MFS - The Other News

                    Morning Posting.

• Updated !Earthquakes in the last 24 hours in the world seismic activity situation Kara Khem, Respublika Tyva - Russia near Mongolian border 6.6 ;Tonga 5.8 - 5.9 ; Japan 5.4 - 5.3 - 5.2 !More info here.

• US to hit debt limit early January: Treasury.(AFP).WASHINGTON — The US government will hit its debt limit in the first week of January, the Treasury Department said on Tuesday, as it pointed to an imminent request for $1.2 trillion increase.The government is expected to come within $100 billion of the current $15.2 trillion ceiling by the end of the year, Treasury Department officials said.That effectively puts lawmakers on notice that they will have until mid-January to oppose a fresh increase.But a reprise of the vicious political debates over the debt ceiling that brought the US to the brink of default over the summer is unlikely.Congress agreed on July 31 to immediately increase the national debt by $400 billion, and then increase it in stages after that when necessary.An increase can only be blocked if both the House of Representatives and the Senate pass measures opposing it.In September the Democratic Party-dominated Senate declined to block a $500 billion increase.But the Republican-controlled House nevertheless passed a resolution symbolically rejecting the ceiling rise.With fiscal rectitude looming large as the 2012 election season gets underway in earnest, the new request to hike the borrowing ceiling could sound the starting gun on a fresh political fight.The Treasury Department said it would have to perform some accounting and managerial acrobatics to make sure the US does not miss payments before the raise comes into effect in mid-January.If opposition to the increase is unsuccessful the limit will be raised to around $16.4 trillion.That is expected to put the issue to bed until late 2012. A new rise in the debt ceiling is not expected to be needed until after the general elections in November.Read the full story here.

• GoDaddy lost 72,354 domains after supporting SOPA legislation.(BLN).Despite a massive Twitter campaign and a blog post that claims “Go Daddy no longer supports SOPA legislation” the company and their CEO have dodged questions about opposing the bill. In essence, they are taking a lesser role by not showing support for the bill. They have not opposed it.This week, they lost around 72,000 domain registrations. At a yearly discounted rate of $6.99 (most registrations are higher), that’s over half a million dollars per year. It is apparently not enough for them to speak out against the bill.How many domains is the company willing to lose before they oppose this abomination of legislation? Do they believe that when they “step back and let others take leadership roles” that we are going to see it as something other than a “duck and cover” public relations move to try to get out of the spotlight and hope someone else takes the brunt of the attacks while they quietly support the bill?Read the full story here.

• Another $845 Mil For Fraud-Infested Welfare Program.(JW).The Obama Administration’s manic spending spree to help “low-income” populations isn’t taking a break for the holidays, this month allocating an additional $845 million to a fraud-infested welfare program that’s already received billions from U.S. taxpayers this year.Incredibly, this particular initiative—known as Low-Income Home Energy Assistance Program (LIHEAP)—is rife with corruption that’s routinely exposed in congressional probes and the media. This hasn’t stopped the Obama Administration from pouring huge sums of money into it, however.Every year the Department of Health and Human Services (HHS) provides “needy” residents around the nation billions of dollars to pay for heating and cooling bills. That’s because the agency considers home energy a public health issue and therefore LIHEAP could help keep families safe and healthy. In fact, the agency encourages people to apply for funds by saying: “If you can’t afford to pay your home energy bill, your home may not be safe and you may be at risk of serious illness or injury,”In late October HHS gave LIHEAP a whopping $1.7 billion to “ensure low-income families are able to meet their heating cost expenses this winter.” When that chunk of change was doled out, the agency said it was for “immediate needs” and that states could also access an “additional $136 million, if needed.”Last week the agency distributed an additional $845 million to help low-income households with energy costs. The goal is to assure that “vulnerable families and seniors” can pay their heating bills and “stay warm during the holiday season and into early 2012,” according to an HHS assistant secretary. The same official says that, even as the economy shows signs of improvement, many Americans are struggling to make ends meet.Under this welfare program the government has actually paid the air conditioning bills for thousands of dead people, convicted felons and federal employees whose salary exceeds the maximum income to qualify for the handouts. In fact, one federal employee admitted requesting “free money” after seeing the “long lines” of applicants. You can’t make this stuff up. The details are included in a congressional report documenting fraud in LIHEAP. Investigators blame lack of oversight for the problems.Read the full story here.

