Friday that Stoltenberg and Lavrov "reviewed NATO-Russia relations and agreed to continue exploring the possibility of a NATO-Russia Council meeting."

The United States is planning to quadruple military spending in Europe to $3.4 billion in 2017 as NATO increases troops on rotation and training, stockpiles military hardware and arms, and forms a rapid reaction force. 

Russian PM Medvedev says new Cold War has begun

Russian Prime Minister Dmitry Medvedev has said tensions between Russia and the West have reached Cold War levels. Other leaders also warned of dangerous divisions within Europe.
By Timothy Jones

Speaking at the Munich Security Conference on Saturday, Medvedev said the world had "slid into a new period of Cold War" as differences grew between the West and Russia over conflicts in Syria and Ukraine.

"Almost every day we are accused of making new, horrible threats either against NATO as a whole, against Europe or against the US or other countries," he told delegates at the meeting in the southern German state of Bavaria.

Medvedev said, however, that in the face of the challenges currently facing the world, such as regional conflicts, terrorism and the migration crisis, Russia needed to be regarded as a partner. He added that differences between Moscow and the rest of the world were not unbridgeable.

"Our positions differ, but they do not differ as much as 40 years ago when a wall was standing in Europe," he said, and cited several instances of agreements that had been achieved since then, including on issues such as disarmament, Iran's nuclear program and piracy.

Sanctions 'mutually damaging' 

NATO Russia Military................WAR "IS" Coming to EUROPE!!!!!!!!!!!!!!!!!! 

Doing the THINGS Needed to Prepare for WAR!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 

The Pentagon Is Betting Big on Space Warfare — Against China and Russia
By Greg Walters

The US Defense Department has asked Congress for $108 million to fund a new facility in Colorado dedicated to drawing up plans and running experiments for war in outer space, as anxiety grows about the possibility of extraterrestrial conflict with China or Russia.

"Potential adversaries are rapidly developing capabilities to deny the US and its allies' use of space during a conflict," US Air Force Major General Robert D. Rego, the US Strategic Command official responsible for the center, told VICE News.

The facility he'll run is called the Joint Interagency Combined Space Operations Center, which goes by the awkward military handle JICSpOC (pronounced jick-SPOCK). Its job, he said, will be to "better integrate our space operations in response to these threats."

The funding request follows Defense Secretary Ash Carter's preview last week of the Pentagon's budget for fiscal year 2017, which he promised would enhance America's "ability to identify, attribute, and negate all threatening actions in space." 

SPACE Warfare.................It's Going to HAPPEN!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 

Pentagon: North Korea Nuclear Missile Threat Increasing

Pyongyang shifts policy to building nuclear arsenal
By Bill Gertz

North Korean military

North Korea poses an increasing danger of using long-range missiles capable of striking the United States with nuclear warheads and is fielding new road-mobile and submarine-launched missiles, the Pentagon said in a report to Congress made public Friday.

The Pentagon is working with South Korea, Japan and other countries to counter “the continued and growing threat from North Korea, its nuclear and missile programs, and its proliferation of related technology,” the report said, adding that the U.S. provides “extended deterrence” through both nuclear and conventional forces.

On the nuclear threat, the report singled out missile programs as a major worry.

“North Korea’s continued pursuit of nuclear technology and capabilities and development of intermediate- and long-range ballistic missile programs underscore the growing threat it poses to regional stability and U.S. national security,” the 30-page report states.

“North Korea’s pursuit of a submarine-launched ballistic missile capability also highlights the regime’s commitment to diversifying its missile force, strengthening the missile force’s survivability, and finding new ways to coerce its neighbors.”

North Korea’s submarine-launched ballistic missile (SLBM) program was first disclosed by the Washington Free Beacon. In January, the first successful ejection test of the developmental SLBM was carried out.

Bruce Bechtol, a former Defense Intelligence Agency expert on North Korea, said the SLBM poses an increasing threat of nuclear attack against the United States.

“The SLBM program is scary to me because it has the new, Golf-class submarine, and the ‘new’ SSN-6 missile to successfully threaten American bases and territory,” said Bechtol, a professor at Angelo State University in Texas.

N. Korean Mobile Ballistic Missile Called Top Threat by U.S.
By Anthony Capaccio

North Korea continues to develop a mobile intercontinental ballistic missile that “would likely be capable of reaching much of the continental United States,” the Pentagon said in a new report to Congress on the secretive regime’s military capabilities.

The KN-08 missile would have an estimated range of more than 3,400 miles (5,500 kilometers), and North Korea already has six “road-mobile” launchers for it, according to the annual report delivered to congressional committees Friday and obtained by Bloomberg News. A mobile missile can be harder to track than a silo-based weapon, although the threat from the KN-08 depends on whether it’s “successfully designed and developed,” the Defense Department cautioned.

The new report, reaffirming a judgment about the KN-08 made by the Pentagon in 2013, arrives amid rising tensions after North Korea conducted a nuclear test on Jan. 6 and launched a long-range rocket on Feb. 7. South Korea and the U.S. have said they will begin talks about deploying an American ballistic missile interceptor system known as Thaad on the Korean peninsula.

In the U.S., the House sent legislation to President Barack Obama on Friday authorizing new sanctions against North Korea. The measure, H.R. 757, would impose sanctions against individuals, companies and foreign governments that contribute to North Korea’s nuclear program and ballistic missile development. It also would penalize those who send luxury goods enjoyed by the regime’s elite or aid in its censorship or human rights abuses.

Other sections of the Defense Department report said that North Korea:

NORTH Korea......................The ""BLACK Swan"" of ASIA!!!!!!!!!!!!!!!!!!!!!!!!! 

Inside the Ring: China Adds Warheads to Older DF-5s
By Bill Gertz

Adm. Cecil D. Haney / AP

China’s military has begun retrofitting single-warhead DF-5 intercontinental ballistic missiles with multiple, independently targetable re-entry vehicles, according to U.S. defense officials. The upgrading of the DF-5 missiles with multiple warheads, known as MIRVs, was detected by U.S. intelligence agencies within the past several months.

The addition of three warheads on the long-range missiles marks a significant shift for China’s nuclear arsenal that is increasing in both warheads and missile systems under a major buildup.

Analysts say the warhead upgrades could affect U.S. strategic nuclear deterrence strategy by requiring a boost in U.S. warheads in the future.

US, Indian Navies Planning Joint Patrols in South China Sea
By Manu Balachandran

The Nimitz-class aircraft carrier USS Carl Vinson (CVN 70) and the Indian navy replenishment oiler INS Shakti (A57) conduct a refueling at sea exercise, April 13, 2012.
Officials say they're drafting ideas one year after leaders agreed to expand naval cooperation and ensure freedom of navigation in the SCS.

The already hot waters of the South China Sea seem to be heading for boiling point.

The US and India have held talks to conduct joint naval patrols in the Indian Ocean and in the South China Sea by the end of the year, Reuters reported. Joint naval patrols involve two countries working together to secure maritime interests, a manoeuvre that the Indian Navy has so far never undertaken.

