EGYPT: NO American Happy-face to be SEEN?

 Intelligence Channel OPEN SOURCE

Pundicity; SentinellIntelligence; EA/1; US/1 – MEMBER CONTRIBUTIONS

[ed.note: ‘Don’t Cry for Me Argentina…er Egypt, homeland of Mohammed ATTA -- …BYE-BYE Mubaraks, one and all? Many Members are deeply fearful of a new Iranian/Algerian-style Islamic Revolution in the Arab world’s largest country, home and bastion of the ever vigilant Muslim Brotherhood.

Murbarak has been OPENINGLY STEALING US MONEY since 1977 since he rose to the cash-cropsometime CIA renegades Ed Wilson and Tom Klines, sometime minions of the Blond Ghost, the late Ted Shackley. Go figure. position of Defense Minister under the future Al-Qaedian-Zawahiri-assassinated-Anwar Sadat. EATSCO was one of the earliest Mubarak Payoff vehicles, run by

US/1 opinion? Unfailing: Sic semper tryanus - علممص…then one day perhaps Shlahom suhkran…?

Egyptian Presidential Standard

- Please Note the cropped center of this Eagle of Saladin Coat of Arms Royal Emblem of the Revolution Flag above.

Certainly NOT an Egyptian version of the American Happy-FACE.]

Obama Administration Must Balance Egypt's Repressive Government and Push for Democracy

by Judith Miller

FoxNews

As the smoke clears from Egypt's most violent political protests in more than 30 years, President Hosni Mubarak still retains power.

But veteran Egypt watchers say his fierce repression of the unrest will severely complicate America's relations with his government and all but cripple his desire to have his son, Gamal, succeed him.

In Egypt Mubarak announced he would dissolve his government in his first appearance on television since protests erupted.

"He's going to try to tough it out," said Scott Carpenter, a former Bush administration official now at the Washington Institute for Near East Policy.

But by firing his cabinet and replacing ministers who were committed to liberalizing and privatizing Egypt's economy, the president maybe sacrificing the country's economic growth, in an effort to achieve favor of short term political stability, Carpenter added. "It's not clear he will be able to pull this off."

Protesters and civil rights activists reacted with disbelief and disappointment to president Mubarak's determination to stay on Egypt's ruler.

Basem Fathy, a human rights activist who works for the Egyptian Democratic Academy, a group that advocates greater human rights and political liberalization, said that President Mubarak's decision was shocking and unacceptable. "People should not have shed blood for nothing," he said.

He said that the dissolution of the government would not satisfy Egyptians and that protests would continue. "That Cabinet was a group of Muppets. They were nothing. " He blamed the Obama Administration for not insisting that Mubarak leave power.

"Now we have two enemies, President Mubarak and President Obama" said Fathy, who said he saw people killed and wounded on Friday during the protests.

The Obama Administration has struggled to support the tens of thousands of protesters who are demanding legitimate elections, greater political freedom and an end to the ruling government's corruption and repression, but not undermine the stability of the pro-American government that is a linchpin of American policy in the Middle East.

It is a difficult balance to strike, administration officials said Friday.

For most of his almost 30-year rule, President Mubarak, an ailing 82-year-old former military officer, has been supportive of Washington's efforts to broker an Arab-Israeli peace deal, counter-terrorism initiatives, and its efforts to roll back Iran's nuclear weapons program and contain its regional ambitions.

Egypt was the first Arab state to make peace with Israel and has been a staunch American ally in the region ever since Mubarak's predecessor, Anwar Sadat, broke with the former Soviet Union. But finding a balance between supporting the democratic aspirations of the Egyptian people and not undermining an increasingly repressive, but staunchly pro-American ally in Cairo has become more challenging.

Steven A. Cook, a scholar at the Council on Foreign Relations who returned Thursday night from leading a study group to Egypt, said it was not yet clear whether Mubarak would survive the challenge.

"The protests may be leaderless, but they are truly organic. They enjoy massive support," said Cook in an interview.

Even if Mubarak survived this greatest challenge to his 30-year-rule, Cook added, it would be far harder for President Obama to openly support Egypt, which received roughly $1.5 billion a year in military aid and $250 million in economic assistance last year.

"From now on," he said, "this will have to be an even tougher regime, one in which security and military concerns totally dominate," Cook said.

One administration official, who spoke on condition of anonymity since he was not authorized to speak publicly about this sensitive foreign policy conundrum, confirmed that supporting a government which had "killed, gassed, jailed, tortured and generally abused its opponents" would be a much harder political call.

