I, Alan Aurifericus Nefarious Greenspan, Chairman of the Federal Reserve Bank, holder of the Medal of Freedom, Knight of the British Empire, member of the French Legion of Honor, known to my peers as the "greatest central banker who ever lived," (I will not trouble you with all my titles. I will not mention, for example, that I was the winner of the prestigious Enron Prize for distinguished public service, awarded on November 1, 2001, just days after Enron began to collapse in a heap of corruption charges) am about to give you the strange history of my later years.

For I will dispense with childhood… even with young adulthood, and those dreary sessions with that terminally dreary woman, Ayn Rand, who couldn’t write a compelling sentence if her life depended on it. I’ll also dispense with my own dreary years at the Council of Economic Advisors, and pass directly to the time I spent as the most powerful man in the world. For here are my real titles: Emperor of the world’s most powerful money, despot of the world’s largest and most dynamic economy, and architect of the most audacious financial system this sorry globe has ever seen.

Yes, I, Alan Greenspan, ruled the financial world. But who ruled Alan Greenspan? Ah… I will come to that, and tell you how, while presiding over the biggest boom ever I became caught in what I may call the "golden predicament" from which I have never since become disentangled.

This is not by any means the first thing I have written. I have written much over the years. But it was all written for a purpose, which only a few were able to discern. Most readers foolishly saw the cluttered mind of a dithering economist or the clumsy, stuttering pen of a professional bureaucrat. Many listening to my wandering speeches and twisting sentences thought that English was not my first language. They thought they detected a faint accent, like that of Henry Kissinger or Michael Caine. They mocked me as "incomprehensible" or "indecipherable." They watched what they thought was an obsequious bureaucrat squirm. They had no idea what I was really up to and what I can only now reveal.

But they admired me, too. I knew it. Because they saw in me a kind of genius…a Bernoulli of banking…a Newton of numbers…a Leibnitz of lucre…a Copernicus of currency. My mind worked at such a high pitch, they believed, that my thoughts were inaudible to most humans. They counted on me to keep the great empire’s economy trundling forward. Little (actually nothing) did they know of my real thoughts and designs.

But now, all has changed. Now, I can write clearly and speak the truth. For now I am leaving my post. There is no further need for me to dissemble; no further need for me to pretend to kow-tow before Congressional committees; no further need to hide the real facts from my employers and the American people. Now, I swear by the gods, what I write comes from my own hand, and not from some overpaid, anonymous flack.

Some are born in crisis, some create crisis, and others have crisis thrust upon them.

Let me begin at the beginning. Scarcely had I settled into to the big chair at the Fed when a crisis was thrust upon me. And it is true, I responded in the conventional manner. There is no manual for central bankers, but there is a code of behavior. Faced with a financial crisis of any sort, a central banker’s first duty is to run to the monetary valves and open them. This I did in 1987. I was new to the job and probably didn’t open them enough. The U.S. economy lagged its rivals in Europe for several years. My old boss, George Bush, the elder, lost his bid for re-election in 1992 and blamed it on me. I resolved never to make that mistake again. Faced with a slew of challenges, shocks, uncertainties, crises and elections…ever thereafter, I made sure that every valve, throttle, level, switch and sluice gate was wide open.

But it was on December 5, 1996, that I had my first epiphany. That was the year that I made my celebrated remark about stock prices. I wondered aloud if they did not reflect a kind of "irrational exuberance." In truth, whether they did or did not, I do not know. But what I came to realize was this: 1) People, especially my employers, actually wanted prices that were irrationally exuberant. And 2) they could become far more irrationally exuberant if we put our minds to it.

I was 70 years old at the time. I had weaseled (why not be honest about it?) my way to the top post by knowing the right people and by making myself generally agreeable, and helpful, and by not saying anything anyone could disagree with. That was the original reason for what the press called "Greenspan speak." My private thoughts remained mine alone. All the public and the politicians got was gobbledygook, but for good reason.

They would not have wanted to hear what I really thought. So, I did not tell them. For I knew well and good what generally happened when politicians and central bankers got their hands on soft money and a compliant central banker. I was not born yesterday. They use their control of the money to cheat people. It is as simple as that. (I explained this early on in my career; fortunately, no one bothered to read what I wrote. Otherwise, I never would have gotten the job.) If central banking were an honest métier, there would be no reason to have it at all. Private banks could do the job better.

But people are ready to believe anything. Somehow, they think that a collection of rich financiers and power-mad politicians got together to create and run a central bank for the benefit of the people! Well, I’ve got news: it doesn’t work that way. Money is only valuable when it is rare. It is like stock in a company. The shareholder is happy to hold a few shares. But imagine how he would feel if the company issued a few million more shares. His own ownership of the valuable thing is diluted. He would be cheated.

Likewise, an honest banker cannot dilute his depositors’ money. He cannot create real money "out of thin air," as if he were issuing new share certificates, without cheating his clients. But that is exactly what central bankers do. They issue a certain amount of currency. Then, they issue more and more of it. So, the people who got it and saved it lose a little bit of the value each year. In effect, the value is lost by the savers and captured by the people who control the currency. It is really a very simple swindle. Who but an octogenarian Fed chief, on his way out the door, would have the courage to say so?