A strategically vital and reportedly oil rich 3,500,000-square-kilometre body of water, the South China Sea is ensconced between the Asian mainland and a whole host of east Asian island nations. And almost every country touched by it—China, The Philippines, Vietnam, Indonesia, Brunei, and Malaysia, among others—claim some right or the other over it, or at least over some part of it.

China, of course, is the most assertive. The dominant military and economic power in the region, Beijing has been building man-made islands to use as bases for supporting air and sea patrols. The idea is also perceived to be part of its strategy to legitimise its claims over the region in the long run.

South China Sea!!!!!!!!!!!!!!!!!!!!!!!!!!!! 

Time to Hit Pause on the US Army’s Drawdown
By Ret. Army Gen. Gordon Sullivan

A U.S. Soldier of Bandit Troop 1st (Tiger) Squadron 3rd Cavalry Regiment provides overwatch security while soldiers move up Pride Rock mountain to witness the reenlistment of two U.S. Soldiers in Paktya province, Afghanistan.
The entire plan was built around the idea of an Iraq and Afghanistan 'post-war calm' that never really materialized.

Our Army needs to follow the sage advice of a popular adage: When you find yourself in a deep hole, stop digging.

The deep hole, in this case, is the Army’s continuing reduction in force structure and soldiers. Unless stopped, the Defense Department’s long-range plan will shrink the Army from its 2012 peak of 570,000 active-duty soldiers to 450,000 by 2018. To keep digging without stopping to look around would pose a risk to our nation and its interests, and could endanger our soldiers if they are called on to respond in situations where they lack the numbers, training and resources for the quick and decisive action we expect of our Army.

We need to hit the pause button on the drawdown, at least temporarily, to allow for a thorough reassessment of current and future threats, and for decisions to be made about capabilities the Army will need to carry out its missions.

The risks extend beyond one branch of the military. As the nation’s foundational force, the Army provides key capabilities across all of the services. Any gaps or flaws in the Army’s capabilities can affect Joint Force and coalition operations, widening the impact. 

Russian bomber shown carrying anti-shipping missile in Syria
By Piotr Butowski, Warsaw - IHS Jane's Defence Weekly

The Russian Ministry of Defence has released a video of a Sukhoi Su-34 'Fullback' bomber carrying the new Kh-35U (NATO designation AS-20 'Kayak') anti-shipping missile on operations over Syria.

The on-board video, released on 11 February by the Arabic section of Russian state-broadcaster RT, shows the aircraft departing on a mission with at least one missile mounted on a port-side underwing hardpoint (while footage shot from the other side also shows a missile on the starboard hardpoint, it can't be verified that it is of the same aircraft).

Development of the subsonic Kh-35 was begun by the Soviet Union in March 1983, following an assessment of the operational effectiveness of the Argentine-launched AIM-39 Exocet anti-shipping missile against the UK Royal Navy off the Falkland Islands the year before. The latest Kh-35U-variant is a The Kh-35U is a 550-kg (1,213lb) subsonic anti-ship missile that has been adapted for ship-, shore-, helicopter-, and aircraft-launched applications. While the outer-mould line remains the same as the earlier models, the newer version is powered by a smaller and lighter Saturn Izdeliye 64M turbofan (allowing for more fuel, and a doubling of range to 260 km).

The missile was first trialled on the Su-34 in November 2010. Initial tests of the missile were completed in November 2012, with state acceptance tests following in 2013. It is now in series production at the Tactical Missiles Corporation's facility in Korolev near Moscow.

""GLOBAL WAR"" before the END of this DECADE and it WILL Go Nuclear!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Hey Planet EARTH, If WE are going to Repeat the HELL that Was the 1930s, Why Don't WE Just SKIP the ""DEPRESSION"" and Go Straight to ""GLOBAL WAR""!!!!!!!!!!!!!!!!!!!! 

A Market Collapse Is On The Horizon
By Gail Tverberg

What is ahead for 2016? Most people don’t realize how tightly the following are linked:

1. Growth in debt
2. Growth in the economy
3. Growth in cheap-to-extract energy supplies
4. Inflation in the cost of producing commodities
5. Growth in asset prices, such as the price of shares of stock and of farmland
6. Growth in wages of non-elite workers
7. Population growth

It looks to me as though this linkage is about to cause a very substantial disruption to the economy, as oil limits, as well as other energy limits, cause a rapid shift from the benevolent version of the economic supercycle to the portion of the economic supercycle reflecting contraction. Many people have talked about Peak Oil, the Limits to Growth, and the Debt Supercycle without realizing that the underlying problem is really the same–the fact the we are reaching the limits of a finite world.

There are actually a number of different kinds of limits to a finite world, all leading toward the rising cost of commodity production. I will discuss these in more detail later. In the past, the contraction phase of the supercycle seems to have been caused primarily by too high a population relative to resources. This time, depleting fossil fuels–particularly oil–plays a major role. Other limits contributing to the end of the current debt supercycle include rising pollution and depletion of resources other than fossil fuels.

The problem of reaching limits in a finite world manifests itself in an unexpected way: slowing wage growth for non-elite workers. Lower wages mean that these workers become less able to afford the output of the system. These problems first lead to commodity oversupply and very low commodity prices. Eventually these problems lead to falling asset prices and widespread debt defaults. These problems are the opposite of what many expect, namely oil shortages and high prices. This strange situation exists because the economy is a networked system. Feedback loops in a networked system don’t necessarily work in the way people expect.

I expect that the particular problem we are likely to reach in 2016 is limits to oil storage. This may happen at different times for crude oil and the various types of refined products. As storage fills, prices can be expected to drop to a very low level–less than $10 per barrel for crude oil, and correspondingly low prices for the various types of oil products, such as gasoline, diesel, and asphalt. We can then expect to face a problem with debt defaults, failing banks, and failing governments (especially of oil exporters).

The idea of a bounce back to new higher oil prices seems exceedingly unlikely, in part because of the huge overhang of supply in storage, which owners will want to sell, keeping supply high for a long time. Furthermore, the underlying cause of the problem is the failure of wages of non-elite workers to rise rapidly enough to keep up with the rising cost of commodity production, particularly oil production. Because of falling inflation-adjusted wages, non-elite workers are becoming increasingly unable to afford the output of the economic system. As non-elite workers cut back on their purchases of goods, the economy tends to contract rather than expand. Efficiencies of scale are lost, and debt becomes increasingly difficult to repay with interest. The whole system tends to collapse. 

""LAB RATS"" of America..............How's that ""HOPE and CHANGE"" Bullshit Working out For YA??????????????????????? 

The Shipping Industry Is Suffering From China’s Trade Slowdown

When business slows and owners of ships and offshore oil rigs need a place to store their unneeded vessels, Saravanan Krishna suddenly becomes one of the industry’s most popular executives. Krishna is the operation director of International Shipcare, a Malaysian company that mothballs ships and rigs, and these days he’s busy taking calls from beleaguered operators with excess capacity. There are 102 vessels laid up at the company’s berths off the Malaysian island of Labuan, more than double the number a year ago. More are on the way. “There’s a huge demand,” he says. “People are calling us not to lay up one ship but 15 or 20.”

