by Josey Wales, BIN

How would it be if the next few hundred billion dollars or so in U.S. bills could be paid off in cash? No borrowing. No additional debt.

Just as Barack Obama is planning to borrow another pile of currency, probably from China, to pay for his programs and promotions, calls are starting to develop for the U.S. to call in the debts that are due – and have been due for roughly two generations.

Those would be the sovereign debt bonds sold by China before the communist revolution – bonds that were issued with the promise by the Chinese that they would be an internationally recognized debt of China and its successor governments until paid.

But so far? Nothing.

The issue got the attention of Peter Huessy, the president of GeoStrategic Analysis, a defense forecasting firm, in a commentary at Fox News not long back.

“Many people assume China has the U.S. over a barrel. The country buys so much of our debt – around $800 billion – that we cannot ‘rock the boat’ when it comes to U.S. and China relations. That has meant not pressing the PRC ‘too hard’ when it comes to North Korea, or Iran,” he wrote. “Just recently, a top Obama administration delegation visited the People’s Republic of China. While there, the Chinese were told not to worry about the U.S. paying its debts to the country – their investments in the U.S. were safe. True enough.”

But he added, “I was struck with the fact that the PRC, however, does not pay its debts to the U.S.”

WND reported when Obama’s first “stimulus” package of some $700 billion-plus was being pushed through Congress that some of the beneficiaries would be Chinese companies – even while the billions of unpaid debt remained outstanding.

At that time, Kevin O”Brien, writing for the Global Association of Risk Professionals, warned that the situation could develop into a significant problem.

“One of the greatest problems facing China is the government’s failure to acknowledge and effectively address the true extent of state institutions’ bad debt,” he wrote.

“The repayment obligation was inherited by the People’s Republic of China, when the communists took control in 1949. The successor government doctrine of settled international law affirms continuity of obligations among international recognized successive governments,” O’Brien wrote.

Huessy explained what happened.

“Many decades ago, China sold sovereign bonds worldwide to investors in many nations. They sold tens of thousands of these bonds on U.S. soil to American citizens on the recommendation of our government, indicating it was a solid investment,” he said. “Over the last sixty years, China has refused to pay to these bondholders either the principal or interest on these full faith and credit sovereign bonds.”

He noted that in 1987 the British financial markets threatened to keep China out because of the unpaid bonds due to owners in that nation, so the Chinese reached agreement to pay up. But only to those bondholders.

That’s what is know as a “selective default,” meaning some debts were paid but others were not, Huessy said.

He noted that U.S. credit rating agencies such as Standard and Poor’s claim they simply can overlook that.

“Under the rules, they are granted a license by the Security and Exchange Commission (SEC) of the United States to be a nationally recognized statistical rating organization (NRSRO), a charter to assess the risk of investing in sovereign and corporate debt, stocks, or bonds. The ‘selective default’ of the PRC must be acknowledged, in that the metrics used by the NRSRO organizations that they themselves have promised to follow as part of their license agreement includes just such a requirement,” he warned.

“Now if China was found in selective default, this would cause the PRC to have to pay considerably more to finance its debt than it does now. Billions more,” he said.

He noted that China insisted, when Saddam Hussein’s government in Iraq collapsed several years ago, that any successor government in Iraq must be held to the existing debts, and the U.N. agreed to its demands.

“Currently, the People’s Republic of China owes a debt of over $750 billion to American citizens who are holding these full faith and credit sovereign bonds (many of them denominated in gold) sold to them by the Republic of China. Worldwide, the debt China owes to all bondholders is estimated to be several trillion dollars. The debt owed to the American people should be paid. The U.S. government could dollar for dollar offset bond interest we owe China with interest, principal and penalties China owes us,” Huessy said.

It wasn’t too far off the date when China demanded Iraq be held to account that the Chinese Ministry of Finance in 2006 issued an official communiqué addressed to “the Embassy of the United States of America in China,” in which the Chinese government formally repudiated China’s defaulted full faith and credit sovereign debt and announced that it would not repay any debt held by America, O’Brien explained.

China, meanwhile, continues to boast of its economic growth and influence, moves that periodically prompt outraged members of Congress to try to bring the issue to a head. A few years back it was Sen. James Inhofe, R-Okla., tried to advance a resolution noting China’s attempt “to conceal its defaulted government debt from investors.”

Huessy indicated that the White House should be jumping on the issue.

“That could even be part of the upcoming budget and debt agreement, paid down over a period of years,” he noted.

Meanwhile, under last year’s debt increase law, Obama can raise the nation’s debt cap, now $15.2 trillion, after he notifies Congress of the need unless his plan is opposed by a two-third supermajority, an unlikely event.

Fox News reports that almost $1 trillion of the new debt for the U.S. “can be attributed to Obama’s 2009 deficit-financed economic stimulus package,” of which some of the benefits went to Chinese-owned companies.

Source: www.wnd.com/2012/01/find-out-who-owes-u-s-billions/

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Israeli hackers brought down the websites of both the Saudi Stock Exchange (Tadawul) and the Abu Dhabi Securities Exchange (ADX) Tuesday, in the latest episode of a continuing cyber war between hackers in the two countries.

The Israeli hackers, who go by the name IDF-Team, were able to paralyze the Tadawul website, while causing significant delays to the ADX exchange site.
Tel Aviv Stock Exchange Bloomberg

The hackers wrote that the attack came in response to the “pathetic” hacking of Israeli sites on Monday. The hackers warned that if the attacks continue, they will “move to the next stage and paralyze websites for a period of two weeks to a month.”