On Friday afternoon, White House officials were debating whether to cut American assistance to Egypt or what other steps they could take to signal America's disapproval of the Egyptian government's crackdown, without not undermining or destabilizing the regime. President Obama was said to be receiving briefings throughout the day about the political earthquake that was rocking the country, indeed the region.

White House press secretary Robert Gibbs said President Obama had not spoken with the Egyptian president since the crisis began. One senior Egyptian official said President Mubarak's senior aides were furious over what the administration considered balanced criticism.

Although Vice President Joe Biden said in an interview on PBS Thursday night that Egypt was an American ally and that he did not consider President Mubarak a "dictator," Egyptian officials have told visitors they feel that Washington's comments have undermined Egyptian stability.

"We feel betrayed," the official said.

Carpenter said Mubarak's "radio silence" of nearly four days spoke volumes about the severity of the crisis.

The fact he had not spoken to the Egyptian people throughout the strife-ridden week raised questions about the Egyptian regime's strategy and staying power.

Perhaps Mubarak felt hemmed in and did not know what to say, Carpenter said, or that if he made concessions on reform that protesters have been demanding, he would appear weak.

"Or perhaps he did not want to be compared to Ben Ali," Carpenter added, referring to the fact that the Tunisian president addressed his public and promised reforms hours before he fled the country.

Other analysts agree Egypt's demonstrations are likely to make it virtually impossible for Gamal Mubarak, the president's 47-year-old son, to succeed his father as president. "Gamal is over," said Fouad Ajami, a scholar at Johns Hopkins University.

While President Mubarak's son has a base in the National Democratic Party, the ruling party, he has not enjoyed strong support from the security establishment at the core of Egypt's government.

Gamal Mubarak's whereabouts are uncertain. Reports in the Egyptian and foreign press have placed him in London, but others have said he is still in Egypt.

The current protests are the most serious disturbances in Egypt since Mubarak came to power in the wake of Anwar Sadat's assassination in 1981 by Muslim extremists. In January, 1977, Egyptians across the country staged two days of violent food riots over the rising price of bread; in 1986, Central Security Forces, (CSF) the 300,000-man force that is charged with maintaining order, mutinied and staged protests for four days.

The fate of the current regime depends largely on the extent to which the security forces and the 350,000- man military continue to define their power and privileges as synonymous with the perpetuation of Mubarak's rule.

"The performance of these forces is key to the outcome of this crisis," argued Jeffrey White, a former Defense Intelligence Agency official and now an analyst at the Washington Institute for Near East Policy.

In Tunisia, for instance, former president Ben Ali had little choice but to flee the country after the army chief reportedly told him that his forces would not fire on protesters.

Egyptian police, Central Security Forces and the army were all deployed on Friday in efforts to contain the protests in defiance of a government curfew.

The White House spokesman Gibbs called upon the Mubarak government to view the protests as an "opportunity" to enact reforms and to be "responsive" to the protesters' demands for greater democracy and political space. He asked the government to open up Internet and cell phone networks that have been shut down, and expressed "deep concern" about the reported arrest of Mohamed El Baradei, the former head of the International Atomic Energy Agency who returned to Egypt earlier this week.

"The grievances of those must be addressed in concrete reform," Gibbs said.

The largest organized opposition group to the Mubarak regime, however, is not the secular opposition, but the Muslim Brotherhood, which has been hostile to Egypt's peace with Israel, many other American policies in the region and seeks a greater degree of Islamic religious law for Egyptians.

In an article in Friday's Financial Times, American Middle East expert Anthony Cordesman called the Brotherhood "the strongest political alternative" to the Mubarak regime.

But he warned that even the Brotherhood was "weak," more "ideological than practical," and might not be able to meet the expectations of the protesters.

Islamic banners of earlier protests in Egypt were not in evidence this week. Rather, Steven Cook said, Egyptians in the streets were calling for jobs, greater democracy, and respect for human and civil rights. The April 6th movement, a secular opposition group, released a list of demands this week, none of which referred to religious themes.

The group instead called for increases in the country's minimum wage, the lifting of the emergency law that gives the government unrivaled powers and has been in effect since the Sadat assassination. The group also called for a restaging of last fall's parliamentary elections, in which almost all of the opposing parties of Egypt were denied seats in elections widely condemned as fraudulent.