People today act as if they had invented money themselves. But money, central banking, and currency debasing have been around a long time. In 64 A.D., Nero decreed that the number of aureus coins minted from a pound of gold would increase from 41 to 45 (each coin would be about 10% less valuable). The silver denarius, meanwhile, lost 99.98% in the five centuries before the sacking of Rome. Paper sheds value even faster. The dollar has lost 95% of its purchasing power since the Fed was set up to protect it in 1913.

A successful central banker, in the age of compliant paper money, is one who is able to control the rate of ruin so that the rubes don’t catch on. A little bit of inflation, they believe, is actually healthy. Haven’t the economists told them so? Issuing a little bit more money each year makes people feel richer…so they spend more; they hire more people; they build more houses. Everybody is happy. Everyone feels richer. What an elegant fraud! It’s almost a perfect crime, because no one objects as long as it is done right. (My replacement at the Fed, Ben Bernanke, specializes in controlling the rate at which central bankers can steal from dollar holders without getting caught. He says that if necessary, he’ll "drop money from helicopters" should the currency fail to lose value fast enough. I predict that there will be a lot of people who will want to drop him from a helicopter…for reasons I will explain here.)

I return to my narrative. After I made my remark about "irrational exuberance," I was called into Congress. The politicians who confronted me were the usual oafs and know-nothings. They made it clear that if I wanted to hold onto my job, I would have to stop worrying whether asset prices were too high; instead, I would need to do all I could to goose them up! It was on that very day, I recall it well, that what I had previously seen only in foggy theory came out into the clear, bright daylight of applied central banking.

No one wants honest money. No one. The politicians, bankers, investors, voters, and householders – anyone with a voice in the matter wants "easy" money. It is just too delicious to resist. (I wondered what kind of a central banker would stand against them; he would need a backbone of titanium like Paul Volcker, and a head as thick and hard as a vault.) Debtors want a little inflation to lighten their burdens and put a wind to their backs. Creditors want inflation to swell their asset values. Politicians want to be re-elected. Businessmen want customers with money to throw around. Is there anyone who doesn’t appreciate a little inflation?

And yet, of course, I always knew the answer. Easy money only works by defrauding people into thinking they have more money than they really do. Easy come; easy go. They get it; they spend it. Before you know it, you have a boom. But people soon adjust their expectations. Prices rise to catch up to new money. Debt levels increase, and with them come heavier debt service costs. The magic fades. What can a central banker do? He can do the right thing. He can "take the punch bowl away," as my predecessors used to say. But this is where the trouble begins. Take away the punch bowl, and they begin punching you! I recall they burned Paul Volcker in effigy on the Capital steps when he did it. They would have burned him alive if they could have gotten their hands on him.

Why should I, Greenspan, suffer such a fate? No, it was not for me. This was the "golden predicament" I faced. Yes, I knew well that the nation would be better off if the punch bowl were removed, but I knew that I would be removed too, if I did it. And I knew, also, that it would be just a matter of time until the pressure for easy money would overwhelm any resistance a Fed chairman could put up. No pure paper money system has ever lasted. People can never resist the temptation to make the money easier and easier…until it is so wobbly and woozy it falls on its face. It’s better that it falls sooner rather than later. It’s better that the lesson is taught now, rather than 10 years from now. It’s better that the lean times come on the next man’s watch, not on mine! That’s what I owe to old Ayn; she taught me who rules Greenspan – Greenspan! Ayn taught me the number one rule: Look out for Numero Uno.

I remember it so clearly. I was sitting in a House committee hearing room. My tormentors kept asking questions. I kept giving the kind of answers for which I later became famous…answers that didn’t say anything. And I thought to myself: if these lardheads want easy money, I’ll give them easy money. I’ll give them the easiest money the planet has ever seen! I’ll give it to them good and hard!

And so, I did.

Since I joined the Fed, outstanding home-mortgage debt has jumped from $1.8 trillion to $8.2 trillion. Total consumer debt went from $2.7 trillion to $11 trillion. Household debt has quadrupled.

And government debt, too, exploded. The feds owed less than $2 trillion in the second Reagan administration, a figure that had been almost constant for the previous 40 years. But under my direction, the red ink has overflowed like the Nile in flood – to over $7 trillion.

During the two terms of George W. Bush alone, the feds have borrowed more money from foreign governments and banks than all other American administrations put together, from 1776 to 2000. And more debt will be added in the eight Bush years than in the previous two hundred. The trade deficit, too, more than tripled since I’ve been at the Fed, from 150.7 to 756.8 billion, and will reach $830 billion in 2006. When I came to power, the United States was still a creditor. Now, it is a debtor, with more than $11 trillion worth of U.S. assets in foreign hands, a more than 500% increase since 1987.

Who can argue with such a record? Who can compete with it? Who would want to?

But that is the smooth, perverse pleasure a cynical old man takes in his achievements. I have practically ruined the nation, and I know it. If you distributed the cost of the federal government’s programs, promises, and pledges to the voters, along with the nation’s private debt, the typical household, and the nation itself, would be broke. And yet, almost everywhere I go, I am revered as a maestro…saluted as if I were a war hero. It is as if I had won World War II all by myself. The same numbskulls that wanted easy money 10 years ago, now praise me for causing what they call "The Great Moderation," as if there were anything moderate about America’s borrowing binge.

Others say that my real legacy is that I finally "made central banking work." Yes, I made it work…just like it’s supposed to work, giving the people enough rope so they could hang themselves. That’s what they’ve done. Now, they dangle from a long rope of mortgages, deficits and credit cards.

