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Unless you read Russian or monitor the free blogosphere, you might not have noticed this, but something big just happened in Russia: Kerry, Nuland and a large State Department delegation have traveled to Sochi were they met with Foreign Minister Lavrov and then with President Putin.  With the latter they spent over 4 hours.  Not only that, but Kerry made a few rather interesting remarks, saying that the Minsk-2 Agreement (M2A) was the only way forward and that he would strongly caution Poroshenko against the idea of renewing military operations.

Unless you read Russian or monitor the free blogosphere, you might not have noticed this, but something big just happened in Russia: Kerry, Nuland and a large State Department delegation have traveled to Sochi were they met with Foreign Minister Lavrov and then with President Putin.  With the latter they spent over 4 hours.  Not only that, but Kerry made a few rather interesting remarks, saying that the Minsk-2 Agreement (M2A) was the only way forward and that he would strongly caution Poroshenko against the idea of renewing military operations.

To say that this is a stunning development would be an understatement. For one thing, this means that the so-called “isolation of Russia” is now officially over, even for the “Indispensable Empire”. Second, this is, as far as I know, the first official US endorsement of M2A.  This is rather humiliating for the US considering that M2A was negotiated without the Americans. Third, for the very first time the US has actually warned the Ukronazi junta against a military attack.  This, at a time when the Ukronazis are in a state of bellicose frenzy and Poroshenko just promised to re-conqueor not only the Donetsk Airport, but all of the Donbass and even Crimea, show that for the very first time the US and Kiev are not on the same page.

For the second time this month, Russia moved to expand its political and military influence in the Syria conflict and left the United States scrambling, this time by reaching an understanding, announced on Sunday, with Iraq, Syria and Iran to share intelligence about the Islamic State.Like Russia’s earlier move to bolster the government of President Bashar al-Assad by deploying warplanes and tanks to a base near Latakia, Syria, the intelligence-sharing arrangement was sealed without notice to the United States. American officials knew that a group of Russian military officers were in Baghdad, but they were clearly surprised when the Iraqi military’s Joint Operations Command announced the intelligence sharing accord on Sunday.

It was another sign that President Vladimir V. Putin of Russia was moving ahead with a sharply different tack from that of the Obama administration in battling the Islamic State, also known as ISIS or ISIL, by assembling a rival coalition that includes Iran and the Syrian government.

The effort, which Mr. Putin is expected to underscore in his speech at the United Nations on Monday, not only puts Moscow in a position to give military support to Mr. Assad, its longtime ally in the Middle East, but could also enable the Kremlin to influence the choice of a successor if Mr. Assad were to eventually leave power.Russia’s moves are raising difficult questions for the Obama administration, which remains deeply conflicted about American military involvement in the Syria conflict. Ensuring that the Russian military and the United States-led coalition, which is carrying out airstrikes against the Islamic State, “deconflict” and avoid running into each other is only part of the problem: The Obama administration and the Kremlin do not appear to agree even on the main reason for the conflict.

President Obama, Russian President Vladimir Putin and other world leaders joined forces Tuesday in seeking a negotiated Syrian peace settlement that would forge a “united, inclusive and democratic” government -- but couldn't agree on whether this means President Bashar Assad must go. The declaration at the end of the two-day Group of 8 summit sought to narrow the diplomatic chasm between Assad's key backer, Russia, and Western leaders who together have been trying to start peace talks in Geneva to end a two-year civil war that has claimed more than 90,000 lives. The declaration said the country needs a new coalition government with “a top leadership that inspires public confidence.” It made no reference to the possibility of sending U.S., British or French weapons to rebels, an option being kept open by all three G-8 members. Russia refused to back any declaration that made Assad's ouster an explicit goal, arguing that it would be impossible to start peace talks with a predetermined outcome.

Reflecting growing unease at the behavior of some militants in the ranks of Syria's splintered opposition forces, the G-8 declaration said participants in any peace talks must agree to expel Al Qaeda-linked fighters from the country. The declaration condemned human rights abuses committed by government forces and rebels alike, and called on both sides to permit access by U.N.-led experts trying to investigate the contentious claims of chemical weapons use. In its only concrete commitment, the declaration commits an additional $1.5 billion in aid for Syrians driven from their homes by the conflict: 4.2 million of them within Syria and 1.6 million more taking refuge in neighboring countries. The G-8 noted that the new funds would cover only part of the United Nations' 2013 appeal for $5.2 billion in Syria-directed aid.

he New York Times is an over-the-top lying machine, systematically suppressing hard truths. Its latest misinformation piece falsely headlined “Russian Soldiers Join Syria Fight,” claiming Moscow “said Monday that its ‘volunteer’ ground forces would join the fight and NATO warned the Kremlin after at least one Russian warplane trespassed into Turkey’s airspace.” More on the so-called air space violation below. The Times accused Moscow of “saber-rattling,” challenging Obama’s Syria agenda, ignoring its lawlessness, saying “(a) Russian ground force could fundamentally alter the conflict.” Putin categorically ruled out using ground troops in Syria. Russian upper house Federation Council foreign affairs committee chairman Konstantin Kosachev said “(w)e would not risk getting stuck in a long conflict and threaten the lives of our troops. The operation is aerial only. Certainly, in coordination with the ground operation of the Syrian army.” Putin called for an international anti-terrorist coalition to fight its scourge, cooperatively with Syrian armed forces, boots on the ground directly engaging ISIS and other takfiri terrorists. Accusing Moscow of using ground troops in Syria repeats the Big Lie about nonexistent “Russian aggression” in Ukraine.