Shipbuilders, container lines, and port operators feasted on China’s rise and the global resources boom. Now they’re among the biggest victims of the country’s slowdown and the worldwide decline in demand for oil rigs and other gear amid the oil price plunge. China’s exports fell 1.8 percent in 2015, while its imports tumbled 13.2 percent. The Baltic Dry Index, which measures the cost of shipping coal, iron ore, grain, and other non-oil commodities, has fallen 76 percent since August and is now at a record low. Shipping rates for Asia-originated routes have dropped, too, and traffic at some of the region’s major ports is falling. In Singapore, the world’s second-largest port, container traffic fell 8.7 percent in 2015, the first decline in six years. Volumes at the port of Hong Kong, the fourth-busiest, slid 9.5 percent last year. Beyond Asia, the giant port of Rotterdam in the Netherlands recorded a dip in containerized traffic for the year.

Globally, orders for new vessels dropped 40 percent in 2015, to $69 billion, according to London-based consulting firm Clarksons Research. The demolition rate for unwanted vessels jumped 15 percent.

Just a few years ago, as the global economy improved and oil prices rose, many companies ordered more fuel-efficient ships. There were more than 1,200 orders for bulk carriers that transport iron ore, coal, and grain in 2013, compared with just 250 last year, according to Clarksons. Many of the ships ordered are now in operation, says Tim Huxley, chief executive officer of Wah Kwong Maritime Transport Holdings, a Hong Kong-based owner of bulk carriers and tankers. “You have a massive oversupply,” he says.

The damage is especially severe in China, the world’s leading producer of ships. New orders for Chinese shipbuilders fell by nearly half last year, according to the Ministry of Industry and Information Technology. In December, Zhoushan Wuzhou Ship Repairing & Building became the first state-owned shipbuilder to go bankrupt in a decade.

The yuan has dropped 6 percent since last August. While that should help exports, Hutchison Port Holdings Trust, a company controlled by Hong Kong billionaire Li Ka-shing that runs some of China’s top container terminals, has yet to see an uptick in outbound business. According to Ivor Chow, chief financial officer of Hutchison, the devaluation is leading to a slowdown in traffic as customers wait to see how much lower the yuan will fall. “People are really hesitant to commit to orders at this point,” he said on a conference call with analysts on Feb. 2.

The slowdown is hurting many Chinese ports. Sales at Shanghai International Port were 7.5 billion yuan ($1.1 billion) in the third quarter, down from 7.6 billion yuan the year before, and net profit was 1.4 billion yuan, a decline of 18 percent. The Shanghai Shipping Exchange’s containerized freight index has dropped 27 percent since the start of 2015. While container volume at Shanghai’s port, the world’s largest, grew 3.7 percent last year, that was down from 4.8 percent growth the previous year and was largely the result of taking market share away from high-cost rival Hong Kong, according to Bloomberg Intelligence analyst John Mathai. 

Baltic Dry Index!!!!!!!!!!!!!!!!!!!!!!!! 

""GLOBAL TRADE""..............RECESSION Dead Ahead!!!!!!!!!!!!!!!!!!!!!!!!! 

There Will Be No OPEC Cut
By Matt Smith

Two hundred and seven years after the birth of Charles Darwin, and the final trading day of the week is evolving into a rambunctious rally for the crude complex. Once again the market is at the mercy of OPEC rhetoric, as comments from the UAE’s energy minister have been interpreted as a sign of collusion for a production cut. Here are three reasons why this news is more likely to be poppycock than progress:

1) OPEC’s tactics are working. The US oil patch is debilitating at a rapid pace. Oil firms are maxing out credit lines, as shrinking revenues from lower oil prices mean cash flow is not enough to service debt obligations. The WSJ reports today a number of companies have drawn down their revolving credit lines – signaling potential bankruptcy ahead. Midstates Petroleum, Linn Energy and Sandridge Energy are three examples, having recently burned through their collective cash cushion of $1.5 billion.

2) OPEC’s production is set to rise. Despite there being suggestions earlier in the week that Iran is ready to cooperate with other OPEC members to limit oil production, this seems a highly unlikely scenario. With sanctions lifted on Iran, it is looking to boost production by 500,000 barrels per day in the coming months, and has already entered into a deal with Total to supply 160,000 bpd into Europe as it looks to increase receipts by 300,000 bpd to the region. We can already see from our ClipperData that January loadings were 75 percent higher than for the same month in the previous year; Iran means business.

3) We are starting to see global production cuts. Although only a small loss of 4,800 bpd, the first closure of a Norwegian oil field – the Varg oil deposit – in the North Sea is evidence that OPEC’s tactic of trying to flush out higher-cost production is starting to work. 

GOT it RIGHT Again!!!!!!!!!!!!!!!!!!!!!

""FALLING Crude Oil PRICES""..............There's a HELL Storm Coming this Summer!!!!!!!!!!!!!!!!!!!!!!!! 

Worst Still Ahead for Global Mining Industry After Losing $1.4 Trillion

When you find yourself in a hole, the saying goes, stop digging. A simple lesson that arguably has bypassed a mining industry that’s wiped out more than $1.4 trillion of shareholder value by digging too many holes around the globe. The industry’s 73 percent plunge from a 2011 peak is far beyond the oil industry’s 49 percent loss during the same time.

Just how long it will take for the world to erode bulging stockpiles of metals, coal and iron ore was the central debate at the mining industry’s biggest investment conference in Cape Town this week, which attracted more than 6,000 top executives, bankers, brokers, analysts, miners and reporters. Here’s what they concluded.

The Worst Is Yet to Come

This year may be the worst yet with prices trending lower for longer, according to Anglo American Chief Executive Officer Mark Cutifani, who says his company should be better prepared “for the winter that inevitably comes after the summer.”


The Australian revealed that since he took on the role 33 months ago the company’s revenue had slumped by an average of $350 million a month.

Rio Tinto Group is also preparing for a tough year, with CEO Sam Walsh predicting on Bloomberg Television on Thursday that distress from the commodities rout will spread to majors. The company joined rivals in scrapping its so-called progressive dividend policy.

Walsh Sees a Tough 2016 For Rio Tinto, Worse Than 2015

Distress or Impress

The industry is splitting into two classes of citizens: those under distress and those that will impress by riding out the downturn and coming out on the other side in a stronger position heading into the next cycle.

Vedanta Resources CEO Tom Albanese was hesitant to call the bottom. Vedanta, like its peers, is focused on paying its debts and will be “hunkering down and getting that done,” he said in an interview with Bloomberg Television.

Those businesses that are best at it will be best-recovering,” said Albanese, the former boss of Rio Tinto.

Sticky Supply

Gluts of everything from iron ore to copper are the main challenge for the industry. China’s slowest economic growth in a generation has led to oversupplies of metals, and for that, the industry is largely to blame, Cutifani said. The big cost of environmental cleanups after closing a mine is preventing closures and prolonging the downturn.

“Excess supply is awash in most commodities and as painful as it is, economically and rationally it needs to leave the market to create a long term sustainable future,” said Graham Kerr, CEO of South32 Ltd., the spin-off of BHP Billiton. 