And I am delighted. Soon, people will be able to see how central banking really works. And poor Ben Bernanke will get the blame for it. He and his stupid helicopters…he almost deserves it.

Some measure of caution is always sensible when you're managing long-term savings. After all, it's money you can't easily replace. Still, you don't want to mistake a bonk on the head from an acorn for a sign that the sky is falling. Remember Y2K? Dow 5000? Those predictions in the late 1980s and early 1990s that the Japanese would eat our lunch?

Overreacting to such possibilities isn't just silly, it can be self-defeating. If you don't remain properly invested in a mildly depressed market, for instance, you'll miss the fast profits that come when share prices first start to rebound. Here's a look at five of today's big worries, including clear-eyed assessments of the real levels of risk and some suggestions about how you might be able to profit from the Chicken Little syndrome.

"Oil prices are going to soar even higher!"

THE REALITY Yes, turmoil in the Middle East and hurricane damage to Gulf Coast wells and refineries have temporarily put a crimp in supply. Strong demand, including greater consumption in China, also has boosted energy costs.

But there's no long-term energy shortage. Canada's oil sands alone contain nearly as much petroleum as Saudi Arabia has. It just costs $20 a barrel or more to produce, six times the cost of the cheapest existing wells in the Middle East. Other sources of oil and gas are abundant as well, although at high prices. The bigger catch is that it takes as long as five years to find and bring new production online.

BOTTOM LINE Oil production can be slow to catch up with demand. So although it's likely that prices will be generally high during the next 20 years, they should stabilize at some point below today's steep $61 a barrel.

Owning big oil stocks like ExxonMobil or ConocoPhillips does make sense for the long term -- you get dividends, currently around 2 percent, as well as long-term inflation protection. But you don't need to rush to buy big oils if you don't already own them. You might even get a chance to scoop those stocks up at lower share prices if you wait for a pullback in oil prices to $45 a barrel some time in the next couple of years.

"A nasty new inflation spiral has begun!"

THE REALITY No question, inflation has picked up. The consumer price index rose at annualized rates of as much as 4.7 percent in 2005, compared with 1 to 3 percent for most of the previous three years. But recent peaks aren't sustainable. In fact, November's inflation number was down sharply -- the biggest monthly drop in 56 years -- because of an unexpected tumble in gasoline prices.

Over time, there will probably be an upward creep in consumer prices as long as the economy remains robust. But productivity gains and cheap imports are still stopping companies from hiking wages too much. Indeed, we may actually see a reduction in inflation, perhaps to less than 2.5 percent, if oil prices ease substantially in 2006.

BOTTOM LINE Even if we aren't on the brink of an inflation surge, any prudent long-term investing strategy will include inflation hedges. If you're setting up a new portfolio, you might want to search for stocks that would likely be able to keep up with inflation. Besides energy companies, that includes raw-materials producers and real estate investment trusts. Or you could rely on a fund like T. Rowe Price New Era, which owns the shares of natural-resources companies.

And it's worth noting that the fund has even performed well in today's climate of low to moderate inflation, returning an average of 16.5 percent annually over the past five years. Again, however, many inflation hedges are expensive at the moment, and you may have a better buying opportunity if you wait and inflation slows this year or next.

"Interest rates will continue to rise!"

THE REALITY Federal Reserve Board chairman Alan Greenspan has now hiked short-term interest rates 13 times in a row, to 4.25 percent, the highest level in almost five years. Since the Fed began raising rates in June 2004, the big surprise has been that long-term interest rates have not followed along at all -- in fact, the yield on 10-year Treasuries has even fallen slightly.

Some analysts fear that this means the Fed will have to keep raising rates until bond yields catch up. An alternative view, however, is that the Fed rate hikes simply mean the economy is doing well -- and that the mysterious refusal of bond yields to surge only signifies that inflation is under control. Moreover, many Fed watchers think that Greenspan hopes to complete almost all of this round of short-term rate increases before he steps down on Jan. 31. That way, his successor, Ben Bernanke, can start his term as Fed chairman with a relatively clean slate.

BOTTOM LINE Most forecasters expect two rate hikes in 2006, taking short-term rates to 4.75 percent. If Greenspan has gauged the economy correctly, overall growth can continue at a healthy clip while long-term yields inch up. This scenario would be better for high-yield stocks than for bonds, which are hurt by any rise in interest rates.

It's also worth noting that major bank stocks often rally once a string of increases in short-term rates is completed. This effect bodes well for banking giants such as Bank of America, Citigroup and J.P. Morgan Chase, which yield at least 3.4 percent and trade at less than 12 times estimated earnings for 2006.

"A recession is just around the corner!"

THE REALITY Well, one thing is clear: There's no recession yet. Real gross domestic product has grown at an above-average annual rate of 3.3 percent or more for 10 quarters in a row. So why should the economy suddenly sour now?

Two possible reasons are worth thinking about. The first is that short-term interest rates are now nearly as high as long-term rates, which is normally a sign that the economy is slowing down. But it could also be the result of unusually low inflation pressure, thanks to growing productivity, cheap imports and sound Fed policy.

The second reason some analysts give for fearing a recession is that the consumer is stretched quite thin. Consumer debt per household is near record highs. So are bank-card delinquencies and minimum required payments as a percentage of disposable income. And now that mortgage rates are rising, it's harder for homeowners to refinance and use home equity to pay down debt.

