Friday, December 23, 2011
New Zealand earthquake: Dozens injured in Christchurch
The quakes - including one of magnitude 6 and two above 5 on the Richter scale - damaged buildings, cut power, and caused mud and sewage to bubble into streets.
Several buildings which were partially demolished after previous quakes collapsed completely.
A spokesman for the St John ambulance service said they had received around 150 emergency calls. About 60 people were treated for minor injuries, heart attacks, panic attacks and collapses.
Thousands of shoppers were evacuated from malls, where goods tumbled from shelves on what should have been one of the busiest days of the year for retailers.
One woman customer said: “We saw the staff running out, so we thought if they are off, we’re going too.”
Frightened workers also ran out of office buildings across the city.
The international airport was closed for checks after the main terminal “shook violently", causing havoc for hundreds of passengers.
Residents in low-lying eastern suburbs were again hit hard by liquefaction, a process in which water oozes out of the ground, creating a tide of evil-smelling mud.
In hillside suburbs, the biggest danger came from rockfalls as loose boulders were dislodged.
Coastguard officials rescued four people who were trapped by a rockfall in Boulder Bay.
The energy supply company Orion was struggling to reconnect power to 26,000 properties.
Large pot-holes and cracks appeared in roads, which soon became gridlocked with traffic.
More than 7,000 aftershocks have rocked the city since a magnitude-7 quake struck on September 4, 2010.
A shallow 6.3 quake on Feb 22 this year killed 182 people and devastated the city centre business district, where ruined buildings are still cordoned off.
Many people were reduced to tears by the latest earthquakes, coming just as residents were daring to hope that the worst of the aftershocks were over.
John Key, the New Zealand Prime Minister, said the quakes were “frightening and disheartening” for residents.
"My heart goes out to the people of Christchurch and Canterbury at this time,” Mr Key said.
"However, residents can be confident that the authorities are on to the situation, and government resources stand ready to assist wherever they are needed.”
He pledged that his government’s resolve to rebuild the city remained unchanged.
Bob Parker, the mayor, interrupted a Christmas break in the North Island to head back to his city.
He said the shakes would take a large emotional toll on people.
"Many of them are just sitting around and in tears,” he said.
The Telegraph
Iran starts building a nuclear weapon: US and Israel tighten cooperation
Iran has embarked on "activities related to possible weaponization," said American sources Thursday, Dec. 22, thereby accounting for the dramatic reversal of the Obama administration's wait-and-see attitude on attacking Iran. The change was articulated this week by US Defense Secretary Leon Panetta and Chairman of the Joint US Chiefs of Staff Gen. Martin Dempsey.
DEBKAfile's Washington sources report that the Islamic Republic crossed the red line President Barack Obama had set for the United States, i.e., when Tehran begins using the technologies and fissile materials (enriched uranium) it has amassed for assembling a bomb or missile warheads. This marks the moment that Iran goes nuclear and only a short time remains before it has an operational nuclear weapon.
Washington has always claimed that when the order to build a weapon was given in Tehran, the United States would know about it within a short time.
The US stealth drone RQ-170 was sent into Iranian airspace for the first time to find evidence to support this suspicion. On Dec. 4 the Iranians downed the unmanned reconnaissance craft by intelligence or cyber means not yet fully clarified. The US - and most probably Israel too - then turned to other intelligence resources to find out what Iran was up to. According toDEBKAfile's military and intelligence sources, they found evidence that Iran has in fact begun putting together components of a nuclear bomb or warhead.
This discovery prompted the latest statements by Mr. Panetta and Gen. Dempsey.
The defense secretary put it into words when he said Tuesday, Dec.: “Despite the efforts to disrupt the Iranian nuclear program, the Iranians have reached a point where they can assemble a bomb in a year or potentially less.”
The next day, Gen. Dempsey said, “My biggest worry is they will miscalculate our resolve. Any miscalculation could mean that we are drawn into conflict, and that would be a tragedy for the region and the world.”
Dennis Ross, until last month President Obama’s senior Middle East adviser, and key architect of White House policies on the Iranian nuclear program and understandings with Israel on this issue, said Israel has four causes for concern about uranium enrichment in the underground nuclear facility at Fordo near Qom and other developments:
1. Iran’s accumulation of low-enriched uranium, its decision to enrich to nearly 20 percent “when there is no justification for it.”