The Chinese yuan countdown is on
By Christopher

*Currency stability is a prerequisite for China's economic transition
*Defending the yuan is prohibitively expensive – China cannot beat the market
*Progressive devaluation managed by PBoC is the most probable scenario for 2016
*Remember that the country is on the capitalism learning curve
*Exchange rates will inevitably be a key discussion point at Shanghai G20
*China has moved from being a net importer to a net exporter of capital

The undervalued Chinese yuan is nothing but a bad memory. In the context of competitive devaluations throughout the world, the yuan is now significantly overvalued compared to its main counterparts, primarily the dollar and the euro.

If it is to pull off its economic transition, China needs a stable currency, hence its repeated interventions on the exchange markets over the past few months. Over the last year $513 billion was drawn from the foreign exchange reserves without stemming any of the downwards market pressures on the yuan. Over the period is actually lost 5% against the US dollar. This is a significant depreciation for a currency that is used to fluctuating between narrower markers. By way of comparison, the euro, which floats freely on the market, lost almost 6% of its value against the US dollar last year.

The increasingly credible assumption of a devaluation before this summer: 

Raymond James Is Out With A Major Bearish Call

From Robin Landry of Raymond James

Since the last update the market has fallen to test the 1810 area as seen on the attached chart. The news and various indicators I use are getting more bearish. The world is drowning in debt and the central banks are showing themselves to be powerless to turn the economies of their respective countries around. Now they are moving to negative interest rates which only confirms my view of the world being in a DEFLATIONARY trend that has years to go. The talk of doing away with currency and moving to a digital currency is also showing the desperation. I believe a digital currency is coming much sooner that most people realize. The count shown in the attached chart is the one which gives a little larger view of where I believe the market is headed over the next few months if the top is already in. The rally happening, as I write this, is mainly due to the rally in oil. If the market is to make a new high, as I have suggested in earlier updates, this rally must break through the resistance in the S&P 500 around the 1950 area on increasing volume. If it fails, then the decline will drop to the 1740 area which I have repeatedly said MUST HOLD or the markets are in a MAJOR BEAR MARKET that will test the lows reached in 2009. 

Still to Optimistic...............Crude OIL Will take the S&P Down to at least 1650 and Then CHINA will Finish OFF Global Equity Markets and the Global Economy for the REST of this DECADE!!!!!!!!!!!!!!!!!!!!!!!! 

China HARD Landing...............It's Happening NOW!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Is the US economy running out of gas?
By John W. Schoen

Is there another U.S. recession on the way?

That's a question rattling investors, worrying business leaders and shaping the debate on the presidential campaign trail.

The answer depends a lot on how you measure the strength and durability of the recovery, now in its seventh year based the business cycle dates tracked by economists at the National Bureau of Economic Research.

"There is always some chance of recession in any year," Fed Chair Janet Yellen told Senators on Thursday. "But the evidence suggests that expansions don't die of old age."

To see how this recovery compares, CNBC tracked a series of economic and market data over the last eight recessions since 1960 — starting each cycle with the beginning of each downturn.

By just about every measure, the current expansion has been the weakest of the eight.

One of the main reasons has been the relatively sluggish pace of spending an investment — by consumers, government and businesses — since the Great Recession began in December 2007. Consumer spending has recovered far more slowly than past recoveries. And despite a massive stimulus program in 2010, government spending at all levels is actually lower than when the Great Recession hit.

Consumers have been slow to spend, in part, because their paychecks have been rising more slowly than in past downturns. While the job market has recovered and the pace hiring sped up in the last two years, the overall gains in employment lag past recoveries because the scale of job losses in 2007 and 2008 was much higher.

Consumer spending — which makes up about two-thirds of the U.S. economy — has also been held back by the sharp drop in household wealth that accompanied the collapse of the financial markets. To rebuild the trillions of dollars in lost wealth, American households have been stashing more into savings than in past recoveries.

The next recession could be around the corner, and the Fed isn't ready for it
By Timothy B. Lee

Around the world, markets are in chaos. Japan's stock market plunged 5 percent on Friday, while markets in France, Germany, and the UK all saw big losses on Thursday. The US stock market is doing better than most, but it is also down since the start of the year. Oil hit a new low on Thursday of $26 per barrel.

These declines reflect growing concerns that the world economy is headed for another recession. Before 2007 we’d say, "If things get bad, the Fed will cut interest rates." But with the Fed’s benchmark rate below 0.5 percent already, a substantial cut would mean rates that are below zero. That's an unorthodox strategy, and it might not even be legal, according to testimony by Fed Chair Janet Yellen before congressional committees this week.

The Fed needs a new strategy: Stop targeting interest rates and instead target the growth of the overall economy. Moving away from interest rate targeting would give markets confidence that the Fed has the tools to deal with the next economic downturn, which would reduce the danger of another 2008-style meltdown.

Unfortunately, there's little sign that the Fed is laying the groundwork for a shift in strategy. Instead, Yellen seemed to be in denial about the magnitude of the challenge she is facing.

"Let’s remember that the labor market is continuing to perform well," she said to the Senate Banking Committee on Thursday. "We want to be careful not to jump to a conclusion about what is in store for the economy." Maybe not — but the Fed needs to be prepared for the worst.

The Fed needs a new game plan for the next recession

Six Years Later, 93% of U.S. Counties Haven’t Recovered From Recession, Study Finds
By Eric Morath

More than six years after the economic expansion began, 93% of counties in the U.S. have failed to fully recover from the blow they suffered during the recession.

Nationwide, 214 counties, or 7% of 3,069, had recovered last year to prerecession levels on four indicators: total employment, the unemployment rate, size of the economy and home values, a study from the National Association of Counties released Tuesday found.

The reality is slowing population growth and industry shifts mean some parts of the country will likely never fully recover. But by the end of last year, more counties had not recovered on any one of the four indicators, 16%, than had recovered on all of them.

“Americans don’t live in a single economic place,” said Emilia Istrate, the association’s director of research and outreach and one of the study’s authors. “It tells you why many Americans don’t feel the good economic numbers they see on TV.”

As was the case in 2014, when just 65 counties had fully recovered, most of those that bounced back are in states benefiting from the energy boom. Last year, 72 of the recovered counties were in Texas, the most of any state. Nebraska followed with 22. Minnesota, Kentucky, North Dakota, Montana and Kansas each had at least 10 fully recovered counties.

Meanwhile, in 27 states, not a single county had fully recovered.

Some of the nation’s largest counties finally recovered from the recession in 2015, including the counties containing Denver, San Francisco, San Jose, Dallas and Columbus, Ohio. In 2014, no county with more than 500,000 residents had fully recovered. Last year, 17 of 126 had.

The recovery is spreading out from the energy-rich center of the country—in part because a massive drop in oil prices is reversing job creation there while providing an economic benefit to larger metro areas near the coasts. 

Worrisome signs series – US business cycle coming to end?

Last time US faced business cycle contraction dates back to 2007, at a time of great recession, which finally ended in June 2009 and it has been expanding since then.

