For some reason, the Council of Foreign Relations, where ex-Fed-Chief Alan Greenspan spoke last week, decided the following discussion should be left out of the official transcript. We can perhaps understand why... as Gillian Tett concludes, "comments like that will be turning you into a rock star amongst the gold bug community."


TETT: Do you think that gold is currently a good investment?

GREENSPAN: Yes... Remember what we're looking at. Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it.

Which is missing from the official CFR transcript...

GREENSPAN: ...remember, we had that first tapering discussion, we got a very strong market response. And then we reassured everybody to have no - remember, tapering is still (audio gap) of an agreement that the central banks have made -European central banks, I believe - about allocating their gold sales which occurred when gold prices were falling down (audio gap) has been renewed this year with a statement that gold serves a very important place in monetary reserves.

And the question is, why do central banks put money into an asset which has no rate of return, but cost of storage and insurance and everything else like that, why are they doing that? If you look at the data with a very few exceptions, all of the developed countries have gold reserves. Why?

TETT: I imagine right now, it's because of a question mark hanging over the value of fiat currency, the credibility going forward.

GREENSPAN: Well, that's what I'm getting at.Every time you get some really serious questions, the 50 percent of the gold price determination begins to move.

TETT: Right.

GREENSPAN: And I think it is fascinating and - I don't know, is Benn Steil in the audience?

TETT: Yes.

GREENSPAN: There he is, OK. Before you read my book, go read Benn's book. The reason is, you'll find it fascinating on exactly this issue, because here you have the ultimate test at the Mount Washington Hotel in 1944 of the real intellectual debate between the - those who wanted an international fiat currency which was embodied in John Maynard Keynes' construct of a banker, and he was there in 1944, holding forth with all of his prestige, but couldn't counter the fact that the United States dollar was convertible into gold and that was the major draw. Everyone wanted America's gold. And I think that Benn really described that in extraordinarily useful terms, as far as I can see. Anyway, thank you.

TETT: Right. Well, I'm sure with comments like that, that will be turning you into a rock star amongst the gold bug community.

Back on September 11 and 12, there was a summit meeting in a city that involved an organization that most Americans have never heard of. Mainstream media coverage was all but nonexistent.

The place was Dushanbe, the capital of Tajikistan, a country few Westerners could correctly place on a map.

But you can bet your last ruble that Vladimir Putin knows exactly where Tajikistan is. Because the group that met there is the Russian president's baby. It's the Shanghai Cooperation Organization (SCO), consisting of six member states: Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan.

The SCO was founded in 2001, ostensibly to collectively oppose extremism and enhance border security. But its real reason for being is larger. Putin sees it in a broad context, as a counterweight to NATO (a position that the SCO doesn't deny, by the way). Its official stance may be to pledge nonalignment, nonconfrontation, and noninterference in other countries' affairs, but - pointedly - the members do conduct joint military exercises.

Why should we care about this meeting in the middle of nowhere? Well, obviously, anything that Russia and China propose to do together warrants our attention. But there's a whole lot more to the story.

A documentary broadcast on the Australian Broadcasting Corporation's "Four Corners" television program on Monday night provided a devastating portrait of the Israeli government's systematic policy of threats, arbitrary arrest and torture of Palestinian youth and children.

These measures are aimed at holding the Palestinian population, particularly the youth, in a permanent state of terror and suppressing any opposition to the Israeli occupation. An entire generation of youth is being traumatised as the Israeli security forces sow a climate of fear, as well as suspicion and division, through the forced recruitment of young informers.

The well-researched exposé - which also involved the Australian newspaper - was based on interviews with Palestinian youth themselves, as well as an Israeli lawyer, a former Israeli soldier and an Australian lawyer who has spent six years in the country.

Qusai Zamara, one of the boys interviewed, was 14 years old when he was abducted from his bed during a late-night military raid on his family home in the West Bank. He was taken to an interrogation facility and tortured into confessing to throwing stones at Israeli citizens and security forces. This accusation is commonly used by the Israeli military to justify the repression, arbitrary arrests and killings meted out against the Palestinian people.