• Monsanto’s GM Corn Linked To Organ Failure in rats.(Disinfo - Huffington Post). Make sure you have a GMO-free Christmas y’all! Katherine Goldstein and Gazelle Emami report on the consequences of genetic engineering of seeds by Monsanto, for Huffington Post: In a study released by the International Journal of Biological Sciences, analyzing the effects of genetically modified foods on mammalian health, researchers found that agricultural giant Monsanto’s GM corn is linked to organ damage in rats. According to the study, which was summarized by Rady Ananda at Food Freedom, “Three varieties of Monsanto’s GM corn – Mon 863, insecticide-producing Mon 810, and Roundup® herbicide-absorbing NK 603 – were approved for consumption by US, European and several other national food safety authorities.” Monsanto gathered its own crude statistical data after conducting a 90-day study, even though chronic problems can rarely be found after 90 days, and concluded that the corn was safe for consumption. The stamp of approval may have been premature, however. In the conclusion of the IJBS study, researchers wrote: “Effects were mostly concentrated in kidney and liver function, the two major diet detoxification organs, but in detail differed with each GM type. In addition, some effects on heart, adrenal, spleen and blood cells were also frequently noted. As there normally exists sex differences in liver and kidney metabolism, the highly statistically significant disturbances in the function of these organs, seen between male and female rats, cannot be dismissed as biologically insignificant as has been proposed by others. We therefore conclude that our data strongly suggests that these GM maize varieties induce a state of hepatorenal toxicity….These substances have never before been an integral part of the human or animal diet and therefore their health consequences for those who consume them, especially over long time periods are currently unknown.” Monsanto has immediately responded to the study, stating that the research is “based on faulty analytical methods and reasoning and do not call into question the safety findings for these products.”Read the full story here.

• Sears to shut up to 120 stores as sales slump.(MarketWatch).Sears Holdings shares down 20% on plan to cull Kmart and Sears locations. Moves signal “deepening problems” and “desperation,” analyst says.At a time when holiday season sales overall have turned out better than expected, Sears Holdings Corp. was an exception: It said Tuesday that it will close 100 to 120 Sears and Kmart stores after disappointing holiday sales.It's stock, having already lost 37% of its value this year, tumbled 20% to $36.61 in early trading, making it the biggest percentage decliner in the S&P 500. One of its key suppliers, Whirlpool Corp. was down 5.6%. The final list of stores to be closed hasn’t yet been determined, Sears said. In a change of strategy, the company said it no longer plans to keep “marginally performing” stores open while it works to improve their performance. Sears, which has more than 4,000 full-line and specialty retail stores in the U.S. and Canada, said it plans to take as much as $2.4 billion of charges in the fourth quarter on asset write downs and other items. The move come as the Hoffman Estates, Ill., company said that comparable sales in the eight weeks through Dec. 25 fell 5.2%, including a 4.4% drop at the Kmart discount chain and a 6% decline at the Sears department-store chain. In contrast, the National Retail Federation earlier this month raised its industry holiday forecast to a 3.8% increase from a 2.8% gain. declining profit and lower sales “point to deepening problems at this struggling chain and renew worries about Sears’s survivability,” said Credit Suisse analyst Gary Balter, who rates the stock underperform. “The moves announced by Sears point to desperation. Unfortunately for Sears, with (adjusted pre-tax profit) down to about 10% of its five-year peak, one wonders if vendors begin to worry about their own exposure.”Read the full story here.

