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You should be reading a lot about biofuels and famine issues these days… If not, please do. These are subjects that you should become familiar with.

From Online Journal


Analysis
Global famine? Blame the Fed
By Mike Whitney
Online Journal Contributing Writer


Apr 29, 2008, 00:19

The stakes couldn’t be higher for Ben Bernanke. If the Fed chief decides to lower rates at the end of April, he could be condemning millions of people to a death by starvation.

The situation is that serious. Food riots have broken out across the globe destabilizing large parts of the developing world. China is experiencing double-digit inflation. Indonesia, Vietnam and India have imposed controls over rice exports. Wheat, corn and soya are at record highs and threatening to go higher still. Commodities are up across the board. The World Food Program is warning of widespread famine if the West doesn’t provide emergency humanitarian relief.

Venezuelan President Hugo Chavez said it best: “It is a massacre of the world’s poor. The problem is not the production of food. It is the economic, social and political model of the world. The capitalist model is in crisis.”

Right on, Hugo. There is no shortage of food; it’s just the prices that are making food unaffordable. Bernanke’s “weak dollar” policy has ignited a wave of speculation in commodities which is pushing prices into the stratosphere. The UN is calling the global food crisis a “silent tsunami,” but its more like a flood; the world is awash in increasingly worthless dollars that are making food and raw materials more expensive. Foreign central banks and investors presently hold $6 trillion in dollars and dollar-backed assets, so when the dollar starts to slide, the pain radiates through entire economies. This is especially true in countries where the currency is pegged to the dollar. That’s why most of the Gulf States are experiencing runaway inflation. This doesn’t mean that oil depletion, biofuel production, over-population, and giant agribusinesses don’t add to the problem. They do. But the catalyst is the Fed’s monetary policies; that’s the domino that puts the others in motion.

Here’s Otto Spengler’s summary in his recent article in Asia Times, Rice, Death and the Dollar: “The global food crisis is a monetary phenomenon, an unintended consequence of America’s attempt to inflate its way out of a market failure. There are long-term reasons for food prices to rise, but the unprecedented spike in grain prices during the past year stems from the weakness of the American dollar. Washington’s economic misery now threatens to become a geopolitical catastrophe. . . . The link between the declining parity of the US unit and the rising price of commodities, including oil as well as rice and other wares, is indisputable.

“Never before in history has hunger become a global threat in a period of plentiful harvests. Global rice production will hit a record of 423 million tons in the 2007-2008 crop year, enough to satisfy global demand. The trouble is that only 7% of the world’s rice supply is exported, because local demand is met by local production. Any significant increase in rice stockpiles cuts deeply into available supply for export, leading to a spike in prices. Because such a small proportion of the global rice supply trades, the monetary shock from the weak dollar was sufficient to more than double its price.” [“Rice, death and the dollar”, By Otto Spengler, Asia Times]

The US is exporting its inflation by cheapening its currency. Now a field worker in Haiti who earns $2 a day, and spends all of that to feed his family, has to earn twice that amount or eat half as much. No wonder that six people were killed in Port au Prince in the recent food riots. People go crazy when they can’t feed their kids.

Food and energy prices are sucking the life out of the global economy. Foreign banks and pension funds are trying to protect their investments by diverting dollars into things that will retain their value. That’s why oil is nudging $120 per barrel when it should be in the $70 to $80 range.

According to Tim Evans, energy analyst at Citigroup in New York, “There’s no supply-demand deficit.” None. In fact suppliers are expecting an oil surplus by the end of this year.

“The case for lower oil prices is straightforward: The prospect of a deep U.S. recession or even a marked period of slower economic growth in the world’s top energy consumer making a dent in energy consumption. Year to date, oil demand in the U.S. is down 1.9% compared with the same period in 2007, and high prices and a weak economy should knock down U.S. oil consumption by 90,000 barrels a day this year, according to the federal Energy Information Administration.” [“Bears Baffled by Oil Highs,” Gregory Meyer, Wall Street Journal]

There’s no oil shortage; that’s another ruse. Speculators are simply driving up the price of oil to hedge their bets on the falling dollar. What else can they do, put them in the frozen bond market, or the sinking stock market, or the collapsing housing market? The Fed has gummed up the entire financial system with its low-interest credit scam, now it’s on to commodities where the real pain is just beginning to be felt.

