Thursday, December 18, 2014
The ruble soared 10 percent Wednesday, boosted by the Russian central bank’s announcement that it is prepared to pump money into banks in 2015 and adopt a series of measures to “maintain the stability of the Russian financial sector.” But even as the currency appeared to rebound after a sharp decline earlier in the week, the ripple effects of crisis in the world’s sixth-largest economy will be felt far and wide.
“The currency has collapsed, and it’s possible that the economy could also collapse. They’ve become a wild card at this point, it’s a very dangerous situation,” said Stephen Guilfoyle, chief economist at Sarge986.com.
Russia’s $3.5 trillion economy depends heavily on exports, and oil accounts for roughly half of government revenue. As a result, the country is reeling from the combination of trade sanctions resulting from its invasion of Ukraine and Crimea, and the precipitous recent drop in global oil prices. And the meltdown will be a “headache” for the U.S., according to Ariel Cohen, director of the Center for Energy, National Resources and Geopolitics at the Institute for the Analysis of Global Security in Washington, D.C.
“We do not know and cannot predict the political ramifications of this economic crisis,” said Cohen. “Russian leaders didn’t realize how fragile the economy was and what the macroeconomic implications from the conflict in Ukraine would be.”
The ruble had previously tumbled over 20 percent against the dollar to 58 rubles per dollar on Tuesday, a record low. That came after Russia made a surprise move and hiked interest rates to 17 percent from 10 percent. In afternoon trading Wednesday, the ruble jumped over 10 percent to 62.04 rubles per dollar.
Meanwhile, the U.S. is benefiting from the 40 percent drop in global oil prices in the last six months. The country is also enjoying a stronger dollar compared to other major currencies. At the same time, global investors—especially Russians seeking a safe haven to park assets—are channeling funds into U.S. treasuries.
Continued strength in the dollar could hurt U.S. multinational companies. “Between 40 percent to 50 percent of S&P 500 revenues are now overseas. So you’ll probably start to see companies pre-announce a negative impact in earnings from a stronger dollar in early January,” said Charlie Bilello, director of research at Pension Partners, LLC.
As global crude oil prices have fallen, it’s turned into a stimulus for the U.S. consumer, but it will begin to affect U.S. credit markets “because roughly 13 to 15 percent of the high-yield market is energy related and the credit spreads there have really widened,” Bilello said. Meaning, as global crude oil prices continue to plummet, contagion fears have risen as oil prices are hurting high-yield corporate bonds, which are now posing broader risks.
For a while, investors thought the spread would be contained in the energy sector, but in the last week it has spilled over to other sectors. “You’re seeing high-yield spreads in the U.S. really start to widen out at their highest level since 2012,” Bilello said.
That will also affect companies’ ability to raise more debt to buy back stocks. “To the extent that companies have higher borrowing costs, obviously with very slow top-line growth, any marginal increase in that borrowing cost is difficult to stomach,” Bilello said.
Economists expect the Russian economy to contract 5 percent next year, according to Neil Shearing, chief emerging markets economist at Capital Economics.
“Russia is most likely headed for a prolonged recession. In conjunction, all of the BRICS [Brazil, Russia, India, China and South Africa] are looking quite poor, and the potential for boost from the emerging markets is looking quite poor,” Gregory Daco, chief U.S. economist at Oxford Economics, said.
How wide might the contagion spread? “You’re really seeing the emerging markets getting hit,” said Bilello. The global economy is already seeing spillover effects in commodity-centric countries such as Venezuela and Brazil.
In addition, economists are watching Iran, West African nations such as Angola and Nigeria and the so-called BRICS nations.
Many countries can ill afford the contagion. Brazil went through a recessionary environment with almost no growth this year along with little growth expected next year. China is slowing, and its growth outlook is expected to fall below its 7 percent target next year, Daco said.
“It’s still highly inflationary for Russia and these other emerging countries. It’s much harder situation for them to pay back their denominated debts. That’s the real big issue,” Bilello said. Meaning, it’s going to put pressure on these countries, as well as the companies within those countries, to pay back debt and issue new debt.
In the midst of the Russian Central Bank trying to calm contagion fears, other economies around the world are also showing signs of weakness, as Japan unexpectedly fell into recession last quarter while China is experiencing its slowest growth since 2009. Meanwhile, Europe is teetering on a triple dip recession.