2. The "hardening" of Iranian nuclear sites, largely by moving facilities underground.
3. Other activities related to possible weaponization.
4. Israel suspects that Fordo is not Iran's only buried facility and that nuclear "weaponization" is ongoing surreptitiously at additional underground locations. “I would not isolate Qom and say this alone is the Israeli red line to spur a military response.”
Our military sources report that all these developments were covered in the short and epic conversation between President Barack Obama and Israeli Defense Minister Ehud Barak at the Gaylord Hotel in Maryland on Dec. 16. It ended with accord on the US and Israeli responses to the new situation arising in Iran.
The White House has since accepted the Israeli assessment of Iran's nuclear bomb time table and endorses the conviction that unless Iran retreats from its decision to build a nuclear bomb and steps back from the process it set in train this month, the only option remaining will be a military strike to disable its nuclear program.
Following the Maryland encounter, DEBKAfile’s sources report a procession of prominent US officials visiting Israel to tighten coordination between the US and Israel on their next moves. Lt. Gen. Frank Gorenc, commander of the US’s Third air Force, was one of those visitors. He came to organize the biggest joint military exercise ever held by the US and Israel, as part of the shared response to Iran's steps.
Tuesday, Dec. 20, saw the arrival of Undersecretary of State Wendy Sherman, Secretary of State Hillary Clinton’s right-hand, together with Robert Einhorn, a State Department special adviser on nonproliferation. The two came to tie up the diplomatic ends of the decisions reached by President Obama and Defense Minister Barak at their Maryland meeting.
Defkafiles
Global depression could last several years: Medvedev
"We really are facing difficult times," Medvedev said in his last address to the nation before March presidential elections in which he will be ceding his place to his predecessor and mentor Vladimir Putin.
"The global economic depression could last several years, while competition for the minds, the ideas, the resources -- it will only get stiffer, and we are in the epicentre of this race.
"But even in these most difficult times, we have no right to stop our development. This work will require perseverance, effort and, of course, time."
Both Putin and Medvedev have taken credit for helping Russia survive the worst of the 2008-2009 global financial crisis and insisted that only their team will be able to deal with current economic challenges.
Medvedev noted that "many politicians, heads of international organisations and leading economists and businessmen" have all warned of the onset of a global economic depression in the months to come.
"It is obvious that difficult times await us all," Medvedev stressed.
"I have already said that our country honourably survived the test of crisis. The current team passed this test.
"I hope that we will cope with the new challenges, whoever becomes Russian president or whoever heads the federal government," he added in reference to th e premiership post he has been promised by Putin under his presidency.
France 24
UBS' George Magnus: Europe Has Been Mis-Diagnosed, And The Crisis Will Come Roaring Back
Financial markets will soon "regroup...to the rising sound of the rising crescendo of the next-euro crisis," writes UBS economic advisor George Magnus in a column published yesterday in the Financial Times.
In fact, EU leaders are completely misdiagnosing the problem, threatening Europe with the prospect of "zombie economies, institutions, and financial instruments" that could take down not only Germany, but the entire monetary union.
EU leaders have actually exacerbated sovereign debt and banking problems with their current policies:
They attribute the crisis to fiscal profligacy and the lack of adequate institutional fiscal mechanisms, rather than to the large external and competitiveness imbalances between member states. So, instead of coming up with an economic and debt adjustment strategy that distributes reform responsibilities symmetrically between debtors and creditors, leaders continue single-mindedly to pledge institutionalised fiscal discipline as the solution to the crisis. They have, in effect, sealed a pro-cyclical austerity zone.
A proper approach to resolving the crisis would have two distinct parts, and would comprise a true, equitable fiscal and monetary union:
Firstly, although Germany would never agree to the permanent transfer of the Bundestag’s authority to a European agency, the absence of any intent to transform European sovereign bond markets into a giant joint liability European bond market is a major weakness. It is going to make it harder for investors to return to orderly sovereign debt financing in the weakest economies.
Secondly, a proper approach to fiscal union would have to recognise the interconnectedness between the creditworthiness of sovereigns and banks. In other words, the handmaiden of a new fiscal federalism in Europe means very little unless accompanied by banking federalism too.
