BlackMask Breaking News

https://youtu.be/krNHE-mMwIA

The unpredictable Shi’ite leader, Muqtada al-Sadr, s in a dramatic statement, he warned his followers that he would disown them if they didn’t stop rioting inside parliament and other government buildings inside Baghdad’s Green Zone, put down their weapons and return home within the hour.  Al-Sadr’s threat to his followers was issued on Tuesday, following the deaths of 30 people the evening before in clashes between his supporters on one side and government security forces and pro-Iranian Shi’ite militias on the other. So far, the cease-fire is mostly holding, but only until the next spark is ignited, which will no doubt not take long. Iraq is in the midst of the longest and most difficult power struggle it has endured since the U.S. invasion in 2003. Ten months after elections were held in October 2021, the politicians have failed to reach an agreement on the choice of a president or prime minister. Under the constitution, at the head of the state presides a presidential council composed of the Kurdish president, a Sunni deputy and a Shi’ite deputy. The president, chosen by parliament, then appoints a prime minister that the Shi’ite factions have agreed upon. The speaker of parliament is a Sunni Muslim. The structure closely resembles Lebanon’s. The chief obstacle to naming a president lies in the inability of the two big Kurdish factions – one led by the Barzani family, which controls the presidency of Iraq’s Kurdish enclave, and the other led by the Talabani family, whose members have customarily served as presidents of Iraq (currently Barham Salih) – to reach an agreement on a candidate. This year, the Barzani family decided to disrupt the process by demanding that the next president come from within its ranks. Without an agreed-upon president, there’s no prime minister and no cabinet; the country is ruled by a caretaker government headed by Mustafa Al-Kadhimi, an effective leader and former journalist who once headed Iraqi intelligence. Al-Kadhimi maintains good ties with the United States, Saudi Arabia and Iran and has succeeded in navigating through Iraq’s complicated domestic politics. Al-Kadhimi even played a role in this year’s dialogue between Iran and Saudi Arabia regarding the possibility of restoring relations.

But the dispute between the Kurdish factions is only a sideshow to the main struggle. On the face of it, it’s war between Shi’ite and Shi’ite: between the coalition of pro-Iran Shi’ite parties that go under the name the Coordination Framework in partnership with the Talabani family, and a coalition constructed by al-Sadr that won 73 of the 329 seats in parliament in the last election. The largest political bloc in Iraq, it has found allies in the largest Sunni movement and the Barzani family.

• Iraq’s chaos is eroding Iran’s role as the region’s puppet master
• Iraq is fed up with relying on Iran, but has no alternative for now
• As Israeli-attributed strikes rattle Syria, Russia and the U.S. are losing interest