“We haven’t seen this in a long time where oil prices have fallen without a global recession,” Bilello said. “The U.S. is really the strong hand here, but global growth issues are also part of the decline, and people can’t totally dismiss that.”
Ditching the Ruble
No Turning Back
The Time Parameters for World War III
1. Sex was not Satan’s idea; it was God’s. God meant for it to deepen the covenant relationship of marriage between a man and a woman. It was for pleasure, intimacy, and procreation.2. Since God created sex, He also set boundaries for its proper use. These boundaries, as well as all others declared within the Word of God, were established because of God’s love for us. The act of sex is more than just a physical union. Mankind was created in the image of God; this is exemplified in our tripartite design. Sex brings all three aspects of our being into play, so our spirits, souls, and bodies are affected. Sexual union outside of the boundaries established by God can open the doors of Hell to the lives of those individuals and within society as a whole.
For in the resurrection they neither marry, nor are given in marriage, but are as the angels of God in heaven. (Matthew 22:30)
More and more we are finding that mythology in general though greatly contorted very often has some historic base. And the interesting thing is that one myth which occurs over and over again in many parts of the world is that somewhere a long time ago supernatural beings had sexual intercourse with natural women and produced a special breed of people.[i]
For a man indeed ought not to cover his head, forasmuch as he is the image and glory of God: but the woman is the glory of the man.For the man is not of the woman; but the woman of the man.Neither was the man created for the woman; but the woman for the man.For this cause ought the woman to have power on her head because of the angels. (1 Corinthians 11:7–10, emphasis added)
Although evidently widely known during the development of the Hebrew Bible canon, 1 Enoch was excluded from both the formal canon of the Tanakh and the typical canon of the Septuagint and therefore, also the writings known today as the Deuterocanon. One possible reason for Jewish rejection of the book might be the textual nature of several early sections of the book that make use of material from the Torah; for example, 1 En 1 is a midrash of Deuteronomy 33.[ii]
There are several aspects of the Book of Enoch that I find interesting:
And again the Lord said to Raphael: “Bind Azazel hand and foot, and cast him into the darkness: and make an opening in the desert, which is in Dudael, and cast him therein. And place upon him rough and jagged rocks, and cover him with darkness, and let him abide there for ever, and cover his face that he may not see light. And on the day of the great judgment he shall be cast into the fire.” (1 Enoch 10:4–6)
And Aaron shall cast lots upon the two goats; one lot for the Lord, and the other lot for the scapegoat. (Leviticus 16:8)And when he hath made an end of reconciling the holy place, and the tabernacle of the congregation, and the altar, he shall bring the live goat:And Aaron shall lay both his hands upon the head of the live goat, and confess over him all the iniquities of the children of Israel, and all their transgressions in all their sins, putting them upon the head of the goat, and shall send him away by the hand of a fit man into the wilderness:And the goat shall bear upon him all their iniquities unto a land not inhabited: and he shall let go the goat in the wilderness. (Leviticus 16:20–22)
And Azazel taught men to make swords, and knives, and shields, and breastplates, and made known to them the metals of the earth and the art of working them, and bracelets, and ornaments, and the use of antimony, and the beautifying of the eyelids, and all kinds of costly stones, and all colouring tinctures.And there arose much godlessness, and they committed fornication, and they were led astray, and became corrupt in all their ways. (1 Enoch 8:1–2)Thou seest what Azazel hath done, who hath taught all unrighteousness on earth and revealed the eternal secrets which were (preserved) in heaven, which men were striving to learn. (1 Enoch 9:5, emphasis added)
Ancient historians had a variety of horrors to tell about the Celtae giants, including the fact that they were homosexuals (another crime which dictated the death penalty under Mosaic Law). Athenaeus states that the giants were accustomed to sleeping with not one but two boys. The historian Diodorus also suggested that homosexuality was rampant among the giants when he wrote:Although their wives were comely, they have very little to do with them, but raged with lust in outlandish fashion for the embraces of males. And the most astonishing thing of all is that they feel no concern for their proper dignity but prostitute to others without a qualm the flower of their bodies; nor do they consider this a disgraceful thing to do, but rather when anyone of them is thus approached and refuses the favor offered him, this they consider an act of dishonor.[iv]
While such a possibility is almost too repulsive to imagine, the bestiality of Sodom and Gomorra and the linkage of these two cities to the practices of the fallen angels elsewhere in the Bible suggest such hideous acts might be considered a possibility.
