Thread: Iraq/Dinar Until June 9th 1PM CST

U.S.: IRAQ NEEDS TIME, PRESSURE ON OIL LAW
Published: June 1, 2007 at 3:02 PM E-mail Story | Print Preview | License

WASHINGTON, June 1 (UPI) -- The U.S. State Department says Iraqis need time to get the oil law "right," while U.S. pressure is to ensure Baghdad keeps its eyes on the prize.

A senior department official told United Press International on condition of anonymity that Iraqis negotiating the law must strike a "delicate balance" between getting it right and getting it done.

The law will govern Iraq's vast petroleum reserves -- the world's third-largest -- and determine regional and federal control over the oil and the extent of foreign oil company involvement. It will also decide how the revenue from oil sales is split up, among other issues.

"It's absolutely critical they get this right," the official said, adding, "It really is in their self interest to address these issues as soon as possible."

But Iraqi parliamentarians and oil experts on various sides of the debate say U.S. pressure to pass the law could make matters worse by rushing the divisive issue. President Bush has called the law a "benchmark for reconciliation" and he, U.S. ambassadors to Iraq and Vice President Dick Cheney and Defense Secretary Robert Gates have expressed the desire for the law to be passed soon. Congressional Democrats have joined the chorus, including it as a benchmark for success in supplemental war funding passed last week.

The official said the United States has spent the last few years "getting the investment climate right in Iraq," which, in terms of the oil law, means pushing Baghdad for "clear, transparent" legislation.

The United States, via a contract with McLean, Va.-based consultant BearingPoint Inc., has provided specialized experts, like an oil lawyer, to answer questions oil law negotiators may have, the State Department official said.

Iraq produces around 2 million barrels per day, down from 2.6 million before the war. It exports about 1.6 million barrels daily, which brings in more than 93 percent of its federal budget.

"Certainly we understand the criticality of these issues, as do the Iraqis," the official said.

Negotiations between the Kurdish Regional Government and central Iraqi government continue next week. But skepticism looms as the sides are far from reaching a deal that will be supported by enough members of parliament.

United Press International - Energy - Briefing

Originally Posted by zipper

The damage of the dollar glut
Money printing to prop up the U.S. economy has spawned more of the same around the world, fueling a global boom and an inflation spiral.
Latest Market Update
June 04, 2007 -- 14:30 ET

By Bill Fleckenstein
We're in the midst of a leveraged-buyout mania and a worldwide stock frenzy, running the gamut from just plain wild to completely out of control.
From time to time I find myself wondering: How did we get here? So today, I'm sharing my thoughts on that subject because if you don't know how you got to where you are, it's hard to be prepared for what may happen next.
In the beginning . . .
To make a long story short: The process was started by money printing in America to bail out the last bubble.
That induced money printing in much of the world because so many countries had linked their currencies to the dollar. More importantly, the very regions that were primed to grow -- think Asia, India and the Middle East -- exploded, in no small part, thanks to money printing. Thus, America's housing boom kept our economy growing. Growth in the other parts of the world I just mentioned, together with the attendant commodities boom, conspired to create the worldwide growth (and inflation) that we have experienced.
A lot of what's transpired has been a function of absurdly low interest rates, given the level of inflation around the world, and the collapse in risk premiums, aided by ratings-agency alchemy, which has allowed debt -- from moderately risky to total garbage -- to be spun into high-quality credit structures. In other words, the debt markets have acted as unindicted co-conspirators in the frenzy.
Stuffed to the gills with dollar bills
A major reason why our Treasurys market has traded as well as it has stems from the accumulation of dollars by the aforementioned regions and their desire to keep their currencies weak against the dollar. (China, Japan, South Korea, Taiwan and India have accumulated more than $2.5 trillion in less than 10 years, according to the May 23 Financial Times.)
The trillions of dollars printed "forced" those countries to print trillions of dollars' worth of their own currencies to keep them from appreciating too quickly. After they printed their currencies to buy ours, they wound up buying mostly Treasurys with those electronic greenbacks (that is, until recently).

