Iran rial collapse news items . Turkey continues artillery barrage for second day - have they entered the Syrian campaign ? Efforts of NATO training of Afghan military reflected in more sophisticated green on blue attacks ? Special Forces Ops planned for inside Libya as their Government attempts to assert its authority. Pentagon taps a slush fund to keep its Iraq pet project going... Iran and Syria items of note at the top......

http://www.juancole.com/2012/10/iran-bazaar-strikes-signal-misery-not-sanctions-victory.html

Iran Bazaar Strikes signal Misery, not Sanctions ‘Victory’

Posted on 10/04/2012 by Juan

On Wednesday, the Tehran covered bazaar was closed, and the traditional market in some other cities such as Mashhad also went on strike, with demonstrators protesting the collapse of the Iranian currency, the rial. Until last November, the rial was about 10,000 to the dollar. Then it fell to 12,000. Last summer it hit 16,000. Some merchants were offering 35,000 to the dollar on Wednesday and expected the rial to decline further.

Although the US, the EU and Israel’s government will gloat that ‘sanctions are working,’ it is unclear that any such thing is true.

True, Western sanctions on Iran have gone beyond mere boycotts to a kind of financial blockade, in which obstacles are being placed in the way of Iran selling its petroleum to third parties, especially in Asia.

Iran had been producing 3.5 million barrels a day of oil, and selling 2.5 million abroad. It is now apparently only producing 3 million barrels a day and selling 2 (especially to China, India and some other Asian states). Iran is shipping to China in its own tankers and insuring them itself, which is producing some delays in delivery, but nothing the Chinese are worried about. The loss of 500,000 barrels a day in exports, and the extra costs of doing business (15%?), however, cannot possibly be causing the collapse of the value of the rial.

The West can blockade Iranian petroleum in this way because Saudi Arabia agreed to ‘flood the market,’ pumping as much as two million barrels a day more than normal. Iraqi output is also up about a million barrels a day over 2010 levels. But the addition of a couple of million barrels a day wouldn’t have been enough to allow this policy. In addition, the world economic slowdown has reduced the rate at which the demand for oil is expanding in Asia. At any point where Asian demand returns strong, Iran will likely be better able to evade sanctions.

Thus, although Iran’s petroleum sales have fallen, it is not clear that they have will have fallen dramatically when new trade arrangements with China, India, South Korea and so forth are implemented, getting around the US financial blockade. Europe stopped buying Iranian oil on July 1, and sales were hurt that month. But Iranian officials say that they are back up to normal sales volume this fall. Likely Europe will buy oil from other producers, denying it to previous customers in the global south, some of whom will turn to Iran. Iran’s government should be flush with billions of dollars of reserves, and should have the expectation of more, and there is no obvious reason for the rial to plummet this way.

In short, it is not entirely clear that these severe sanctions or the reduced oil exports are the only things responsible for the rial’s rapid decline against the dollar.

Hyperinflation is caused by printing too much money. President Mahmoud Ahmadinejad has for some time pumped extra money into the economy in the form of subsidies, which has caused the money supply to grow unhealthily in Iran. The rial has probably for a long time been over-valued, partly because of the support for it of an oil state. So it may be that years of easy money are now coming home to roost, in part because the severe sanctions have (irrationally) weakened the confidence of traders in the hardness of the rial, a confidence that itself had earlier been irrational.

Money traders in the neighboring United Arab Emirates are said to have been unable to quote a price for converting rials to dollars on Wednesday, because the rial was going over a waterfall in a barrel, falling by the second.

The money changers and merchants in Tehran and Mashhad were angered in part by an inability to price their goods (especially imported goods). Many of them had counted on keeping some of their assets in dollars, but suddenly dollars have disappeared from the Iranian currency markets, probably because they are being massively hoarded. There are rumors in the bazaar, say some close observers, that ‘mafias’ and cliques are doing the hoarding.

But reading these events as a ‘victory’ for sanctions goes too far. First, the demonstration in the bazaar may have had a narrow social base.

Here is a video of the closed-up bazaar in Tehran on Wednesday:

There is video showing a larger crowd, apparently middle class, some of whom demanded that the regime stop throwing money away in Syria and spend it in Iran instead. This theme is reminiscent of the chanting of the Greens in September of 2009 that Iranians should stop obsessing about Palestine and put the emphasis on Iran’s welfare instead. The remnants of theGreen Movement press hailed the demonstrations and reported on them in detail.

Second, the demonstration may have been aimed at unseating President Ahmadinejad, whom the Iranian right and business classes have long loathed because of what they see as his populist and irresponsible mismanagement of the economy. (His subsidies for the working classes and the poor, and easy money policies grated on them). Ahmadinejad has been in bad odor with conservatives since his tiff last spring with the Supreme Leader over key government appointments, including in intelligence. The Supreme Leader won, as might be suggested by his title, and Ahmadinejad is a lame duck.