Interestingly, a Canaanite tablet contains several verses claiming that such matings took place between animals and the god Baal:
He loved a heifer in the pasture,He lay with her seventy-seven times,She made him mount eighty-eight times,She conceived and gave birth to his likeness.[v]
1. Cain had taught them to settle in communities, and build cities; and the sons of Lamech—speedily followed, no doubt, by many others—had introduced the mechanical and fine arts, and had devised unlawful means of evading the labour imposed by the curse.[vi]2. And yet so great had been their intellectual power that the famous library of Agane, founded at the time by Sargon I, was stocked with books “which were either translated from Accadian originally, or else based on Accadian texts, and filled with technical words which belonged to the old language.”[vii]3. We have evidence that in very early times there were well-known libraries at Erech, Ur, Cutha, and Larsa, to which observatories and universities were attached.If, then, we give but their fair weight to these considerations, we seem compelled to admit that the antediluvians may have attained a perfection in civilization and high culture that has scarcely yet been recovered, much as we pride ourselves upon our own times.[viii]
The term foo fighter was used by Allied aircraft pilots in World War II to describe various UFOs or mysterious aerial phenomena seen in the skies over both the European and Pacific theaters of operations.Though “foo fighter” initially described a type of UFO reported and named by the U.S. 415th Night Fighter Squadron, the term was also commonly used to mean any UFO sighting from that period. Formally reported from November 1944 onwards, witnesses often assumed that the foo fighters were secret weapons employed by the enemy.[ix]
1. Has there been a great acceleration of knowledge that surpasses that of previous generations?2. Has there been a refining of civilization and technology with a corresponding level of darkness released with it?3. It there a move within our civilization to cast off all boundaries (restraints) set by God for a more enlightened view?4. Has there been an increase in sexual perversion that far surpasses historical norms?
The Nephilim—Human 2.0?
There were giants in the earth in those days; and also after that, when the sons of God came in unto the daughters of men, and they bare children to them, the same became mighty men which were of old, men of renown. (Genesis 6:4)
“Nephilim” is a transliteration of the Hebrew, not a translation, which indicates a group or class. It is commonly related to nāpal, meaning “to fall”; thus the Nephilim are considered “the Fallen Ones.” If so, does this refer to their expulsion from heaven, their death as “fallen” in battle, or to their moral degeneracy? Another proposal is the related noun nēpel, meaning“miscarriage” (Job 3:16; Ps 58:8 ; Eccl 6:3), suggesting that they were unusual in appearance since they were born by miscarriage. The terms “fallen” and “warriors” occur repeatedly in Ezekiel’s oracles against the nations (Ezek 32:20–27) whose armies fall in battle; this may have alluded to 6:1–4. Ezekiel’s use of “fallen,” however, is likely a sound play on the word “Nephilim” and not derived from an etymological association.The traditional English rendering “giants” (AV) follows the LXX Septuagint (and ancient versions), which translates gígantes for Hebrew nĕpilîm (Nephilim). We can attribute this most likely to the influence of the later account recorded in Num 13:33. The frightened Israelite spies marveled at the exceptional height of the Nephilim, remarking that the Hebrews were no more than like “grasshoppers” before them. Later Jewish literature interpreted the Nephilim as giants and referred to their infamous pride and wickedness.[xii] (Emphasis added)
Delitzsch, nevertheless, together with Hofmann, prefers to explain it as the fallen, namely, from heaven, because begotten by heavenly beings. Here from to falt, would he make to fall from, and from this again, to fall from heaven; then this is made to mean begotten of heavenly beings! The sense, cadentes, defectores, apostatœ (see Gesenius), would be more near the truth. “There were giants” (הָיוּ), not, there became giants, which would have required וַיִּהְיוּ for its expression (see Keil). These giants, or powerful men, are already in near cotemporaneity with the transgression of these mesalliances (in those very same days), and this warrants the conclusion of Luther, that these powerful men were doers of violent deeds.[xiii](Emphasis added)
נָפִיל only in pl. נְפִילִים m. giants, Gen. 6:4; Nu. 13:33. So all the ancient versions (Chald. נִפְלָאthe giant in the sky, i.e. the constellation Orion, plur. the greater constellations). The etymology of this word is uncertain. Some have compared نَبِيلُ, نَبِيلَةُ, which Gigg. and Cast. render, great, large in body; but this is incorrect; for it means, excellent, noble, skilful. I prefer with the Hebrew interpreters and Aqu. (ἐπιπίπτοντες) falling on, attacking, so that נָפִיל is of intransitive signification. Those who used to interpret the passage in Genesis of the fall of the angels, were accustomed to render נפילים fallers, rebels, apostates.[xiv]
More and more we are finding that mythology in general though greatly contorted very often has some historic base. And the interesting thing is that one myth which occurs over and over again in many parts of the world is that somewhere a long time ago supernatural beings had sexual intercourse with natural women and produced a special breed of people.[xv]
They are dead, they shall not live; they are deceased, they shall not rise: therefore hast thou visited and destroyed them, and made all their memory to perish.