On Monday, lower house State Duma defense committee head Admiral Vladimir Komoyedov said it’s “likely that groups of Russian volunteers will appear in the ranks of the Syrian army as combat participants” – not active duty military personnel and not sent by Moscow. He stressed the Kremlin has no plans to use ground forces in Syria. His comments came after Russian Chechnya republic head Ramzan Kadyrov expressed willingness to send Chechen forces to conduct “special operations” if Putin OKs it. Russia’s Black Sea Fleet may block Syria’s coastline, Komoyedov added, saying: Regarding the large-scale use of the Black Sea Fleet in this operation, I don’t think it will happen, but in terms of a coastal blockade, I think that it’s quite (possible). The delivery of artillery strikes hasn’t been excluded. The ships are ready for this, but there is no point in it for now. The terrorists are in deep, where the artillery cannot reach. The Times accused Russia of using troops disguised as volunteers – the same “little green men” Big Lie claim about Ukraine – “stealth tactics…using (Russian) soldiers to seize Crimea…and aid pro-Moscow rebels in eastern Ukraine,” said The Times – polar opposite clear, hard truths. It cited unnamed US military officials, claiming hundreds of “Russian military personnel” are in Syria, preparing for many more to come.

The only “Russian military personnel” are ones Moscow publicly explained – advisors and others involved in training Syrian forces to use weapons supplied. The Times repeated the Big Lie about Russia mainly targeting US-supported anti-Assad forces, not ISIS. Sergey Lavrov called the so-called Free Syrian Army a “phantom…(W)here is it,” he asked? (N)othing is known about it. We will be ready to establish contact with it if it’s really a capable military group of patriotic opposition consisting of Syrians. We do not hide this fact. But this structure is already a phantom. I have asked John Kerry to provide us with information about the whereabouts of this Free Syrian Army and who commands it. So far no one has told us where and how this Free Syrian Army operates or where and how other units of the so-called moderate opposition operate. The vast majority of anti-Assad elements are imported terrorists, ISIS and others. Washington maintains the fiction of a moderate opposition. Its bombing campaign strikes Syrian targets, supporting these groups, not fighting them.

Who would’ve thought it would come to this? Certainly not the Obama Administration, and their brilliant geo-political think-tank neo-conservative strategists. John Kerry’s brilliant “win-win” proposal of last September during his September 11 Jeddah meeting with ailing Saudi King Abdullah was simple: Do a rerun of the highly successful State Department-Saudi deal in 1986 when Washington persuaded the Saudis to flood the world market at a time of over-supply in order to collapse oil prices worldwide, a kind of “oil shock in reverse.” In 1986 was successful in helping to break the back of a faltering Soviet Union highly dependent on dollar oil export revenues for maintaining its grip on power. So, though it was not made public, Kerry and Abdullah agreed on September 11, 2014 that the Saudis would use their oil muscle to bring Putin’s Russia to their knees today.

It seemed brilliant at the time no doubt. On the following day, 12 September 2014, the US Treasury’s aptly-named Office of Terrorism and Financial Intelligence, headed by Treasury Under-Secretary David S. Cohen, announced new sanctions against Russia’s energy giants Gazprom, Gazprom Neft, Lukoil, Surgutneftgas and Rosneft. It forbid US oil companies to participate with the Russian companies in joint ventures for oil or gas offshore or in the Arctic. Then, just as the ruble was rapidly falling and Russian major corporations were scrambling for dollars for their year-end settlements, a collapse of world oil prices would end Putin’s reign. That was clearly the thinking of the hollowed-out souls who pass for statesmen in Washington today. Victoria Nuland was jubilant, praising the precision new financial warfare weapon at David Cohen’s Treasury financial terrorism unit. In July, 2014 West Texas Intermediate, the benchmark price for US domestic oil pricing, traded at $101 a barrel. The shale oil bonanza was booming, making the US into a major oil player for the first time since the 1970’s. When WTI hit $46 at the beginning of January this year, suddenly things looked different. Washington realized they had shot themselves in the foot.

They realized that the over-indebted US shale oil industry was about to collapse under the falling oil price. Behind the scenes Washington and Wall Street colluded to artificially stabilize what then was an impending chain-reaction bankruptcy collapse in the US shale oil industry. As a result oil prices began a slow rise, hitting $53 in February. The Wall Street and Washington propaganda mills began talking about the end of falling oil prices. By May prices had crept up to $62 and almost everyone was convinced oil recovery was in process. How wrong they were.

This is the big secret that now cannot be covered anymore. The governments of the US and the European countries are NOT independent entities, they are not sovereign. They do not have the will or even the ability to act on behalf of their people. They are controlled by powerful banking interests. They have been taken over by two financial centers that do not care for the real economy. They pursue only speculation and looting. In response on March 4th the economic adviser to Putin, Sergey Glazyev declared openly that if the financial vultures persisted, Russia would create on the spot an independent financial system which is separate from that of the US Dollar. Glazyev explained to the vampires: ‘We have wonderful economic and trade relations with our Southern and Eastern partners. We will find a way not just to eliminate our dependence on the US but also profit from these sanctions….If sanctions are applied against Russia’s state structures we will have to move into other currencies and create our own settlement system. We will be forced to recognize the impossibility of repayment of the loans that the US banks gave to Russian state structures. Indeed, sanctions are a double-edged weapon, and if the US chooses to freeze our assets, then our equities and liabilities in dollars will also be frozen…’