Though it is very difficult to gauge how the world would have been without the support from US Federal Reserve, but one thing can be said with some degree of certainty contractionary cycle could have been much larger. In 2007 business cycle contracted for long 18 months, which is higher than last 115 years average of 15 months but much lower than that occurred during great depression, when business cycle contracted for record 43 months, according to data from National Bureau of Economic Research (NBER).

So key questions worrying us, as FED and other central banks are coming to the end of monetary policy expansion viz. a viz. support, is it going to be the end for expanding business cycle, especially since corporate profits are in decline.

Latest US business cycle that has been expanding, has now continued growth for 78 months, much higher than 45 months average of last 115 years.

However, what giving us hope, business cycles' expansionary leg has increased in average since 1970, averaging around 71 and last three business cycle averaged about 95 months, in thanks to 120 months long expansion before dot com bubble burst.

Nevertheless it is vital to recognize, we are slowly closing into rarest of the stretch (check figure). 

Yes there Still "IS" This THING Known as the ""Business Cycle""!!!!!!!!!!!!!!!!!!!!!!

Business Inventories Jump, Sales Tumble Sending Ratio To Recession-Warning Cycle Highs

After some stabilization into mid-2015, the ratio of business inventories-to-sales has surged as sales have disappointed and mal-investment-driven dreams have over-stocked. Business inventories rose 0.1% MoM in December (retail up 0.4%) and sales tumbled 0.6%.

Year-over-year, Inventories are now up 1.7% (led by retailers up 5.4%) while Sales are down 2.4% (led by Manufacturers down 5.1%)


Wholesale Business Inventories!!!!!!!!!!!!!!!!

Baby Boomers Are Drowning In Loans: Debt Of Average 67-Year-Old Soared 169% In Past 12 Years

For those who follow the monthly consumer credit report released by the Fed there was nothing surprising in today's release of the latest Household Debt and Credit Report by the New York Fed. It reports that total household debt rose to $12.12 trillion in Q4, up from $11.83 trillion a year ago... 

U.S. Consumer DEBT!!!!!!!!!!!!!!!!!!!! 

The American MIDDLE Class...............If You can Handle the TRUTH................READ and then TELL a Friend!!!!!!!!!!!!!!!!!!!!! 

THE FED........................Will be the CAUSE for the First TIME in the History of Money for the NEXT Recession!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Those who are Buying today Will be SELLING Next WEEK. Nothing Can STOP the 2016 ""Global RECESSION""............................NOTHING!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
***Jakobsen & Hardy: Why this crisis could be good for us
By Steen Jakobsen

If anyone had thought that the Chair of the Federal Reserve, Janet Yellen, was going to calm the markets this week, they couldn't have been more wrong. And that proves what Saxo Bank's Chief Economist, Steen Jakobsen and Saxo's head of FX Strategy, John Hardy, have been saying for some time - that Central Banks are not in control.

Steen and John discuss why the markets no longer believe in Central Bank guidance, why the world has been relying on these bankers for too long and whether the moves towards negative rates will have any impact at all.

They also debate which country has the most to lose in all this and why this crisis could be the start of something more positive.

Steen explains how the turbulence of 2016 has so far impacted his portfolio and John looks at the effect it's having on particular currency pairs. 

Why economists increasingly think the Fed’s hands are tied

The Fed’s own thinking that may stymie a healthy rate increase process
By Andrea Riquier

Has the Fed painted itself into a corner?

A growing chorus of economists and analysts are suggesting that policymakers, who really want to get on with the process of bringing interest rates back to a normal level, just won’t be able to do the deed.

On Thursday, economists at BNP Paribas wrote in a research note that they do not expect any additional rate increases from the Fed at all in 2016 – nor in 2017.

“We see the Fed as trying to manage a retreat in an orderly fashion, while hoping for the best,” the economists wrote. “We do not think the best will materialize.”

Everything from deeper pain in emerging markets to further easing from other major global central banks is conspiring against the Fed, BNP’s team wrote.

“What strikes us most is the difficulty for the Fed to re-engage in this environment after a pause, since that might make the volatility come back. We have to see a relatively long period of convincing calm before rate hikes can be delivered, and by that stage we see a slowing economy raising questions about the need for rate hikes,” they added.

But as economist Tim Duy wrote on his influential “Fed Watch blog” on Thursday, “the Fed just isn’t ready to stop talking about rate hikes later this year.”

Duy doesn’t rule out rate hikes in 2016 altogether, but he believes the Fed should acknowledge that tighter financial conditions have the same effect on the economy as tighter monetary policy. If policymakers could bring themselves to admit that reality, Duy argued, “this will also sustain the expansion and allow wage growth and inflation accelerate.”

There’s a big downside to that scenario, Duy acknowledged. It could put the Fed in the position of having to raise rates relatively quickly, if inflation picks up once the financial markets have settled. 

Rising Systemic Risk for ALL Markets
By Martin Armstrong

We are on the precipice of what can only be described as a rising systemic risk for all markets. The Fed is now hinting that banks should prepare for NEGATIVE INTEREST RATES. This insanity of following the crowd is undermining the entire world economy. The increasingly unstable footing that we find ourselves standing on is reflected in widening credit spreads that demonstrate that CONFIDENCE is indeed collapsing.

The EU Commission will no longer classify government bonds in bank balance sheets as “risk.” Banks would have government bonds on par with “equity” yet government bonds have proven risky and are inferior to what would, in some financial institutions, result in an increased capital requirement. Turning to Goldman Sachs, we saw the so-called world’s greatest trader close out its long USD trade against a basket of euros and Japanese yen with a potential loss of around 5%, which is being bantered about on the street showing they too got this all wrong. This early 2016 destabilization is stopping out short gold positions, but it is not replacing them with any buying conviction. The euro trade of long Italian 5-year against short German 5-year has also turned into a bloodbath as the euro finally rallied begrudgingly to reach our first resistance target in the mid-113 area.

Global economic growth has been anemic at best in the States, but it is clearly turning down since 2015.75. This new world order of NEGATIVE INTEREST RATES is so insane and focuses solely on trying to stimulate borrowing. This is undermining pensions for the elderly and creating the economic storm of the century that is on the horizon that will be far worse than the Great Depression of the 1930s. Even the Japanese 10-year bond has gone NEGATIVE, demonstrating the total collapse in CONFIDENCE. Why, you ask?  Because this time, the defaults will engulf all governments at all levels. Like a drunk who just won the lottery, all is always lost in a matter of time. 

Japan People............Japan "IS" the PROOF!!!!!!!!!!!!!!!!!!!!!!!!  

Central banks court danger with desperate measures
By Vesna Poljak

Central banks have tightened their grip on negative interest rates to save the economies of Japan and Europe from dangerously low inflation and a fresh outbreak of the global currency wars.

The way markets see it, these are the desperate actions of policymakers who have run out of options, and that in itself might be the biggest risk to global financial stability.

Sweden's Riksbank on Thursday became the latest central bank to double down on negative rates, pushing its repo rate out to negative 0.5 per cent from 0.35 percent, and warning it is willing to go even further.