• A Run On The Global Banking System—How Close Are We?(BLN).Source: Gonzalo Lira.Nine weeks after its bankruptcy, the general public still hasn’t quite realized the implications of the MF Global scandal.My own sense is, this is the first tremor of the earthquake that’s coming to the global financial system. And how the central banks and financial regulators treated the “Systemically Important Financial Institutions” that had exposure to MF Global—to the detriment of the ordinary, blameless customer who got royally ripped off in its bankruptcy—is both the template of how the next financial crisis will be handled, and an accelerator that will make the next crisis happen that much sooner.So first off, what happened with MF Global?Simple: It went bankrupt—because it made bad bets on European sovereign debt, by way of leveraging positions 100-to-1. Yeah, I know: Stupid. Anyway, they went bankrupt—which in and of itself is no big deal. It’s not as if it’s the first time in history that a brokerage firm has gone bust. But to me, the big deal in this case was the way the bankruptcy was handled. Now there are several extremely serious aspects to the MF Global case: Specifically, how their customers were shut out of their brokerage accounts for over a week following the bankruptcy, which made it impossible for those customers to sell out of their positions, and thus caused them to lose serious money; and of course how MF Global was more adept than Mandrake the Magician at making money disappear—about $1 billion, in fact, which still hasn’t turned up. These are quite serious issues which merit prolonged discussion, investigation, prosecution, and ultimately jailtime. But for now, I want to discuss one narrow aspect of the MF Global bankruptcy: How authorities (mis)handled the bankruptcy—either willfully or out of incompetence—which allowed customer’s money to be stolen so as to make JPMorgan whole. From this one issue, it seems clear to me that we can infer what will happen when the next financial crisis hits in the nearterm future. Brokerage firms hold clients’ money in what are known as segregated accounts. This is the money that brokerage firms hold for when a customer makes a trade. If a brokerage firm goes bankrupt, these monies are never touched—because they never belonged to the firm, and thus are not part of its assets. Think of segregated accounts as if they were the content in a safety deposit box: The bank owns the vault—but it doesn’t own the content of the safety deposit boxes inside the vault. If the bank goes broke, the customers who stored their jewelry and pornographic diaries in the safe deposit boxes don’t lose a thing. The bank is just a steward of those assets—just as a brokerage firm is the steward of those customers’ segregated accounts. But when MF Global went bankrupt, these segregated accounts—that is, the content of those safe deposit boxes—were taken away from their rightful owners—that is, MF Global’s customers—and then used to pay off other creditors: That is, JPMorgan. (The mechanics of how this was done are interesting, but insanely complicated, and ultimately not relevant to this discussion. To grossly simplify, MF Global pledged customer assets to JPMorgan, in a process known as rehypothecation—customer assets which MF Global did not have a right to. Needless to say, JPMorgan covered its ass legally. Ethically? Morally? Black as night.)This was seriously wrong—and this is the source of the scandal: Rather than being treated as a bankruptcy of a commodities brokerage firm under subchapter IV of the Chapter 7 bankruptcy law, MF Global was treated as an equities firm (subchapter III) for the purposes of its bankruptcy. Why does this difference of a single subchapter matter? Because in a brokerage firm bankruptcy, the customers get their money first—because after all, it’s theirs—while in an equities firm bankruptcy, the customers are at the end of the line. In the case of MF Global, what should have happened was for all the customers to get their money first. Then everyone else—including JPMorgan—would have picked over the remaining scraps. And the monies MF Global had already pledged to JPMorgan? They call it clawback for a reason.The Chicago Mercantile Exchange, which handled the bankruptcy, should have done this—but instead, the Merc was more concerned with making JPMorgan whole than with protecting the money that rightfully belonged to MF Global’s 40,000 customers. Thus these 40,000 MF Global customers had their money stolen—there’s no polite way to characterize what happened. And this theft was not carried out by MF Global—it was carried out by the authorities who were charged with handling the firm’s bankruptcy. These 40,000 customers were not Big Money types—they were farmers who had accounts to hedge their crops, individuals owning gold (like Gerald Celente—here’s his account of what happened to him)——in short, ordinary investors. Ordinary people—and they got screwed by the regulators, for the sake of protecting JPMorgan and other big fry who had exposure to MF Global. That, in a nutshell, is what happened. Now, what does this mean?It means that nobody’s money is safe. It means that regulators care more about protecting the so-called “Systemically Important Financial Institutions” than about protecting Ordinary Joe investors. It means that, when crunchtime comes, central banks and government regulators will allow SIFI’s to get better, and let the Ordinary Joes get fucked. So far, so evil—but here comes the really troubling part: It is an open secret that there are more paper-assets than there are actual assets. The markets are essentially playing musical chairs—and praying that the music never stops. Because if it ever does—that is, if there is ever a panic, where everyone decides that they want their actual asset instead of just a slip of paper—the system would crash. And unlike with fiat currency, where a central bank can print all the liquidity it wants, you can’t print up gold bullion. You can’t print up a silo of grain. You can’t print up a tankerful of oil. Now, question: When is there ever a panic? When is there ever a run on a financial system? Answer: When enough participants no longer trust the system. It is the classic definition of a tipping point. It’s not that all of the participants lose faith in the system or institution. It’s not even when most of the participants lose faith: Rather, it’s when a mere some of the participants decide they no longer trust the system that a run is triggered. And though this is completely subjective on my part—backed by no statistics except scattered anecdotal evidence—but it seems to me that MF Global has shoved us a lot closer to this theoretical run on the system. As I write this, a lot of investors whom I know personally—who are sophisticated, wealthy, and not at all the paranoid type—are quietly pulling their money out of all brokerage firms, all banks, all equity firms. They are quietly trading out of their paper assets and going into the actual, physical asset. Note that they’re not trading into the asset—they’re simply exchanging their paper-asset for the real thing. Why? MF Global. “Because of MF Global, the integrity of the system has disappeared,” said a good friend of mine, Tuur Demester, who runs Macrotrends, a Dutch newsletter out of Brugge. “The banks are insolvent, the governments are insolvent, and all that’s left is for the people to realize what’s going on—and that will start a panic.”He hit it on the head: Some of the more sophisticated people—like Tuur, like some of my acquaintances, (like myself, frankly)—have realized that the MF Global scandal means that there is no safety for any paper investment: The integrity of the systems has been completely shattered. If in the face of one medium-sized brokerage firm going under, the regulators will openly allow ordinary people to be ripped off for the sake of protecting the so-called “Systemically Important Financial Institutions”—in this case JPMorgan—what will happen if there is a system-wide run? What if two or three MF Globals happen simultaneously?Will they protect the citizens’ money? Or will they protect the “Systemically Important Financial Institutions”?I think we know the answer.Read the full story here.