This is what happens when there’s too many dollars sloshing around the system; they all need a place to rest, and when they do, they create equity bubbles. Sound familiar? Indeed. This is Greenspan’s legacy in a nutshell; the dark specter of Maestro will continue to haunt the world until all the hyper-inflated asset-classes (real estate, bonds, stocks, commodities) return to earth and all the red ink is mopped up. That’ll take time, but Bernanke could make things a lot easier if he accepted some responsibility for the current turmoil and raised rates by 25 basis points. That would show speculators that the Fed was serious about defending the currency, which would send the commodities bubble crashing to earth. Prices would go down overnight.

But Bernanke won’t raise rates because he doesn’t really give a hoot about the people in Cameroon who have to scavenge through garbage dumps for a few morsels to keep their families alive. Nor does he care about the average American working-stiff who goes into cardiac arrest every time he pulls up to the gas pump. What matters to Bernanke is making sure that his fat cat buddies in the banking establishment get a steady stream of low interest loot, so they can paper over their bad investments and ward off bankruptcy for another day or two. It’s a joke; it was the investment banks that created this mess with their putrid mortgage-backed securities and other debt exotica. Still, in Bernanke’s mind, they are the only ones who really count.

And don’t expect Bush to step in and save the day either. The “Decider” still believes in the unrestricted activity of the free market, especially when his crooked friends can make a buck on the deal.

From the Washington Times: “Farmers and food executives appealed fruitlessly to federal officials yesterday for regulatory steps to limit speculative buying that is helping to drive food prices higher. Meanwhile, some Americans are stocking up on staples such as rice, flour and oil in anticipation of high prices and shortages spreading from overseas. Costco and other grocery stores in California reported a run on rice, which has forced them to set limits on how many sacks of rice each customer can buy. Filipinos in Canada are scooping up all the rice they can find and shipping it to relatives in the Philippines, which is suffering a severe shortage that is leaving many people hungry.” [Patrice Hill, Washington Times]

The Bush administration knows there’s hanky-panky going on, but they just look the other way. It’s Enron all over again — where Ken Lay & Co. scalped the public with utter impunity while regulators sat on the sidelines applauding. Great. Now it’s the Commodity Futures Trading Commission (CFTC) turn; they’re taking a hands-off approach so Wall Street sharpies make a fortune jacking up the price of everything from soda crackers to toilet bowls.

“A hearing Tuesday in Washington before the Commodity Futures Trading Commission starts a new round of scrutiny into the popularity of agricultural futures, once a quieter arena that for years was dominated largely by big producers and consumers of crops and their banks trying to manage price risks. The commission’s official stance and that of many of the exchanges, however, is likely to disappoint many consumer groups. The CFTC’s economist plans to state at the hearing that the agency doesn’t believe financial investors are driving up grain prices. Some grain buyers say speculators’ big bets on relatively small grain exchanges, especially recently, are pushing up prices for ordinary consumers. [“Call Goes Out to Rein In Grain Speculators”, Ann Davis]

“The agency doesn’t believe financial investors are driving up grain prices”?

Prices have doubled, people are starving, and the Bush troop is still parroting the same worn party-mantra. It’s maddening.

The US has been gaming the system for decades; sucking up two-thirds of the world’s capital to expand its cache of Cadillac Escalades and flat-screen TVs; giving nothing back in return except mortgage-backed junk, cluster bombs, and crummy green paper. Nothing changes; it only gets worse. But this time its different. The world is now facing the very real prospect of famine on a massive scale because 12 doddering old banksters at the Federal Reserve would rather bail out their sketchy friends than save the lives of starving women and children. Bernanke, with one swipe of the pen, now has an opportunity to send more people to their eternal reward than Bush. If he cut rates, the dollar will fall, commodities will spike, and people will starve. It’s as simple as that.

Mike Whitney lives in Washington state. He can be reached at fergiewhitney@msn.com.

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This may not be the best news for Americans needing gasoline and oil but Venezuelan oil supplier, Petroleos de Venezuela SA (PDVSA), is slapping back at the overly aggressive Exxon Mobil corporation.

As you’ll recall a couple of days ago, Exxon Mobil stomped on PDVSA by getting a British court to freeze $12 billion of PDVSA’s own assets in a move to take over the company. Boy, that takes gall but it’s becoming a norm with the imperialist attitude we are seeing these days under the Bush regime and the New World Order.

