Russia And Germany Allegedly Working On Secret "Gas For Land" Deal

http://www.zerohedge.com/news/2014-07-31/molotov-ribbentrop-20-russia-and-germany-allegedly-working-secret-gas-land-deal

Russia And Germany Allegedly Working On Secret "Gas For Land" Deal
Submitted by Tyler Durden on 07/31/2014 14:50 -0400

While many were amused by this photo of Putin and Merkel during the world cup final showing Europe's two most important leaders siding side by side, some were more curious by just what the two were scheming:

Thanks to the Independent, we may know the answer, and it is a doozy, because according to some it is nothing shy of a sequel to the Molotov-Ribbentrop pact: allegedly Germany and Russia have been working on a secret plan to broker a peaceful solution to end international tensions over the Ukraine, one which would negotiate to trade Crimea's sovereignty for guarantees on energy security and trade. The Independent reveals that the peace plan, being worked on by both Angela Merkel and Vladimir Putin, "hinges on two main ambitions: stabilising the borders of Ukraine and providing the financially troubled country with a strong economic boost, particularly a new energy agreement ensuring security of gas supplies."

Amusingly, this comes on the day when the WSJ leads with "On Hold: Merkel Gives Putin a Blunt Message. Germany's Backing of Russia Sanctions Marks Breach in Pivotal European Relationship" in which we read that " Angela Merkel spoke to Russian President Vladimir Putin for at least the 30th time since the Ukraine crisis erupted. She had a blunt message, according to people briefed on the phone conversation: Call me if you have progress to report in defusing the conflict. That was July 20. The two leaders haven't spoken since."

They may or may not have spoken since, but it is not because Putin has "no progress to report" - it's because the two leaders have come to a secret agreement which will hardly make Ukraine, or most of Europe, not to mention the UN, happy as it requires that Crimea be permanently handed over to Russia in exchange for Russian gas, which has been cut off for a month now due to non-payment by Kiev.

Here is how the deal came to happen:

Sources close to the secret negotiations claim that the first part of the stabilisation plan requires Russia to withdraw its financial and military support for the various pro-separatist groups operating in eastern Ukraine. As part of any such agreement, the region would be allowed some devolved powers.

At the same time, the Ukrainian President would agree not to apply to join NATO. In return, President Putin would not seek to block or interfere with the Ukraine’s new trade relations with the European Union under a pact signed a few weeks ago.

Second, the Ukraine would be offered a new long-term agreement with Russia’s Gazprom, the giant gas supplier, for future gas supplies and pricing. At present, there is no gas deal in place; Ukraine’s gas supplies are running low and are likely to run out before this winter, which would spell economic and social ruin for the country.

As part of the deal, Russia would compensate Ukraine with a billion-dollar financial package for the loss of the rent it used to pay for stationing its fleets in the Crimea and at the port of Sevastopol on the Black Sea until Crimea voted for independence in March.



To be sure, in the aftermath of the MH-17 shooting, which in light of this revelation would clearly not benefit Russia, negotiations have stalled they are expected to restart once the investigation has taken place. “It is in everyone’s interests to do a deal. Hopefully, talks will be revived if a satisfactory outcome can be reached to investigations now taking place as to the causes of the MH17 catastrophe."

But while Germany can't wait to put the Ukraine conflict behind it and restore normal Russian relations (see Adidas' record plunge earlier today, blamed on the Ukraine conflict) others are far more eager to stir the pot some more: "A spokesman for the Foreign and Commonwealth Office said they had no knowledge of such negotiations taking place. However, the spokesman said he thought it highly unlikely that either the US or UK would agree to recognising Russian control over Crimea. There was no one available at the German embassy’s press office yesterday."

Which, of course, goes back to the fundamental question behind the Eurozone experiment: just who calls the shots. And despite what the UK (and certainly France) believe, that one person was and continues to be Merkel.  And at the end of the day, pragmatic Germany knows that for all the posturing and rhetoric, the biggest loser from a western embargo of Russia (which is now actively shifting its attention to China and now India) would be Germany itself.

[S]trong trade ties between the two countries have also served to strengthen Ms Merkel’s hand and the Russian speaker has emerged as the leading advocate of closer relations between the EU and Russia. “This is Merkel’s deal. She has been dealing direct with President Putin on this. She needs to solve the dispute because it’s in no one’s interest to have tension in the Ukraine or to have Russia out in the cold. No one wants another Cold War,” said one insider close to the negotiations.