Thus, currency-suppression techniques and blind reliance on formulas on the part of ratings agencies, combined with organic growth, plus the madness of the crowds, have brought us to where we are. But important changes are under way that at some point will derail the process I've just described.
First of all, Kuwait's dollar de-linking and China's sliding of the band (to pick the two most recent examples) will, at the margin, require less dollar buying and ultimately less Treasurys buying. Additionally, it appeared the Chinese were already spending fewer of their dollars on Treasurys and more on commodities, even before they took a flier on the Blackstone purchase. This is a roundabout way of saying that the world's bond markets might finally experience rising rates as the ranks of buyers thin out.
LBOs: Gorge now, regurgitate later
One of the unwritten beliefs of folks in the leveraged-buyout (LBO) crowd is that they'll be able to finance any wild idea they can come up with. So far, that has been the case. But we are going to hit a point where the cumulative effect of all this exchanging equity for debt will swamp the debt market, and the LBO party will be over. It's not possible to predict when speculative forces finally will choke the debt buyers, though that moment should be recognizable as it occurs.
Lastly, I believe that the world economy's growth will at the least be tested, if not completely undermined, because U.S. economic growth is in the process of slowing down. I think it will continue to slow as consumers are tapped.

The boom in leveraged buyouts is rallying the stock market, but it could spell trouble for bond investors -- especially those who own investment-grade bonds. MSN Money's Jim Jubak explains how to check your portfolio to prevent big losses.
The main engine that kept them going after the last stock bubble was the real-estate ATM, which is now broken. Further, the recent tightening of credit standards and increasing interest rates in the bond market -- not to mention the high price of gasoline -- will compound the problem.
A sanguine state of rationalization
In the meantime, it's been onward and upward for stocks, thanks to the blind faith in LBOs and a never-ending global boom, and a market that "acts well" (reinforcing the belief that market action never lies about what the future holds), factors that lull folks into a sanguine state of rationalization. Ultimately, I believe that market action will fool people. The one thing that I am most certain of is that there is going to be a dislocation -- because never have so many rationalized so much with so much leverage.

The damage of the dollar glut - MSN Money

I sent this to my broker for his views and also asked how Canada would be affected:

Hi Jean. I think this is excactly what is going on. Liquidity is
mostly debt not cash, a huge potential problem because the easy credit
could dry up at any time. Hard to predict when, but even our analyst
(Don Coxe)is suspecting that the bubble is in the bond and credit
markets and not adequately pricing in risk......the ultimate unwind
could be ugly (good for gold). Canada has a lot of leverage as well,
but not near what you find in the U.S. - especially in the mortgage
market. The phenomonon is global so all boats have been lifted and all
asset classes have inflated together, so an ultimate correction might be
in all asset classes as well.........at least initially.

Longer term the emerging economies are going to continue to be extremely
influential to the global landscape and commodity prices, but a few
significant hicups are to be expected.

Originally Posted by Kodabear

U.S., Iraqi troops control fewer than a third of Baghdad neighborhoods
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BAGHDAD, 04 June 2007 (New York Times)
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Three months after the start of the Baghdad security plan that has added thousands of American and Iraqi troops to the capital, they control fewer than one-third of the city's neighborhoods, far short of the initial goal for the operation, according to some commanders and an internal military assessment.

The assessment, completed in late May, found that American and Iraqi forces are able "to protect the population" and "maintain physical influence over" only 146 of the 457 Baghdad neighborhoods.

In the remaining 311 neighborhoods, troops have either not begun operations aimed at rooting out insurgents or still face "resistance," according to the one-page assessment, which summarized reports from brigade and battalion commanders in Baghdad.

The assessment offers the first comprehensive look at the progress of the effort to stabilize Baghdad with the heavy influx of additional troops. The last remaining American contributions to the troop increase are just now arriving.

Violence has diminished in many areas but is especially chronic in mixed Shiite-Sunni neighborhoods in western Baghdad, several senior officers said. Overall, improvements have not yet been widespread or lasting across Baghdad, they acknowledged.

The operation "is at a difficult point right now, to be sure," said Maj. Gen. Vincent K. Brooks, the deputy commander of the 1st Cavalry Division, which has responsibility for Baghdad, in an interview.

He said that, while military planners had expected to make greater gains by now, that has not been possible in large part because Iraqi police and army units, which were expected to handle basic security tasks, like manning checkpoints and conducting patrols, have not been provided all the forces promised and in some cases, have performed poorly.

That is forcing American commanders to conduct operations to remove insurgents from some areas multiple times. The heavily Shiite security forces have also repeatedly failed to intervene in some areas when fighters who fled or laid low when the American troops arrived resumed sectarian killings.

When planners designed the Baghdad security plan late last year, they had assumed most Baghdad neighborhoods would be under control around July, according to a senior American military officer, so the emphasis could shift into restoring services and rebuilding the neighborhoods as the summer progressed.

"Lt. Gen. Raymond T. Odierno, the senior American ground commander in Iraq, said in a brief interview that he never believed that a midsummer timetable for establishing security in Baghdad was realistic. "This was always going to be conditions-driven," he said, noting that he always had expected it would take until fall to establish security across much of the city.