The irony of the current protests is in Egypt, as in Tunisia, demonstrators have turned out by the thousands despite the government's rather impressive record of growth and economic development.

The Egyptian economy has been growing at rates of roughly 6 and 7 percent a year in the past decade, though the vast majority of Egypt's 83 million people still earn under $4 a day and the gap between rich and poor is growing.

While protesters remained in the streets on Friday night, members of Mubarak's inner circle were vowing to stay in power. Omar Suleiman, the head of Egyptian intelligence and widely touted as a possible successor to Hosni Mubarak, told a group of western visitors earlier this week the government had a strategy for containing the protests, that Mubarak was not weak, and that he would not be forced from power. Egypt, he said, would not go the way of Tunisia.

Importance: High

SENTINEL INTELLIGENCE SERVICES, LLC
LYLE J. RAPACKI, Ph.D.
____________
Saturday -
January the 29th, 2011
0845Hrs; m.s.t. (Arizona) Lyle@SentinelIntelligenceServices.com
_____________________ _______________________
Email Briefing Bulletin: FLASH TRAFFIC - - FLASH TRAFFIC
The information contained in this briefing is for your consideration insofar as how we in America may be affected by the growing crisis
in Egypt.

FOR YOUR ANALYSIS:
1. The riots in Egypt have continued the past 4-days, and are growing in both intensity and in numbers of outbreaks and participants. As of this date/time, 74-killed and two thousand injured. Also 3-police officers have been killed. The police in Cairo have been recalled completely with the Egyptian military now the lead
force attempting to bring order. The curfew has been completely ignored, with the numbers of rioters growing by the hour. Over 18-million people live in Cairo, Egypt.
2. The rioters are "everyday" Egyptians; including Moms, Grandmothers, and those who would never have thought about acts of civil disobedience. Egyptians are well-educated but literally hungry. For 30-years, the Egyptian government has stolen from the people, and while the Egyptian government became wealthy and accustomed to a very nice life-style, the people of Egypt, for the most part, have not been as fortunate. Another example of the disparity between the Elites and everyone else. The emotional drama is still building. Crowds take on their own personality, and what is taking place in Cairo, Egypt is beginning to spread to outlining areas of the country, and is also intensifying. The people are beginning to speak in one voice "Not until
Mubarak is removed!" Shuffling the Egyptian cabinet may prove to be nothing more than political window dressing, and the people will not go along with this type of sham
3. Lt. Gen Omar Suleiman, Director of Egypt's Intelligence System, EGID, similar to America's CIA, has been appointed Vice President of Egypt. This may prove to be the first step in President Mubarak stepping down as President. General Suleiman can be viewed as Gerald Ford was during the Nixon transition closing down Watergate; a calming and transitional President. Mubarak is still holding on, but his wife and son already have left the country landing in London, England.

4. Banks throughout Egypt are closed; international businesses and corporations have closed; selected embassy's have removed their staffs; growing concern over the security and calm at the Suez Canal, which, as you know, is a critical water passage way for oil distribution world-wide. Oil already has risen $4-a
Barrel to $90-barrel which means gas in America will go to $4-gal by next week. Yesterday, Friday, oil jumped 4.3% the largest one-day jump since 9/09. There is speculation a price jump could be as high as $10-a barrel. This rise would have very serious implications for Americans and our economy. Over 2-million barrels of oil go to Europe daily through the Suez Canal. Any disruption could have a severe immediate effect on Europe and its' continuing decaying economy.
5. Signs of a slow and steady villanization of America is underway. The United States is seen by a growing number of Egyptians as being the main support to Mubarak, helping him to remain in a dictatorial position the past 30-years. Mubarak will not listen to the present administration in America. He is most close to the
Clintons, but does not respect at all Obama. So, our influence will be limited.
6. The Muslim Brotherhood is increasing its presence and influence during this. This will have a very negative result for America.

LYLE J. RAPACKI, Ph.D.
Protective Intelligence and Assessment Specialist
Consultant at Behavioral Analysis and Threat Assessment
Private-Sector Intelligence Analyst

[Information contained in BKNT E-mail is considered Attorney-Client and Attorney Work Product privileged, copyrighted and confidential. Views that may be expressed are those of the author(s) and do not necessarily reflect those of any government, agency, or news organization.]