Although Ahmadinejad is hated in the West, Wikileaks revealed that he has often been the official most inclined to compromise with and negotiate with the West, being blocked by the Revolutionary Guards Corps and other hard liners to his right. For the Iranian far right to unseat Ahmadinejad is anything but a victory for the West.

Ahmadinejad himself blamed the currency collapse on ‘psychological warfare’ waged by enemies ‘abroad and within.’

Finally, for sanctions to ‘work,’ they would have to have the effect of deterring the Iranian state from purusing its nuclear enrichment program. There is no such evidence, and the likelihood is that regime officials will be cushioned from the sanctions because they control the state-owned oil company and can siphon off money to protect themselves.

Severe sanctions almost never work in producing regime change or even in altering major policies of regimes. In Iraq, the severe sanctions of the 1990s actually destroyed the middle classes and eviscerated civil and political society, leaving Iraqis more at the mercy of the authoritarian Baath Party of Saddam Hussein than ever before. The high Baath officials squirreled away $30 billion during the oil for food program, cushioning themselves But the sanctions that denied Iraqis chlorine imports disabled the water purification plants, giving the whole country constant diarrhea, a condition that easily kills infants and toddlers. Some 500,000 Iraqi children are estimated to have been killed this way.

Usama Bin Laden cited this death toll of Iranian children as one of the reasons for his 9/11 attacks on the US. If the sanctions end up killing Iranian children, the US could be borrowing a lot more trouble for the future.

Moreover, the difficulty of maintaining the sanctions on Iraq was given as a reason by then deputy secretary of defense Paul Wolfowitz as a reason for going to war with Iraq. Severe sanctions often do not deflect wars but rather lead to them.

The collapse of the rial, then, may be a signal that the Iranian public is in for great suffering and that the savings of the middle class are about to be wiped out. But that would mean they would lack the money to pay for an insurrection. Moreover, while they are blaming Ahmadinejad now, they know that the US, the EU and Israel are behind their deepening misery, and they are likely to come to hate their torturers.

http://www.zerohedge.com/news/2012-10-04/iran-arrests-gang-16-currency-manipulators

Iran Arrests Gang-Of-16 'Currency Manipulators'

Submitted by Tyler Durden on 10/04/2012 17:37 -0400

• European Union
 
• Fail
 
• Iran
 
• Purchasing Power

A gang of 16 shady individuals have been arrested by Iranian officials for allegedly smuggling currencies outside the banking network in order to increase the value of foreign currencies and to disturb the public. As CNN reports, amid the protests in the clip below, Iran says the 16 unidentified individuals "had used anatmosphere of psychological war created by the enemy" and colluded with "certain domestic and foreign groups" to exacerbate conditions. One of the accused, allegedly, had $300mm going through a bank account and "will be dealt with soon." Those arrested "were the main players in the recent fluctuations in the foreign currency market," the Tehran Judiciary said in a statement as the public panics over a 60% drop in its currency's purchasing power in the last few weeks. Of course, a 99% drop in the USD's purchasing power is acceptable to the US public since it has been achieved over a century or so...

Via CNN:

Iran arrested 16 people Thursday, accusing them of contributing to the currency crisis plaguing the country that has triggered protests in the streets.

Those arrested "were the main players in the recent fluctuations in the foreign currency market," the Tehran Judiciary said in a statement.

The move came a day after riot police worked to disperse protests in the capital's main bazaar and nearby streets. Demonstrators chanted slogans opposing firebrand President Mahmoud Ahmadinejad and decrying the skyrocketing cost of basic goods.

...

The rial's plummet to historic lows is the result of international sanctions, imposed largely by the United States and the European Union in an effort to pressure Iran to sit down for talks on its nuclear program.

...

Ahmadinejad and the country's supreme leader, Ayatollah Ali Khamenei, have assailed the sanctions, insisting "the enemy" will fail in its efforts and is hurting the Iranian people rather than the government.

The government did not identify the 16 arrested Thursday. In a written statement, the judiciary said they"had used an atmosphere of psychological war created by the enemy" and colluded with "certain domestic and foreign groups" to exacerbate conditions."

They traded extensively in "smuggled" currencies "outside of the banking network" in order to increase the value of foreign currencies and disturb the public, the judiciary claimed, adding that they "amassed illegal fortunes."

One of the accused had $300 million going through a bank account, the statement said.