Some of Germany’s biggest companies have big operations in Russia, which is now one of Europe’s biggest car markets, while many of its small to medium companies are also expanding into the country. Although Russia now provides EU countries with a third of their gas supplies through pipelines crossing the Ukraine, Germany has its own bilateral gas pipeline direct to Russia making it less vulnerable than other European countries.

However, Russia is still the EU’s third-biggest trading partner with cross-border trade of $460bn (£272bn) last year, and the latest sanctions being introduced by the EU towards Russian individuals and banks will hurt European countries more than any other – particularly Germany, but also the City of London.

Curiously, if there is one entity that could scuttle the deal it is, no surprise there, the US.

Central to the negotiations over any new gas deal with Gazprom is understood to be one of Ukraine’s wealthiest businessmen, the gas broker, Dmitry Firtash. Mr Firtash – who negotiated the first big gas deal between the Ukraine and Russia between 2006 and 2009 – is now living in Vienna fighting extradition charges from the Americans. But he has close relations with the Russian and Ukrainian leaders – he supported Mr Poroschenko – and has been acting as a go-between behind the scenes at the highest levels.

Incidentally, the same Americans which over the past 2 years has been desperate to start a regional war in any one part of the globe in order to break some more windows and boost GDP courtesy of the tried and true "Military Industrial Complex" GDP boost. Which is why if indeed the Ukraine peace process is in the arms of the US, then perhaps Putin's advisor was spot on when he said that "There is a war coming in Europe." Compliments of the United States?

Finally, for those wondering how much of the Independent's story is a fabrication, here is Germany denying it all:

GERMANY: REPORT OF SECRET DEAL ON UKRAINE `TOTALLY UNFOUNDED'

Which, if Jean-Claude Juncker is any indication, seals it.

US Set To Alienate Angry Germany Next, As Crackdown Shifts From BNP To Commerzbank, Deutsche Bank

US Set To Alienate Angry Germany Next, As Crackdown Shifts From BNP To Commerzbank, Deutsche Bank

Submitted by Tyler Durden on 07/08/2014 08:04 -0400

http://www.zerohedge.com/news/2014-07-08/us-set-alienate-angry-germany-next-crackdown-shifts-bnp-commerzbank-deutsche-bank

As we reported over the weekend in "By "Punishing" France, The US Just Accelerated The Demise Of The Dollar", following the record $9 billion fine against French BNP, the outcry has been fast and furious, with virtually everyone in the local chain of command, from Total CEO to the head of the Bank of France (and ECB member) Christian Noyer, all saying that the US is now clearly abusing the reserve power of the dollar and it is time to move away from a dollar-based reserve currency (how that jives with concurrent French demands for a lower EUR is a different, incomprehensible matter entirely).

It appears that having pushed France forcefully into the Russia-China Eurasian, and anti-US camp, the US will now do the same with Germany. Because after infuriating the German population by first refusing to return their gold contained (the legend goes) at the New York Fed, and then with scandal after spying scandal, most recently involving the CIA directly soliciting a German double agent, now the time has come to "punish" Germany's largest banks for the same kind of money laundering that BNP was engaged in. As the NYT and Reuters report, the time has come to shift away from the BNP scandal and focus on what will soon be the Commerzbank and Deutsche Bank fallout.


According to the NYT, the money laundering crackdown is "bound for another European financial center: Germany. State and federal authorities have begun settlement talks with Commerzbank, Germany’s second-largest lender, over the bank’s dealings with Iran and other countries blacklisted by the United States, according to people briefed on the matter. The bank, which is suspected of transferring money through its American operations on behalf of companies in Iran and Sudan, could strike a settlement deal with the state and federal authorities as soon as this summer, said the people briefed on the matter, who were not authorized to speak publicly.

The contours of a settlement, which the authorities have only begun to sketch out, are expected to include at least $500 million in penalties for Commerzbank, the people added. Although prosecutors were still weighing punishments, the people briefed on the matter said that the bank would most likely face a so-called deferred prosecution agreement, which would suspend criminal charges in exchange for the financial penalty and other concessions.

It's not just Commerzbank - a settlement with the smaller bank will merely pave the way for the punishment of the biggest bank of all (in terms of groiss derivative notional held): Deutsche Bank.

A potential deal with Commerzbank — which is expected to pave the way for a separate settlement with Deutsche Bank, Germany’s largest bank — would pale in comparison to the case announced last week against France’s biggest bank, BNP Paribas. The French bank agreed to pay a record $8.9 billion penalty and plead guilty to criminal charges for processing transactions on behalf of Sudan and other countries that America has hit with sanctions, a rare criminal action against a financial giant.