• Hmmmm:Did Obama sell defective Bunker-Busters to Israel....and if so, then was it on purpose?(AstuteBlogger).By ReliaPundit.Israel ordered its first batch of the GBU-28 in 2005 and reportedly received them a year later. In 2007 it asked the Pentagon for another batch of bombs but the delivery was delayed due to concern in Washington that Israel planned to use the bunker buster bomb to attack Iran’s nuclear facilities, some of which are located in fortified bunkers. In September, Newsweek reported that the Obama administration had recently decided to authorize the delivery of 55 GBU-28 bombs as part of an aid package aimed at improving ties with Jerusalem. ... On Friday, the US Justice Department announced that it had reached a settlement with Kaman Corp. which allegedly substituted a fuse in four lots of fuses made for the bombs. Under the settlement, Kaman Corp. will pay the government $4.75 million. The US government alleged in its lawsuit against the company that the installation of defective fuses could lead to the premature detonation of the bomb and cause accidental misfires.IT WOULD SEEM THAT OBAMA AND HOLDER KNEW THAT THESE BOMBS WERE DEFECTIVE BECAUSE THEY HAD A LAWSUIT AGAINST THE MANUFACTURER.AND IT WOULD SEEM THAT ISRAEL JUST FOUND OUT ABOUT THIS.THIS MEANS THAT OBAMA AND HOLDER DELIBERATELY DID NOT TELL ISRAEL.EITHER THIS IS AN EXAMPLE OF GROSS NEGLIGENCE OR A DELIBERATE ATTEMPT TO SABOTAGE THE IAF AND ISRAEL'S ABILITY TO EFFECTIVELY ATTACK IRAN'S NUKE PROGRAM.Although Israel has been buying bunker busters since 2006, the contractor who apparently installed defective fuses started working for the US government in September 2010.Hmmm......“I will stand with the Muslims should the political winds shift in an ugly direction.”Read the full story here.

• Dr. Mohamed Saad Katatni, Secretary General of the Freedom and Justice Party (FJP),encourages Zakat Without Interfering in its Regulation.(IW).Dr. Mohamed Saad Katatni, Secretary General of the Freedom and Justice Party (FJP), stated that Zakat is an obligatory duty for the rich Muslims to pay, and a right for the poor, to be distributed in ‘Sharia-prescribed’ lawful channels.Dr. Katatni added that the party does not interfere in the means and mechanisms of organizing and regulating Zakat, because they are not of FJP responsibilities as a party, and that these were up to parliament and governments to come, after extensive discussion within the community in order to achieve the noble purposes of Sharia laws and rules.Katatni stressed that the party is currently working in accordance with its platform to encourage financially-capable Muslims to pay out Zakat in aspects defined in Sharia.Hmmmm......Mubarak......The good old days?Read the full story here.