On March 18, the spokesperson for the Kremlin, Dmitry Peskov, stated that Russia would switch to new partners in case of economic sanctions being imposed by the European Union and the United States. He highlighted that the modern world isn’t unipolar and Russia has strong ties with other states as well, though Russia wants to remain in good relations with its Western partners, especially with the EU due to the volume of trade and joint projects. Those “new partners” are not really new since Russia has been closely interconnected with them for almost 13 years. This is all about the so-called BRICS organization, consisting of Brazil, Russia, India, China and South Africa. BRICS represents 42 percent of the world’s population and about a quarter of the world’s economy, which means that this bloc of states is an important global actor. The BRICS countries are like-minded in regard to supporting the principles of international law, the central role of the UN Security Council and the principles of the non-use of force in international relations; this is why they are so actively performing in the sphere of settling regional conflicts. However, the cooperation between Brazil, Russia, India, China and South Africa goes beyond political aspects and is also demonstrated by dynamic trade and multiple projects in different areas. Today, in total, there are more than 20 formats of cooperation within the BRICS which are being developing. For example, in February the member-states came to an agreement about 11 possible projects of scientific and technical cooperation, from aeronautics to bio- and nanotechnology.

This strategy is known as the Financial Nuclear Option. It could lead to the end of the predatory looting system of Wall Street. The ‘Southern and Eastern partners’ Glazyev is talking about are clearly the members of the BRICS, Brazil, Russia, India, China, South Africa, the sane part of the world economy, the future. And it is  exactly  what the official spokesman of the Kremlin, Dmitry Peskov indicated in an interview to the BBC: “Sanctions against Russia could be the final trigger that will force many countries to create a new independent financial system based on the real economy. The world is changing rapidly. How many civilizations grew and died in the course of history? Who will be able to resist the pressure of dying systems and indicate to the people the road toward the future?”  The possibility of a new financial system independent from the collapsing dollar empire, as consequence of anti Russia sanctions was also emphasized by an authoritative the Russian media including  RT. (See:http://rt.com/op-edge/russia-switches-to-brics-sanctions-357/) …Western sanctions might push Russia to deepen cooperation with BRICS states, in particular, to strengthen its ties with China, which will possibly turn out to be a big catastrophe for the US and the EU some time later.

The European Union’s ruling elite just hammered another nail into its creaky coffin this week with the critical loss of the South Stream gas project. Russian President Vladimir Putin may have been the one to formally pull the plug on the project while on an official visit to Turkey, but most observers can see that it is EU politicking that lay behind the collapse. Putin said that continual obstruction to the South Stream project from Brussels had made it unviable. Putin said that Russia would henceforth be applying its energy resources elsewhere and unveiled a new pipeline route to Turkey from the Black Sea. It was reminiscent of how Russia has directed new energy trade with China and Asia over the past year partly as a result of Western unilateral sanctions and obstinacy. And who could fault for Russia for that?

the contradictions betray an ulterior agenda. The EU’s «probity» over the South Stream is just a cover for its own petty political reasons and a direct corollary of the Washington-Brussels aggressive agenda toward Russia over Ukraine.   Reactions to the news of the project’s cancellation were also indicative of which party was to blame for the debacle. The governments of Bulgaria, Hungary, Slovenia and Serbia described the decision as a blow. The tone of chagrin was deafening. Tellingly they did not rebuke Russia over the decision. Indeed, the Hungarian government said it was Russia’s right to cancel the project given the backdrop of wearisome wrangling by Brussels. While Slovenia’s prime minister Miro Cerar said he was «not surprised» by Russia giving up on the $40 billion undertaking, which was to come into operation in 2018 following its commencement last year.   The above countries were to have acted as key transit partners and stood to gain billions of dollars worth of fees over the long-term supply of gas to Europe. The pipeline was being contracted to supply some 63 billion cubic metres of natural gas from Russia to Central and Southern Europe, including Austria and Italy. That represents about 40 per cent of Russia’s total supply of gas to Europe in 2013. The South Stream route would thus have been a critical component of European energy security and would have reduced gas costs for millions of households. 

Both Brussels and Washington have piled intense pressure on the Eastern European countries that were key to the project. Bulgaria, one of the newest and poorest members of the EU, was singled out for acute pressure from Brussels and Washington.   ‘Bulgaria halts work on the South Stream after US talks,’ reported the BBC back in June this year. Among the US Senators to have lobbied the government in Sofia was John McCain, the self-styled champion of the neo-Nazi and anti-Russian Kiev regime in Kiev that Washington and Brussels helped to install in February.   Bulgaria’s reported halt to the South Stream due to American «talks» finally became a matter of full suspension two months later, in August, after Brussels conducted more «talks». The exact nature of this coercion is not sure. But it is not hard to imagine how all sorts of financial leverage could have been exerted by Brussels and Washington on the vulnerable Bulgarian government. 

The European Council on Foreign Relations and Berlin think-tank Friedrich Ebert Stiftung have just reached more or less the same conclusion. If the dangerous stand-off between the EU and Russia over Ukraine is not solved, the EU could face, up to 2030, a military build-up in eastern Europe; a new arms race with NATO as a protagonist; and a semi-permanent “zone of instability” from the Baltic to the Balkans and the Black Sea. What these two think-tanks don’t – and won’t – ever acknowledge is that a new European “arc of instability” – from the Baltic to the Black Sea, as myself and other independent analysts have stressed – is exactly what the Empire of Chaos and its weaponized arm – NATO – are working on to prevent closer Eurasia integration. By the way, the Pentagon excels in fabricating “arcs of instability.” The previous one was – and remains – massive, stretching from the Maghreb to Xinjiang in western China across the Middle East and Central Asia.