But in order to meet that timetable, he added that the Iraqi Security Forces would have to make strides in coming months at maintaining security.

Joan

You know the surge troops are finally there just now and one third of a large area is basically solved and the rest is much better yet the Strinkin NY Times must spin it bad. One thing for sure the editors of the Times must be "Al-Jezeera west". Perhaps Bin Laden is a contributing editor. It's no wonder their subscription is way down. if this keeps up, bankruptcy will be on the horizon. One could only hope.

Hey guys need some help. I was trying to find a thread from someone named Benadict Arnold. Seen it earlier. Can't find it now. Thanks

Originally Posted by Bill

Hey guys need some help. I was trying to find a thread from someone named Benadict Arnold. Seen it earlier. Can't find it now. Thanks

Yeah I am hunting for it as well. Looks like it was pulled 'cause I can not find it anywhere. Weird. Never seen this happen here before...

Anyone know what evil ensued after the posting?

Weird is right. He said he had a update at 8:00pm. Never seen it.

Economic : economic window

The market mechanism

Imad Principality
Consider (economists) to the market mechanism as an effective tool in the structural change and to restore the Iraqi economy Tozanath implications for the activation mechanism (the market) in achieving economic variables require economic measures undertaken by the State

It is the most important revitalization tools of monetary and fiscal policies and that these policies seem to be short-term but it is (the economic environment) most appropriate for activating the market mechanisms and show results in the form of long-term structural changes and here is sequencing necessary to arrange economic policies is the issue of the utmost importance in this regard stresses (experts economy) that the activation of the advantages associated with the Iraqi market to a large extent the size of this market whenever any widened strong demand and supply empowered in the Iraqi market could then access to competitive situations more efficiently, it must consolidate the supply situation in the Iraqi market, and this happens through expansion of productive Mmcnath (Economy Iraqi)

This occurs through the conversion of public property or curbing the role of the State in ownership of the forces of production equipment and the kinds of projects large and medium and transformed into (the private sector), which is one component of supply in (the Iraqi market) could then market mechanisms and the restructuring of production according to demand trends, the reference here seem to function feature of the economy Iraqi being economical (permitted) to the high relative importance of the petroleum sector's contribution to GDP at its control, the subject was largely due to external variables (oil market) to be fluctuations in the revenue range then affected the GDP and so that it can be (the Iraqi economy)

Diversity Commodity exports in the matter requires pursuit of trade liberalization to give a greater role to (the strong market) in the process of resource allocation in the Iraqi economy ..

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The government is preparing to announce a general amnesty to activate dialogue with the armed groups want to join the political process

04/06/2007 15:13 (GMT)

The deputy said the bloc United Iraqi Alliance Sunaid good that the Iraqi government is laying the foundations of the draft general amnesty preceded the national reconciliation process in order to activate the dialogue with armed groups willing to join the political process.

The Sunaid In statements made today, Monday, that the amnesty which it is hoped that a government is part of the program and comes within the framework of national reconciliation plan how to ensure that the return of criminals.

He pointed out that this strategy also includes a cabinet reshuffle includes service ministries which have direct contact with citizens and activate security plan Baghdad and establish diplomatic relations with regional states to urge them to implement their debt towards Iraq, including the support of the United National Security and control its borders with Iraq and to support the political process.

On the other hand, welcomed the figures parliamentary desire the American side in an amnesty on what it calls the former rebels in Iraq and opening a dialogue with some of the armed factions in support of the draft national reconciliation.

Details of the correspondent of "Radio Sawa" in Baghdad Zafar Ahmed :

Hashemi : national reconciliation has not achieved the desired expectations and the International Covenant requires national covenant

04/06/2007 23:48 (GMT)

The Vice President Tariq Hashimi, the road is still long to achieve national reconciliation in Iraq, pointing to the importance of consultation and discussion with Egypt to help Iraq out of its crisis, cautioning that the situation in Iraq will overshadow the future of the Arab national security.

Hashemi told reporters after meeting with Secretary-General of the Arab League Amr Moussa in Cairo on Monday, the draft reconciliation government's draft was a good one and should be the safety valve for all Iraqis, but this project has not achieved the desired expectations still a long way to go before the Iraqis to build a strong Iraqi reconciliation.

He said that the International Hashemi, which was built in May during the Sharm El-Sheikh conference needs to be an Iraqi national covenant to apply.
The International Plan extends for five years by Baghdad with the United Nations in 2006 with support from the World Bank aimed at strengthening security and revival of the Iraqi economy after four years of violence.

Originally Posted by Bill

Weird is right. He said he had a update at 8:00pm. Never seen it.

well that makes 3 of us ...... lol

anyone have a copy of it ?