Hebrew: rapha’ (HSN-
), translated dead (Isa. 26:19; 14:9; Job 26:5; Ps. 88:10–11; Prov. 2:18; 9:18; 21:16); deceased (Isa. 26:14); giants (Dt. 2:11, 20; 3:11,13; Josh. 12:4; 13:12; 15:8; 17:15; 18:16; 2 Sam. 21:16–22; 1 Chr. 20:4–8); and Rephaim (Isa. 17:5; Gen. 14:5; 15:20; 2 Sam. 5:18, 22; 23:13; 1 Chr. 11:15; 14:9). In the eight places where it is translated dead and deceased it should have been retained as a proper name—Rephaim, as follows:1. Rephaim under waters.2. Shall the Rephaim arise and praise You? (Ps. 88:10–11)3. Her paths unto the Rephaim. (Prov. 2:18)4. The Rephaim are there. (Prov. 9:18).5. Congregation to the Rephaim. (Prov. 21:16)6. It stirreth up the Rephaim for you. (Isa. 14:9)7. They are Rephaim. (Isa. 26:14)8. The earth shall cast out the Rephaim.The Rephaim were the other lords of Isa 26:13; they shall not rise because God visited and destroyed them (Isa 26:14). This plainly teaches that the giants or Rephaim have no resurrection like the dead of Israel referred to in Isa 26:19. They were the offspring of fallen angels, not ordinary men who do have a resurrection.[xvii]
1. To so contaminate the human genome that there would be no pure human bloodline left for Messiah (the Seed of the women) to be born from. Note: Genesis 6:9 refers to Noah being “perfect in his generations,” annotating him and his family as still being completely Human 1.0.
2. To replace the image of God within mankind with the image of the Beast. This would render mankind unredeemable. Although the image of God is marred within sinful man, it still provides a conscience. The conscience not only recognizes sin but the need for repentance. If that image could be replaced with another one (i.e., the image of the Beast), there would be no recognition of sin, and repentance would be impossible. This is possibly why there is no hope for those who receive the mark of the Beast and worship his image in the book of Revelation. (See my chapter entitled, “A New Theory on the Image of the Beast and the New Conscience,” in the book, Blood on the Altar: The Coming War between Christian vs. Christian, Defender Publishing.)
And except that the Lord had shortened those days, no flesh should be saved: but for the elect's sake, whom he hath chosen, he hath shortened the days. (Mark 13:20)
Russia has lost control of its economy and may be forced to impose Soviet-style exchange controls after "shock and awe" action by the central bank failed to stem the collapse of the rouble.
“The situation is critical,” said the central bank’s vice-chairman, Sergei Shvetsov. “What is happening is a nightmare that we could not even have imagined a year ago."
The currency crashed to 100 against the euro in the biggest one-day drop since the default crisis in 1998 as capital flight gathered pace, despite a drastic rise in interest rates to 17pc intended to crush speculators and show resolve.
Yields on two-year Russian bonds spiralled to 15.36pc, while credit default swaps are pricing in a one-third chance of a sovereign default. The shares of Russia’s biggest lender, Sberbank, fell 18pc.
Neil Shearing, from Capital Economics, said the spectacular failure of the rate shock may bring matters to a head. “If a rise of 650 basis points won’t do the job, we are near the end. That means stringent capital controls,” he said.