• Iran warns could stop oil flow if sanctions -IRNA.(Reuters). Iran's first vice-president warned on Tuesday that if foreign sanctions are imposed on its oil exports, the flow of crude will be stopped from the crucial Strait of Hormuz in the Gulf, the country's official news agency reported."If they (the West) imposes sanctions on Iran's oil exports, then even one drop of oil cannot flow from the Strait of Hormuz," IRNA quoted Mohammad Reza Rahimi as saying. Read the full story here.

• ElBaradei: US Seeking Hard to Stop New Egypt from Annulling Camp David Treaty.(Fars).Mohamed ElBaradei, a prominent Egyptian political figure and the former head of the UN nuclear watchdog agency, cautioned that the US is doing whatever it can within its possibilities to stop the revolutionary Egypt from annulling Camp David Accord specially now that Islamist parties are coming to power in Egypt.Speaking to FNA, pro-reform leader and Nobel peace laureate Mohamed ElBaradei said that the future of the Camp David Accord has been the focus of meetings between Egypt's ruling Supreme Council of the Armed Forces (SCAF) and Washington. "The negotiations were completely secrete and confidential," ElBaradei said. "What the supreme military council said was that the talks were about bilateral and mutual relations, but I believe that Americans wanted to ensure that the deals signed between Egypt and Israel will remain intact if Islamists ascend to power," ElBaradei stated. The two main Islamic parties in the Egypt, which won majority of votes in the recent parliamentary elections in the country, have voiced their opposition to Cairo-Tel Aviv ties. Speaking to FNA in Cairo on Saturday, spokesman of the Salafi al-Nour party rejected reports about a meeting between the party's leaders and Israel's ambassador to Egypt, and described the reports as smear campaign to defame the Islamist party. "Al-Nour party can in no way ignore the Arab nations and Arab world's rights and the restoration of these rights is an unchangeable principle of the party," Nader Bakar said. "Al-Nour is against the establishment of any relations with the Zionist regime," he stated. The spokesman underlined that his party would certainly strive to change the Camp David Accord in the interests of Egyptian nation. The Salafi al-Nour is among the two main Islamist parties that won a majority of votes in both the first the second rounds of Egypt's parliamentary. It has won 20% of ballots. Early in December, a senior member of the Egyptian Al-Ikhwan Al-Muslimun (Muslim Brotherhood) party underlined the necessity for revising Camp David Accord between Cairo and Tel Aviv, describing the pact as "cruel". "It is natural that after the victory of the revolution many things and issues should be studied and dealt with," Kamal al-Halbawi told FNA at the time. "Hence, the issue of revising the Camp David Accord will also be in the list of the top priorities of (Egypt's new) officials to be studied in its appropriate time," he added. Also, former Egyptian Ambassador to the Palestinian territories Gamal Mazloum had told FNA that Egypt should take action to boost its forces in the Sinai Desert and make a formal request to correct and modify the Camp David Accord. Since the Zionist regime has several times breached the Camp David Accord, Egypt should use its power and increase its military presence in the Sinai Desert if the Israeli regime rejects a willing modification of Camp David, he said in October. Another leading Egyptian political activist had also underlined the necessity of revisions in the Camp David Accord between Cairo and Tel Aviv, stressing that the deal is no more valid. "Camp David has been annulled and has no more credit and value," member of Egypt's National Association for Change George Ishaq told FNA in Cairo in September. Hmmm...As i said before "You don't give them a bridgehead in the Sinai".Read the full story here.