And boy oh boy is Exxon Mobil one greedy mo-fo… Just look at their last year’s profits:

On February 1, 2008, for the year 2007, The New York Times reported that Exxon Mobil “beat its own record for the highest profits ever recorded by any company, with net income rising 3 percent to $40.6 billion, thanks to surging oil prices. The company’s sales, more than $404 billion, exceeded the gross domestic product of 120 countries. “

I say you go PDVSA! Don’t take any shit from Exxon Mobil – fight, fight, fight! Don’t let those overbearing fat, rich, piggy, snobby, imperialist, greedy, self-centered s.o.b.’s. push you around! Besides it looks like they have enough money to keep 120 countries from suffering from poverty, starvation, famine, epidemics and a host of other things, as well as maintaining the living of all the residents within those countries, and they can certainly keep them in OIL – so they don’t need your’s too!

Furthermore, don’t buy Exxon Mobil gasoline or products; don’t support companies like this.

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Venezuela Halts Oil Sales to Exxon Mobil

Tuesday February 12, 9:27 pm ET
By Fabiola Sanchez, Associated Press Writer

Venezuela’s State Oil Company Halts Oil Sales to Exxon Mobil

CARACAS, Venezuela (AP) — Venezuela’s state oil company said Tuesday that it has stopped selling crude to Exxon Mobil Corp. in response to the U.S. oil company’s drive to use the courts to seize billions of dollars in Venezuelan assets.

Exxon Mobil is locked in a dispute over the nationalization of its oil ventures in Venezuela that has led President Hugo Chavez to threaten to cut off all Venezuelan oil supplies to the United States. Venezuela is the United States’ fourth largest oil supplier.

Tuesday’s announcement by state-run Petroleos de Venezuela SA, or PDVSA, was limited to Exxon Mobil, which PDVSA accused of “judicial-economic harassment” for its efforts in U.S. and European courts.

PDVSA said it “has paralyzed sales of crude to Exxon Mobil” and suspended commercial relations with the Irving, Texas-based company.

“The legal actions carried out by the U.S. transnational are unnecessary … and hostile,” PDVSA said in the statement. It said it will honor any existing contracts it has with Exxon Mobil for joint investments abroad, but reserved the right to terminate them if permitted by the terms of the contracts.

It was unclear how much oil PDVSA supplies to Exxon Mobil, the world’s biggest publicly traded oil company. Both Chavez and Oil Minister Rafael Ramirez previously said the company is no longer welcome to do business in Venezuela.

Venezuela’s decision leaves up in the air the situation of a refinery in Chalmette, La. — a joint venture supplied by Venezuelan oil in which PDVSA and Exxon Mobil are equal partners.

Exxon Mobil spokeswoman Margaret Ross declined to comment on the move by Venezuela but added that “it is our long-standing practice to take appropriate steps to meet our customers’ needs.”

Exxon Mobil is challenging the Chavez government’s nationalization of one of four heavy oil projects in the Orinoco River basin, one of the world’s richest oil deposits.

A British court issued an injunction last month temporarily freezing up to $12 billion of PDVSA’s assets. Exxon Mobil also has secured an “order of attachment” from U.S. District Court in Manhattan on about $300 million in cash held by PDVSA. A hearing to confirm the order is scheduled for Wednesday.

Other oil companies including Chevron Corp., France’s Total, Britain’s BP PLC and Norway’s StatoilHydro ASA have negotiated deals with Venezuela to continue as minority partners in the nationalized projects. ConocoPhillips and Exxon Mobil balked at the government’s tougher terms and have been in compensation talks with PDVSA.

Earlier Tuesday at an energy conference in Houston, Exxon Mobil senior vice president Mark Albers declined comment on any court proceedings with Venezuela, though he said the company is eager to negotiate fair compensation for its assets.

Exxon Mobil is taking the dispute to international arbitration, to which Venezuela has agreed. Its legal actions essentially seek to corral Venezuelan assets ahead of any decision by the arbitration panel.

Venezuela’s announcement came after Ramirez, the oil minister and PDVSA president, reiterated in a newspaper interview Tuesday that Venezuela is ready to cut off oil supplies to the United States if pressed into an “economic war.”

“If they want this conflict to escalate, it’s going to escalate. We have a way to make this conflict escalate,” Ramirez was quoted as saying.