Michal Dybula, from BNP Paribas, said the rouble's plunge risks setting off a systemic bank run. “A large-scale run on deposits, once under way, would make capital controls pretty much unavoidable,” he said, adding that the authorities may start by forcing state-controlled companies to sell foreign assets and repatriate funds.
In Washington, the White House said it had no intention of easing pressure on Russia to halt the freefall. "It is president Vladimir Putin's decision to make. The aim is to sharpen the choice that he faces," it said.
President Barack Obama will not veto a law passed by Congress imposing a raft of new sanctions against Russia, even though he warned previously that it goes too far for European leaders and risks splitting the trans-Atlantic front. The measures include $350m of military assistance to Ukraine, and authorize Mr Obama to impose curbs on energy companies investing in Russia, as well as to prohibit credit to Gazprom.
Sergei Lavrov, Russia's foreign minister, said it is now clear that the US aim is to topple Mr Putin through "regime change" but vowed that the Russian people would rise in defiance. “We have been in much worse situations in our history, and every time we have got out of our fix much stronger,” he said.
After years of bluster and suggestions by Mr Putin that the US is a paper tiger, the Kremlin is now coming face to face with the cataclysmic consequences of what it has done by invading Ukraine and changing Europe's borders by force. By the same token, Washington needs to move with care since it would be a geostrategic miscalculation of the first order to push a nuclear-armed Russia too far into a corner, or to perpetuatue a cycle of grievance.
Anthony Peters, from SwissInvest, said Russia's leaders had misled their own people and have until now been in denial about the crisis engulfing them. "Not since Soviet times have we seen such steadfast refusal by the Kremlin to acknowledge the presence of severe political and economic problems while sacrificing the people in the name of orthodoxy. The Russian people are legendarily stoic in the face of hardships but beware if, and when, their patience runs out,” he said.
- Russia's economic crisis: live
The rouble crash has doubled the cost of servicing nearly $700bn of external debt owed by Russian banks, companies and state bodies, mostly in dollars. They must repay $30bn this month and a further $100bn next year. Oil giant Rosneft has requested $49bn of state aid to weather the crisis.
Traders in Moscow expressed fury at the central bank’s refusal to deploy its $416bn of foreign reserves to “turbo-charge” the defence of the rouble, though the authorities may have intervened in late trading. The currency clawed back some ground - to 69 against the dollar - after one of the wildest days of the modern era. Eugene Kogan, from Moscow Partners, said the Russian stock market faces “slow death” over the next six months as liquidity vanishes.
It is clear that the authorities are guarding their reserves jealously after burning through $100bn this year to little avail. BNP’s Tatiana Tchembarova said what remains no longer covers external debt, unlike 2008 when there was still ample cover. “In addition to being twice as levered, Russia is entering this crisis with lower reserves,” she said.
The government has already committed $143bn in foreign reserve spending for next year. “We think that more will be required to support Russia’s banking system,” she said. The Kremlin had to spend $170bn rescuing the banks in the 2008-2009 crisis.
Lubomir Mitov, from the Institute of International Finance, said any fall in reserves below $330bn could prove dangerous, given the scale of foreign debt and a confluence of pressures. “It is a perfect storm. Each $10 fall in the price of oil reduces export revenues by some 2pc of GDP. A decline of this magnitude could shift the current account to a 3.5pc deficit,” he said. The total “financing gap” could soon reach 10pc of GDP due to the combined effects of capital flight and sanctions.
The central bank knows that Russia’s seemingly large reserves are a Maginot Line. Yet its attempt to defend the rouble only by raising rates is itself lethal. Even before the latest move it warned that the economy could contract by 4.7pc next year in a scenario of $60 oil prices.
The slump may now be far worse as a violent monetary squeeze sends tremors through the banking system and sets off a wave of corporate bankruptcies. BNP Paribas said each 100-basis point rise in rates cuts 0.8pc off GDP a year later. Rates have risen 750 points in a week.
Lars Christensen, from Danske Bank, said the Kremlin’s actions have led to the “absolutely worst possible outcome” since the botched move is enough to do grave damage, without solving anything. “They should have let the currency go rather than killing the economy. Investment is in freefall, and I fear this shock is going to be even bigger than in 2008-2009. Nothing suggests that oil is going to rebound quickly this time,” he said.