But these trends threaten only a small percentage of consumers, hardly enough to drag down the overall economy. Much more important is the fact that unemployment has fallen to 5 percent, down from 6.3 percent in 2003. Many Chicken Littles don't get it: The best sign of a strong economy is strong employment numbers.

BOTTOM LINE Focus on your own finances. If you have more than $1,000 of credit-card debt, pay it down. The amount you save on interest will likely be far greater than what you can earn in the stock market. And the flexibility that comes with low indebtedness provides enormous intangible benefits.

"The bull market will be over before it's started!"

THE REALITY The current bull market has gone on about as long as the typical post-W.W. II expansion, but its stock price gains have been smaller than usual. To match, the S&P 500 would have to rise from 1270 to 1400, or at least 10 percent.

BOTTOM LINE During this bull run, earnings have risen far more than the norm, so a further 10 percent gain in share prices seems the least to expect. And big-cap growth stocks, even with some recent gains, remain undervalued by about 10 percent relative to the rest of the market.

In short, if you focus on blue chips with double-digit earnings growth and relatively low price/earnings ratios, you have a good shot at gaining up to 20 percent in 2006. Among stocks in the Sivy 70 that meet those criteria: 3M, which just appointed a promising new CEO; Fortune Brands, a collection of superb consumer businesses; overnight shipper FedEx; defense contractor General Dynamics; chipmaking giant Intel; software kingpin Microsoft; and discount retailer Wal-Mart. It will take more than an acorn to knock down stocks like these.

"It's going to be painful for some people," Ford Chairman and CEO Bill Ford said earlier this month at the North American International Auto Show in Detroit. (Watch employees worry about 'Way Forward' -- 1:58)

The assembly plants believed to be most at risk for closure are in St. Louis, Missouri; St. Paul, Minnesota; Atlanta, Georgia; Wixom, Michigan; St. Thomas, Ontario; and Cuatitlan, Mexico.

Those plants could be targeted because of their age, the products they make, their lack of flexibility or other factors.

States were scrambling to offer tax credits and other incentives to keep Ford from closing their facilities.

Earlier this month, Missouri Gov. Matt Blunt and other state officials flew to Ford's headquarters in Dearborn for a meeting with Ford executives.

Michigan Gov. Jennifer Granholm said she outlined a package of incentives to Ford last week. Granholm wouldn't disclose the details of the package and said she wasn't given any assurance that Michigan plants would be spared.

Ford is expected to report a worldwide profit for 2005 when it releases earnings Monday. But it lost more than $1.4 billion in its North American operations in the first nine months of last year.

The No. 2 U.S. automaker has been hurt by falling sales of its profitable sport utility vehicles, growing health care and materials costs and labor contracts that have limited its ability to close plants and cut jobs. The United Auto Workers union will have to agree to some of the changes Ford wants to make.

"We don't like to see any jobs go away," UAW President Ron Gettelfinger said last week. "We're always in hope that down the road we'll be able to reverse some of those decisions."

Ford also has seen its U.S. market share slide as a result of increasing competition from foreign rivals.

The company suffered its 10th straight year of market share losses in the United States in 2005, and for the first time in 19 years, Ford lost its crown as America's best-selling brand to GM's Chevrolet.

Ford sold about 2.9 million vehicles for a market share of 17.4 percent in 2005, down from 18.3 percent the year before and 24 percent in 1990.

The restructuring is Ford's second in four years. Under the previous plan, Ford closed five plants and cut 35,000 jobs, but its North American operations failed to turn around.

Ford used just 79 percent of its North American plant capacity in 2005, down from 86 percent in 2004, according to preliminary numbers released last week by Harbour Consulting Inc., a firm that measures plant productivity.

By contrast, rival Toyota Motor Corp. was operating at full capacity.

Copyright 2006 The Associated Press.

"They would shoot themselves in the foot," said Mustafa Alani, director of national security and terrorism studies at the Dubai-based Gulf Research Center. "It's one thing to test the market psychology, it's another to take the actual step and stop oil exports."

Bracing for sanctions - U.N. or otherwise - Iran's central bank said on Friday that it is moving its foreign currency reserves out of European banks as a pre-emptive measure.

Iran, the second-largest oil producer within the Organization of Petroleum Exporting Countries, exports roughly 2.5 million barrels per day - 1 million barrels more than current excess production capacity worldwide. It also controls the strategic Strait of Hormuz, a critical shipping lane in the Middle East.

"Even if Iran pulled a small amount of its oil off the market, say it pulled a half million barrels a day, I could see oil prices literally jumping over the $100 per barrel mark," said James Bartis, a senior researcher at Rand Corp.

But other oil analysts say prices would likely not climb much higher than $75 a barrel before strategic reserves would be released and demand would begin to taper off as economic activity slowed around the world.

So who would be hurt more? The United States and other nations say it would be Tehran and argue against succumbing to economic blackmail in any case. "We cannot be intimidated by economic threats from their side," Sen. Trent Lott, R-Miss, told CNN.

The U.S. Department of Energy estimates that oil exports finance about half of the Iranian government's budget. And while high oil prices have boosted the annual growth rate to about 5 percent, Iran has never really recovered from its 1980-1988 war against Iraq and trade restrictions on sensitive technologies. The Iran Nonproliferation Act, which the U.S. Congress passed in 2000, deters international support for Iran to develop nuclear, chemical and biological weapons programs and missile-delivery systems.

For weeks, Iran's state television has sought to show a people united behind the leadership, showing passer-by on Tehran city streets expressing their support for the country's strivings for nuclear independence.