• Jerusalem Mufti Warns about Israel's Expansive Judaization Measures in Jerusalem City.(Fars).The Mufti of Al Quds, Sheikh Mohammed Hussein, blasted Israel for its claim on Quds city, and warned about the judaization of the holy city by the Zionist regime. "The Zionist regime's decision to announce Jerusalem as the capital of the Jewish government is the result of the Zionists' racist prejudice," Sheikh Akrameh Sabri told FNA on Tuesday. He underlined the responsibility of the Arab and Islamic governments for preventing the implementation of such dangerous decisions, and said, "We want them not to leave us alone." Sabri stressed that the Zionist regime is misusing the opportunity created by the Islamic Awakening uprisings in the Middle-Eastern and North African countries to promote its plots for Judaizing the Quds city, building more settlements and destroying the houses of the Palestinians while Arab states are busy with their own internal problems. In light of the Arab and Muslim world's passive stance, the Zionist regime takes any action it wants very freely and breaks sanctuaries and Judaizes the Quds city without being questioned by the international community. Palestinian officials had also earlier warned that the Israeli Quds municipality continued to Judaize East Quds (Jerusalem) through the renaming of Arab street names and monuments in the city. As part of what the municipality calls "infrastructure restoration and area development", authorities fenced off areas around the city's historic Damascus Gate to do name and landscape changes as part of the Judaizing of the city.Read the full story here.

• China Insolvency Wave Begins As Nation's Biggest Provincial Borrowers "Defer" Loan Payments.(Zerohedge).Remember, back in the day, when a bankruptcy was simply called a bankruptcy? Naturally, this was well before ISDA came on the scene and footnoted the living feces out of everything by claiming that a bankruptcy is never a bankruptcy, as long as the creditors agree to 99.999% losses at gunpoint, with electrodes strapped to their testicles, submerged in a tank full of rabid piranhas, it they just sign a piece of paper (preferably in their own blood) saying the vaseline-free gang abuse was consensual. Well, now we learn that as the global insolvency wave finally moves to China, a bankruptcy is now called something even less scary: "deferred loan payments" (and also explains why suddenly Japan is going to have to bail China out and buy its bonds, because somehow when China fails, it is the turn of the country that started the whole deflationary collapse to step to the plate). After all, who in their right mind would want to scare the public that the entire world is now broke. Certainly not SWIFT. And certainly not that paragon of 8%+ annual growth, where no matter how many layers of lipstick are applied, the piggyness of it all is shining through ever more acutely. Because here are the facts, from China Daily, and they speaks for themselves: "China's biggest provincial borrowers are deferring payment on their loans just two months after the country's regulator said some local government companies would be allowed to do so....Hunan Provincial Expressway Construction Group is delaying payment on 3.11 billion yuan in interest, documents governing the securities show this month. Guangdong Provincial Communications Group Co, the second-largest debtor, is following suit. So are two others among the biggest 11 debtors, for a total of 30.16 billion yuan, according to bond prospectuses from 55 local authorities that have raised money in capital markets since the beginning of November." So not even two months in and companies are already becoming serial defaulters, pardon, "loan payment deferrers?" And China is supposed to bail out the world? Ironically, in a world in which can kicking is now an art form, China will show everyone just how it is done, by effectively upturning the capital structure and saying that paying interest is, well, optional. In the immortal words of the comrade from Georgia, "no coupon, no problem."Hmmmm.....'Comrade' Obama we want our money back?Read the full story here.