Read More…

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WASHINGTON — Defense Secretary Leon Panetta says Iran is laying the groundwork for making nuclear weapons someday, but is not yet building a bomb and called for continued diplomatic and economic pressure to persuade Tehran not to take that step.

As he has previously, Panetta cautioned against a unilateral strike by Israel against Iran’s nuclear facilities, saying the action could trigger Iranian retaliation against U.S. forces in the region.

..”We have common cause here” with Israel, he said. “And the better approach is for us to work together.”

Panetta’s remarks on CBS’ Face the Nation, which were taped Friday and aired Sunday, reflect the long-held view of the Obama administration that Iran is not yet committed to building a nuclear arsenal, only to creating the industrial and scientific capacity to allow one if its leaders to decide to take that final step.

The comments suggest the White House’s assessment of Iran’s nuclear strategy has not changed in recent months, despite warnings from advocates of military action that time is running out to prevent Tehran from becoming a nuclear-armed state.

Iran says its nuclear program is only for energy and medical research, and refuses to halt uranium enrichment

Several Republican candidates have called for a tougher line against Iran, saying they believe it is committed to building the bomb. “If we re-elect Barack Obama, Iran will have a nuclear weapon,” said Mitt Romney. “And if you elect Mitt Romney, Iran will not have a nuclear weapon.”

Rick Santorum has said that the U.S. should plan a military strike against Iran’s nuclear facilities and “say to them that if you do not open up those facilities and close them down, we will close them down for you.”

Iran has opened two dozen of its facilities to international inspectors, but has refused in defiance of the U.N. Security Council to suspend its uranium enrichment.

A leading hardline Iranian newspaper reported Sunday that Iran has begun uranium enrichment at a new underground site well protected from possible airstrikes.

Kayhan daily, which is close to Iran’s ruling clerics, said scientists have begun injecting uranium gas into sophisticated centrifuges at the Fordo facility near the holy city of Qom.

In a talk at a Brookings Institution forum in December, Panetta said an attack on Iran’s nuclear facilities would “at best” delay Iran’s nuclear program by one or two years. Among the unintended consequences, he said, would be an increase in international support for Iran and the likelihood of Iranian retaliation against U.S. forces and bases in the Mideast.

Panetta did not discuss the issue directly on Sunday’s “Face the Nation.” But Chairman of the Joint Chiefs of Staff Gen. Martin Dempsey, appearing with the defense secretary, said that he wanted the Iranians to believe that a U.S. military strike could wipe out their nuclear program.

“I absolutely want them to believe that’s the case,” he said.

Panetta did not rule out launching a pre-emptive strike.

“But the responsible thing to do right now is to keep putting diplomatic and economic pressure on them to force them to do the right thing,” he said. “And to make sure that they do not make the decision to proceed with the development of a nuclear weapon.”

Panetta said if Iran started developing a weapon, the U.S. would act. “I think they need to know that — that if they take that step — that they’re going to get stopped.”

Dempsey also said that Iran has the military power to block the Strait of Hormuz “for a period of time” if it decides to do so, but that the U.S. would take action to reopen waterway. “We can defeat that,” he said.

Panetta said closing the strait would draw a U.S. military response. “We made very clear that the United States will not tolerate the blocking of the Strait of Hormuz,” he said. “That’s another red line for us and … we will respond to them.”

A number of experts say Iran is unlikely to close the strait, through which Gulf oil flows, because the action could hurt Iran as much as the West.

But a second Iranian newspaper, the Khorasan daily, on Sunday quoted a senior commander of the powerful Revolutionary Guard force as saying Tehran’s leadership has decided to order the closure of the strategic oil route if the country’s petroleum exports are blocked.

Iranian politicians have issued similar threats in the past, but this is the strongest statement yet by a top commander in the security establishment.

http://www.washingtonpost.com/national/national-security/panetta-iran-is-seek…

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from Breitbart

The latest round of American sanctions are aimed at shutting down Iran’s central bank,a senior US official said Thursday, spelling out that intention directly for the first time.

“We do need to close down the Central Bank of Iran (CBI),” the official told reporters on condition of anonymity, while adding that the United States is moving quickly to implement the sanctions, signed into law last month.

The sanctions, broadly aimed at forcing Tehran to shift course on its nuclear program, targeted Iran’s crucial oil sector and required foreign firms to make a choice between doing business with Iran or the United States.

Foreign central banks that deal with the Iranian central bank on oil transactions could also face similar restrictions under the new law, which has sparked fears of damage to US ties with nations like Russia and China.

“If a correspondent bank of a US bank wants to do business with us and they’re doing business with CBI or other designated Iranian banks… then they’re going to get in trouble with us,” the US official said.

Read More…

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Mili Note: Coming soon to an Amerika near you.

by Brandon Turbeville, ActivistPost

Over the past few months, I have written several articles dealing with the coming cashless society and the developing technological control grid. I also have written about the surge of government attempts to gain access to and force the use of biometric data for the purposes of identification, tracking, tracing, and surveillance.

Only a totalitarian form of government would desire this information; and only a very determined totalitarian government would actively work toward establishing it. India is only the first nation to openly sweep up its entire national population into such a massive biometric database net. We cannot let our nation be the next.

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