U.S. Sending Envoy to Consult on Tunisian Elections

Channel

Intelligence - OPEN SOURCE

RT/66; US/1 – MEMBER CONTRIBUTION

by Judith Miller
NewsMax
January 23, 2011

http://www.judithmiller.com/8647/tunisian-elections

RABAT — The crumbling of 23 years of authoritarian rule in Tunisia after only 29 days of mass protest is miraculous. In a region known for sclerotic, autocratic regimes, ex-president Zine el-Abidine Ben Ali's forced exile prompted stunned, jubilant Tunisians to take to the streets to proclaim the victory of their "Jasmine Revolution."
But is the euphoria justified, or is the upheaval in Tunisia likely to end in tears? And what, if anything, is Washington doing to ensure a successful transition from autocracy to political pluralism?
On Monday, according to senior U.S. officials, the Obama administration plans to announce that it is sending a "high level" envoy to consult with the Tunisians about how best to stage what interim prime minister and ancien regime holdover Mohammed Ghannouchi pledged Saturday would be Tunisia's "first transparent and legitimate elections since independence."

Washington's recent expressions of enthusiasm for democracy in North Africa and other Arab states – however well received by Arab citizens and civil society groups -- are not shared by Tunisia's neighbors. In most Arab capitals, the upheaval has generated concern bordering on alarm, judging by public statements and interviews in Morocco last week.
First, several officials said it was still unclear whether the "revolution" itself was less of a popular overthrow and more of a "putsch," or given France's colonial rule in Tunisia until 1956, a "coup d'etat" bent on preserving the traditional ruling party's dominance.
Second, they warn that despite the prime minister's pledge to hold free-wheeling, inclusive elections and leave politics after Tunisians choose a new government, the revolution risks being hijacked by non-democratic forces given the weakness of the country's political parties and its lack of experience with political pluralism.
Arab officials see two unedifying political scenarios as most plausible. The first is what a senior diplomat called an "Iranian" solution – that is, the hijacking of the political system by militant Islamists masquerading as political pluralists, similar to what occurred in Iran after a broad coalition of Islamist-led forces overthrew the Shah in 1979 and installed in power an equally repressive, enduring religious regime.
Or, alternatively, they see a potential for what one described as the "Algerian" scenario – a military takeover, as occurred in Algeria in 1992 after the military cancelled a second round of parliamentary elections that would have made Islamists the largest political party in that strife-ridden country.
In this scenario, the Tunisian military, which helped overthrow Ben Ali by refusing to fire on protesters, would eventually tire of the street protests and political chaos which prompted Ben Ali's ouster and seize power itself to restore stability.
Concern about possible variations of the "Iranian" or "Algerian" scenarios dominated the informal corridor talk last week at the second Arab economic summit in the Egyptian Red Sea resort of Sharm el Sheikh, said North African officials who asked not to be identified because of Tunisia's delicate political situation.
Though the summit was supposed to tackle purely economic issues, most of the leaders and senior officials there discussed whether the Tunisian upheaval was likely to be contagious.
Could the region's rising unemployment, particularly among the young, skyrocketing prices of food and other basic necessities, and the political repression which combined to trigger Ben Ali's demise prompt similar upheavals in their own countries?
Though he did not attend the meeting, Muammar Ghadafi, the de facto ruler of sparsely-populated, oil-rich Libya since a military coup in 1969, quickly staked out his stance of hostility to the revolt, lambasting Tunisians for having gotten rid of his ally.
In a speech broadcast on Libyan TV last Monday, Col. Ghadafi called the episode "painful" and condemned Tunisians for being "impatient' in pushing out a leader who had pledged to step down anyway in 2014. "Tunisia now lives in fear," said Ghadafi, known for his erratic behavior and provocative, belligerent speeches. "Families can be raided and slaughtered in their bedrooms and the citizens in the street killed as if it was the Bolshevik or American revolution."
In Morocco, which unlike most of North Africa has remained calm and without mass protests or the self-immolations that have shocked Egypt, Algeria, Mauritania, and other states, the kingdom nonetheless waited four days before reacting officially to Ben Ali's ouster.
The statement, which expressed "great concern" about the upheaval, called upon all Tunisian factions to restore order by engaging in "fruitful national dialogue." Deliberately low-key, the declaration of "solidarity" with the Tunisian people and simultaneous "concern" was issued by the foreign ministry, not by King Mohammed VI, who assumed power in 1999. Unlike Ben Ali, the Moroccan king, a direct descendant of the Prophet Mohammed, enjoys religious legitimacy and support among many of his 34 million people as the "commander of the faithful."
In an interview Thursday, Dr. Taieb Fassi Fihri, Morocco's foreign minister, said that he hoped that Tunisians would have a "productive dialogue open to all, despite the risks." He declined to identify what he considered the greatest risks.
But other North African officials expressed concern about anarchy, or a potential hijacking of the uprising by non-democratic forces and the replacement of Tunisia's autocratic kleptocracy with a government that would be democratic in name only.
Concern about a potential victory by Tunisia's Islamists is particularly pronounced among secular forces. Although interim Prime Minister Ghannouchi did not appoint any Islamists to senior posts to his interim government, the Islamic movement's flagship party, the Tunisian Islamic Party, or Nahda (Renaissance), has been regrouping. Outlawed since 1991, the exiled leader of Nahda, Rached Ghannouchi (no relation to the new prime minister) has said that he intends to return to Tunisia, but seek no role in the transitional government.
Instead, he told the Financial Times and The Wall Street Journal, he is working with other opposition groups to purge members of the country's previous regime and encourage others in his party to stand for elections. He also disputed the notion that his party is a stalking horse for theocratic Islam. "We are not a religious party," he said. "We're a democratic party which is inspired by Muslim values."
Many remain deeply suspicious of the 69-year-old Ghannouchi and his party. David Schenker, an analyst with the Washington Institute for Near East Policy, noted that Ghannouchi was among the first Islamists to welcome the Iranian theocratic state, had opposed the 1991 U.S. invasion of Iraq to liberate Kuwait, and had steadfastly opposed Arab-Israeli peace deals. Israeli retired Colonel Jacques Neriah warned that Ghannouchi has visited Tehran regularly in recent years and reportedly carries a Sudanese passport that the Islamic authorities in Khartoum gave him at Teheran's request.
Larry Diamond, the director of Stanford University's Center on Democracy, Development, and the Rule of Law, warned that historically, the "demise of a dictator does not guarantee the rise of a democracy in its place." After similar upheavals, most authoritarian regimes have given way to a new (and often only slightly reconstituted) autocracy," he recently wrote. If Tunisia were to avoid this pattern, he added, it would need a "significant period of time to reform the corrupt rules and institutions of the authoritarian regime and create an open, pluralistic society and party system that is capable of structuring democratic competition" – at least six months, rather than the 60 days currently envisioned before national elections are held.
But several French and American analysts were far more upbeat about Tunisia's prospects. In Paris, Pierre Lellouche, a Tunisian-born French official who is the Ministry of Economy's Secretary of State for Foreign Trade, noted that thanks to Habib Bourguiba's three-decade-long rule, Tunisia's 10 million people enjoy high rates of literacy and a good educational system, relative equality for women, a strong middle class and impressive economic growth and development. Unlike other states in North Africa, or the Maghreb, "Tunisians are historically Phoenicians, traders open to the world. Islamicization came last and remained relatively weak," he said. Tunisians "speak French, watch French tv, and follow French politics."
He likened their revolt to 1989 in Europe when crises in Eastern European regimes ultimately triggered the Soviet system's demise. Tunisia's upheaval could well trigger a similar upheaval in other parts of the Arab world, he said.