The European Central Bank, which already has negative deposit rates and a €1.1 trillion ($1.7 trillion) bond-buying program under way, has readied markets for even more stimulus soon. And the Bank of Japan is coming up against the limits of its policy actions, with a rapidly appreciating yen defying its shock embrace of negative rates at the end of January. A rising currency is an enemy of inflation.

The unconventional monetary policy experiment is getting more creative, so much so that even the trillions in bond purchases which defined the quantitative easing era now look almost conventional in comparison.

The United States Federal Reserve's opportunistic December rate hike was plotted with the intention of "normalising" interest rates. But thanks to the damage incurred by plunging oil (energy prices being a victim of slowing global activity, the US dollar rally and a supply glut), global monetary policy has teetered further off its axis since the end of zero per cent interest rates in the US last year.

That end of ZIRP paved the way for NIRP. 

The Economics Of Less than Zero
By MN Gordon

Just when we thought we’d seen it all the impossible happened.  Earlier this week the 10-year Japanese government bond slipped into negative.  Obviously, it took decades of heavy handed intervention into credit markets to pull off such a feat.

On Tuesday, when the Nikkei dropped over 5 percent, the yield on Japan’s 10-year government bond dropped to minus 0.005 percent.  This marked the first time in the history of government debt that the yield on a G7 country’s 10-year bond has been less than zero.  We are lucky to be alive to bear witness to the absurdity.

Just a few years ago these depressed credit prices would’ve been considered impossible.  Why would anyone with advanced knowledge of a negative outcome loan their money at a loss?  But sure enough, in the bright light of day, the impossible has become reality.

Make of it what you will.  The ultimate impact of a 10-year government bond with a negative yield is unknown…though something seems amiss.  Will this allow the government to issue, and also buy up, unlimited amounts of its own debt?

Quite frankly, aside from the notion that bond holders will pay a fee for the privilege of loaning money to the Japanese government for a decade, we really don’t know the implications.  Still, we can offer some reflections.

The Beatings Will Continue

If you recall, Prime Minister Shinzo Abe, the brainchild behind the Bank of Japan’s Abenomics, has pursued a reckless policy to boost exports by trashing the currency.  A weak yen, it was thought, would give Japan a competitive advantage and allow them to import wealth from the world.  Conversely, by devaluing the currency, Japan would somehow be able to export their way to wealth. 

Bill Gross Gives Thumbs Down to Negative Interest Rates

Prominent bond managers have a message for central bankers: negative interest rates won’t work.

Bill Gross of Janus Capital Group Inc., Scott Mather of Pacific Investment Management Co. and Tad Rivelle of TCW Group said negative rates won’t stimulate growth and may have adverse consequences for economies and markets. Investors are fleeing bank stocks and other financials as concerns mount that low- and negative-rate policies will prohibit them from making a profit, Gross said.

“Markets sense that and they go down,” Gross, manager of the $1.3 billion Janus Global Unconstrained Bond Fund, said during an interview Thursday at his office in Newport Beach, California. “Finance is leading the charge.”

As central bankers from Tokyo to Stockholm embrace the notion of negative rates, volatility is surging. Far from being buoyed by the measures, global stocks have entered bear market territory and investors have fled to perceived havens such as U.S. Treasury bonds and gold.

The Standard & Poor’s 500 Financials Index fell 3 percent Thursday, the most since Sept. 1, and is down 18 percent this year. Bank of America Corp. lost 6.8 percent on the day and Citigroup Inc. slid 6.5 percent.

Yellen’s Testimony 

This Is The NIRP "Doom Loop" That Threatens To Wipeout Banks And The Global Economy

Remember the vicious cycle that threatened the entire European banking sector in 2012?

It went something like this: over indebted sovereigns depended on domestic banks to buy their debt, but when yields on that debt spiked, the banks took a hit, inhibiting their ability to fund the sovereign, whose yields would then rise some more, further curtailing banks’ ability to help out, and so on and so forth.

Well don’t look now, but central bankers’ headlong plunge into NIRP-dom has created another “doom loop” whereby negative rates weaken banks whose profits are already crimped by the new regulatory regime, sharply lower revenue from trading, and billions in fines. Weak banks then pull back on lending, thus weakening the economy further and compelling policy makers to take rates even lower in a self-perpetuating death spiral. Meanwhile, bank stocks plunge raising questions about the entire sector's viability and that, in turn, raises the specter of yet another financial market meltdown.

Below, find the diagram that illustrates this dynamic followed by a bit of color from WSJ: 

637 Rate Cuts And $12.3 Trillion In Global QE Later, World Shocked To Find "Quantitative Failure"

2016 is shaping up to be the year that everyone finally comes to terms with the fact that the monetary emperors truly have no clothes.

To be sure, it’s been a long time coming. For nearly 8 years, market participants and economists convinced themselves that the answer was always “more Keynes.” Global trade still stagnant? Cut rates. Economic growth still stuck in neutral? Buy more assets.

It was almost as if everyone lost sight of the fact that if printing fiat scrip and tinkering with the cost of money were the answers, there would never be any problems. That is, policy makers can always hit ctrl+P and/or move rates around. But in order to resuscitate anemic aggregate demand and revive inflation, you need to tackle the core problems facing the global economy - not paper over them (and we mean “paper over them” in the most literal sense of the term).

Well late last month, central banks officially lost control of the narrative. Kuroda’s move into negative territory reeked of desperation and given the surging JPY and tumbling Japanese stocks, it’s pretty clear that the half-life on central bank easing has fallen dramatically.

And so, as the market wakes up from the punchbowl party with a massive hangover, everyone is suddenly left to contemplate “quantitative failure.” Below, courtesy of BofA's Michael Hartnett is a bullet point summary of 8 years spent chasing the dragon... and a list of the disappointing results.

*  *  *

From BofA                   

Whether the recent tipping point was the Fed hike, negative rates in Europe & Japan, or simply the growing market dislocations and macro misallocation of resources and wealth, the deflationary theme of “Quantitative Failure” is stalking the financial markets. A multi-year period of major policy intervention & “financial repression” is ending with weak economic growth & investors rebelling against QE. 

How €3.5 Trillion In NIRP Debt Made Europe's Credit Market "Most Vulnerable Since Lehman"

Earlier today, we discussed how after 8 long years spent wandering punch drunk through a dream-like Keynesian wonderland where all financial assets rise inexorably, the world finally woke up last month with a terrible hangover only to discover that after 637 rate cuts and $12.3 trillion in asset purchases, “quantitative easing” has been a “quantitative failure.”

Perhaps it was the harrowing volatility that tipped investors off to the fact that central bankers were failing. Or perhaps it was the realization that the persistent disinflationary impulse that hangs over developed markets isn’t exactly compatible with the notion that central banks are “succeeding.” Or maybe it was the BoJ’s move into NIRP which was quickly followed by a canceled JGB auction, a soaring JPY, and crashing Japanese equities. Of course it could have been tumbling yields on the US 10Y. Take your pick, but whatever the catalyst, everyone suddenly began to talk about central banker impotence as opposed to central banker omnipotence, and at that point, the narrative was lost.

