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Wishful Thinking: America Overcomes the Debt Crisis as Britain Sinks Deeper into the Swamp

Britain has sunk deeper into debt. Three years after bubble burst, the UK has barely begun to tackle the crushing burden left by Gordon Brown. The contrast with the United States is frankly shocking.
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The latest report on "Debt and Deleveraging" by the McKinsey Global Institute shows that total public and private debt in the UK is still hovering at an all-time high. It has risen from 487pc to 507pc of GDP since the crisis began.

As the chart above shows, as recently as 1990 Britain's debts were still just 220pc of GDP. Has a rich country ever been debauched so fast in peace time?

The ordeal of belt-tightening will be grim, dragging out for a generation if Japan is any guide. The Japanese at least began their post-bubble debacle as the world's top creditor nation with a trade super-surplus and a savings rate of 17pc. Britain has no such buffers.

It is a very different picture in the US where light is emerging at the end of the tunnel. American banks, firms, and households have been chipping away at their debts, more than offsetting Washington's double-digit deficits.

The total burden has dropped to 279pc, down from 295pc at the peak of the boom. Households have purged roughly a third of the excess, roughly tracking the historic pattern of post-bubble deleveraging.

Dominoes

Canada: 'U.S. Economy Unlikely to Fully Recover': Carney

Mark Carney
© Chris Wattie/Reuters
Bank of Canada Governor Mark Carney
Canada needs to look beyond its southern neighbour for markets because the United States economy is unlikely to ever fully recover, Bank of Canada governor Mark Carney said Sunday.

In an interview with CTV's Question Period, Carney said that it is vital for Canada to look for new trading partners in the Asia-Pacific region and elsewhere to prevent the economy from being dragged down by the U.S.

"It's going to take a number of years before they get back to the U.S. that we used to know - in fact, they are not, in our opinion, ultimately going to get back to the U.S. that we used to know," he said.

Carney pointed to China as a market with great potential and as a place where Canada is currently under-represented, but cautioned it would take time to enhance trade between the two countries.

Newspaper

US: Georgia Judge Orders President to Appear at Hearing


Atlanta - A judge has ordered President Barack Obama to appear in court in Atlanta for a hearing on a complaint that says Obama isn't a natural-born citizen and can't be president.

Bad Guys

Davos Elites to Seek Reforms of 'Outdated' Capitalism

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© Agence France-Presse
World Economic Forum (WEF) founder and executive chairman Klaus Schwab gives a news conference in Cologny, near Geneva, on January 18.
Economic and political elites meeting this week at the Swiss resort of Davos will be asked to urgently find ways to reform a capitalist system that has been described as "outdated and crumbling."

"We have a general morality gap, we are over-leveraged, we have neglected to invest in the future, we have undermined social coherence, and we are in danger of completely losing the confidence of future generations," said Klaus Schwab, host and founder of the annual World Economic Forum.

"Solving problems in the context of outdated and crumbling models will only dig us deeper into the hole.

"We are in an era of profound change that urgently requires new ways of thinking instead of more business-as-usual," the 73-year-old said, adding that "capitalism in its current form, has no place in the world around us."

Bizarro Earth

European Union adopts Iran oil embargo

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© Shutterstock
Brussels - The European Union adopted an oil embargo Monday against Iran and a freeze of the assets of the country's central bank, part of sanctions meant to pressure the country to resume talks on its nuclear program.

Diplomats said the measures, which were adopted in Brussels by the EU's 27 foreign ministers, include an immediate embargo on new contracts for crude oil and petroleum products, while existing contracts will be allowed to run until July.

EU diplomats are calling the measure part of a twin track approach toward Iran: Increase sanctions to discourage what they suspect is Iran's pursuit of nuclear weapons but emphasize at the same time the international community's willingness to talk. Iran says its nuclear program is exclusively for peaceful purposes.

British Foreign Secretary William Hague called the embargo part of "an unprecedented set of sanctions."

"I think this shows the resolve of the European Union on this issue," Hague said.

Comment: Who is Maryam Rajavi? Where does she reside? What is her main part in the over theme of generating more data to bastardize Iran?

The forces of conquest and pillaging are aligning against a generally peaceful country, once again.


Info

Greece Presses EU to Ease Iran Oil Sanctions

Greece Flag, EU Flag
© unknown
Greece is pressing its European Union partners to make last-minute concessions over a forthcoming EU embargo on Iranian oil, complicating the bloc's efforts to unveil a sweeping package of sanctions against Tehran on Monday.

European diplomats are confident that EU foreign ministers will agree plans on Monday to impose a phased ban on the import of crude oil from Iran over the next few months.

But Greek brinkmanship has added an element of suspense to Monday's meeting, which is aimed at imposing the most serious sanctions the EU has ever agreed in protest at Iran's nuclear programme.

The imposition of a ban on Iranian oil will be painful for a range of southern European countries, such as Italy and Spain, which are heavily dependent on imports from Iran.

