Generational Dynamics World View

[John J. Xenakis]

*** 3-Aug-16 World View -- Iran furious at Palestinian meeting with Iran opposition group

This morning's key headlines from GenerationalDynamics.com

• Iran furious at Palestinian meeting with Iran opposition group
  
• Maryam Rajavi: Leader of the Mujahedin-e Khalq Organization (MEK or MKO)
  
• Negative interest rates creating increased anxiety
  

****
**** Iran furious at Palestinian meeting with Iran opposition group
****


Maryam Rajavi's meeting in Paris with Mahmoud Abbas is infuriating Iran (Iran News Update)

On Saturday, Palestinian Authority president Mahmoud Abbas met in
Paris with Maryam Rajavi, leader of the National Council of Resistance
to Iran (NCRI).

> [indent]<QUOTE>"President Mahmoud Abbas, at the meeting, reiterated
> the need to combat fundamentalism and terrorism in the region and
> informed Mrs. Rajavi of the latest developments in the Middle
> East, in particular regarding Palestine and France's initiative.
>
> Mrs. Rajavi expressed gratitude for the solidarity of the
> Palestinian resistance and its leader with the Iranian people and
> Resistance. She congratulated the Palestinian government on its
> victories and expressed hope that the goal of the Palestinian
> people would be achieved. She reiterated that the Iranian regime
> is the main instigator of sectarian discord, fundamentalism and
> terrorism in the entire region, in particular in Iraq, Syria,
> Lebanon, Yemen, and Palestine, but she added that today the
> mullahs' regime is at its weakest and most fragile and vulnerable
> state. ...
>
> Mrs. Rajavi reiterated that the regime is above all fearful of the
> solidarity and unity between the Iranian people and Resistance and
> the countries and nations of the region. Therefore, the countries
> of the region and the Iranian people and Resistance ought to take
> the initiative to free the region from the scourge of
> fundamentalism."<END QUOTE>[/indent]

Rajavi has been an enemy of Iran's government for decades -- even
before the 1979 revolution -- so nothing that she said was surprising.
What was surprising, and what has apparently completely freaked out
Iran's government was the cordial meeting between Rajavi and Abbas.

A high Iranian official, Hossein Amir-Abdollahian, responded
harshly:

> [indent]<QUOTE>"The Palestinians surely regret Mahmoud Abbas’s act of
> supporting terrorist instead of fighting with it. Mahmoud Abbas’s
> problem is that he is not focused on restoring the rights of
> Palestinians.
>
> Supporting terrorists instead of fighting them, not only does not
> lead to the liberation of Quds [Jerusalem] and weakening the
> Zionist regime, but also makes the Palestinian nation
> regret."<END QUOTE>[/indent]

Another Iranian official said that Abbas was collaborating with the
CIA, which is common fare these days in countries that massacre their
own people. According to an advisor to Iran's foreign ministry:

> [indent]<QUOTE>"That man [Abbas] is known to us and documents from
> the US Embassy in Tehran revealed that he has been a collaborator
> with the Central Intelligence Agency for a long time and his
> actions in the past decades have proved that."<END QUOTE>[/indent]

Mkhaimar Abusada, a university professor in the Gaza Strip, says that
this is all about money:

> [indent]<QUOTE>"The Palestinian Authority has made a decision to
> align itself with the so-called moderate Sunni Arab governments
> and in the meantime distance itself from Iran and the Shiite camp
> in the region, because it does not want to lose political and
> financial support of [the former]. That’s why the PA and
> President Mahmoud Abbas met with the Iranian opposition
> leader."<END QUOTE>[/indent]

Abusada is correct. This really is all about the money.

As I've written a number of times in the past, the top leadership in
Iran, led by Supreme Leader Ayatollah Seyed Ali Khamenei, are almost
completely delusional in many ways.

First, they can't seem to grasp that the younger post-Revolution
generations are pro-Western. This was apparent in the early 2000s
when young college students were holding massive pro-Western
demonstration. Iran's security police bashed, tortured and killed
many college students for those protests, but they didn't change
opinions. Today, that generation is now 30-40 years old, in
positions of power, ready to take over when the old geezer mullahs
like Khamenei are gone.