The White House on Tuesday declined to comment on Venezuela’s threat. “When there’s a litigation that’s ongoing, different parties will say anything to try to win over on an argument,” said White House press secretary Dana Perino.

Meanwhile, Venezuelan state television has begun airing short anti-Exxon segments, with a message appearing on the screen in red text reading: “Exxon Mobil turns oil into blood.”

The U.S. remains the No. 1 buyer of Venezuelan oil, and Chavez relies largely on U.S. oil money to stimulate his economy and bankroll social programs that have traditionally boosted his popularity.

Some analysts say it would make little sense for Chavez to follow through on his broader threats to cut off oil sales to the U.S. because Venezuela owns refineries in the United States that are customized to handle the South American country’s heavy crude.

Ramirez said Venezuela is selling the U.S. a daily average of 1.5 million barrels of crude and other products derived from oil

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In March 2006 Chavez asked Exxon Mobil to give more of their profits back to the country or get out. Today Exxon Mobil has gotten a British court injunction to freeze $12 billion in assets in a move to take over Petroleos de Venezuela SA. President Chavez is rightly incensed:


Chavez Threatens US Oil Cutoff

Feb 10 03:49 PM US/Eastern


CARACAS, Venezuela (AP) – President Hugo Chavez on Sunday threatened to cut off oil sales to the United States if Exxon Mobil Corp. wins court judgments to seize his government’s assets. “If you end up freezing (Venezuelan assets) and it harms us, we’re going to harm you,” Chavez said. “Do you know how? We aren’t going to send oil to the United States. Take note, Mr. Bush, Mr. Danger.”

Exxon Mobil has gone after the assets of state oil company Petroleos de Venezuela SA in U.S., British and Dutch courts as it challenges the nationalization of a multibillion dollar oil project by Chavez’s government.

A British court has issued an injunction “freezing” as much as $12 billion in assets.

“The outlaws of Exxon Mobil will never again rob us,” Chavez said, saying the Irving, Texas-based oil major acts in concert with “the imperialist government of the United States” and is part of corporate “worldwide mafias.”

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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ABC News

Exclusive: Peace Corps, Fulbright Scholar Asked to ‘Spy’ on Cubans, Venezuelans

U.S. Embassy Official’s ‘Spy’ Request Violated Long-Standing U.S. Policy

By JEAN FRIEDMAN-RUDOVSKY and BRIAN ROSS

Feb. 8, 2008—

In an apparent violation of U.S. policy, Peace Corps volunteers and a Fulbright scholar were asked by a U.S. Embassy official in Bolivia “to basically spy” on Cubans and Venezuelans in the country, according to Peace Corps personnel and the Fulbright scholar involved.

Click here to read this article in Spanish. (Haz click aquí para leer este artículo en español.)

“I was told to provide the names, addresses and activities of any Venezuelan or Cuban doctors or field workers I come across during my time here,” Fulbright scholar John Alexander van Schaick told ABCNews.com in an interview in La Paz.

Van Schaick’s account matches that of Peace Corps members and staff who claim that last July their entire group of new volunteers was instructed by the same U.S. Embassy official in Bolivia to report on Cuban and Venezuelan nationals.

The State Department says any such request was “in error” and a violation of long-standing U.S. policy which prohibits the use of Peace Corps personnel or Fulbright scholars for intelligence purposes.

“We take this very seriously and want to stress this is not in any way our policy,” a senior State Department official told ABCNews.com.

The Fulbright scholar van Schaick, a 2006 Rutgers University graduate, says the request came at a mandatory orientation and security briefing meeting with Assistant Regional Security Officer Vincent Cooper at the embassy on the morning of Nov. 5, 2007.

According to van Schaick, the request for information gathering “surfaced casually” halfway through Cooper’s 30-minute, one-on-one briefing, which initially dealt with helpful tips about life and security concerns in Bolivia.

“He said, ‘We know the Venezuelans and Cubans are here, and we want to keep tabs on them,'” said van Schaick who recalls feeling “appalled” at the comment.

“I was in shock,” van Schaick said. “My immediate thought was ‘oh my God! Somebody from the U.S. Embassy just asked me to basically spy for the U.S. Embassy.'”

A similar pattern emerges in the account of the three Peace Corps volunteers and their supervisor. On July 29, 2007, just before the new volunteers were sworn in, they say embassy security officer Vincent Cooper visited the 30-person group to give a talk on safety and made his request about the Cubans and Venezuelans.