Still, Alani of the Gulf Research Center questioned "whether the ordinary citizens will be willing to risk sanctions and endure a lot of suffering like the Iraqis suffered for 13 years" under U.N. sanctions.

Oil consuming nations, meanwhile, have at least one ace up their sleeves - crude reserves. The United States and other members of the International Energy Agency have a combined 1.48 billion barrels of oil in their emergency stocks. That's equivalent to about 600 days of Iran's net oil exports of 2.4 million barrels per day.

OPEC might be able to add 1.5 million barrels per day to world production, mostly from Saudi Arabia. And oil analyst Fadel Gheit at Oppenheimer & Co. in New York said Russia might be able to crank up exports by about 500,000 barrels once its domestic home-heating demand eases.

Gregory L. Schulte, chief U.S. delegate to the International Atomic Energy Agency, accused Iran last week of deceiving the world about its atomic program, declaring that moves to haul it before the U.N. Security Council were meant to deny "the most deadly of weapons to the most dangerous of countries."

His comments were part of increasing international pressure on Iran since it removed seals from uranium enrichment equipment earlier in the month and said it would start small scale work on the process that can make both fuel and the fissile core of nuclear warheads.

"It's a very difficult situation where you don't know which side is going to blink first," said Leonard Spector, deputy director of the Monterey Institute of International Studies' Center for Nonproliferation Studies.

It's also not clear the United States could win a referral on sanctions at the Security Council, where members Russia and China are Iran's main allies. Both have strong economic and strategic ties to Iran, with China a large oil consumer and drilling partner and Russia a key supplier of arms and nuclear technology and services for what Tehran says is a peaceful program. Additionally, oil-rich Russia would benefit from higher prices and increased demand for its crude if Iran's oil were off the market.

Influential India, which imports 75 percent of the crude it consumes, some from Iran, is a wild card in the referral struggle.

It joined the U.S., Britain, France and Germany in September to back an IAEA resolution that set the stage for reporting Iran for violating the Nuclear Nonproliferation Treaty. But pressure is building on the Indian government not to vote against Iran when the 35-nation IAEA board meets Feb. 2 to consider actual referral.

"India must not allow itself to be dragooned into joining the Washington-led nuclear lynch mob against Iran," The Hindu, one of India's most influential newspapers, cautioned Thursday. "Aside from the lack of any legal basis for threatening Iran with sanctions, India should consider what the U.S. pressure on Tehran will do to international oil prices as well as to the overall security scenario in West Asia."

The United States and its allies are thought to have the majority behind them on any vote for referral. Still they would like to see India, China and Russia on board - all three countries carry weight among other IAEA board nations, and Moscow and Beijing have a vote on the Security Council on what to do about Iran, once it is referred.

Associated Press Writers Alex Nicholson in Moscow, Constant Brand in Brussels, Laurence Frost in Paris, Nirmala George in New Delhi and Ali Akbar Dareini in Tehran contributed to this report. Brad Foss reported from Washington, George Jahn from Vienna, Austria.

State legislators are pressing the multinational corporate giant to provide health insurance for full-time workers. Wal-Mart, not known for paying its employees well, refuses to indicate how much it spends on its payroll for employee health care insurance.

However, it is believed to be about 7 percent, less than most big corporations. It is known that Wal-Mart pays less than half of its employees in America health care benefits.

Putting further pressure on the corporate giant, a Pennsylvania court has granted class-action status to a lawsuit claiming Wal-Mart forced as many as 150,000 employees at its stores in the state to work through their breaks and after hours.

Wal-Mart, known for moving into a community with one of its huge stores and forcing its competition out of business, has fallen upon hard times in recent days.

The retail giant has been caught using illegal aliens on its maintenance teams, using underage workers on potentially hazardous jobs, showing discrimination against women in the work place and strong-arming local governments to provide special tax considerations when its stores locate in a community.

Wal-Mart is also having trouble in various locations in both the United States and Canada for keeping its employees from organizing into unions.

In the case of forcing its employees to work through breaks and after hours, late last year a California court awarded workers $172.3 million in a class-action case. Wal-Mart settled a similar case in Colorado for $50 million.

On Jan. 11 the Maryland legislature passed a law that would require Wal-Mart stores to increase spending for employee health benefits to at least 8 percent. Although the law pertains to all companies with 10,000 or more employees, it is clearly aimed at Wal-Mart.

The legislature’s action overrides a veto by Gov. Robert Ehrlich (R). Critics accuse the mega-chain of not paying its employees, who are called “associates,” a living wage and not providing health benefits.

Consequently, thousands of Wal-Mart employees are forced to seek health care assistance through the states’ Medicaid system, running up the cost to taxpayers.

Wal-Mart hired four lobbying firms to fight the bill in Maryland.

State Sen. Gloria G. Lawlah, who introduced the Maryland bill, called the Wal-Mart lobbying effort “horrendous.”

It has been reported that 12 lobbyists were working at the same time to kill the bill, earning them the nickname “the dirty dozen.”

Wal-Mart, which is planning to build a distribution center on Maryland’s Eastern Shore that would employ some 1,000 workers, threatened to build the center elsewhere if Maryland enacted the health care law.