"We have seen enormous change everywhere in the world in the past 20 years -- the end of the Soviet Union, the opening up of China, the consolidation of Europe," he said. "Only the Arabs have not changed. There we have the same governments, the same dynasties, the same misery."
John Entelis, director of Fordham University's Middle East program and a veteran analyst of North Africa, also thought that fears of an "Iranian" or "Algerian" scenario in Tunisia were unduly alarmist given the strength of Tunisia's secular forces, the more moderate strain of Islam favored by most Tunisians, the country's relatively strong economic performance, and the influential role played by France and the United States.
While the sudden unwinding of the Tunisian regime clearly took Washington (and other western governments) by surprise, the Obama Administration's endorsement of the revolt, its "congratulations" to the Tunisian people for having ousted Ben Ali, and calls for political pluralism have been well received, at least by civil society groups and analysts who favor modernization and political reform in North Africa.
During my trip, sponsored by the Moroccan-government funded Moroccan-American Center for Policy, several Moroccan analysts praised section's of Hillary Clinton's speech two weeks ago in Doha warning that Arab regimes would "sink" into the sand if they avoided political reform as they pursued economic development. Wikileaks cables written by American diplomats scoring official corruption in Tunisia and Morocco have also been widely published by Arab bloggers and the Arabic press beyond the reach of the government-censured press.
While some pro-democracy advocates have accused the Obama Administration of rejecting democracy in favor of stability, backing authoritarian leaders for fear of Islamist governments and eschewing former President George W. Bush's pro-democracy agenda, Tamara Cofman Wittes, the State Department's Deputy Secretary of State for Near Eastern Affairs, responsible for promoting democracy and human rights, argued that Washington has repeatedly sought "engagement" not just with Arab governments, but with Arab human rights groups and other components of civil society.
In 12010, the State Department spent $65 million promoting political pluralism in its Middle East Partnership Initiative, which operates out of American embassies in Tunis and Abu Dhabi.
Administration officials said that the U.S. government still did not fully understand how Ben Ali had been persuaded to flee, , but State Department spokesman P.J. Crowley denied reports in the Arab press that the U.S. had urged the Tunisian military to oust him.
"The Tunisian people have spoken," Crowley tweeted on Sunday.