Khamenei and the others are also delusional for believing that
they can buy the loyalty of the Palestinians. The Iranians
are Shias, and the Palestinians are Sunnis. There isn't a
snowflake's chance in hell that the Palestinians would ever
remain loyal to Iran. However, Iran for decades has supported
both the PA in the West Bank and Hamas in Gaza with money and
weapons. The PA and Hamas have for decades paid lip service
to loyalty to Iran so that the money and weapons would keep
coming.

That whole arrangement has been falling apart anyway. When Syria's
president Bashar al-Assad in 2011 started conducting extermination
campaigns on Sunni civilians, including Palestinians living in refugee
camps in Syria, there was the previous close relationship between
Hamas and al-Assad was dissolved. And since Iran is supporting
al-Assad, there was a big strain on the relationship between
Palestinians and Iran.

This game has been going on for five years now, with Iranians paying
off the Palestinians like a man might give money and presents to a
mistress who treats him with contempt, but she still takes the money.

But this meeting between Rajavi and Abbas may have been a step too
far, and may even cause a permanent split between the PA and Iran.
This has to come sooner or later, because there's going to be a war
between Saudi Arabia and Iran, and when the Sunni Palestinians are
forced to choose between the two, the Palestinians will be on the side
of Saudi Arabia.

It seems that every few days I get a fresh opportunity to point this
out: Years ago I wrote, based on a Generational Dynamics analysis,
that in the coming Clash of Civilizations world war, China, Pakistan,
and the Sunni Muslim countries will be one side, and India, Iran, the
United States and the West will be on the other side. This meeting
between Rajavi and Abbas, and the furious reaction from Iran, is yet
another event that moves the world along the predicted trend line.
Iran News Update (anti-Iran) and Mehr News (Tehran) and Jerusalem Post

****
**** Maryam Rajavi: Leader of the Mujahedin-e Khalq Organization (MEK or MKO)
****

Much of Iran's fury at Maryam Rajavi is that she and her husband
Massoud are long-time leaders of the terrorist organization
Mujahedin-e Khalq Organization (MEK or MKO).

MKO was formed in the 1960s in opposition to the government of the
Shah of Iran, who was America's ally. MEK was extremely violent, with
an ideology that mixed Islamism and Marxism. It conducted numerous
terrorist murders of both Iranian government officials and American
officials and military in Iran.

MEK supported Iran's Great Islamic Revolution in 1979, helping to
replace the Shah with the government of Ayatollah Rouhollah Khomeini.
However, MEK leaders quickly discovered that the Khomeini was actually
worse than the Shah's government. In 1981, MEK launched a bombing
campaign that killed Iran's president and prime minister. Then, its
leadership fled to Europe.

The MEK sided with Iraq in the Iran/Iraq war of the 1980s, and helped
Saddam Hussein defeat the Kurds as well as the Iranians. Saddam
set up an enclave of Iranian MEK supporters in refugee camps
in Iraq.

The US in the 1990s declared the MEK to be a terrorist organization,
and after the US won the Iraq war in 2003, the US army disarmed the
MEK enclaves, and disbursed many of the refugees to Europe. The MEK
has become weaker, as its membership has diminished, and in 2012 the
US State Dept. removed the MEK from its list of terrorist
organizations.

Iran has frequently attacked the MEK refugee camps in Iraq with
missiles, and still consider the MEK, and its leaders Massoud and
Maryam Rajavi, to be terrorists. Global Security and Tehran Times

****
**** Negative interest rates creating increased anxiety
****


Global sovereign bond yields have plummeted precipitously since November 2015 (Bloomberg)

If you pay attention to the Pollyannaish mainstream financial media,
then you constantly get the picture that the economy is wonderful, and
investments will only keep growing. For example, even when the
financial crisis occurred in 2007-2010, and millions of people lost
their jobs, went bankrupt and lost their homes, the message was always
the same that all losses were in the past.