(Issue #5, January 30, 2006)

Not Copyrighted. Readers can reprint and are free to redistribute - as long as full credit is given to American Free Press - 645 Pennsylvania Avenue SE, Suite 100 Washington, D.C. 20003

Italy's Eni energy company said supplies had been cut by 5.4% between 6am on Tuesday and 6am yesterday. There were also unconfirmed reports of cuts in supplies to Bosnia and Austria. British Gas warned that the Gazprom move would result in a "worrying domino impact" on the UK wholesale market, where prices are already 75% higher than last year.

But Gazprom denied any problems and said it was delivering 7% more than its contracts with clients in Europe required.

The dispute again undermined President Vladimir Putin's attempt to use Russia's chairmanship of the G8 to boost his country's status as a reliable energy supplier. On January 1 a price row led to Gazprom cutting off the gas to Ukraine. The cuts hit supplies across eastern Europe, and sparked criticism from both the EU and the US that Moscow was "politicising" energy. Yesterday Wolfgang Schüssel, the chancellor of Austria which holds the EU presidency, said the EU should cut its dependency on Russian gas to ensure "security of supply".

Temperatures were predicted to fall to -37C overnight in Moscow, the lowest since 1979. At least 24 people reportedly died across the country.

The energy disputes will raise doubts about Gazprom's reliability. The company has said it wants to secure up to 20% of the British market within a decade. Mr Putin said recently that Russia could supply 10% of Britain's gas.

China and Saudi Arabia signed an energy cooperation agreement during a landmark visit by Saudi King Abdullah that both sides said would usher in an era of closer economic ties.

King Abdullah, who arrived Sunday on his first trip outside the Middle East since taking the throne in August, met President Hu Jintao on Monday at the Great Hall of the People.

King Abdullah and Hu oversaw the signing of five agreements, including one on "oil, natural gas and mineral cooperation," and another on "economic, trade and technical cooperation".

Agreements were also signed to "avoid dual taxation", allow for a Saudi loan to improve infrastructure in the city of Aksu in China's oil-rich Xinjiang region, and to facilitate "cooperating in vocational training".

Neither side immediately provided further details of the agreements, although Saudi Foreign Minister Prince Saud al-Faisal spelt out before the signing ceremonies the main interest of both nations.

"China is one of the most important markets for oil and Saudi oil is one of the most important sources of energy for China," said the prince, who is accompanying the king on Monday.

Prince Saud said the energy deal would set the framework for specific energy investments, but agreements on the projects would have to be signed between the two countries' oil companies.

He suggested specific agreements could be signed soon.

The visit by the Saudi king comes at a time when China, the world's second biggest oil consumer, is scouring the globe for more oil to fuel its unprecedented economic transformation.

At the same time, Saudi Arabia, the world's biggest oil supplier with the largest known reserves, is seeking to diversify its economy and ease its dependence on the United States, the biggest oil consumer.

At the welcoming ceremony, Hu said the fact that King Abdullah had chosen China as the first destination of his first official trip outside the Middle East since ascending the throne had been noted and welcomed in Beijing.

"This will write a new chapter of friendly cooperation between China and Saudi Arabia in the new century," Hu said, who called the king "a respected and familiar old friend" of China.

King Abdullah, who is making the first visit by a Saudi leader to China since the two nations established diplomatic ties 16 years ago, also said he looked forward to stronger bilateral ties.

"What makes us happy is that since the two countries established diplomatic relations in 1990 our two countries have had fruitful cooperation in many fields," he said.

"We hope this cooperation will develop even more in the future."

Analysts said King Abdullah's choice of China as the first country of his Asian tour, which will also take in India, Malaysia and Pakistan, was a strategically sound move.

"China has the fastest growing market and Saudi Arabia has the right product to sell," said a Hong Kong-based oil analyst who requested anonymity.

Shi Yinhong, an international relations professor at People's University in Beijing, said China had "a very focused interest in Saudi Arabia".

"China wants secure sources of oil," Shi said.

China's oil demand has been increasing by about 15 percent annually. The Asian giant imported a record 130 million tonnes of crude last year, up 3.3 percent from 2004, after growth of more than 30 percent a year earlier.

Oil imports from Saudi Arabia have already risen from 8.8 million tonnes in 2001 to about 20 million tonnes last year, according to previous figures published in China's state media.

Among other energy deals already in place, China's Sinopec is drilling for gas in the Saudi desert and building a refinery with Saudi oil firm Saudi Aramco in China's Fujian province.

Aramco is also beginning engineering work with Sinopec on a second refinery in China's Qingdao city.

Despite the growing bilateral ties, Shi said neither China nor the Saudis would want to alarm the United States.

"China will be very cautious, it won't buy oilfields in Saudi Arabia. That would make the US very sensitive," Shi said.

Beijing also hopes Riyadh will be an ally on Middle East issues, such as Iran's nuclear standoff with the United States, according to Shi.

So what? This sounds like a minor change, and possibly even a useful one, broadening the choice among traders and consumers in the kind of way that Adam Smith, the 18th century father of modern capitalism, would have recommended.

Not so. This could be a far more profoundly punishing blow to American interests than Iran's ability to manufacture a crude atom bomb that would have little credibility until it became small and stable and reliable enough to be delivered on some putative target.

The relationship between the oil price and dollar is intimate and important, and very useful to the dollar's highly profitable status as the world's reserve currency. The prospect of a rival bourse and futures market opens the intriguing possibility, beyond hedging the future oil price, of profitable arbitrage between the euro and the dollar.