Aged 48, al-Sadr’s power rests on his religious and family pedigree. He is the son of Grand Ayatollah Mohammad al-Sadr, who was the revered leader of young Shi’ites and the lower classes and was assassinated, along with two of his sons, by Saddam Hussein. Muqtada al-Sadr is the nephew of the Shi’ite philosopher and legal scholar Mohammad Baqir al-Sadr, who was also murdered by Saddam’s agents, in 1980. Muqtada al-Sadr sees himself as the heir to the family dynasty, the national and religious leader of Iraq’s “downtrodden and the oppressed” Shi’ites, the one who will actualize his father’s teachings and his uncle’s philosophy. However impressive his pedigree may be, al-Sadr doesn’t have the supreme religious authority conferred on the designated grand ayatollahs. The time he spent on religious studies in Iran was insufficient to achieve that status, as much as he aspired to it, let alone to capture the prize of senior Shi’ite spiritual leader, which today is held by the 92-year-old Grand Ayatollah Ali al-Sistani. Whatever al-Sadr lacks in formal religious credentials is compensated for by his political power, which he deploys through the private militias he has cultivated since the U.S. invasion. Back then, his political agenda centered on opposition to the American presence in Iraq, with Iran acting as his key supporter. Eventually, he changed sides, positioning himself as opposed to all foreign interference in Iraq, including Iran, which challenged al-Sadr’s power by using its own militias that eventually became a parallel military competing with Iraq’s official one. Al-Sadr’s armed forces have often clashed with the other Shi’ite militias, especially during violent clashes with Iraqis in the south of the country protesting the lack of water and electricity. The protestors not only blamed the government in Baghdad for the power shortages, but also Iran, which supplies about 40 percent of Iraq’s natural gas and electricity. The protesters claimed that Tehran was rationing supplies to pressure the Iraqi government. Al-Sadr understood how to mobilize anti-Iran sentiments and direct them against the Shi’ite political parties in Iraq that rely on Iranian support. His overwhelming victory in October’s election made it clear to Tehran that it risked losing control of its most important asset if al-Sadr succeeded in his goal of appointing a prime minister from his bloc.  Iraq’s Supreme Court ruled that the current parliament had been elected legally and that there was no reason to dissolve it, al-Sadr ordered his lawmakers to resign and leave their offices while hundreds of his supporters broke into the Green Zone and seized control of the parliament building and other government offices. They staged a sit-in strike and clashed with government forces and rival Shi’ite militias. After several days, al-Sadr ordered his followers to leave the parliament building, partly in order to enable a parliamentary debate on legislation ensuring nutritional needs – al-Sadr didn’t want to be seen as blocking a law that aims to help his constituents and, no less, to help himself and his movement. Without an approved state budget for the 2022/23 fiscal year, the government of Iraq can’t touch the $115 billion of oil earnings it is expected to earn this year. Legally, each month the government can spend only one-twelfth of the money it spent in the previous year’s budget. The law being weighed by parliament would have authorized a new budget to help compensate Iraqis for the surge in global food prices since Russia’s invasion of Ukraine, and would have made a $1.6 billion payment owed to Iran for electricity and gas purchased by Iraq. The on al-Sadr was particularly high because Iran had threatened to cut off supplies of power and gas, and had even begun the technical procedures to do so, if it wasn’t paid. While parliament approved some $17 billion for the special budget, only half of the sum was allocated for the purposes specified in the law. The rest will, in theory, go to funding current operations in the provinces, but in practice it will be used by local officials to boost their support and pay for the private militias. Al-Sadr, who is also sharing in the financial benefits of the law, authorized his lawmakers to support it. Only after it was approved on June 13 did his 73 members of parliament quit. NN: Syria is getting close by the day to an  all out Shiite Sunni civil war. And oil exports by both sides will be attacked.