As NYT adds, correctly, "The Commerzbank investigation features an added twist: The bank is 17 percent owned by the German government. It is unclear whether — as in the BNP case, which led French authorities to intervene on the bank’s behalf — the settlement talks could inflame diplomatic tensions between Washington and Berlin."

Of course, since this is the ridiculous "scorched earth" diplomatic policy, if one may call it that, of the Obama administration, nobody is surprised any more that the US president is alienating one former ally after another.

As we first observed a few weeks ago when we revealed JPM's involvement in all of this money laundering, "some critics have questioned why American authorities have set their eye on European banks. The answer, authorities say, is that American banks by and large avoided processing transactions for Iran and Sudan. But American banks are not immune from touching dirty money. Citigroup’s Banamex unit is under investigation for processing money linked to a drug cartel. And in January, JPMorgan Chase reached a roughly $2 billion deal with the authorities over ignoring signs of the Ponzi scheme orchestrated by Bernard L. Madoff, who held accounts at the bank for over two decades."

Not only that but as we wrote over the weekend, the bank that was instrumental in facilitating BNP's money laundering for nearly a decade was none other than JPM. One wonders if JPM also "unwittingly" was the bank that made German money laundering around the globe possible. Did we mention unwittingly?

Still, while one can debate the idiocy of US foreign policy, eager to push European allies into the willing hands of Russia and China at the worst possible moment, when regional and civil wars and conflicts are suddenly breaking out across all key geopolitical hotspots, one wonders: in the case of BNP, the "fine" was as a result of French unwillingness to halt the Russian amphibious warship deal despite US demands. So it would be curious just what the US blackmail against German banks is for: one really does wonder just what punishment Angela Merkel deserves behind the scenes in the eyes of John Kerry et clueless al, to punish her and Germany so blatantly for the entire world to see.

One thing is clear: if the US thinks that Germany will continue to consider America its BFF and make zero contingency plans for when the alliance with the US finally crashes and burns, it will be truly surprised when the Eurasian alliance of Russia and China finally announces its final, all

LEAKED Confession: Cesspool Of Greek-German Corruption

LEAKED Confession: Cesspool Of Greek-German Corruption
December 30th, 2013

http://investmentwatchblog.com/leaked-confession-cesspool-of-greek-german-corruption/

Wolf Richter www.testosteronepit.com  www.amazon.com/author/wolfrichter

Apparently, it has been impossible to sell Greece any weapons at all, not even a water pistol, without bribing officials at the Defense Ministry. Corruption is so pandemic that Transparency International awarded Greece once again the dubious honor of being the most corrupt country in the EU. For 2013, Greece ended up in 80th place of the 177 countries in the survey, same as China. But it takes two to tango.

And in holier-than-thou Germany, where exporting at any price is a state religion (with chart) regardless of who runs the show, the defense industry was allegedly eager to dance with Greece – supplying tanks, submarines, and other equipment that broke Greece didn’t need and couldn’t afford.

Now there’s a confession. After four days of grilling, investigating magistrates in Athens extracted it from Antonios Kantas, General Secretary for Procurement at the Defense Ministry between 1996 and 2002. He’d been arrested in mid-December after authorities found nearly €14 million in various accounts. In his 30-page testimony, elements of which have been leaked, he admitted having pocketed €15 million in bribes since 1989 – just this one guy!

But it was a community effort that stretched across party lines. He named names, euros, and dollars, implicating 17 Greek politicians and businessmen. They include former head of procurement Yiannis Sbokos, former Defense Minister Akis Tsochatzopoulos – who, along with Sbokos, has already been condemned to years in the hoosegow for laundering the kickbacks he’d received in various arms deals – and his worthy successor, former Defense Minister Yiannos Papantoniou. And Kantas named the coddled weapons manufacturers in Germany.



There was the multi-billion euro deal for 170 “Leopard 2” tanks, manufactured by Krauss-Maffei Wegmann (KMW), as the Süddeutsche Zeitung “learned.” The tanks have all been delivered and paid for except for a few tens of millions of euros. For his diligent work, Kantas received €1.7 million in several payments, including €600,000 that a middleman “forgot” in Kantas’ office as payment for not raising objections to the purchase.

KMW denied everything when the Süddeutsche started prying. It had never paid, or authorized others to pay bribes, neither to Kantas nor to anyone else, the company said. Further, it required all employees and business partners to observe the laws. The order from Greece, dated March 2003, had been carefully monitored. Kantas didn’t represent Greece, etc., etc.