American officials said that in the days ahead, American diplomats would be listening to Tunisians about how they can best assist the transition to democracy. ""This has been and has to remain a Tunisian process," said Ms. Cofman Wittes.
Since almost no diplomats anywhere predicted the sudden unraveling of Ben Ali's autocratic regime, "the lesson of the last four weeks has got to be one of humility," said one official.

http://www.judithmiller.com/8647/tunisian-elections

[Information contained in BKNT E-Posts is considered Attorney-Client and Attorney Work Product privileged, copyrighted and confidential. Views that may be expressed are those of the author(s) and do not necessarily reflect those of any government, agency, or news organization.]

Fannie and Freddie: Georgia on their Minds?

BlackNET Intelligence Channel - LIMITED DISSEMINATION
SR-6; ProPublica.org; JAG/1; US/1; ATTN: US/12; FPC/1; HST/2

[ed.note: When the Russian Federation, furious over US covert Special Operations training and involvement the Georgian Republic during the Russian military incursion 2008 (Summer), finally agreed with the People’s Republic of China to threaten to pull out its $100 BILLION or so investment in FANNIE, along with the PRC’s approx. $340 BILLION, the Federal Reserve and the Treasury Dept. hand was forced to take over Freddie and FANNIE ($14 Trillion in potential liabilities), pushing the US banking system and its highly over-leveraged mortgage-backed derivatives and many other related CDSs and CDOs (Credit Default Swaps and Collateral Debt Obligations) TO THE BRINK of INSOLVENCY by the fateful CRASH of 15 September 2008.

Further narrative exposition, analysis and evidence reporting on said same, along with Republican presidential nominee Senator John McCain’s provocatively immortal phrase, ‘We are all Georgians now,’ with be posted in the coming weeks. Stay tuned for ‘FANNIE FIDDLING: The Secret Georgian Connection to America’s Banking Collapse.’

NO DISSEMINATION above [Lifted]

OPEN SOURCE, below—Perhaps an ever more ominous reincarnation of the Republican Remnant of the 1999 Clinton Administration Glass-Steagal Social Security Privatization Plan—premised on the once and always apparently immutable Raines Rules of Unintended Consequences...?]

History Repeats Itself:

Wall St. Wants a Part of Fannie and Freddie’s Gov’t-Guaranteed Deal

by Marian Wang
ProPublica, Jan. 21, 2011, 12:19 p.m.

As the White House considers how to reform [1] troubled mortgage giants Fannie and Freddie, some of the nation’s largest banks have piped up with their own suggestion. The New York Times reports that banks are suggesting that they be allowed to take over [2] some of Fannie and Freddie’s work of issuing securities backed by a government guarantee. That guarantee can be quite convenient for businesses, which get to keep the profits in good times and—as we saw during the housing market collapse—get to socialize the losses by passing them onto the government. From the Times:

The banks have presented their ideas publicly through trade groups. Housing industry consultants and people familiar with recent meetings at the Treasury Department say these banks view the government’s overhaul of the mortgage market as a potential profit opportunity.

This is something that nearly dates back to the beginning of mortgage securitization. Even in the '80s, Wall Street was looking for a way to cash in on the secondary mortgage market—in other words, looking for a way to get in on Fannie and Freddie's business. Bethany McLean and Joe Nocera give a quick refresher of this history in the first part of their new book [3], All the Devils are Here:

Wall Street realized it was never going to dislodge Fannie and Freddie from their dominant position as the securitizers of traditional mortgages. If it hoped to circumvent the GSEs [4] and keep all the profits to itself, Wall Street would have to find some other mortgage product to securitize, products that Fannie and Freddie couldn’t—or wouldn’t—touch.