Moscow has totally identified the plot; Foreign Minister Sergey Lavrov, once again, has made it crystal clear, in detail. And crucially, some influential sectors in Germany also did, as in members of the cultural elite destroying the notion of a new war in Europe: “Not in our name.” The same applies to those that always preach more transatlantic cooperation, extol the US’s “defining” role in Germany, and effusively praise Germany as the most American country in Europe; that’s the case of the Frankfurter Allgemeine newspaper – which stands for the core of the political and economic establishment in Germany. It’s still in an embryonic stage, and has not yet made Chancellor Angela Merkel see the light; but a reverse reengineering of Atlanticist relations is already in progress in Germany.

Meanwhile, the proverbial group of extremist US senators, plus the notorious poodles/vassals of Britain and Poland, haven’t stopped lobbying to shut Russia off from SWIFT – just as they did with Iran. This would be nothing but yet another declaration of (economic) war – or the economic counterpoint to NATO hysteria. In fairness, a great deal of the EU – especially Germany – knows this is madness. Germany’s top financial paper Handelsblatt recently published a key interview with head of VTB-Bank Andrei Kostin, which has still not been translated into any major English-language paper.

At the symposium, held in a divinely frescoed former 15th century Dominican refectory now part of the Italian parliament's library, Sergey Glazyev, on the phone from Moscow, gave a stark reading of Cold War 2.0. There's no real "government" in Kiev; the US ambassador is in charge. An anti-Russia doctrine has been hatched in Washington to foment war in Europe - and European politicians are its collaborators. Washington wants a war in Europe because it is losing the competition with China. Glazyev addressed the sanctions dementia: Russia is trying simultaneously to reorganize the politics of the International Monetary Fund, fight capital flight and minimize the effect of banks closing credit lines for many businessmen. Yet the end result of sanctions, he says, is that Europe will be the ultimate losers economically; bureaucracy in Europe has lost economic focus as American geopoliticians have taken over.

What he did emphasize was this was outright financial war, helped by a fifth column in the Russian establishment. The only equal component in this asymmetrical war was nuclear forces. And yet Russia would not surrender. Leontyev characterized Europe not as a historical subject but as an object: "The European project is an American project." And "democracy" had become fiction. The run on the rouble came and went like a devastating economic hurricane. Yet you don't threat a checkmate against a skilled chess player unless your firepower is stronger than Jupiter's lightning bolt. Moscow survived. Gazprom heeded the request of President Vladimir Putin and will sell its US dollar reserves on the domestic market. German Foreign Minister Frank-Walter Steinmeier went on the record against the EU further "turning the screw" as in more counterproductive sanctions against Moscow. And at his annual press conference, Putin emphasized how Russia would weather the storm.

Essentially, the Empire of Chaos is bluffing, using Europe as pawns. The Empire of Chaos is as lousy at chess as it is at history. What it excels in is in upping the ante to force Russia to back down. Russia won't back down.

It appears that the Russians got tired of waiting.  I suggest that you all carefully parse the Statement of the Russian Ministry of Foreign Affairs I posted earlier today.  This is an interesting document because besides an explanation of the Russian decision to move it, it is also, potentially, a legal defense or an unprecedented Russian decision: to overtly violate the Ukrainian sovereignty.  Let me explain. First, the case of Crimea was also a "special case".  The Russian were legally present there and, in the Russian rationale, all the "Polite Armed Men in Green" did was to protect the local population to make it possible for the latter to freely express its will.  Only after that will was expressed did Russia agree to formally re-incorporate Crimea into Russia.  So from the legal Russian point of view, none of the Russian actions in Crimea included any form of  violation of Ukrainian sovereignty.  I know, most western analyst will not agree, but that is the official Russian stance.  And official stances are important because they form the basis for a legal argument.

Second, the aid which Russia has been sending to Novorussia has been exclusively covert.  Covert operations, no matter their magnitude, do not form the basis for a legal position.  The official position of Moscow has been that not only was there absolutely no military aid to Novorussia, but even when Ukie artillery shells landed inside Russia did the Kremlin authorize any retaliation, again in (official) deference to the Ukrainian national sovereignty. This time, however, there is no doubt at all that the Russians did deliberately and officially chose to ignore Kiev and move in.  Now, in fact, in reality, this is clearly the logically, politically and morally right thing to do.  But in legal terms, this clearly a violation of Ukrainian sovereignty.  From a legal point of view, the Ukies had the right to keep the Russian convoy at the border for another 10'000 years if they wanted and Russia had no legal right to simply move in.  What apparently happened this morning is that the Ukie officials did not even bother showing up, so the Kremlin just said "forget it!" and ordered the trucks in.