• Putin will take 'revenge' on Russia's protesters in bid to cling to power, claims senior former aide.(DailyMail).Vladimir Putin will take 'revenge' on Russia's protesters in the New Year with a major crackdown including a state of emergency in a desperate bid to cling to power, predicted a former senior aide to the Russian strongman.In a doomsday scenario, key opposition leaders could be assassinated or there may be attacks blamed on terrorists, warned Andrei Illarionov. These horrors would be pretexts for a tough clampdown which could include the muzzling of the media, a ban on protests, and even the March presidential election being cancelled altogether.He even warned that Russia could become embroiled in a military conflict ahead of elections, to change the public mood and serve as an excuse to curb the wave of recent street protests which are fuelling antipathy towards strongman Putin who has led the country for a dozen years as president or in his current role as prime minister. These extraordinary and alarming forecasts come from a man who as senior economic adviser was at Putin's side during his first term as president, and knows him well. He claimed recent concessions from the Kremlin represent a 'smokescreen' and warned: 'The authorities are busy provoking and discrediting, including the rally organisers, but the most important thing is that they are getting ready for revenge.'The authorities are seriously preparing to take a sharp U-turn, away from so-called 'liberalisation’ and 'democratisation'. It will happen very soon.' He predicted a New Year 'provocation' that would eclipse the current opposition show of strength that has appeared to paralyse the Russian elite and raised questions about Putin’s ability to return to the Kremlin presidency in March.'It is absolutely clear that among the long list of the actions there are various ones, such as 'accidents', terrorist attacks, some international 'initiatives’ to restore the quasi-Soviet Union - and the all internal questions fade into insignificance compared to conflicts which involve Russian army,' said Illarionov in a radio interview.'These give additional reasons to introduce a state of emergency, which naturally go hand in hand with silencing the media.'This kind of thing has been organised so often in different countries, including ours, that it would be extremely unwise and short-sighted to exclude such scenarios from the list of future possibilities. We simply have to bare these in mind.' He claimed that Putin's real support was no more than 36 per cent which would make it impossible for him to win outright in March without ballot rigging on a far larger scale than alleged in recent parliamentary polls won by the strongman’s party. 'My guess is that the authorities will opt for any falsifications so that there is no second round, and possibly no voting at all,' he said. Russia now faced 'extreme danger' linked to a presidential election that 'is too risky for Putin', he said.Last night there was a new protest after opposition leader Sergei Udaltsov, from an extreme-left wing group, was re-arrested and sentenced to a new stint in jail. There are now concerns for his health as he vowed to continue a hunger strike. Former chess world champion Garry Kasparov told him: 'Please start eating - and next year we’ll drink together at the funeral of Putin's regime.' Another anti-Putin leader warned the authorities 'do everything possible to bring riots to Moscow streets'.  Illarionov served Putin for five years to 2005 when he quit saying Russia had 'stopped being free and democratic'. He is now a senior researcher at the Cato Institute in Washington.Read the full story here.

• Turkish court accepts online blasphemy case, ECtHR ruling precedent.(TodaysZaman).A Turkish court has accepted an indictment filed against a man who allegedly insulted Islamic values online by a prosecutor who cited an earlier ruling by the European Court of Human Rights (ECtHR).The lawsuit was filed against A.M.S. over his remarks allegedly insulting Islamic beliefs on Ekşi Sözlük (Sour Times), a website on which contributors share their comments on various issues and incidents in Turkey. In the indictment she prepared over a criminal complaint filed against A.M.S. by an individual, İstanbul prosecutor Nurten Altınok referred to a 1994 decision of the ECtHR in the Otto-Preminger-Institut v. Austria case. The case concerns an application by the Austria-based Otto-Preminger-Institut at the European court over the ban of a movie by the Austrian government in 1985, on the grounds that it insulted the Christian religion.The applicant claimed a violation of their freedom of speech under Article 10 of the European Convention on Human Rights, which provides the right to freedom of expression. The court, however, found no violation of the convention and said the interference with the applicant association's freedom of expression was prescribed by law but the seizure and forfeiture of the film were aimed at “the protection of the rights of others” -- namely, the right to respect for one's religious feelings, and at ensuring religious peace. The court assessed the conflicting interests of the exercise of two fundamental freedoms guaranteed under the convention and concluded that the Austrian authorities did not overstep their margin of appreciation.Prosecutor Altınok, who says the suspect went beyond the limits of freedom of speech by ridiculing Muslim prayer rituals and the Islamic belief that the universe was created by God, seeks up to one-and-a-half years in jail for A.M.S., who said in his testimony that he did not intend to commit a crime nor to target a group or individual with his comments.Hmmmm.....Torquemada seen nodding from hell, waiting for the inquisition courts to be re installed.Read the full story here.

• Venezuela ranked top importer of Russian arms.(RN).MOSCOW, Venezuela became the largest importer of Russian arms for ground forces in 2011, the Moscow based Center for Analysis of World Arms Trade (CAWAT) said on Tuesday. Russia delivered a large consignment of arms to Venezuela under contracts signed in 2009 and 2010, CAWAT head Igor Korotchenko said without offering any figures. In 2011, Venezuela bought an unspecified number of T-72B1 tanks, BMP-3M infantry fighting vehicles, BTR-80A armored personnel carriers, Msta-S 152-mm self-propelled howitzers, Nona-SVK 120-mm self-propelled mortars, Grad multiple rocket launchers, and an assortment of other weaponry, he said. Next year Venezuela will launch licensed production of AK-103 assault rifles. Venezuela is followed by India, Kazakhstan, the United Arab Emirates, Azerbaijan, Uganda, Bangladesh, China, Uruguay, and Turkmenistan, which bought 10 T-90S tanks. Russia exports arms and military equipment to over 100 countries.Hmmmm......Venezuela.....Iran .......Hezbollah....take your pick.Read the full story here.