What they found was riskier mortgages and subprime loans. As the Center for Public Integrity reminded us this week, it was Wall Street, after all, that led the way into the mortgage mess [5].

Fannie and Freddie were followers, lowering their underwriting standards when they realized they were losing market share. CPI reports:

Government data [6] shows Fannie and Freddie didn’t take the same risks that Wall Street’s mortgage-backed securities machine did. Mortgages financed by Wall Street from 2001 to 2008 were 4½ times more likely to be seriously delinquent than mortgages backed by Fannie and Freddie.

… Fannie and Freddie, Cecala says, didn’t start making a big move into riskier mortgages until the mortgage boom was already under way, and they were fighting to reclaim market share they’d lost to more aggressive Wall Street players. Even then, they were more cautious than Lehman Brothers and other investment banks. For example, just over 15 percent of Fannie- and Freddie-backed loans made in 2007 have been seriously delinquent, compared to nearly 42 percent of mortgages bankrolled by Wall Street, according to the FHFA.

Nonetheless, Republicans have consistently blamed the mortgage giants for the financial crisis. GOP.gov calls Fannie Mae and Freddie Mac “the main cause of the nation’s current financial turmoil [7].”

While there’s no doubt that Fannie and Freddie’s billion-dollar housing losses—which necessitated their government takeover in 2008—have cost taxpayers billions [8], at least one former Treasury official told the Times that having Wall Street take over Fannie and Freddie’s work is not a good idea.

Michael Barr, who worked on housing issues at the Treasury Department until last month, told the Times that although reforming the mortgage giants is necessary, allowing banks to issue government guarantees sets up the banks as a second-generation of Fannie and Freddie, creating “the same conflict we had in the past.”

http://www.propublica.org/blog/item/history-repeats-itself-wall-st.-banks-gun-for-fannie-and-freddies-business

[Information contained in BKNT E-mail is considered Attorney-Client and Attorney Work Product privileged, copyrighted and confidential. Views that may be expressed are those of the author(s) and do not necessarily reflect those of any government, agency, or news organization.]

Former Haitian Dictator Taken Away by Police--OS
BlackNETIntelligence Channel- OPEN SOURCE

[ed.note: BlackVAULT - After tracking down Philippines Dictator Ferdinand MARCOS’ $2.1 Billion in stolen assets (including approximately $500 Million is stolen Central Bank gold) in 1986, FRONTLINE next sicked US/1 onto Baby Doc DUVALIER. Turned out the guy was piker compared to the master MARCOS. Yet BABY DOC probably caused more of his people, per capita, to be tortured or starved, than MARCOS (both pail, of course, in comparasion either overall or per capita, to Chairman MAO and Comrade STALIN).

US/1, your affiant, actually first took up the ‘cause’ of Haiti’s DUVALIER family and their legendary shadow henchmen, the always torturous TON TON MACOUTE--under both the father, PAPA DOC, and his successor/son—twenty years earlier, in the fall of 1966. His Arlington, VA fifth-grade elementary school class had formed-up a mock Organization of American States (OAS). The 10-year-old US/1 chose to become the mock-representive for Haiti—attracted, of course, to the fact that Haiti was said to still practice VOODOO, and was then (and still IS) the poorest nation in the Western Hemisphere.

Chief educational benefit: US/1 gained an early mastery of the Machevellian ways of Roberts Rules of Order, and was able to usurp influence to Haiti’s benefit and to deny its deployment by the mock US-OAS Ambassador and the mock CUBAN Non-Member observer.

Now that’s how to learn international affairs—fast and furious.*

Members of Miss Nelson’s advanced-fifth-grade Mock-OAS class were rewarded for their efforts at the end of the school year--during the blossoming Spring of 1967--with a special road trip to the actual, ornate OAS Headquarters building, katty-conner across the Elipse from the White House. This rambunctious crew of 11-year-olds were the FIRST outsiders ever allowed into the chambers to actually occupy the council seats of their respective members states at the real OAS.

For one, brief, shinning moment--outside of their just and fear-inducing slave-revoltution of 1803--HAITI ruled…

_OAS+ *

And finally, by February 1986, the last of the Duvalier clan and WIFES had fled to FRANCE.