The US and their main agent in Kiev, Nalivaichenko, immediately and correctly understood the threat: not only did this convoy bring much needed humanitarian aid to Lugansk, it also provided a fantastic political and legal "cover" for future Russian actions inside Novorussia.  And by "actions" I don't necessarily mean military actions, although that is now clearly and officially possible.  I also mean legal actions such as recognizing Novorussia.  From their point of view, Obama, Poroshenko, Nalivaichenko are absolutely correct to be enraged, because I bet you that the timing, context and manner in which Russia moved into Novorussia will not result in further sanctions or political consequences.   Russia has now officially declared the Ukie national sovereignty as "over" and the EU will probably not do anything meaningful about it. That, by itself, is a nightmare for Uncle Sam. Furthermore, I expect the Russian to act with a great deal of restraint.  It would be stupid for them to say "okay, now that we violated the territorial integrity of the Ukraine and ignored its sovereignty we might as well bomb the junta forces and move our troops in".  I am quite confident that they will not do that.  Yet.  For the Russian side, the best thing to do now is to wait.  First, the convoy will really help.  Second, it will become a headache for the Ukies (bombing this convey would not look very good).  Third, this convoy will buy enough time for the situation to become far clearer.  What am I referring to here?

A few days ago, when we wrote our "explainer" on the need for Russia to have an alternative pathway for its gas, one which bypasses Ukraine entirely and as the current "South Stream" framework is set up, crosses the Black Sea and enters Bulgaria before passing Serbia and Hungary on the way to the Central European energy hub located in Baumgarten, Austria, we said that "one short month after Putin concluded the Holy Grail deal with Beijing, he not only managed to formalize his conquest of Europe's energy needs with yet another pipeline, one which completely bypasses Ukraine (for numerous reasons but mostly one: call it a Plan B), but scored a massive political victory by creating a fissure in the heart of the Eurozone, after Austria openly defied its European peers and sided with Putin."

As Itar-Tass reports, citing Gazprom CEO Alexei Miller, "Russia’s gas giant Gazprom does not rule out gas transit via Ukraine may be stopped completely." "What happened once is a tendency, nothing happens incidentally. In 2009, gas supplies were stopped completely — so, we know precedents,” Miller told a briefing on Friday. Clearly, this is bad news for Ukraine: Gazprom not interested in participation in Ukraine’s gas transportation system (GTS), “train has departed”, CEO said. “The train has already departed. It seems it departed yesterday,” Miller said. “It belongs to no one. The GTS has no owner,” he said. “The GTS of Ukraine does not belong to Naftogaz but to the Ukrainian government. Before discussing things with someone regarding modernization and cooperation, it should appear on the balance sheet of this or that economic entity.”   “Property and legal issues should be resolved first,” Miller said. In fact, the civil war torn country may soon lose all leverage it had with both Europe and Russia as a transit hub for natural gas, which also means that it is quite likely that Ukraine is about to be abandoned by its western allies who will no longer have any practical use for it. 

The Gazprom chief added that “a dozen Ukrainian laws need to be changed to be able to do something with the GTS.”  Confirming that Ukraine's leverage at least with Russia is now effectively zero, Gazprom's CEO also said that “As for the continuation of negotiations with Ukraine, today there is no subject for talks. First, they must repay their debts." “The gas price for Ukraine is fair - this price is fixed in the contract,” he stressed. There have been no requests on the part of Ukraine’s national oil and gas company Naftogaz Ukrainy on a change of the transit deal with Russia, Alexei Miller said. Miller told journalists that it would be bad news if such requests had been received. At least we now know what the Ukraine endgame will look like: as Russian transit through the country is completely cut off, the nation will lose all strategic importance first to Russia and then to Europe, which is still over-reliant on Russian gas (see map below), but which will increasingly turn its attention to the countries which the South Stream passes through.

While the West continues to press the "Russia is increasingly isolated" meme, it appears - as we noted ironically previously, that Vladimir Putin is finding plenty of friends... most notably China. While threats of 'asymmetric' retaliation over European sanctions may have been enough to worry Europe's leaders, the slew of news overnight regarding increased cooperation between China and Russia is likely more damaging to Western strategy (and egos).   Not so isolated...

As overnight news shows... China and Russia are ramping up their cooperation... First, as Reuters reports, Russia and China pledged on Tuesday to settle more bilateral trade in rouble and yuan and to enhance cooperation between banks, Russia's First Deputy Prime Minister Igor Shuvalov said, as Moscow seeks to cushion the effects of Western economic sanctions... Russia's First Deputy Prime Minister Igor Shuvalov said told reporters in Beijing that he had agreed an economic cooperation pact with China's Vice Premier Zhang Gaoli that included boosting use of the rouble and yuan for trade transactions.   The pact also lets Russian banks set up accounts with Chinese banks, and makes provisions for Russian companies to seek loans from Chinese firms.

Second, as RBTH reports, The Chinese company CNPC is to get up to 10 percent in Russia’s Vankor oilfields, Rosneft’s biggest production asset... Russian President Vladimir Putin announced the plan at the construction launch of the Power of Siberia gas pipeline on 1 September, business newspaper Kommersant reported.   “The plan will secure state support, and we will encourage your participation,” said Putin to the members of the Chinese delegation.   “There are no restrictions for our Chinese friends,” he said. According to Kommersant, the Chinese state company CNPC could get up to 10 percent in Vankorneft for approximately $1 billion.

By Paul Craig Roberts August 29, 2014 "ICH" - The latest Washington lie, this one coming from NATO, is that Russia has invaded Ukraine with 1,000 troops and self-propelled artillery. How do we know that this is a lie? Is it because we have heard nothing but lies about Russia from NATO, from US ambassador to the UN Samantha Power, from assistant secretary of state Victoria Nuland, from Obama and his entire regime of pathological liars, and from the British, German, and French governments along with the BBC and the entirety of the Western media? This, of course, is a good reason for knowing that the latest Western propaganda is a lie. Those who are pathological liars don’t suddenly start telling the truth. But there are even better reasons for understanding that Russia has not invaded Ukraine with 1,000 troops. One reason is that Putin has invested heavily in diplomacy backed by unprovocative behavior. He would not risk his bet on diplomacy by sending in troops too few in number to have a decisive effect on the outcome.