• 'PLO might revoke recognition of Israel'.(YNet).As Fatah and Hamas promote their reconciliation efforts and as signs indicating that the Islamic Jihad may be warming up to the idea of joining the Palestine Liberation Organization become more evident, the Palestinian Authority seems to be taking a harsher stand vis-à-vis Israel. PLO Executive Committee Member Hanan Ashrawi said Monday that the PLO may choose to revoke its recognition of Israel "should all other (political) avenues fail."In an interview with the Voice of Palestine radio station, Ashrawi stressed that while the possibility has yet to be discussed by the PLO, it was nonetheless considered as a viable option by the Palestinian leadership. Commenting on contested Israeli policies, she said that first option the Palestinians must exhaust was to file grievances against Israel with international bodies over issues such as settlement expansion.Ashrawi added that the PA must "devise a plan that would bolster the resilience of the residents of east Jerusalem," in view of what she called "Israel's Judaization plans"; and that the PA should pursue legal recourse against Israel on an international level, over its "prolonged violations of international law." She also voices her support for continued peaceful resistance, the likes of the weekly protest rallies in the West Bank against the construction of the security fence. Ashrawi's statement echoed a similar sentiment expressed by Fatah Executive Committee Member Muhammad Ashtiyeh, who last week said: "If Netanyahu insists on treating Tel Aviv and Har Homa the same way, we will treat Ramallah and Jaffa the same." Ashtiyeh protested what he called the "unbalanced" agreement between the PLO and Israel, reiterating the Palestinian demand that Israel recognize the 1967 borders as Palestinian territory.The escalation in the Palestinian may stem from the end of the three-month period given to Israel and the Palestinian Authority by the Quartet to submit it with reports detailing their stance on security and borders.The Palestinians have submitted their demands, but Israel has yet to do so. The final deadline in January 26. Palestinian Foreign Minister Riyad al-Malki said that the Mideast Quartet is close to failing in bringing Israel and the Palestinians back to the negotiating table. He added that other nations should join the mediation efforts, the likes of Brazil, Turkey, China, India and other Western countries.Al-Malki noted that the Palestinian Authority is considering applying to the UN General Assembly as a nonmember state, thus making it easier for the PA to join other international bodies, including the International Court of Justice.Meanwhile. Palestinian President Mahmoud Abbas met Monday with members of the Palestinian "Reform and Change" movement, which is affiliated with Hamas. The parties discussed the recent reconciliation meeting between the Palestinian factions. Abbas expressed his satisfaction from the progress made between the factions, saying it will lead to Palestinian elections.Hmmmm......Already starting to sound like Hamas,time that Israel remembers that Only the 'victor' dictates the terms.Read the full story here.

• Iran’s navy ‘warns off’ chopper.(HurriyetDaily).Tehran.The Iranian navy said it warned off a foreign helicopter that had approached the site of a naval drill it is conducting in international waters. A spokesman for the drill, Lieutenant Commander of the Iranian Navy Admiral Seyed Mahmoud Mousavi, told state TV the helicopter left the area immediately after the warning Dec. 25. Iran’s navy began the 10-day drill Dec. 24 in waters beyond the strategic Strait of Hormuz at the mouth of the Persian Gulf. The naval maneuvers dubbed are due to cover an area stretching from east of the Strait of Hormuz in the Persian Gulf to the Gulf of Aden. Mousavi said according to the international rules, the military units of the trans-regional states are not allowed to enter the exercise zone. Meanwhile, a senior Iranian lawmaker said Dec. 26 the ongoing naval war games should be seen as a serious warning to the West. “These war games are a warning to the western countries about the closure of the Strait of Hormuz,” Zohreh Elahian, member of the Parliament’s National Security and Foreign Policy Commission, told Fars News Agency yesterday.Read the full story here.