“I’m in show business, why are you coming to me?”

“War is show business, that’s why we are here.”

– “Wag the Dog” (1997 film)

By the first week of August 2008, Fannie Mae and Freddie Mac had just announced record losses, as did most of the reporting companies. Unemployment was on the rise, the foreclosure crisis was deepening, state budgets were in shambles, and massive bailouts were everywhere. Investors had every reason to expect the dollar and the stock market to plummet and gold and oil to skyrocket. Interestingly, the Dow Jones Industrial Average gained 300 points, the dollar strengthened, and gold and oil were crushed. What happened?

It hardly took psychic powers to see that the Dive Protection Team had come to the rescue. Formally known as the President’s Task Force on Financial Markets, the PPT was once hidden and its very existence denied as if it were a matter of strict national security. But the PPT has now come out of the closet. What was once a legally questionable “manipulator” of the markets has become an authorized stabilizer and protector of the markets. The new tone was set in January 2008, when global markets suffered their worst decline since September 11, 2001. Sen. Hillary Clinton said in a statement reported by the State News Service:

“I think it’s imperative that the next step be taken. The president should have done it already and he should do it very quickly, convene the President’s Task Force on Financial Markets. That’s something you can ask the Secretary of the Treasury to do. Markets with. regulators here and obviously with regulators and central banks around the world. “

The mystery of what was happening to the dollar the first week of August was solved by James Turk, founder of GoldMoney, who wrote on August 7:

“[T]Banking problems in the United States continue to mount, while the federal government deficit continues to skyrocket out of control. So what happened to make the dollar rally over the past three weeks? In a word, intervention. Central banks have propped up the dollar and here is the proof.

“When central banks intervene in the currency markets, they exchange their currency for dollars. Central banks then use the dollars they acquire to buy US government debt instruments so they can earn interest on their money. The debt instruments that they acquire. acquired by central banks are kept in custody for them at the Federal Reserve, which reports this amount weekly.

“On July 16, 2008, the Federal Reserve reported that it had $ 2.349 billion of US government paper in custody for central banks. In its report released today, this amount had grown over the past three weeks. at $ 2.401 billion, an annual rate of 38.4% Central banks have accumulated dollars over the past three weeks at a rate much higher than would be expected as a result of the US trade deficit. The logical conclusion is they were intervening in the currency markets.of propping it up, to prevent the dollar from falling off the edge of the cliff and in doing so sparked a short hedging rally, which is not too difficult to achieve given the leverage employed in the markets these days by hedge funds and others. “

Just as central banks manipulate currencies in concert, gold can be manipulated through the massive sale of central bank reserves. Oil and any other market can also be manipulated. But markets can be manipulated only to a limited extent and for a limited time without solving the underlying problem. More bad news is coming, news of such magnitude that no ordinary manipulation can hide it.

For one thing, roughly $ 400 billion in ARMs (adjustable rate mortgages) have been or will be reset between March and October of this year. Assuming 3-6 months for troubled debtors to hit the wall with their payments, a big wave of defaults is about to hit, which will continue until March 2009, just in time for the next big wave of restarts, at ARM. options. Option ARMs are loans with the option to pay even less than just the loan interest on a monthly basis, increasing the loan balance until the loan reaches a certain amount (typically 110% to 125% of the original loan balance) , when reset. The recently opened $ 800 billion line of credit for Fannie Mae and Freddie Mac can not only be taken advantage of, but also squeezed, at the expense of taxpayers. The underlying problem is little discussed but impossible to fix: a trillion-dollar derivatives scheme that is now imploding. Banks around the world are facing massive write-offs, putting the entire banking system on the brink of collapse. Only public bailouts will save him, but they could bankrupt the nation.

To do? War and threats of war have historically been used to distract the population and divert public scrutiny from economic calamity. As the plan was summarized in the trailer for the 1997 film “Wag the Dog”:

“There is a crisis in the White House, and to save the elections, they would have to fake a war.”

Perhaps that explains the sudden outbreak of war in the Eurasian country of Georgia on August 8, just 3 months before the November elections. August 8 was the day the Olympics began in Beijing, a distraction that may have been timed to prevent China from intervening on behalf of Russia. The version of events in the mainstream media is that Russia, the bully on the block, invaded its little neighbor Georgia; but not all commenters agree. Mikhail Gorbachev, writing in The Washington Post on August 12, observed:

“What happened on the night of August 7 is beyond comprehension. The Georgian army attacked the capital of South Ossetia, Tskhinvali, with multiple rocket launchers designed to devastate large areas. Russia had to respond. To accuse it of aggression against the ‘Helpless little Georgia’ is not only hypocritical, it shows a lack of humanity. The Georgian leadership could do this only with the perceived support and encouragement of a much more powerful force. “

Bruce Gagnon, coordinator of the Global Network Against Arms and Nuclear Energy, commented on OpEdNews on August 11:

“The United States has long been involved in supporting ‘freedom movements’ throughout this region that have attempted to replace Russian influence with American corporate control. The CIA, National Endowment for Democracy, and Freedom House (includes Zbigniew Brzezinski, former CIA Director James Woolsey, and Obama’s foreign policy adviser Anthony Lake) have been the main funders and supporters of putting politicians across Central Asia in power who would play “our side.” Nothing This is what the good guys versus the bad guys are all about. There is a lot of money at stake. [B]other parties (Republican and Democratic) share a bipartisan history and agenda of advancing corporate interests in this part of the world. Obama’s advisers, like McCain (one of his top advisers was recently a lobbyist for the current administration in Georgia) are in on this stew. “

Brzezinski, who is now an adviser to Obama, was Jimmy Carter’s foreign policy adviser in the 1970s. He also served in the 1970s as director of the Trilateral Commission, which he co-founded with David Rockefeller Sr., considered by some to be the “master spider” of the Wall Street banking network. Brzezinski, who wrote a book called The Great Chessboard, later boasted of leading Russia to war with Afghanistan in 1979, “turning over its Vietnam War to the Soviet Union.” Is the Georgia case an attempt to repeat that coup? Mike Whitney, a popular internet commentator, observed on August 11:

“Washington’s bloody fingerprints are all over the invasion of South Ossetia. Georgia’s President Mikhail Saakashvili would never dream of launching a massive military strike unless he received explicit orders from his bosses at 1600 Pennsylvania Ave. After all , Saakashvili owes his entire political career to American power agents and US intelligence agencies. If he disobeyed them, he would be gone in fifteen days. Furthermore, an operation like this requires months of planning and logistical support, especially if it is perfectly timed. to coincide with the start of the Olympics. (another little neo-conservative touch) That means Pentagon planners must have been working hand-in-hand with Georgian generals for months now. Nothing was left to chance. “

Part of that careful planning may have been the unprecedented propping up of the dollar and the bombardment of gold and oil the week before the curtain opened on the scene. Gold and oil had to be pushed down hard to give them room to rise before someone yelled “hyperinflation!” As we watch the curtain rise on the war in Eurasia, it is good to remember that things are not always what they seem. Markets are rigged and wars are staged by Grand Chessmen behind the scenes.