Of course it’s too late to turn back now. There’s no telling what markets would do if central banks were to suddenly admit that this has all been one giant mistake and so, the monetary powers that be stick to the script. For instance, Haruhiko Kuroda - who is known for saying things so at odds with reality that one can only laugh - said last night that “negative rates are clearly having an effect” - just as Japanese stocks were collapsing on themselves (again).

And central bankers aren’t just doubling down on the rhetoric. They’re doubling down on the easing. Earlier this week, Stefan Ingves and the Riksbank cut Sweden’s repo rate by 15 more bps to -0.50% and Mario Draghi and co. are almost sure to follow suit next month. Meanwhile, Janet Yellen admitted that NIRP has been studied for the US.

In a note out Friday, BofA takes a fresh look at what the plunge down the NIRP rabbit hole has meant for the proliferation of negative-yielding assets in Europe.

A prolonged period of USD strength (in part due to policy divergence between the Fed and the ECB) quickly took its toll on a variety of markets including, of course, commodities and EM FX. “the negative effects of this deflationary wave have been visible,” BofA’s Barnaby Martin writes, adding that “credit rating downgrades have increased [while] European high-yield spreads reached their cycle tights right before” the dollar strength began to manifest itself in earnest. “[And] not because of rising defaults, but rather because of the growth in EM-domiciled credits in the index, thus raising the market’s sensitivity to the strong Dollar/weak commodity story,” he continues.

With that as the backdrop, here’s the rest of the story which explains how NIRP initially offset the bearish themes that accompanied the strong dollar/weak commodity deflationary deep dive but ultimately left the world with a $9 trillion pile of negative-yielding debt and created a “stealth” bear market in European corporate credit.

*  *  *

From BofA 

Why NIRP (Negative Interest Rates) Will Fail Miserably
By Charles Smith

What NIRP communicates is: this sucker's going down, so sell everything and hoard your cash and precious metals.

The last hurrah of central banks is the negative interest rate policy--NIRP. The basic idea of NIRP is to punish savers so severely that households and businesses will be compelled to go blow whatever money they have on something--what the money is squandered on is of no importance to central banks.

All that matters is that people and enterprises are forced to spend whatever cash they have rather than "hoard" it, i.e. preserve and conserve their capital.

That this is certifiably insane is self-evident. If an economy depends on bringing future spending into the present by destroying savings, that economy is doomed regardless of NIRP, for eventually the cash runs out and spending declines anyway. 

NIRP...................A License to STEAL and a Declaration of WAR by Central Banksters on SAVERS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!  

This is How Financial Chaos Begins
By Wolf Richter

It’s not contained.

There are over $1.8 trillion of US junk bonds outstanding. It’s the lifeblood of over-indebted corporate America. When yields began to soar over a year ago, and liquidity began to dry up at the bottom of the scale, it was “contained.”

Yet contagion has spread from energy, metals, and mining to other industries and up the scale. According to UBS, about $1 trillion of these junk bonds are now “stressed” or “distressed.” And the entire corporate bond market, which is far larger than the stock market, is getting antsy.

The average yield of CCC or lower-rated junk bonds hit the 20% mark a week ago. The last time yields had jumped to that level was on September 20, 2008, in the panic after the Lehman bankruptcy, as we pointed out. Today, that average yield is nearly 22%!

Today even the average yield spread between those bonds and US Treasuries has breached the 20% mark. Last time this happened was on October 6, 2008, during the post-Lehman panic: 

JUNK Bonds.....................A Leading Indicator of RECESSION before the END of 2016!!!!!!!!!!!!!!!!!!!! 

Attention ""LAB RATS"" of Planet EARTH..........................BANKING Crisis II has BEGUN and You NEXT Fucking NIGHTMARE Comes Sunday NIGHT when CHINA Begins to TRADE after the NEW Year Holiday Break!!!!!!!!!!!!!!!!!!!!!!!!!!!! Now I have BEEN Saying for YEARS that the Chinese Economy "IS" the Biggest Fraud on Planet Earth........................ 

The five fears stalking the global banking industry
By Rob Davies

Banking shares have come under pressure this week as investors express fears that the sector will be badly hit by a global economic downturn. Financial institutions have strengthened their balance sheets since the 2008 financial crisis, but they could be in for a turbulent year if potential flashpoints such as emerging markets or the energy sector produce a cascade of debt defaults. Here are the five biggest threats to the banking sector:


A property boom and frenzy of manufacturing in the aftermath of the 2008 financial crash kept the global economy motoring, but stored up huge private debts that investors fear will soon destabilise the Chinese economy.

Beijing is working hard to wean itself off being the world’s source of cheap manufactured goods, but it is a painful transition, full of pitfalls. Some banks have called in bad loans, forcing firms to go bust. But these are rare, leaving international investors to fear that more are in the pipeline, without knowing the extent of the problem.

Property developments and infrastructure projects stand half-finished while the authorities take stock of the situation.

Some analysts fear Beijing is covertly depreciating the yuan to gain a competitive advantage while it moves towards a more western-style consumer economy. That would spark a currency war and a wave of competitive devaluations.

The stock market is dominated by individual investors who treat the market like a casino. Efforts to shift share ownership to institutional investors and impose stricter regulations have proved ineffective so far, leaving the Shanghai and Shenzhen exchanges to cope with wild swings each time there is bad economic news. 

And NOW Kyle Bass "IS" Warning that THIS ""PONZI SCHEME"" in China Will Begin to Collapse before the END of 2016 and make 2017 a Holy NIGHTMARE for Anyone that Still has ASSETS at Risk in Global Equity Markets.


Welcome Back to 2008 as Planet EARTH "IS" Heading for a ""***HARD Landing***""!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

And KEEP ONE Very Important FACT in Your Mind going forward from HERE....................There WILL BE NO ""***BAILOUTS***"" for Anyone in this Recession......................The ""GREAT Reset has BEGUN""!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Global Assault on Banks Intensifies
By Nicholas Comfort

Credit Suisse Group AG shares plunged to the lowest in a generation on Thursday and a one-year contract to insure Deutsche Bank AG debt against default surged to a record as a global rout in financial companies intensified.

Theories abound as to what lies behind the months-long selloff, with some traders fretting over falling oil prices, China’s economy and negative interest rates. A pullback by some sovereign-wealth funds has also been blamed for lower asset prices. Whatever the cause, the hammering has been the worst in Europe, where concerns persist about the health of some of the biggest banks eight years after the financial crisis.

“The market is aggressively penalizing banks,” said Nikhil Srinivasan, who oversees 480 billion euros ($543 billion) as chief investment officer at Assicurazioni Generali SpA in Milan. “It’s going to be a challenging 2016, and I don’t see a short tunnel -- this could go on for a while.”

Investors have fled lenders that show signs of weakness, as Societe Generale SA did Thursday when the Paris-based bank said it might miss its profitability goal this year. The stock plunged 13 percent that day, the most since 2011. Both Credit Suisse and Deutsche Bank published dismal fourth-quarter results in recent weeks that have sent shareholders and bondholders to the exits.