Federal Reserve officials have acknowledged that the battle against inflation will be paid for with lost jobs, and the U.S. central bank will need an unlikely combination of events to keep those losses to a minimum as interest rates continue to rise. Economists assessing the trade-off facing the Fed estimate U.S. employment could drop by anywhere from a few hundred thousand positions to as many as several million before the Fed fixes the worst outbreak of inflation in 40 years. The final tally will depend on how closely the economy follows patterns seen in recent decades, to what extent things like improved global supply chains help lower inflation, and how strict the Fed is in enforcing its 2% inflation goal. With the central bank’s preferred inflation measure currently increasing at a more than a 6% annual rate, Joe Brusuelas, chief economist at RSM, a U.S.-based consulting firm, estimates it would take 5.3 million lost jobs and an unemployment rate of 6.7%, substantially above the 3.7% seen in August, to lower inflation to 2%. “Can the Fed achieve a pure soft landing? … Probably not,” Brusuelas said, referring to a scenario in which monetary tightening slows the economy, and inflation, without triggering a recession. “It is difficult to envision a benign outcome.” Data on August jobs, released Friday showed the U.S. firms added 315,000 jobs in August, a slowing from the blow-out half-million jobs added in July and a sign that some of the economy’s post-pandemic excesses may be moderating without giving way altogether. In addition, the number of people in the labor force surged by nearly 800,000 to a new record high – a dynamic Fed officials have been banking on to ease wage pressures over time. Because many of those new entrants had yet to find a job, the unemployment rate rose to 3.7% from 3.5%, an increase Fed and other officials are likely to see as constructive since it indicates a greater supply of people willing to take jobs if offered. “I don’t mind seeing an uptick in unemployment if we are getting more people into the work force. That is good for companies,” said U.S. Labor Secretary Marty Walsh. “We still hear the concerns” from firms about difficulties hiring workers, “but not as loud,” he said. Fed officials hope the burden of fighting inflation falls less on employment than other parts of the economy, even as for months they’ve bemoaned the labor market’s current state as unsustainable. Updated projections are due to be released at the end of the Fed’s policy meeting on September 20-21. If, as expected, those projections show higher unemployment, the chances for a soft landing will confront an unpleasant historical fact: Once the U.S. unemployment rate increases beyond a certain amount, it tends to keep rising. Since at least the late 1940s, even modest increases of half a percentage point in the unemployment rate from a year earlier – the magnitude of increase Fed officials have begun to hint at – have tended to spiral to jumps of 2 percentage points or more. At the current labor force level of 164.7 million, that would translate into around 3.3 million fewer people employed – below some estimates but still high. “Usually, once the labor market gets going downhill, it picks up speed and it goes” further downhill, said Claudia Sahm, a former Fed economist and founder of Sahm Consulting. “We’ve communicated over and over and over again our commitment to achieve that 2% goal,” New York Fed President John Williams told the Wall Street Journal this week. “I think it’ll take a few years, but there’s no confusion … We’re absolutely committed to doing it.” NN: Its going to take at least 1 6% unemployment rate and 6 to 7% FED FUNDS rate to put out this inflation fire storm…….

Sept 2 (Reuters) – Group of Seven finance ministers are expected to firm up plans on Friday to impose a price cap on Russian oil aimed at slashing revenues for Moscow’s war in Ukraine but keeping crude flowing to avoid price spikes, G7 officials said. The ministers from the club of wealthy industrial democracies are due to meet virtually and are seen as likely to issue a communique that lays out their implementation plans. “A deal is likely,” a European G7 official said, adding that it was unclear how much detail would be revealed, such as the per-barrel level of the price cap, above which complying countries would refuse insurance and finance to Russian crude and oil product cargoes. British Finance Minister Nadhim Zahawi said on Thursday in Washington that he was hopeful that G7 finance ministers will “have a statement that will mean that we can move forward at pace to deliver this.”  “We want to get this oil price cap over the line,” he told a think tank event in Washington a day after discussing the cap with U.S. Treasury Secretary Janet Yellen. Despite Russia’s falling oil export volumes, its oil export revenue in June increased by $700 million from May due to prices pushed higher by its war in Ukraine, the International Energy Agency said last month. Western leaders agreed in June to explore a cap to limit how much refiners and traders can pay for Russian crude – a move Moscow says it will not abide by and can thwart by shipping oil to states not obeying the price ceiling.  The G7 consists of Britain, Canada, France, Germany, Italy, Japan and the United States. Some officials in the bloc have said that the cap needs broader backing and have questioned whether it can be successful without the participation of major oil consumers China and India, which are unlikely to endorse the plan. But other G7 officials have said that China and India have expressed interest in buying Russian oil at an even lower price in line with the cap. The cap would rely heavily on denying London-brokered shipping insurance, which covers about 95% of the world’s tanker fleet, and finance to cargoes priced above the cap. But analysts say that alternatives can be found to circumvent the cap and market forces could render it ineffective  Another G7 official said that the bloc has “a desire to show there’s momentum on this” ahead of the European Union’s planned imposition of a regional embargo on Russian crude on Dec. 5.

The U.S. Treasury has raised concerns that the EU embargo could set off a scramble for alternative supplies, spiking global crude prices to as much as $140 a barrel, and it has been promoting the price cap since May as a way to keep Russian crude flowing.