And if oil and gas are to be denominated in more than just one currency, why not open the trade to others? Why not denominate the price of a barrel of oil in Japanese Yen, or in Chinese yuan, the currency of the world's second biggest oil importer?

Why not, in short, end the monopoly rule of the almighty dollar?

Such a move would not be welcomed in Washington, which swiftly moved after the fall of Baghdad in 2003 to reverse Saddam Hussein's impudent decision to start selling Iraqi oil for euros, rather than dollars. After all, the great benefit of running the world's reserve currency means that if all else fails, the United States Treasury can just print more and more of the stuff and pay for its oil imports that way.

There are, naturally, limits to the degree to which the United States can debase its currency, as the world found with the first great OPEC price rise of 1973, when the price per barrel tripled. This is usually attributed to the political decision by Saudi Arabia and other Arab oil producers to punish the United States for its decisive support of Israel in the Yom Kippur War. That is partly true, but the crucial OPEC decision was as a direct result of President Richard Nixon's Aug. 15 decision to end the dollar's link to the gold standard.

The dollar declined in value, which meant the OPEC producers received less value for their oil. So at their Beirut meeting on Sept. 22, OPEC adopted resolution XXV:140, which resolved to take "any necessary action ... to offset any adverse effects on the per barrel real income of member countries resulting from the international monetary developments as of Aug. 15."

That was also the time when Sheikh Zaki Yamani, the Saudi oil minister, first mentioned the possibility of deploying the ultimate weapon of an oil embargo.

Most of the financial world is currently awaiting another, similar devaluation of the dollar, in response to the monstrous scale of current deficit on the U.S. current account. Writing in the Financial Times last week, Harvard Professor Marty Feldstein suggested that on the basis of the 1985-87 Louvre and Plaza devaluations, the dollar could fall as much as 40 percent or even more.

The markets simply do not know when. But should it come after an Iranian bourse is up and running, some very tidy sums could be made by those playing a dollar-euro trade on Tehran's energy futures market.

The Tehran bourse is listed as an objective for this year in Iran's current five-year plan. The Tehran Times reported July 26 that the final authorizations had been received for the bourse to go ahead. Mohammad Javad Asemipour, the technocrat and former deputy petroleum minister who has been charged with launching the bourse, has made a number of discreet scouting trips to London, Frankfurt, Moscow and Paris. Just after Christmas, he was quoted by the Iran Labor News Agency saying "transparency in oil transactions would be one of the advantages of having such an establishment "(the bourse), and adding that this would "allow dealers access to related information and promote equal trade opportunities."

Asemipour is an elusive type, but one who seems convinced that Iran can play off the European against the Americans, the euro against the dollar. Just over a year ago, he was quoted in the quasi-official Iran Daily saying that the Europeans have played "a beautiful game" with the United States during the years of sanctions, when they actively participated in economic projects, particularly in the energy sector, across Iran.

"In this game, the Europeans have pretended to be siding with America, whereas they got involved in business here and developed a sort of competition with the Americans," he said. "But in practice, they (the Europeans) have pursued their own interests." There is no shortage of officials in the Bush administration who nurture such suspicions of the French and Germans, despite what seems at the moment to be a common concern about Iran's nuclear ambitions.

The question now is whether the world's traders will come to a Tehran Bourse if and when it opens, bearing in mind that a similar idea in Dubai failed to gain much traction. But that was before oil prices reached $65 a barrel, and before the Dubai's partners in the Gulf Cooperation Council decided it was time to stop glowering at Iran as a potential enemy, and started to invite Tehran to their meetings as an observer. Before, that is, the Arab world began to judge that whatever the American intentions, Iran had become the real winner of the Iraq War.

The world could be about to change much faster than we think, whether or not Iran tests an atomic device. There are other, possibly more devastating weapons available that could hit a financially vulnerable American where it hurts most.

© Copyright 2006 United Press International, Inc.

In the first place, just the talk has kicked up the price of oil. In the second place, there is no proof that Iran really wants to develop nuclear weapons. So far, what the Iranians have done and propose to do are legal. They have a reasonable explanation for why they want to develop nuclear power. Oil is their biggest and most valuable export. The less they use for domestic purposes, the more they will have to export.

On the other hand, they are surrounded by nuclear powers – Israel, Russia, Pakistan, India and the U.S. (through its heavy presence in the Persian Gulf and Iraq). So maybe they do want to develop a nuclear bomb. Personally, I don't care if they do. Having lived most of my life with 30,000 nuclear warheads and the means to deliver them in the Soviet Union, I'm not going to worry about the Iranians having six or seven.

I'm not one of those people who think the world will end with a nuclear explosion. There have been a lot of nuclear explosions. We dropped two on Japan, and all the nuclear powers tested their bombs in the atmosphere as well as underground. Despite the urban legends about plutonium, we are all still here. A nuclear weapon is, after all, a bomb, and like all bombs there is a limit to its radius of destruction. As Brother Dave Gardner put it, the place to be when a nuclear bomb goes off is wherever you can say, "What was that?"

In the meantime, what the United States should do is talk to the Iranians, instead of talking at them, threatening them and insulting them. Civil discourse and honest diplomacy are too much to ask of this reckless and immature administration, which, despite evidence to the contrary, seems to believe it can bully the whole world into doing its bidding.