Growth has held up over recent months but this may be an illusion of the crisis itself as people scramble to rid themselves of roubles to buy homes, cars, washing machines or anything that keeps its value. Ikea has seen a surge of orders for new kitchens. This is a one-off effect, and creates a cliff-edge from the economy next year.
The rouble trauma came as premier Dmitry Medvedev held an emergency meeting with economic planners, and rumours swirled of a sweeping purge at the top of Kremlin. Officials denied there were any plans for capital controls after the meeting.
There is no sign yet of relief from the oil markets. Brent crude fell below $59 a barrel on Tuesday for the first time since the depths of the Great Recession in 2009. The fallout from the crisis is already hitting banks linked to Russia and Ukraine. The share price of Austria’s Raiffeisen fell 8pc in Vienna. More than 240pc of its tangible equity is exposed to the region. The biggest external lender is France’s Societe Generale, with €25bn of exposure, or 62pc of tangible equity.
Contagion is spreading across the emerging market nexus, hitting countries such as Turkey and India that should be beneficiaries of lower oil prices. “There is absolutely no liquidity anywhere. The system is stressed and we have a crunch all over the place,” said one hedge fund trader.
There are signs that the sell-off is becoming self-feeding as investors withdraw money from emerging market bond funds, forcing the funds to liquidate holdings into the downturn. In some cases managers are acting tactically, selling “proxies” such as Turkish debt given the difficulty of exiting Russian positions.
The rouble has now fallen 56pc against the dollar over the past year. Russian GDP has shrunk to $1.1 trillion, smaller than the economy of Texas, and half the size of Italy’s. The effect has been to double Russia’s external debt to at least 70pc of GDP, a high-risk level for rating agencies.
“A Russian downgrade to junk is only a matter or time,” said Tim Ash, from Standard Bank.
Credit to The Telegraph
No matter how many bombs Americans drop on ISIS forces, Iraqi troops are losing ground. If al-Anbar is lost, the entire Iraqi front dynamic will shift to favor ISIS again, and months of the U.S.-led air campaign will have been wasted.
Maybe that’s why we had reports from an Iraqi field commander on Tuesday that U.S. forces had their first ground clash with ISIS terrorists at midnight on Monday, Baghdad time. ISIS fighters were forced to withdraw after U.S. air force fighters bombed enemy positions.
The minor victory was well timed. After six weeks of defeats in Iraq, ISIS made its first gains in the western province of al-Anbar last week, threatening the remaining Iraqi government forces and its tribal Sunni allies who are defending the remaining cities and army camps there.
“We have ammunition to fight ISIS for five days only. After that, we will not be able to fight them with their advanced arms,” said Sheikh Naeim al-Gaud, a tribal leader who suffered hundreds of losses in a massacre committed by ISIS several weeks ago near the city of Hit, western Iraq.
A lot is riding on Al-Anbar. It’s Iraq’s largest province, about one-third the size of Iraq. It borders Syria, Jordan and Saudi Arabia. It also borders Baghdad, Babil, Karbala, Najaf, Salahuddin and Nineveh provinces. Most of the province is controlled by ISIS. Nevertheless, the provincial capital, Ramadi, is divided between the Iraqi government and ISIS. Several other towns are still controlled by the government as well, including an army camp that hosts 100 U.S. soldiers.
On the days following al-Gaud’s warning, ISIS retook many areas to the west of Ramadi, near the town of al-Baghdadi, forcing the army and its allies to halt an attack to restore the city of Hit. Shekh al-Gaud said he only received 72 AK-47 rifles that are out of service despite his public appeals for help. He also said that the army’s seventh division, which is fighting ISIS in his area, has no tanks at all while ISIS has many of them. His tribal fighters used rocket-propelled grenades, or RPGs, to counter ISIS tanks. That is no longer working. “They have developed a way to make their tanks avoid our rockets.”
He lost 762 members of his tribe who were killed by ISIS.
One of the reasons the Iraqi government hesitates to arm the tribes in al-Anbar is that some of the weapons sent previously ended up in ISIS hands. “I was told that 4000 Russian PKCs heavy machine guns were sent before. 800 of them ended up with ISIS,” al-Gaud said.