Another reason is that if Putin decides he has no alternative to sending the Russian military to protect the Russian residents in eastern and southern Ukraine, Putin will send in enough troops to do the job quickly as he did in Georgia when the American and Israeli trained Georgian army invaded South Ossetia and was destroyed in a few hours by the Russian response. If you hear that 100,000 Russian troops accompanied by air cover have invaded Ukraine, it would be a more believable claim. A third reason is that the Russian military does not need to send troops into Ukraine in order to stop the bombing and artillery shelling of the Russian populations by Washington’s puppet government in Kiev. The Russian air force can easily and quickly destroy the Ukrainian air force and artillery and, thereby, stop the Ukrainian attack on the secessionist provinces.

It was only two weeks ago that a fabricated report spread by the UK Guardian and the BBC that a Russian armored convoy entered Ukraine and was destroyed by the Ukrainian Military. And two weeks prior to that we had the hoax of the satellite images allegedly released by the US State Department that the corrupt US ambassador in Kiev spread around the world on social media allegedly showing that Russian forces were firing into Ukraine. One or two weeks from now we will have another lie, and another a week or two after that, and so on. The cumulative effect of lie piled upon lie for most people is to build the view that the Russians are up to no good. Once this view is established, Western governments can take more serious moves against Russia.

Russia cut gas exports to Europe by 60 per cent today, plunging the continent into an energy crisis 'within hours' as a dispute with Ukraine escalated. This morning, gas companies in Ukraine said that Russia had completely cut off their supply.Six countries reported a complete shut-off of Russian gas shipped via Ukraine today, in a sharp escalation of a struggle over energy that threatens Europe as winter sets in.Bulgaria, Greece, Macedonia, Romania, Croatia and Turkey all reported a halt in gas shipments from Russia through Ukraine. Croatia said it was temporarily reducing supplies to industrial customers while Bulgaria said it had enough gas for only 'for a few days' and was in a 'crisis situation'.

Russia cut gas exports to Europe by 60 per cent today, plunging the continent into an energy crisis 'within hours' as a dispute with Ukraine escalated. This morning, gas companies in Ukraine said that Russia had completely cut off their supply.Six countries reported a complete shut-off of Russian gas shipped via Ukraine today, in a sharp escalation of a struggle over energy that threatens Europe as winter sets in.Bulgaria, Greece, Macedonia, Romania, Croatia and Turkey all reported a halt in gas shipments from Russia through Ukraine. Croatia said it was temporarily reducing supplies to industrial customers while Bulgaria said it had enough gas for only 'for a few days' and was in a 'crisis situation'.

The EU demanded the two sides reopen talks as the row immediately sparked fears of gas supply shortages and rising energy prices in the UK.The UK is suffering one of its coldest nights this century with temperatures plunging to as low as -10C.Though Britain is one of Gazprom's largest importers - relying on the company for some 16 per cent of consumption in 2007, according to The Times, the gas is supplied through a complicated swap scheme that means supplies themselves may not be affected.Prices, on the other hand, rose during trading in London today.

June 25, 2014. A final number for real US GDP growth in the first quarter of 2014 was released today. The number is not the 2.6% growth rate predicted by the know-nothing economists in January of this year. The number is a decline in GDP of -2.9 percent. The negative growth rate of -2.9 percent is itself an understatement. This number was achieved by deflating nominal GDP with an understated measure of inflation. During the Clinton regime, the Boskin Commission rigged the inflation measure in order to cheat Social Security recipients out of their cost-of-living adjustments. Anyone who purchases food, fuel, or anything knows that inflation is much higher than the officially reported number. It is possible that the drop in first quarter real GDP is three times the official number. Regardless, the difference is large between the January forecast of +2.6 percent growth and the decline as of the end of March of -2.9 percent.

Any economist who is real and unpaid by Wall Street, the government, or the Establishment knew that the +2.6 percent forecast was a crock. Americans’ incomes have not grown except for the one percent, and the only credit growth is in student loans, as those many who cannot find jobs mistakenly turn to “education is the answer.” In an economy based on consumer demand, the absence of income and credit growth means no economic growth. The US economy cannot grow because corporations pushed by Wall Street have moved the US economy offshore. US manufactured products are made offshore. Look at the labels on your clothes, your shoes, your eating and cooking utensils, your computers, whatever. US professional jobs such as software engineering have been moved offshore. An economy with an offshored economy is not an economy. All of this happened in full view, while well-paid free market shills declared that Americans were benefiting from giving America’s middle class jobs to China and India.

An official decline of -2.9 percent in the first quarter implies a second quarter GDP decline. Two declines in a row is the definition of recession. Imagine the consequences of a recession. It means that years of unprecedented Quantitative Easing failed to revive the economy. It means that years of Keynesian fiscal deficits failed to revive the economy. Neither fiscal nor monetary policy worked. What then can revive the economy? Nothing except to force the return of the economy that the anti-American corporations moved offshore. This would require credible government. Unfortunately, the US government has been losing credibility since the second term of the Clinton regime. It has none left.