What's surprising these days is that the mainstream financial media
are increasingly airing opinions that something is seriously wrong,
and that there is a possible financial crisis in the offing. That has
been particularly true since the end of 2015, when global sovereign
bond yields started dropping like a stone.

Translation: Every country funds its treasury in several ways, and one
way is to borrow money from investors by issuing "sovereign bonds."
In "normal" times, investors can typically earn 2-10% interest (yield)
per year on these bonds, depending on the country and the length of
time before the bond will be redeemed. These sovereign bonds are
considered to be the gold standard of risk-free investments, since
it's believed and expected that every country will honor its
obligations and redeem the bonds when they expire, paying their face
value, plus the money earned as interest. However, with the recent
arrival of negative yields, the country will pay the investor LESS
money than the invested in the first place. So, for example, you pay
$1,000 for one of these bonds that expires in two years, and two years
later the country redeems it for just $990, and you've paid $10 in
negative yield.

The chart above shows that sovereign bond yields have been crashing
since November of last year. This is becoming increasingly alarming
to many investors.

Sovereign bonds are supposed to be the safest investments in the
world, but according to Bill Gross, one of the best known investors in
the world, sovereign bonds are now too risky:

> [indent]<QUOTE>"Sovereign bond yields at record lows aren’t worth the
> risk and are therefore not top of my shopping list right now; it’s
> too risky. Low yields mean bonds are especially vulnerable
> because a small increase can bring a large decline in
> price."<END QUOTE>[/indent]

This was supported by a release from Fitch Ratings:

> [indent]<QUOTE>"This year's dramatic fall in yields on bonds issued
> by investment grade sovereigns has again raised the risk that a
> sudden interest rate rise could impose large market losses on
> fixed-income investors around the world, Fitch Ratings says. A
> hypothetical rapid reversion of rates to 2011 levels for $37.7
> trillion worth of investment-grade sovereign bonds could drive
> market losses of as much as $3.8 trillion, according to our
> analysis."<END QUOTE>[/indent]

Most people look at the stock market, and think that everything is
rosy, but there's a lot going on that isn't reflected in the stock
market. In 2007, it was the collapse of the real estate bubble and,
more importantly, the disastrous collapse of collateralized debt
obligations (CDOs) backed by subprime mortgages. The disaster had
already occurred before the stock market started falling.

Bloomberg columnist Lisa Abramowicz on TV on Wednesday commented on
the warnings from Bill Gross and Fitch (my transcription):

> [indent]<QUOTE>"There's a high level of concern about how sustainable
> all of this is - when profits are declining, when you have growth
> slowing, when you have stimulus efforts that are not working and
> that are running out of steam -- how long can this last? But at
> the same time, it's very hard to see what could reverse it. The
> only thing that people possibly can point to is inflation, or if
> some country decides not to pay back their debt, or just forgive
> it, or come up with some kind of engineering that creates a
> technical problem."<END QUOTE>[/indent]

As I've been writing for years, inflation or hyperinflation is not
going to happen because the velocity of money keeps plummeting.
( "11-Mar-16 World View -- In desperation move, European Central Bank further lowers negative interest rates"
)

According to Abramowitz's contacts, the only thing that can stop the
current plunge in bond yields is for some country to decide not to pay
back their debt -- essentially to declare sovereign bankruptcy. In
other words, there's a major financial crisis coming no matter what.
Bloomberg and Fitch Ratings


KEYS: Generational Dynamics, Iran, Palestinian Authority, Mahmoud Abbas,
Maryam Rajavi, National Council of Resistance to Iran, NCRI,
Hossein Amir-Abdollahian, Mkhaimar Abusada, Hamas, Gaza,
Ayatollah Seyed Ali Khamenei, Iraq, Saddam Hussein,
Mujahedin-e Khalq Organization, MEK, MKO, Massoud Rajavi,
Syria, Bashar al-Assad, Ayatollah Rouhollah Khomeini,
Bill Gross, Fitch Ratings, Lisa Abramowicz

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John J. Xenakis
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