US/1 was dragged out of bed on this VOODOO deal only following the success (and soon-to-be Emmy Award-winning) 1987 FRONTLINE investigation of ‘In Search of the Marcos Millions’ ($2.1 Billion, actually). Only road trip, however, was upto NYC to uncover about $120 Million in cancelled checks paid to various secret overseas bank accounts. Some of the intial tracking had already been done by Nick PECK, then with security consulting giant, KROLL Associates, who had taken up the BABY DOC gauntlet on a pro-bono basis. US/1 also got to chat with Jonathan DEMME, the New York-based Hollywood director (Silence of the Lambs), who had just completed a rather artful documentary: ‘Haiti Dreams of Democracy.’

on Haiti.

But the best thing that came out of this eventually frustrated Haitian documentary effort, US/1 got to meet the 'fabulous G,’

otherwise known as Her Gness, who--under US/1’s ‘exquisite hindsight’ concept (i.e. being an admitted moron on possibly more than one occasion)--was probably the love of his sorry life…

Go figure.

* - Also see 15-year-old US/1’s 1972 ‘White Paper’ on the Pakistan/Bangaladesh/Indian conflagration, ATTACHED.]

The New York Times - January 18, 2011

Former Haitian Dictator Taken Away by Police

By GINGER THOMPSON

PORT-AU-PRINCE, Haiti — Haitian police officers on Tuesday took away Jean-Claude Duvalier, the former dictator who abruptly returned to this country nearly 25 years after being forced from power, leading him out of the high-end hotel where he has been huddled since his arrival.

Surrounded by heavily armed police officers, Mr. Duvalier emerged from his room at noon in a blue suit and walked down three flights of stairs, never letting go of his companion’s hand as he waved to supporters chanting his name and calling him “president.”

“We are with you,” some supporters shouted as police officers led Mr. Duvalier out of the back of the hotel. With United Nations peacekeepers standing by, police officers put him and several of his associates into a waiting vehicle and drove off. Small clusters of his supporters outside the hotel cried “revolution.” Hunks of concrete were thrown into the convoy’s path.

It remained unclear whether Mr. Duvalier would be arrested or simply questioned. He has faced threats of prosecution in the past for the many human rights abuses committed during his rule, and for the hundreds of millions of dollars government officials have said he looted from the country.

A Haitian justice official and one of Mr. Duvalier’s lawyers said that Mr. Duvalier was being brought to a meeting with prosecutors for questioning. Another Haitian official said separately that Mr. Duvalier could be released by the end of the day.

Still, in a country with a long history of impunity, where leaders rarely face prosecution, it was a striking scene, underscoring the political volatility that has gripped Haiti since a contested presidential election late last year.

One year after the nation was hit by a devastating earthquake that killed more than 200,000 people, the country has been grappling to absorb the potentially destabilizing blow of Mr. Duvalier’s surprise return this week, which drew condemnations from around the world and ignited new fears of conflict.

At a courthouse where Mr. Duvalier was taken on Tuesday, his companion, Veronique Roy, denied that Mr. Duvalier had been arrested. “Absolutely not,” she told The Associated Press by phone. “We are very relaxed, drinking coffee and water," she added. “They said they are making photocopies. We don’t know why.”

Mr. Duvalier, known as Baby Doc, returned to Haiti 24 years and 11 months after he was forced to flee the country by a tide of social upheaval driven by severe poverty and his regime’s brutal political repression. In a brief radio interview, Mr. Duvalier said he had returned only to help his country, not to get involved in politics. He spent the rest of his first day back in Haiti out of the public eye, huddled with his advisers and relatives at a high-end hotel in the mountains overlooking Port-au-Prince, the capital.

His silence left Haitians and the rest of the world to wonder what Mr. Duvalier was really up to.

Neither France, which had granted Mr. Duvalier asylum, nor the United States, Haiti’s largest benefactor, said they had anything to do with his return. In fact, both governments said they had been unaware that Mr. Duvalier had left Paris until his flight was close to landing in Port-au-Prince.

[ed.note: So much for pre-screened advance passenger flight manifests…]

The Haitian government — in disarray since the earthquake — seemed to respond in fits and starts, initially dismissing Mr. Duvalier’s arrival as well within his rights as a Haitian citizen, and later suggesting that the Justice Ministry had begun an investigation into his return.

Angry reactions poured in from around the world, with human rights groups demanding that the Haitian government charge Mr. Duvalier with crimes against humanity — including the kidnapping, torture and murder of thousands of his opponents — and with stealing hundreds of millions of dollars from the nation, the poorest in the hemisphere...

...continue reading...

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