Documents from the Reagan presidential library reveal that two major institutions promoting “democracy” and “freedom” — Freedom House and National Endowment for Democracy — worked hand-in-glove, behind-the-scenes, with a CIA propaganda expert in the 1980s, reports Robert Parry.

But the Russian law would impede NED’s efforts to destabilize the Russian government through funding of political activists, journalists and civic organizations, so it was denounced as an infringement of human rights and helped justify Freedom House’s rating of Russia as “not free.”The Russian government’s concerns were not entirely paranoid. On Sept. 26, 2013, Gershman, in effect, charted the course for the crisis in Ukraine and the greater neocon goal of regime change in Russia. In a Washington Post op-ed, Gershman called Ukraine “the biggest prize” and explained how pulling it into the Western camp could contribute to the ultimate defeat of Russian President Vladimir Putin.“Ukraine’s choice to join Europe will accelerate the demise of the ideology of Russian imperialism that Putin represents,” Gershman wrote. “Russians, too, face a choice, and Putin may find himself on the losing end not just in the near abroad but within Russia itself.”With NED’s budget now exceeding $100 million a year — and with many NGOs headquartered in Washington — Gershman has attained the status of a major paymaster for the neocon movement with his words carrying extra clout because he can fund or de-fund many a project.

Thus, three decades after CIA Director William Casey and his propaganda specialist Walter Raymond Jr. struggled to arrange funding for Freedom House and other organizations that would promote an interventionist agenda, their brainchild – the National Endowment for Democracy – was still around picking up those tabs.

Interesting stuff today.  A major Russian TV channel just aired a report about Putin meeting with his top military commanders.  I don’t have the time to translate what Putin said word for word, but basically he said that the USA had refused every single Russian offer to negotiate about the US anti-missile system in Europe and that while the US had initially promised that the real target of this system was Iran, now that the Iranian nuclear issue had been solved, the US was still deploying the system.  Putin added that the US was clearly attempting to change the world’s military balance.  And then the Russian footage showed this:

According to the Kremlin was mistakenly leaked secret document.  And just to make sure that everybody got it, RT wrote a full article in English about this in an article entitled “‘Assured unacceptable damage’: Russian TV accidentally leaks secret ‘nuclear torpedo’ design“. According to RT The presentation slide titled “Ocean Multipurpose System: Status-6” showed some drawings of a new nuclear submarine weapons system. It is apparently designed to bypass NATO radars and any existing missile defense systems, while also causing heavy damage to “important economic facilities” along the enemy’s coastal regions. The footnote to the slide stated that Status-6 is intended to cause “assured unacceptable damage” to an adversary force. Its detonation “in the area of the enemy coast” would result in “extensive zones of radioactive contamination” that would ensure that the region would not be used for “military, economic, business or other activity” for a “long time.” According to the blurred information provided in the slide, the system represents a massive torpedo, designated as “self-propelled underwater vehicle,” with a range of up to 10 thousand kilometers and capable of operating at a depth of up to 1,000 meters. Actually, such ideas are nothing new.  The late Andrei Sakharov had already proposed a similar idea to basically wipe out the entire US East Coast.  The Russians have also look into the possibility to detonate a nuclear device to set off the “Yellowstone Caldera” and basically destroy most of the USA in one shot.  While in the early years following WWII the Soviets did look into all sort of schemes to threaten the USA with destruction, the subsequent development of Soviet nuclear capabilities made the development of this type of “doomsday weapons” useless.  Personally, I don’t believe for one second that the Russians are now serious about developing such system as it would be literally a waste of resources.  So what is going on here?

This so-called “leak” of “secret documents” is, of course, no leak at all.  This is a completely deliberate action.  To imagine that a Russian journalist could, just by mistake, film a secret document (helpfully held up for him by a general) and then just walk away, get it passed his editor and air it is laughable.  Any footage taken in a meeting of the President with his senior generals would be checked many times over.  No, this was a deliberate way to remind the USA that if they really are hell-bent on spending billions of dollars in a futile quest to create some kind of anti-missile system Russia could easily develop a cheap weapon system to still threaten the USA with total annihilation.  Because, make no mistake, the kind of long range torpedo being suggested here would be rather cheap to build using only already existing technologies.  I would even add that rather than setting such a weapon off the US coast the system could also be designed to fire off a secondary missile (ballistic or cruise) which could then fly to any inland target.  Again, such technologies already exist in the Russian military and have even been deployed on a smaller scale. See for yourself:

The G-20 summit of world political leaders being held in Turkey to discuss the economic issues impacting on the world economy has been turned into a council of war. The major imperialist powers are moving rapidly to escalate their military intervention in Syria in the wake of Friday night’s terror attack in Paris. Yesterday evening French fighter jets carried out their biggest raid on Syria. It was launched simultaneously from the United Arab Emirates and Jordan, dropping 20 bombs on the Syrian city of Raqqa, reportedly targeting an Islamic State in Iraq and Syria (ISIS) command centre, a munitions depot and a training camp. The operation was carried out in coordination with US forces. Earlier, Ben Rhodes, the US deputy national security adviser, said he was confident that in the “coming days and weeks” the US and France would “intensify our strikes against [ISIS] … to make clear there is no safe haven for these terrorists.” Speaking on NBC’s “Meet the Press,” Rhodes said there would be an “intensification” of US military efforts and “what we are doing here at the G-20 is seeking to gain additional contributions from some of our partners so we can bring more force to bear on that effort.”