Attention

Egypt's Islamists Win 75 Percent of Parliament

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© The Associated Press/Khalil Hamra
Protesters chant slogans at a rally honoring those killed in clashes with security forces in Tahrir Square in Cairo, Egypt, Friday, Jan. 20, 2012, nearly a year after the 18-day uprising that ousted President Hosni Mubarak. Activists are now trying to energize the public to demand that the ruling military step down.
Final results on Saturday showed that Islamist parties won nearly three-quarters of the seats in parliament in Egypt's first elections since the ouster of authoritarian president Hosni Mubarak, according to election officials and political groups.

The Islamist domination of Egypt's parliament has worried liberals and even some conservatives about the religious tone of the new legislature, which will be tasked with forming a committee to write a new constitution. It remains unclear whether the constitution will be written while the generals who took power after Mubarak's fall are still in charge, or rather after presidential elections this summer.

In the vote for the lower house of parliament, a coalition led by the fundamentalist Muslim Brotherhood won 47 percent, or 235 seats in the 498-seat parliament. The ultraconservative Al-Nour Party was second with 25 percent, or 125 seats.

The Salafi Al-Nour, which was initially the biggest surprise of the vote, wants to impose strict Islamic law in Egypt, while the more moderate Brotherhood, the country's best-known and organized party, has said publicly that it does not seek to force its views about an appropriate Islamic lifestyle on Egyptians.

Vader

US: Obama signals State of Union a Campaign Rallying Call

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© Reuters/Kevin Lamarque
U.S. President Barack Obama attends a campaign fund raiser at the Apollo Theater in New York January 19, 2012.
President Barack Obama, offering a glimpse of next week's State of the Union address, made clear on Saturday that he will deliver a starkly partisan election-year call for a "return to American values" of economic fairness.

"I'm going to lay out a blueprint for an American economy that's built to last," Obama said in a campaign video sent to supporters. "And most importantly, a return to American values of fairness for all, and responsibility from all."

A reference to values is usually political code for social and religious issues, a rallying cry for conservative Republicans who want to deny the Democratic president a second White House term in November.

But Obama, who delivers his annual State of the Union address to Congress on Tuesday night, is running for re-election on his claim of being a champion for the middle class, while trying to paint Republicans as the party for the rich.

"We can go in two directions. One is towards less opportunity and less fairness. Or we can fight for where I think we need to go: building an economy that works for everyone, not just a wealthy few," Obama said.

Bad Guys

US Military Chief Holds Talks in Israel on Iran

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© The Associated Press/Dan Balilty
U.S. Joint Chiefs of Staff, Army Gen. Martin Dempsey, left, shakes hands with Israeli President Shimon Peres during their meeting at the President's residence in Jerusalem, Friday, Jan. 20, 2012.
The U.S. military's top general conducted an intense string of closed-door talks with Israeli leaders Friday, amid apparent disagreements between the two countries over how to respond to Iran's disputed nuclear program.

The chairman of the U.S. Joint Chiefs of Staff, Army Gen. Martin Dempsey, and Israeli leaders kept silent about the exact content of their discussions. Dempsey was expected to urge Israel not to rush to attack Iran at a time when the U.S. is trying to rally additional global support to pressure Tehran through sanctions to dial back its nuclear program.

Dempsey met Israeli Prime Minister Benjamin Netanyahu, who has been warning about the dangers of the Iranian nuclear program for more than a decade.

Netanyahu told Dempsey the U.S. should ratchet up sanctions against Iran to ones that would target its central bank and oil exports, the Israeli news site YNet reported. It quoted Netanyahu as saying such measures must be imposed immediately.

Bad Guys

Newspaper Editor: Israel Should Consider Assassinating Obama

Obama, Netanyahu
© Getty

Andrew Adler, the owner and publisher of the Atlanta Jewish Times, a weekly newspaper serving Atlanta's Jewish community, devoted his January 13, 2012 column to the thorny problem of the U.S. and Israel's diverging views on the threat posed by Iran. Basically Israel has three options, he wrote: Strike Hezbollah and Hamas, strike Iran, or "order a hit" on Barack Obama. Either way, problem solved!

Here's how Adler laid out "option three" in his list of scenarios facing Israeli president Benjamin Netanyahu (the column, which was forwarded to us by a tipster, isn't online, but you can read a copy here):
Three, give the go-ahead for U.S.-based Mossad agents to take out a president deemed unfriendly to Israel in order for the current vice president to take his place, and forcefully dictate that the United States' policy includes its helping the Jewish state obliterate its enemies.

Yes, you read "three" correctly. Order a hit on a president in order to preserve Israel's existence. Think about it. If I have thought of this Tom Clancy-type scenario, don't you think that this almost unfathomable idea has been discussed in Israel's most inner circles?

Another way of putting "three" in perspective goes something like this: How far would you go to save a nation comprised of seven million lives...Jews, Christians and Arabs alike?

You have got to believe, like I do, that all options are on the table.