Mexico has abruptly cancelled a contract worth $3.75 billion (58.9 billion pesos) with a Chinese-led rail consortium, just two days after it was awarded. The project to construct the country's first bullet train faced opposition from local lawmakers.

The China Railway Construction Corp. and CSR Corp. won the contract Monday, which set off steam amongst opposition politicians, who claimed the tender by the Chinese company, the sole bidder, lacked transparency and legitimacy. A new auction will be held and will include more bidders.


The Chinese-led group included Mexican firms that are linked to the brother of former President Carlos Salinas de Gortari.


The proposed 210-kilometer (130-mile) railway would link Mexico City with the central manufacturing hub of Queretaro.

Esparza told the Televisa network the country's President, Enrique Pena Nieto made a last minute decision to back out of the deal signed on November 3 and start the bidding process over. The Chinese consortium was the only one to put forward a proposal by the October 15 deadline, after Mitsubishi of Japan, Alstom of France, Bombardier of Canada and Siemens of Germany all refrained from bidding.

China also offered to finance 85 percent of the project from loans from the Export-Import Bank of China.

Nieto is due to visit China from next week to participate in the Asia-Pacific Economic Cooperation (APEC) summit, as well as a two-day official state visit to develop ties between Latin America's second biggest economy and the world's second largest economy.

Fresh out of his latest Congressional election shellacking delivered by the minority who bothered to vote in the United States, the formerly most powerful leader in the world, US President Barack Obama, will star in a thriller this weekend, appearing in the same room with China's Xi Jinping, Japan's Shinzo Abe and - fasten your seat belts - Russia's Vladimir Putin.

What a drag - the Bomber-In-Chief must be musing. The global economy is mostly a disaster. China, even growing at "only" 7% a year, keeps eroding his "indispensable nation" aura. Japan has decided to copy the Federal Reserve and embark on its own kamikaze version of quantitative easing. Numerous Southeast Asian nations keep freaking out about a few rocks in the South China Sea.

And last but not least, Obama's nemesis, pesky Vlad "the Hammer" Putin, has just been crowned Most Powerful Leader in the world - even if for the most stupid reasons ("unpredictable" head of a "rogue state") [1] - while he, the Nobel Peace Prize leader of the exceptionalist, indispensable nation, is now nothing but a pitiful lame duck.

The get-together, extended to Monday and Tuesday, will be the highlight of the Asia-Pacific Economic Cooperation (APEC) summit in Beijing - actually, outside of Beijing, so presumably unpolluted blue skies may also have a chance at the photo op. This is APEC's 25th birthday. And the 20th birthday of the Indonesian summit in Bogor - I happened to be there - which, under Bill Clinton's flowery charm, set the 21-member APEC nations a goal of "free" and open trade and investment by 2020. "Free" as in US corporations dictating the rules, of course.

What the whole planet really wants to know about APEC is whether The Lame Duck with meet The Bear face to face, one on one. The White House remains mum. The Kremlin did not rule it out. Well, there's always Plan B: the Group of 20 summit on November 15-16 in Brisbane, Australia.

What the whole planet already knows is that the new slimy show premiering on Capitol Hill on January 2015 has a top priority: the Republicans will do everything in their power to make the lame duck cry for mercy over and over again. So what will this mean in terms of Obama's self-styled "Don't Do Stupid Stuff" foreign policy doctrine, which that 2016 juggernaut known as "The Hillarator" has already derided as a "non-organizational principle"? Just extra layers of cosmic stupidity, or something more substantial?

ISIS is showing new ingenuity in ferrying fighters into Syria and Iraq untraced, after Turkey stepped up its own efforts at border check-ups. Terrorists are now reportedly taking cruise ships to the warzones, Interpol told the AP.