Russian oil prices have risen in anticipation of the EU embargo, with Urals crude trading at an $18-to-$25 per barrel discount to benchmark Brent crude, down from a $30-to-$40 discount earlier this year.  NN: Another stupid idea by the very same people that created this mess to begin with…. Stupid is the order of the day.

Russia says it will stop selling oil to countries that set price caps

A “superbubble” appears dangerously near its “final act” after the recent rally in U.S. stocks lured some investors back into the market just ahead of potential “tragedy,” according to Jeremy Grantham, the legendary co-founder of Boston-based investment firm GMO.

Grantham, who has repeatedly warned investors of a bubble in markets, said in a paper Wednesday that “superbubbles are events unlike any others” and share some common features.

August jobs report may once again carry risks for stocks, but in a ‘less intense’ way than last Friday’s Powell speech

Bostic Says Fed Has ‘Work to Do’ With Inflation Long Way From 2%

“Inflation is high, inflation is too high and we have got to bring it down to our target,” he said Thursday during a classroom session with students at Georgia Tech in Atlanta, noting that the current pace of inflation was a long way from the Fed’s 2% goal. “So we have got some work to do. We have got to figure out how fast we are going to move our policy to try to arrest that inflation and to wrestle it back down to 2%,” he said. Fed officials are aggressively raising interest rates to cool the hottest price pressures in nearly four decades and have vowed they will keep at it despite the likely pain this will cause the public. They raised rates by 75 basis points at their last two meetings and Chair Jerome Powell has said another move of that size could be on the table when they meet Sept. 20-21, depending on the data. Recent readings on the economy have been mixed, with some sectors like housing showing signs of cooling while the labor market has been robust. He said the Fed was risking an economic downturn as it tries to seek a “soft landing” of getting inflation down without job loss. “When you bring demand down, that has the risk of slowing the economy down so that the economy stops growing, where it loses all of its momentum, and then you might get to a situation that some would describe as recessionary,” he said.

A soft landing is “a very hard thing to do. I think it’s only happened maybe once or twice in the history of this country. Ultimately that’s the best of all possible worlds.”

Bostic also discussed Fed efforts to shrink its $8.8 trillion balance sheet by allowing the runoff of its holdings of Treasuries and mortgage-backed securities as they mature. That monthly pace doubles to $95 billion in September, or roughly $1 trillion a year. He noted that because MBS mature more slowly, the process would increase the concentration of these securities in the Fed’s holdings. “We have got to think about how you reduce mortgages,” he said, adding the central bank would actively discuss its options. “We can’t just rely on maturation of these securities. We are going to have to actively try to sell them.” NN: Do not be confused by the Wall Street Social media spin doctors fool you. The FED is not Not NOT going to back down until the inflation rate is at 2%. And i believe with inflation embedded and out of control it will take a depression. With supply chains still throttled out of china and Putin’s energy war their is no way out of this short of the FED slamming on the brakes and hoping the Automatic Braking System will engage in time.

Iran said back-and-forth exchanges with the US over a European Union proposal to revive the nuclear deal will drag on into September. Iran will take “at least” until Sept. 2 to respond to the Biden administration’s comments on an EU-drafted text aimed at salvaging the 2015 pact, state-run Nour News said in a tweet on Sunday. Tehran continues to “carefully review the US’ response at an expert level,” according to Nour, which is closely aligned to Iran’s Supreme National Security Council. The EU’s draft text is seen as a final push to conclude almost 18 months of efforts to resuscitate a deal that former US President Donald Trump abandoned four years ago. Under the original agreement, sanctions were lifted on Iran’s economy and its crucial oil sales in exchange for curbs on the country’s atomic activities. Concessions by Iran in recent weeks have sparked hope that diplomats could close in on a deal soon.

The Sticky Issues Holding Up a New Iran Nuclear Deal

Reviving a landmark agreement limiting Iran’s nuclear program could pave the way for the US to lift sanctions and allow Iranian energy exports back onto world markets. The talks have been hampered by a lack of trust as well as Iranian demands that Washington guarantee economic returns from a new accord, and that international monitors curtail an investigation into Tehran’s past nuclear activities.