Demands are being brought forward from within the American military and political establishment for a major escalation in US action, regardless of the consequences. Texas Senator Ted Cruz, a Republican candidate for president, said that ISIS would “not be deterred by targeted air strikes with zero tolerance for civilian casualties, when the terrorists have such utter disregard for innocent life.” His call for vastly stepped-up US military action, without any regard for the consequences for the civilian population already devastated by the US-inspired civil war, were echoed by California Democrat, Dianne Feinstein, who sits on the Senate Intelligence Committee. “It has become clear,” Feinstein said, “that limited air strikes and support for Iraqi forces and the Syrian opposition are not sufficient to protect our country and our allies.” Retired Navy admiral John Stavridis, who served as NATO’s top commander in Europe from 2009 to 2013, called for direct NATO intervention in Syria and Iraq. “Soft power and playing the long game matter in the Middle East, but there is a time for the ruthless application of hard power. This is that time, and NATO should respond militarily against the Islamic State with vigor,” Stavridis said.

The subsequent discussions between Obama and Putin at the G-20 were held as part of the US objective of sidelining, if not completely removing, Russian support for the Syrian regime of president Bashar al-Assad. Under the agreement, following a ceasefire, a process would be set in motion to establish “inclusive and non-sectarian” governance, the drafting of a new constitution and the holding of elections under UN supervision within 18 months. However, the crucial sticking point remains the future of Assad. In an interview on the eve of the G-20 summit, Putin said other nations had no right to demand that Assad leave office and that “only those who believe in their exceptionality [a thinly-veiled reference to the US] allow themselves to act in such a manner and impose their will on others.” The US has been waging a campaign since 2011 for the overturn of the Assad government as part of its regime-change operations in the Middle East, in order to bring the region under its control. Russia has backed Assad in order to protect its strategic interests in the region, including a naval facility in Syria. The US has made clear that as far as it is concerned there can be no resolution without Assad’s ouster—a position repeated by Obama’s National Security Adviser Susan Rice. She said a “transition regime” had to come to power “and it’s very hard to envision how that could be accomplished with Assad still in power.”

Following in the wake of the terrorist attacks in Paris on Friday, November 13 and Moscow’s conclusion that the Russian Airbus 321 that crashed in Egypt’s North Sinai province on October 31; and following recent talks on Syria in Vienna and talks on the sidelines of the G20 Summit in Antalya, Turkey, the military dynamics pertaining Syria and the international fight against the self-proclaimed Islamic State has changed, significantly. 

French President Francois Hollande and his administration responded to the attacks in Paris by declaring a three months state of emergency while deploying the French aircraft carrier Charles De Gaulle to the Mediterranean to upscale French participation in the fight against the self-proclaimed Islamic State, a.k.a. Daesh, ISIS or ISIL. Hollande announced that the carrier would leave port on September 19., adding that: “This is going to triple our military power [as part of the operation against the Islamic State]. I am not talking about deterring the IS but about eliminating it totally.” On Tuesday the Chief of the Russian Federal Security Service (FSB), Alexander Bortnikov, announced that the crash of the Russian Kogalmavia (Metrojet) Airbus 321 in Egypt’s North Sinai on October 31 had been caused by a bomb on board the plane.

The of Flight KGL9268 claimed the lives of all 224 passengers and crew on board. The plane was brought down about one month after Russia launched its airstrikes against Daesh, Jabhat al-Nusrah and other insurgencies in Syria. President Putin has briefed the Russian military command on the deployment of the French aircraft carrier and instructed the Russian naval forces in the Mediterranean and the Russian air forces in Syria to cooperate with the French military and to coordinate their military operations.

Today the Russian President Putin gave his yearly address to the Russian Federal Assembly. In the context of terrorism and the shooting down of the Russian fighter in Syria he addressed some very harsh words to the Turkish President Erdogan: [T]he Turkish people are kind, hardworking and talented. We have many good and reliable friends in Turkey. Allow me to emphasise that they should know that we do not equate them with the certain part of the current ruling establishment that is directly responsible for the deaths of our servicemen in Syria. We will never forget their collusion with terrorists. We have always deemed betrayal the worst and most shameful thing to do, and that will never change. I would like them to remember this – those in Turkey who shot our pilots in the back, those hypocrites who tried to justify their actions and cover up for terrorists. I don’t even understand why they did it. Any issues they might have had, any problems, any disagreements we knew nothing about could have been settled in a different way. Plus, we were ready to cooperate with Turkey on all the most sensitive issues it had; we were willing to go further, where its allies refused to go. Allah only knows, I suppose, why they did it. And probably, Allah has decided to punish the ruling clique in Turkey by taking their mind and reason.

But, if they expected a nervous or hysterical reaction from us, if they wanted to see us become a danger to ourselves as much as to the world, they won’t get it. They won’t get any response meant for show or even for immediate political gain. They won’t get it. Our actions will always be guided primarily by responsibility – to ourselves, to our country, to our people. We are not going to rattle the sabre. But, if someone thinks they can commit a heinous war crime, kill our people and get away with it, suffering nothing but a ban on tomato imports, or a few restrictions in construction or other industries, they’re delusional. We’ll remind them of what they did, more than once. They’ll regret it. We know what to do. That was strong stuff from someone who usually stays very cool. These were not even threats but direct declarations that Russia will take revenge and will follow through.

But Erdogan escalated. Putin will now not rest until he has kicked that wannabe Sultan off his throne. My bet is that he will be more resourceful in his endeavor than Erdogan.