The problem of the Islamic State (IS, formerly ISIS) bulking up and recruiting en masse has been one of the greatest obstacles to eradicating the group. For a while now the world didn't have a proper mechanism to stem the flow of fighters to the IS' new heartland.

The recent airstrike campaign by the US has hardly put a dent in the movement of fighters making their way to Syria, which "remains constant, so the overall number continues to rise," according to a US intelligence official.

After weeks of rumors, it looks as if Kiev has finally decided to resume full-scale military assault on the Donetsk People's Republic. First, the Saker reported that Col. Cassad (a blogger with sources inside Novorussia) posted an important update:

Right now, he is reporting that while there is an increase in the combat operation, this is more a case of "combat reconnaissance" (opening fire to try to evaluate the enemy disposition) than of a real full-scale attack.

That is the good news.

The bad news is that an energetic "combat reconnaissance" is exactly what the Ukies would be doing before a major offensive.

Please don't panic, I will try to keep you posted. Right now, this is not a full scale attack. Not yet.

Now, RIA Novosti is quoting DPR leader Andrei Purgin's comment from yesterday:

"A full-scale war is underway. We are under attack, and we are defending ourselves," he said.

Earlier on Thursday DPR reported that a tank column of Kiev security officials had entered Donetsk suburbs, and fire in Donetsk surroundings was resumed. On Monday night fighting was resumed near the Donetsk airport.

If true, the NAF, with Russian support, is set to repeat their previous success. Kiev can't say they didn't have it coming.

For the second year running, Russian President Vladimir Putin has been named the world's most powerful person by a panel of Forbes editors.

Forbes says its list isn't based on political influence, but an evaluation of "hard power" - the use of military and economic means to influence the behavior or interests of other political actors.

"We insist the people on our list wield the kind of power that shapes and bends the world, and moves people, markets, armies and minds," the magazine wrote, explaining its choice.

Putin came out top among 17 other heads of state, presiding over a combined GDP of $48 trillion. As reasons for the decision, the editors cite Russia's acquisition of the Crimean peninsula, management of the international standoff over Ukraine and a $400 billion gas pipeline deal signed with China in May.

Allegations voiced by Canadian Foreign Minister John Baird and a number of representatives from the United States and NATO about Russian troops supposedly moving toward the country's border with Ukraine have no grounds and are based on rumors, a Russian Defense Ministry spokesman said Friday.

"These announcements were made citing some 'reports' without any solid proof," the spokesman said.

On Wednesday, Baird said his country was seriously concerned about information that Russian troops were apparently moving toward the Ukrainian border.

The Defense Ministry said that such announcements directed at irritating the conflict in southeastern Ukraine are coming from a single source.

"[The source] is not Ukrainian but he is currently located in an administrative building in Kiev," the Defense Ministry spokesman said. "We call on [our] Western partners to address these dangers of this false information of Russian military forces directly to the source that has invented them in the future," he added.

The Russian leader delivers an important foreign policy address we should consider. The Times botches it badly.

Give me a sec to count. In my lifetime the Soviet Union and latterly the Russian Federation have had nine leaders. Stalin's death elevated Malenkov and then Khrushchev, and the banishing of Khrushchev led to Brezhnev. Then came a pair of forgettables, then Gorbachev and on to the ever-inebriated Yeltsin (whom one wants dearly to forget). For 15 years, counting the Dmitry Medvedev interval, Vladimir Putin has held the wheel of the Russian bus.

Of all these figures only Stalin, and only in his post-"Uncle Joe" years, has been vilified to the extent of the current Russian leader. The question is obvious and I hope not too complicated: Why?

There are always plenty of answers floating around. I take almost all of them to lie somewhere between misguided and malevolent by intent, but I will get to this in a minute. In as few words as I can manage, here is my thought: Putin has fallen drastically afoul of Washington - and his war is with Washington more than the Europeans - because those in deep slumber do not like to be awakened.