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Showing posts from July 29, 2014

The Truth About Diamonds

Americans exchange diamond rings as part of the engagement process, because in 1938 De Beers decided that they would like us to. Prior to a stunningly successful marketing campaign in 1938 Americans occasionally exchanged engagement rings, but wasn't a pervasive occurrence. Not only is the demand for diamonds a marketing invention, but diamonds aren't actually that rare. Only by carefully restricting the supply has De Beers kept the price of a diamond high.

It's the equivalent of some company restricting the supply of aluminum so instead of it actually being available and dirty cheap it's instead sold in jewelry for more expensive than platinum. It's absolutely absurd.

A company called De Beers, who has a monopoly, artificially restricts the supply of diamond to keep the prices obscenely high. Not only are they artificially high but they are a worthless investment. Retail jewelers prefer not to buy back diamonds from customers because they sell them at a 100 to 200…

U.S.-Mexico Border Apprehensions Hit 38-Year Low

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On July 21, Texas Gov. Rick Perry announced he was deploying 1,000 members of the Texas National Guard to the Mexican border to help strengthen border security. The move is the latest in a chain of events concerning the emigration of Central American minors that has become heavily publicized and politicized.

This type of hype and politicization of the U.S.-Mexico border is not new and has surfaced at irregular intervals for decades now. But lost in all the media hype over this "border crisis" is the fact that in 2013 overall immigration was down significantly from historical levels. According to U.S. Border Patrol apprehension statistics, there were only 420,789 apprehensions in fiscal year 2013 compared to 1,160,395 in 2004. In fact, from fiscal years 1976 to 2010, apprehensions never dropped below 500,000. During that same period, the Border Patrol averaged 1,083,495 apprehensions per year compared to just 420,789 last year.

Of course, apprehension statisti…

Iraqi Kurdistan Attempts to Bypass Baghdad, by Way of Texas

by George Friedman

The commotion surrounding Iraqi Kurdistan's ongoing feud with Iraq's central government spread to the Texas Gulf Coast over the weekend. The U.S. Coast Guard, Department of State, Department of Homeland Security and National Security Council were sent scrambling when a tanker tried to offload 100,000 barrels of Kurdish crude.

The sale of the United Kalavryta's cargo would mark the second time (the first was sold to an Israeli buyer) that Iraq's Kurdish leadership has sold crude oil in complete defiance of Baghdad. The Iraqi central government maintains that all Iraqi crude must be sold and distributed by federal authorities in order to maintain the territorial integrity of the country. Baghdad's position is endorsed by the United States and Iran but challenged by Turkey, which has backed the Kurdistan Regional Government's transactions so far and is reportedly loading a fifth tanker at the port of Ceyhan at the time of writing. Meanwhile, anot…

Ukraine: Military Advances to Divide Rebel Strongholds

A resident of Lysychansk, a city in eastern Ukraine, crosses the street past Ukrainian military armored personnel carriers July 27, 2014.(GENYA SAVILOV/AFP/Getty Images)

Summary


Ukrainian forces have made significant progress toward their goal of isolating the separatist-controlled cities of Donetsk and Luhansk. After a week of fighting, the military regained control of Debaltseve, a strategic town at the junction of the main E40 and E50 highways. It also now controls Shakhtarsk and is making gains in Torez, located east of Donetsk, and Lutuhyne, a town to the southwest of Luhansk. This puts Kiev's forces in control of much of the territory between Donetsk and Luhansk, allowing them to prevent the movement of arms and personnel between the two militant strongholds.

Analysis


Despite its recent successes, Kiev continues to face challenges in its attempts to suppress the pro-Russia separatist movement in eastern Ukraine. The government has recently ramped up its military efforts, moving …

Echoes of the Great War Resonate a Century Later

German infantry in training a month before the start of World War I, June 30, 1914. (Topical Press Agency/Getty Images)

Summary


On July 28, 1914, exactly one month after Archduke Franz Ferdinand of Austria and his wife were shot dead, Austria-Hungary declared war on Serbia. The stage was set for World War I, an inevitable result of decades of political maneuvering, militarization, alliances and planning for a conflict that would shatter the great European epoch, laying waste to empires and ascendant nations.

Analysis


At the heart of World War I was the rise of Germany and the question of its place in the European balance of power. Prussian statesman Otto Von Bismarck had painstakingly crafted a modern, unified German nation through fire and blood, ensuring its survival through shrewd realpolitik diplomacy. The new unified Germany remained wary of potential threats from east and west, a concern reciprocated by nearby states, which harbored deep-seated concerns and fears over Germany&…

Geopolitical Calendar: Week of July 28, 2014

EuropeJuly 29: The General Affairs Council, comprising EU foreign ministers, will meet in Brussels.July 30: Spanish Prime Minister Mariano Rajoy and Catalonia regional President Artur Mas will meet at Rajoy's Moncloa residence in Madrid to discuss the issue of independence for Catalonia. Asia-PacificJuly 23-30: Canadian Foreign Minister John Baird will visit China, Mongolia and Japan.July 25-31: U.S., Indian and Japanese warships will hold joint naval exercises in the Pacific. The Japan Maritime Self-Defense Force will take part.July 28-31: Canadian and Japanese negotiators will meet in Ottawa for another round of talks on a free trade agreement between the two countries.July 29: Japanese Defense Minister Itsunori Onodera will meet with his French counterpart, Jean-Yves Le Drian, to discuss expanding military cooperation, particularly in the development of submarine drones.July 29: In a hearing, the U.S. Senate Committee on Finance is likely to address its growing defic…