A more believable plan would complement fiscal discipline procedures and penalties with the transfer of strong executive powers to, say, the European Banking Authority to hold sway over capital and liquidity requirements, deposit and market funding arrangements and guarantees, resolution authority, and mergers.
Unless EU leaders alter their approach, the increasing likelihood of a Greek default in March, large sovereign borrowing, and eventually a French election will create market terror. The crisis will continue to escalate, resulting in the "zombification" of the European economy, governments, banks, Germany, and all.
Read more: http://www.businessinsider.com/ubss-george-magnus-prevent-the-zombification-of-europe-2011-12?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TheMoneyGame+%28The+Money+Game%29&utm_content=Google+Reader#ixzz1hMzB4j5T
Cenk Uygur Cuts Peter Schiff's Mic After He Says We Have Centrally Planned Economy
Cenk Uygur, host of a new program on Current TV, cut off Peter Schiff from his show after the new went head-to-head over capitalism.
Cenk couldn't take being hammered over a "centrally planned socialist economy" so he cut Schiff's microphone and booted him from the show.
“Are you saying the bankers are not guilty of this at all?” Cenk asks.
Schiff responds, “We don’t have the benefits of capitalism any more because we don’t have capitalism — we have a centrally-planned socialist economy, and that is why the average American is getting poorer.”
Cenk cuts Schiff off — though Schiff keeps talking for two minutes into the void — and Cenk says, “He wants to blame the government for the problems, but he knows it’s his banker friends who have given those donations, who buy their senators, who buy their staff members, so they can get more money. He doesn’t want you to pay attention to that, because that’s how they rob you. And he comes on here and goes, ‘Oh, no no, it’s socialism.’ Socialism, my ass! The real problem is — and he’s talked about it in the past, but he didn’t talk about it there — corporatism, where the corporations come in and rob us blind.”
Real clear Politics
Sir Mervyn King: debt crisis is causing a dangerous 'dependence on central banks'
Just a day after the European Central Bank (ECB) provided a record €489bn (£407bn) of cheap loans to banks, the Governor of the Bank of England said the crisis had been made worse by “negative interlinkages”. He added: “Dependence on central banks has risen and signs are intensifying that stressed financial conditions are passing through to the real economy.” Sir Mervyn was speaking in Berlin following a meeting of the European System Risk Board.
His comments were taken as a view on the ECB’s radical refinancing operation unleashed on Wednesday. The action, which saw 523 banks borrow nearly half a trillion euros, is known as the “Sarko trade” after French leader Nicolas Sarkozy said the liquidity would allow each state to “turn to its banks” for finance. Economists have warned that making banks buy risky sovereign debt will not help the crisis.
But European markets were buoyed by the liquidity injection. In France the CAC rose 1.36pc and German DAX ended the day 1.05pc higher. In London, the FTSE 100 climbed 1.25pc.
Sir Mervyn said the action would help in the short term but called for longer-term solutions, including getting the European Financial Stability Facility (EFSF), the so-called “big bazooka” bail-out fund, up and running.
Mr King’s comments came as Lorenzo Bini Smaghi, an executive board member at the European Central Bank, called for quantitative easing to be used to boost Europe’s economies if deflation risks emerge across the currency bloc. He added that Britain should lend its support since, he argued, “the European Union and ECB would certainly contribute to help Britain if London was in difficulty”.
In Rome, Mario Monti won a crucial vote of confidence for his €33bn austerity package which includes overhauling the country’s tax, pension and retirement systems. In a speech to the parliament, the Italian prime minister called for Italians to buy the country’s debt. He added: “There is still enormous work to be done to free the Italian economy from the brakes that have held back growth for too long.”
The strains were showing elsewhere too. S&P downgraded Hungary to BB+/B on “unpredictable policy framework”. Budapest said it would hold fresh meetings with the International Monetary Fund and EU officials in January.
Moody’s downgraded Slovenia’s foreign currency credit rating from A1 to Aa3, citing growing pressure on the government’s balance sheet from potential support for the country’s banks.
As Greek protests were led by hearse drivers complaining about additional taxes, data from Germany’s statistics office showed Greek and Spanish migration to Germany soared 84pc and 49pc respectively in the first half of 2011.
Meanwhile, Peter Bofinger, a member of Chancellor Angela Merkel’s council of economic advisers, told German reporters the future of the euro will be decided in the next six months and depended on decisive action from Germany.
The Telegraph
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