KMW has built over 5,000 Leopard tanks, much of it for export to savory and unsavory countries since domestic purchases after the collapse of the Soviet Union shriveled to nearly nothing. Selling tanks is already a hot-button issue in Germany. It was triggered once again when Chancellor Angela Merkel went to Indonesia last July, accompanied by plane loads of executives. The Indonesian government wanted to make a deal for 100 used “Leopard 2” tanks from the German military – though Merkel’s spokesman had denied it a few days earlier, claiming that it was “not on the agenda.”

It must have ended up on the agenda anyway. Embarrassingly, Indonesian President Susilo Bambang Yudhoyono confirmed after his talk with Merkel, albeit indirectly, that his government had requested the tanks. He had to modernize the army, he said. “Everything that we cannot produce ourselves we have to buy from friendly states,” he said, “and now Germany.”

The controversy erupted in Germany because Indonesia is an island nation. Why would it need tanks to defend itself? From whom, exactly? From tanks and infantry rolling in waves across the ocean? Or did the government, which has been accused of human rights violations and crimes in repressing internal conflicts, want the tanks to use against its own people?

Apparently. The tanks Indonesia was interested in buying would be modified versions designed to fight terrorists and revolts, according to industry insiders. German defense contractor Rheinmetall, which is doing the modification work, and the German government remained assiduously silent on the topic. But the Indonesian government has been talking about it, with Yudhoyono explaining to an incredulous world that “we have never used tanks and helicopters or other weapons against our population.”

Indonesia also asked the Netherlands to sell them their old Leopards, but the Dutch parliament nixed the deal. In Germany, the Bundestag doesn’t get involved in arms deals. It’s up to the government. And Merkel wants those exports, rumored to be worth €3.3 billion. Exports at any price.

Then Greece bought German submarines, a process that was a cesspool of corruption. They were built by Howaldtswerke-Deutsche Werft (HDW) in Kiel, a subsidiary of conglomerate ThyssenKrupp. The submarines were equipped by Rheinmetall-Defence-Electronics and Atlas Elektronik, a German maker of naval electronics, integrated sonar systems for submarines, and torpedoes, now controlled by Thyssen-Krupp. Ferrostaal GmbH, a German industrial company, marketed the submarines to politicians. Kantas claimed to have been paid between €500,000 and €600,000 by a representative of Atlas Elektronik to get that deal done.

This summer, the Prosecutor’s Office in Bremen started investigating Atlas and Rheinmetall for tax fraud and bribery in connection with the sale. They’re alleged to have paid €9 million in bribes. So Kantas only got a small fraction. In August, authorities raided the offices of the two companies. Turns out, they’d made the payments to a British mailbox company owned by a Greek company, but the payments stopped in 2007. Greek authorities raided Rheinmetall’s office in Athens – and that’s how they found out about Kantas’ involvement in all these deals.

As always, Rheinmetall rejected the accusation, claiming that it was “baseless,” that it had made “no direct or indirect payments to Greek officials,” and that any improper payments were “not known to us.”

However, the Prosecutor’s Office in Munich, after investigating Ferrostaal’s role in the deal, prevailed in 2011 in court. The judge condemned two employees of Ferrostaal to, well, probation (to the sound wrists being gently slapped) and Ferrostaal to a €149 million fine.

Then there was the sale to Greece of “Asrad,” a vehicle-mounted short-range anti-aircraft system, designed by Rheinmetall and Swedish arms supplier, Saab Bofors Dynamics. Kantas claimed he’d received €1.5 million for the deal. He also pocketed €750,000 for KMW’s artillery system.

But non-German arms suppliers contributed to his hard-earned wealth as well. He received $3 million for the purchase of Russian anti-tank missiles, including $700,000 in cash, of which $500,000 were handed to two bankers to deposit overseas; $1.7 million for a Russian anti-aircraft missile system; €250,000 for equipment from Brazilian company Embraer; €240,000 for radar systems from Saab; €800,000 for Mirage fighter jets made by French arms maker Dassault; $1 million for a deal to update US-made M48 tanks; and €400,000 for the purchase of anti-ship missile Exocet made by MBDA, which is owned jointly by BAE systems, EADS (Airbus), and Finmeccanica of Italy. The latter is entangled in the helicopters-for-India corruption scandal that saw the CEO get arrested Italy. And so on.

Who knows how long the list actually is! For example, in September, a Greek magistrate brought charges of bribery and money laundering against Kantas for having accepted a bribe of €500,000 paid to a Swiss bank account in his name, for a deal that awarded German industrial conglomerate Siemens a contract to modernize the military’s telecom system.