Right now, the U.S. is banking on getting the International Atomic Energy Agency to refer Iran to the U.N. Security Council. Winning this vote is not a certainty, but even if the U.S. does, Russia or China would likely veto any attempt to apply sanctions on Iran. A high-ranking Chinese official has just publicly announced that Iran is to become China's major trading partner. Russia has a heavy investment in Iran's nuclear facilities. President George W. Bush is about to have his bubble of delusions pricked. We are not the world's only superpower, and there are plenty of people who don't jump when Bush snaps his fingers.

As for the Israelis, they would attack Iran in a New York second – if they had the capability, and I don't believe they do. If they take a northern route, they will need permission from Turkey to use its airspace. They won't get it. If they fly to the south through airspace we control, they would need our permission, and that's not at all certain. Moreover, they don't have the planes capable of taking enough ordnance to do sufficient damage to fortified, underground installations that are widely dispersed.

Iran, despite its problems, is not without the means to retaliate, whether attacked by Israel or the U.S. One thing the Iranians might do is wreck the oil facilities in Kuwait and Saudi Arabia, as well as closing the valves on their own oil. This would throw the world oil market into chaos, and the world economy would quickly follow.

Bush and Vice President Dick Cheney are far too close to the oil industry to risk that kind of worldwide economic train wreck.

Presumably, we didn't want Israel to have the bomb, but the Israelis built them anyway. Ditto Pakistan, India and North Korea. In the end, despite the hot rhetoric, if the Iranians want a bomb, they will probably end up building it. That might cause the Israelis to lose a little sleep – though not much, as they have 200 nuclear weapons – but it shouldn't bother us in the least.

The Iranians are just as sensible and levelheaded as anyone else. Don't buy the propaganda that they are all a bunch of crazies. They've been around a lot longer than we have. I would trust them with nuclear weapons as much as – perhaps even a hair more than – I trust Bush. Americans must stop allowing politicians and propagandists to scare them into reckless behavior.

The "atomic" arm wrestling match that has for three years pitted Iranians against Westerners is entering a phase with significant consequences. Tehran's removal of seals on several of its nuclear facilities brings negotiations between the two parties back to their starting point and back to deadlock, with all of the risks of backsliding that implies.

The Western countries suspect Iran of wanting to acquire nuclear weapons at any cost, which is demonstrated, they say, by its fierce determination to short circuit all proposals and offers that have been made up to now. This suspicion is, in truth, not unfounded. Following the Iraqi precedent, Tehran's regime believes that obtaining nuclear weapons is the only way to save itself from a "preventive" invasion. For this regime, as was said nearly half a century ago by the former Chinese prime minister, Chou En-lai: "The atomic bomb is peace." The last 60 years appear to offer proof: only the powers possessing the supreme weapon of death have remained free of external incursion, war and invasion.

The nation of [Supreme Leader] Khomenei is convinced that it is threatened on the basis of its fundamental ideology and politics, or even its physical existence. Since 1979, following the Islamic revolution, the United States has waged an unseen war against the regime of the mullahs and has infiltrated its internal structures to eat away at it from within. With George Walker Bush, American-Iranian relations have come nearly to the point of armed confrontation.

The United States is now encircling Iran through military deployments in neighboring countries. It is also seeking to curb the Islamic Republic's influence outside its borders, working to isolate it politically and diplomatically by exercising a strategy of direct and indirect destabilization against Tehran. The devastating pressure now being applied to Syria over the Hariri affair is a part of this strategy. It aims to force Damascus to break its alliance with Tehran and distance itself from Hezbollah, an ally of the mullahs. For Washington, isolating the Islamic Republic by depriving it of regional allies is indispensable to making it more vulnerable to pressure or possibly for a possible military attack.

Parallel to this diplomatic offensive of encirclement, President George Bush is said to have authorized secret missions inside Iran. With the aid of information provided by Israel and Pakistan over the last two years, commandos have supposedly been seeking to obtain information on more than three dozen sites related to Iranian nuclear, chemical and ballistic programs. Precision attacks launched by Special Forces could then target them at the appropriate time. This information was revealed by a magazine that is generally reliable: "The New Yorker."

The British magazine, "Jane's," which specializes in military issues, announced not long ago that Israel has developed a "preventive plan of attack" against Iran's nuclear research and development infrastructure, and awaits only the American go ahead.

The major obstacle keeping Washington and Tel Aviv from destroying Iran's nuclear sites is essentially a technical problem with two facets. The first has to do with the fact that these sites are spread throughout several areas of the country, some of which are densely inhabited, which diminishes the chances for success of any action aiming to destroy them entirely. The second has to do with the fear that Iran would retaliate by attacking Israel itself or through its intermediary, Hezbollah, which has very advanced military capabilities. Tehran could also use some of its many Shiite allies in Iraq and Afghanistan to retaliate against American troops present in those two countries.

Protecting Israel is not the only reason for the Washington's determination to destroy the mullahs' regime and its nuclear potential. For the Bush Administration, an Iran with nuclear weapons is an obstacle to a durable American stronghold on the Middle East. Because despite the Iraqi debacle, the American president remains determined to pursue his plan: remodeling the Arab-Muslim world, from Nuakshot to Islamabad.

George Bush's stubbornness is running up against that of [Iran's President Mahmoud] Ahmadinejad. Profiting from the occupation of Iraq, Iran is pushing forward and accentuating its presence with the aim of bringing about the emergence of an Iraqi regime that resembles it like a brother.

Present in both the administration and the armed militia that control many sectors of the Iraqi Shiite population, the mullahs are waiting for their turn with Persian patience. Will 2006 be the year of Iran?