“He said it had to do with the fight against terrorism,” said one, of the briefing from the embassy official. Others remember being told, “It’s for your own safety.”

Peace Corps Deputy Director Doreen Salazar remembers the incident vividly because she says it was the first time she had heard an embassy official make such a request to a Peace Corps group.

Salazar says she and her fellow staff found the comment so out of line that they interrupted the briefing to clarify that volunteers did not have to follow the embassy’s instructions, and she later complained directly to the embassy about the incident.

“Peace Corps is an a-political institution,” Salazar says. “We made it clear to the embassy that this was an inappropriate request, and they agreed.”

Indeed, the State Department admits having acknowledged the infraction and assuring Salazar that it would not happen again. Yet, it was just four months later that Fulbright scholar van Schaick says he was asked by the same embassy official, Cooper, to “spy” on the Cubans and Venezuelans.

A U.S. Embassy official in La Paz, Bolivia said Cooper was referring all calls for comment to the State Department in Washington.

Van Schaick says he never considered complying with the request, fearful he would violate Bolivian espionage laws and that he would jeopardize the integrity of the Fulbright program, which yearly sends hundreds of American college graduates to countries around the world.

“I am supposed to be a cultural ambassador increasing mutual understanding between us and the Bolivian people,” van Schaick explains. “This flies in face of everything Fulbright stands for.”

The Fulbright program receives its funding from the U.S. State Department and the Peace Corps is a federal agency, but the State Department insists that neither group has the obligation to act in an intelligence capacity. In fact, both have strict regulations against members getting involved in politics in their host country.

The press director at the Peace Corps told ABC News in no uncertain terms that the corps is not involved in any intelligence gathering.

“Since Peace Corps’ inception in 1961, it has been the practice of the Peace Corps to keep volunteers separate from any official duties pertaining to U.S. foreign policy, including the reality or the appearance of involvement in intelligence-related activities,” said Amanda Beck, press director of the Peace Corps. “Any connection between the Peace Corps and the intelligence community would seriously compromise the ability of the Peace Corps to develop and maintain the trust and confidence of the people in the host countries we serve.” Read the Peace Corps’ full statement.

Like many of the Peace Corps workers, van Schaick is carrying out his research in the Santa Cruz countryside, where a number of Cuban doctors are deployed providing free medical services as part of Cuba’s solidarity with its socialist ally, Bolivia’s President Evo Morales.

The accusations are likely to reverberate in Bolivia, especially given the already shaky relationship between the Bush administration and President Morales’ two-year-old government.

“These are serious incidents that we will investigate thoroughly,” says Bolivia’s Foreign Minister David Choquehuanca in an interview.

“Any U.S. government use of their students or volunteers to provide intelligence represents a grave threat to Bolivia’s sovereignty.”

Bolivian law provides severe penalties in espionage cases. According to Article 111 of the country’s penal code, “he who procures secretive documents, objects or information&concerning [Bolivia’s] foreign relations in an espionage effort for other countries during times of peace, endangering the security of the State, will incur a penalty of 30 years in prison.” In lay man’s terms: if any U.S. citizen provides information of use in a spying effort, they would be subject to Bolivia’s maximum prison sentence.

But the U.S. citizens who reported being approached in this way by the State Department official said no mention was made of any legal risks arising from complying with the request to keep tabs on foreign nationals in Bolivia.

There is no indication that any of the volunteers made reports to the U.S. Embassy.

Van Schaick says he is keenly aware of the Pandora’s box now knocked open. The Hoboken, N.J. native, however, was adamant that the incident be brought to light — in the hopes for change. “I came forward because the Bolivian people have a right to know,” former union activist van Schaick says. “Asking Fulbrighters to spy is just not OK.”

Three of the other four Fulbright scholars currently in Bolivia say they were never asked about Cubans or Venezuelans in their briefings. A fourth Fulbright scholar declined repeated requests for an interview on the subject.

Editor’s Note: Jean Friedman-Rudovksy is a freelance journalist based in La Paz, Bolivia where she is the correspondent for TIME Magazine and Women’s Enews. She has worked as an associate producer for ABC News in Bolivia and is a founding editor of Ukhampacha Bolivia, an online bilingual Web journal on Latin American social and political issues.

Copyright © 2008 ABC News Internet Ventures

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