1. What guarantees has Iran demanded?

In 2018, former President Donald Trump’s administration unilaterally left the deal that had been agreed in 2015 and reimposed sanctions that severely reduced Iran’s oil exports. Iranian Foreign Minister Hossein Amirabdollahian told diplomats and defense officials at the Munich Security Conference in February that the world powers at the negotiating table must provide assurances that Iranians won’t be tricked into limiting their nuclear activities only to be trapped again under sanctions. Of the previous deal, he said, “It was the Americans who ruined it. It is now up to the Americans to resuscitate it.”

2. Are such assurances possible?

US officials have scoffed at the idea that they can guarantee a future president won’t again leave the deal, known as the Joint Comprehensive Plan of Action. Already, there is considerable opposition to reviving it in the US. More than 100 Republican members of Congress have pledged to oppose any sanctions relief for Iran by the administration of President Joe Biden, a Democrat. A bipartisan bill introduced in July would compel the US government to assess the dangers posed by a nuclear Iran every quarter. Division over the accord within the US has forced negotiators to try to come up with creative solutions that satisfy Iran’s requirements within Washington’s system of checks and balances. Recently, officials said the parties have made progress on specific indemnities that would guarantee Iran economic returns, even if a new US administration or act of Congress overturned the deal again.

3. Where are Washington’s other red lines?

Iran stopped demanding that sanctions be lifted against its elite militia group, the Islamic Revolutionary Guard Corps, after US negotiators insisted on retaining designations punishing the country for malign activities not linked to its nuclear program. The White House also needs to ensure that it doesn’t give Iran any concessions that fundamentally change the original deal. Doing so would invite a new round of Congressional scrutiny from skeptical legislators, who have vowed to invoke a 2015 law that requires the president to subject any new agreement with Iran for review.

4. What’s the issue with Iran’s nuclear infrastructure?

The US called Iran’s response to the latest effort to revive the 2015 nuclear accord “not constructive,” raising questions about whether the two sides can reach a deal that would free more oil for global markets. Vedant Patel, a department spokesperson, didn’t elaborate on the remarks Thursday night, but added that US officials were still looking at the response, which Iran had submitted to the European Union. The EU has drafted a proposal to rescue the agreement, abandoned by President Donald Trump in 2018, and energy traders have been closely watching to see whether there will be a breakthrough. “We are studying it and will respond through the EU, but unfortunately it is not constructive,” Patel said in a statement.

Oil pared a weekly drop as traders weighed both the Iran news and the possibility that Saudi Arabia could push for output cuts at an upcoming OPEC+ meeting. West Texas Intermediate rebounded toward $88 a barrel, after slumping almost 11% over the previous three days.

President Joe Biden, returning to Washington after giving a speech in Pennsylvania on Thursday night, said he had been briefed on the situation but would find out more after getting back to the White House.  An Iranian foreign ministry spokesman earlier called the text “constructive.”  The previous exchange of comments on the EU proposal had spurred optimism, as Washington said Tehran had dropped “extraneous demands.” The goal of the negotiations is to come up with a deal that reinstates limits on Tehran’s rapidly advancing nuclear program in exchange for lifting US sanctions on Iran’s economy. The talks have spurred hopes in some countries that a deal could help reign in high energy prices that have fueled inflation. At the same time, the Biden administration has sent signals that it will take a tough stance on Iran even as it pursues a restored agreement, which is opposed by Republicans and some Democrats in Congress. NN: A deal is coming no matter how bad it is. When it comes to Iran the Biden administration decision is run by Mohammad Obama.. He is the puppet master pulling the strings. Iran is a great threat to the middle east. From Lebanon, Syria to Saudi Arabia to all the gulf states   and Israel Iran is reeking havoc. The world should fear Iran who is becoming more powerful and dangerous by the day. Biden’s/Obama’s nuclear deal is a disaster.