Commerzbank Rebound 

BANKING CRISIS: Forget about Europe, it's SINGAPORE you should worry about
Written by AFR.COM

While investors fret about the carnage in European bank stocks, some analysts are warning that they're ignoring problems much closer to home: the possibility of an Asian banking crisis.

Legendary Swiss investor Felix Zulauf, who runs Zulauf Asset Management, was one of the first to sound the alarm, warning that China's economic woes would inevitably infect Singapore and would probably prompt a banking crisis.

"Singapore, which has attracted a lot of foreign capital over the years because of its image as a strong-currency state, will be extremely exposed to the situation in China," Zulauf told Barron's Roundtable in January.

"Singapore's banking-sector loans have grown dramatically in the past five or six years. Singapore is now losing capital, which means the banking industry is losing deposits."

He said this would probably cause carry trades to backfire, triggering heavy losses for those who had borrowed heavily to buy higher-yielding assets.

"I expect a banking crisis to develop in Singapore and to spread eventually to Hong Kong," he said.

But Zulauf isn't alone in worrying about the financial health of Singapore's large banks. Analysts say Singapore's three largest banks – DBS, Oversea-Chinese Banking Corp and United Overseas Bank – could suffer a sharp spark in problem loans if the Chinese economy brakes sharply. 

Schaeuble Says Portugal Debt Woes Trump `Strong' Deutsche Bank
By Julia-Ambra Verlaine and Rainer Buergin

The volatile Portuguese bond market is more alarming than plunging confidence in Deutsche Bank AG, Europe’s largest lender, according to German Finance Minister Wolfgang Schaeuble.

Even as a global rout in stocks has driven down European bank shares by 27 percent this year, Schaeuble warned on Friday after a meeting of EU finance ministers in Brussels that Portugal doesn’t have enough “resilience.” “Portugal must do everything to counter uncertainty in financial markets,” he said.

The German finance minister’s comments come after the yield on Portugal’s 10-year bond fluctuated in a range of 143 basis points this week, the largest five-day swing since July 2013. Prime Minister Antonio Costa, who was sworn in at the end of November, has rolled back reform measures introduced during the nation’s bailout program that ended in 2014.

Deutsche Bank, which issued a statement Friday reassuring investors it has enough reserves to service debt obligations, “has sufficient capital and is well positioned,” Schaeuble said. In an effort to allay anxieties, the Frankfurt-based lender announced plans to buy back about $5.4 billion of bonds in euros and dollars Friday. The move comes after the cost of insuring its senior debt via credit-default swaps rose to the highest since 2011.

Crisis Lessons 

Stagnating Italy poses new headache for stuttering eurozone

Prime minister Matteo Renzi hits out at Brussels' austerity medicine as euro's third largest economy grinds to a halt
By Mehreen Khan

The eurozone's third largest economy stagnated at the end of last year and Greece fell back into a deep recession, raising further questions over the health of the single currency's weakest economies.

Despite falling oil prices and stimulative monetary policy, Italian GDP ground to a halt at just 0.1pc in the last quarter of 2015, falling below analyst expectations of a 0.3pc expansion. It means the Italian economy grew by just 0.6pc last year having barely emerged from its worst slump since the Second World War in 2014.

""PIIGS"" are STILL ""PIIGS""!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 

ECB rate cut likely but no appetite for now for radical easing: policymakers
FRANKFURT | By Balazs Koranyi and Francesco Canepa

There is firm support for a deposit rate cut within the European Central Bank's Governing Council but appetite for more radical action is still limited, conversations with policymakers indicate a month before the March rate decision.

With long-term inflation expectations falling, the ECB will probably have to act and frame the rate cut as part of broader a package, with some measures involving changes to the bank's flagship asset-purchase program, policymakers told Reuters.

But with no consensus yet about which further measures to take and Europe's modest economic recovery still broadly on track, some of those spoken to cautioned against radical action.

They noted, however, that their view could still change if recent market turmoil proved lasting, posing a risk to the real economy.

ECB President Mario Draghi has said the bank would review and possibly recalibrate its stance in March to fight persistently low inflation. Markets now price at least two rate cuts, taking the deposit rate to -0.55 percent by the end of the year from -0.3 percent. ECBWATCH

"Doing nothing in March is very unlikely," the governor of one of the euro zone's 19 central banks told Reuters. "Monetary conditions have tightened, long term inflation expectations are falling and credibility is at stake." 

More Bad News For European Banks? ECB Leaks "Firm Support For A Deposit Rate Cut"

After starting out strongly this morning, with DB stock trading just shy of $17/share, European banks have seen some weakness in the past hour following a report from Reuters, in which sources were cited as saying that there is "firm support for a deposit rate cut within the European Central Bank's Governing Council." While a year ago this would have sent European stocks soaring, this is no longer the case as explained by none other than Deutsche Bank last weekend: 

Europe's Most Distressing Chart: For Banks 2016 Is Already Worse Than 2008

As we have reported previously on various occasions things are bad for European banks: from DB's record wide 5Y Sub CDS, to Credit Suisse record low stock price, to everyone else inbetween. But did you know that for most European banks, 2016 is shaping up far worse than the dreaded 2008? As the following chart from Reuters shows, the year-to-date stock price performance for most European banks is on pace to far surpass - to the downside - the dreadful for the global financial system 2008.

As Reuters puts its it, "Euro zone banks have seen their shares plummet by nearly 30 percent and yields on their bonds surge since the start of the year, as investors worried about thinning profits and uncomfortably high levels of bad loans in some countries."

This is shown in the chart below.

Battered Bank Stocks Reflect Not Just Jitters, but Mistrust

The bear market in big United States financial stocks has many people wondering: Are we headed for another banking crisis?

The KBW Bank Index, made up of 24 money-center institutions and top regional banks, certainly signals pain for this industry. The index has tumbled 23 percent this year and 30 percent since its peak in July.

Some individual stocks have fared even worse. In recent days, shares of Bank of America, Citigroup and JPMorgan Chase have hit 52-week lows. Bank of America and Citi have lost around 30 percent of their values, year to date, while JPMorgan is down 16 percent.

Clearly, the decline in bank shares reflects turmoil in the commodities markets, the economic downturn in China and renewed banking troubles in Europe. How much these woes will damage big banks’ balance sheets and income statements remains uncertain.

Investors seem to believe steep loan losses lie ahead. This message comes through loud and clear when you compare some banks’ market capitalizations with their book values, or their net worths. When investors anticipate loan losses, they price bank shares below their corresponding book values.

That uncomfortable position is where some of the nation’s largest banks currently stand. For example, Citigroup shares are trading at 59 percent of its tangible book value, a measure of a bank’s equity that excludes items that are difficult to assess, like good will. And Bank of America stock trades at 72 percent of its tangible book value, down from a slight premium late last year. Even the mighty JPMorgan trades at just 16 percent above its tangible book; at year’s end, the stock represented a 38 percent premium. 

BANKING Crisis II.....................Don't Doubt ME on this ONE!!!!!!!!!!!!!!!!!!! 

DRAGHI.........................""DEAD Man"" Walking!!!!!!!!!!!!!!!!!!!!!!!!!!!

The Coming CORRECTION "IS" going to be FRICKING BRUTAL!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!