It’s convenient to blame the culture of corruption in Greece for the putrefaction seeping from every pore of the economy. The scourge has infected Greek institutions to their roots and is in part responsible for the current economic fiasco. But bribery requires a willing partner. In white-glove Germany, the state religion of exports at any price, come hell or high water, has encouraged authorities to close their eyes when companies spend a little extra to get deals done.

Greece didn’t need the weapons, couldn’t afford them, and had to pile on debt to buy them… debt that has become subject to high and tight haircuts and massive bailouts, funded largely by grumbling German taxpayers. And therein lies a twisted, ironic injustice: German taxpayers have to transfer once again their wealth indirectly and unwittingly to the coddled German export sector.

When Jens Weidmann, President of the emasculated Bundesbank, speaks, central bankers and money printers worldwide stuff wax into their ears. “Caution,” he started out, “the euro crisis is far from over.” Then he committed central-bank heresy. Read…. This Ends In A “Planned Economy” – Bundesbank President


Read more at http://investmentwatchblog.com/leaked-confession-cesspool-of-greek-german-corruption

A Holiday Message From The Great Dictator

A Holiday Message From The Great Dictator

Submitted by Tyler Durden on 12/27/2013 13:14 -0500

Submitted by Simon Black via Sovereign Man blog,

http://www.zerohedge.com/news/2013-12-27/holiday-message-great-dictator

In September 1939, six days after the United Kingdom declared war on Germany, Charlie Chaplin began filming one of his most epic films ever… and the first “talkie” for the silent film star.

It was a courageous project - the ‘Great Dictator’ directly poked fun at Adolf Hitler.

At the end of the movie, Chaplin looked into the camera and gave a stirring speech about timeless principles– peace, mutual respect, freedom from evil men who aspire to lead nations.

This did not win Chaplin any friends in Washington who were keen to maintain official neutrality.

And he paid dearly for it; the Great Dictator was the beginning of an entire decade of turbulent trouble between Chaplin and the US government.

FBI director J Edgar Hoover opened a file on Chaplin and launched a smear campaign to tarnish his public image. The mainstream media quickly jumped on board, accusing Chaplin of being a communist sympathizer.

Eventually they found an obscure law on the books as an excuse to haul him into court and put him in prison.

Chaplin won the trial… barely… but was then roped into the anti-communist witch hunts of Senator Joseph McCarthy.

In his autobiography, Chaplin sums up his troubles with the US government as follows:

“My prodigious sin was, and still is, being a nonconformist. Although I am not a Communist, I refused to fall in line by hating them. . . Secondly I was opposed to the Committee on Un-American Activities– a dishonest phrase to begin with, elastic enough to wrap around the throat and strangle the voice of any American citizen whose honest opinion is a minority one.”

Chaplin reached his breaking point when, as a British citizen, he realized that he would be effectively kicked out of the Land of the Free. As he wrote,

“Whether I re-entered that unhappy country or not was of little consequence to me. I would like to have told them that the sooner I was rid of that hate-beleaguered atmosphere the better, that I was fed up with America’s insults and moral poposity, and that the whole subject was damned boring.”

He moved his family to Switzerland and lived out the rest of his days in an idyllic setting near Geneva.

There was just one problem. The entirety of Chaplin’s substantial wealth was in the US. And he waited far too long– until he had been exiled from the country– to even think about moving some funds abroad.

His rousing speech at the end of the Great Dictator calls for a world free of violence, intimidation, and government control. Unfortunately, we don’t get to live in that world.

We live in a world where ambitious men are willing to do anything to seize absolute power… where they can regulate every aspect of our lives, from what we put in our bodies to whether we can collect rainwater.

They confiscate our hard earned wages at gunpoint. They devalue our savings. They spy, brazenly and relentlessly, on absolutely everyone. They wage senseless wars in foreign lands. They waste. They frustrate. They destroy.

This our reality. The world is beautiful. Life is beautiful. But the leaders of humankind surely make it all damned hard to appreciate sometimes.

That’s why it makes so much sense for everyone to have a little bit of insurance– to make sure that we don’t make the same mistake as Chaplin and hold the entirety of our savings and livelihood in the same country in which we live… and one that is clearly on a downward trend.

This is our consumate focus at Sovereign Man. And with each passing day, the reasons become even more obvious. We’re going to be in for a hell of a 2014.

And now, without further ado, please enjoy Mr. Chaplin’s final speech from the Great Dictator:

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