Iran warned that others "are being accused as well and will be dealt with soon."

and....




http://www.sfgate.com/business/bloomberg/article/Iranians-Abandon-Meat-for-Bread-as-Rial-Drop-3918023.php

Iranians Abandon Meat for Bread as Rial Drop Fires Protests

Yeganeh Salehi and Glen Carey, ©2012 Bloomberg News

Updated 4:51 a.m., Thursday, October 4, 2012

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(Adds push for more sanctions in 19th paragraph)

Oct. 4 (Bloomberg) -- Iran’s freefalling currency is turning meat into a luxury, sparking overnight price surges and spurring shoppers to stockpile goods.

“Most of my customers just look at products behind the window and pass,” said Behrouz Madani, 42, who owns a butcher shop in northwest Tehran. “I see them going to the next store, which is a bakery, to feed their families with bread.”

Iran’s rial is in a tailspin, having lost more than half of its value against the dollar in street trading in the past two months as U.S. and European sanctions aimed at curbing the country’s nuclear program bite. Riot police yesterday fired tear gas and sealed off parts of downtown Tehran after the currency’s plunge triggered street protests.

Security forces were also sent to the city’s bazaar after shopkeepers refused to open. The inflation rate, estimated by Parliament Speaker Ali Larijani at 29 percent last week, has accelerated to the point where the price of milk in Tehran rose 9 percent yesterday.

The economic situation has “reached a point where it becomes almost impossible not to show reaction,” said Anoush Ehteshami, professor of international affairs at Durham University in the U.K.

The rial is falling as sanctions eat into Iranian oil exports and foreign currency earnings. The currency dropped about 18 percent on Oct. 1, reaching 35,000 to the dollar on the unofficial market. The currency traded at 36,100 yesterday, the state-run Mehr news agency said, though traders in Tehran said most exchange houses have halted dealing in the greenback. That compares with the official value of 12,260 rials per dollar set by the central bank.

Future Angst

Most Iranians can’t access that rate apart from some importers of essential goods such as medicines, meat and grains.

People “are nervous about tomorrow and next week because they don’t know how much more expensive things will be,” said Mostafa Daryani, 52, whose family owns a Tehran supermarket chain. “They only buy their daily needs and ignore most of the things that are not urgent for daily life. Instead of one bottle of milk, they buy two.”

Prices of home appliances have doubled in the past six months and some shopowners prefer to hoard goods rather than sell them in the hope that they can get higher prices in the future, said Yahya Ebrahimi, 48, who owns an electronics store in central Tehran. Merchants are increasingly using the dollar value of items as the basis for sales, he said.

Ease Tensions

Madani, the butcher, says the cost of chicken, a staple in the country, has doubled in the past year.

President Mahmoud Ahmadinejad has sought to ease tensions in the country, saying in an Oct. 2 press conference that the situation will improve and there was “no economic justification” for the rial’s dive.

“The enemy is administering pressure and it’s lying when they say it’s pressuring the government,” he said. “It’s pressuring the nation, the people.”

That’s clear on the streets of Tehran.

Daryani’s brother, Mohsen, said their supermarket chain started to delay purchases of inventory this week due to the rial’s fall.

“We stopped making large purchases because prices aren’t fixed,” Mohsen Daryani said “Factories are changing the final cost of their products because of the changes in the foreign currency exchange rate every second.”

Weapons Program

The economic squeeze “is a very serious problem for the Iranian regime, because it threatens its socio-economic stability,” Ehteshami said. “To really deal with the crisis will require stabilizing the economy by reducing the sanctions, which is really a political decision, not an economic one.”

Western powers say Iran is hiding a nuclear-weapons program and the U.S. and Israel have raised the possibility of military strikes against its atomic installations. Iran says its nuclear program is peaceful and aims to make electricity.

Israeli Prime Minister Benjamin Netanyahu has been calling for a “clear red line” to be drawn on Iran’s uranium- enrichment program after which force could be used. U.S. officials have refused to take such as step and have said that sanctions and diplomacy must be given the chance to work.

The U.K., France and Germany are pressing for even tougher sanctions to bring Iran’s economy to its knees, according to four European officials who all spoke on condition of anonymity because of diplomatic protocol. They want to tighten the vise in the energy, finance, trade and transportation sectors.

Darker Days

“There are all sorts of public discussions going on now between the parliament and the executive branch about the handling of macro-economic issues, especially the currency,” Ehteshami said. That said, Supreme Leader Ayatollah Ali Khamenei “‘has made it his badge of honor to not yield under pressure.”

For Akbar Mohebi, a retired Daryani supermarket clerk, the tougher times mean that his son has to cancel plans for studying abroad.

‘Yesterday, I told him forget about your dream,” Mohebi said. “Darker days will come to us.”

--With assistance from Ladane Nasseri in Dubai. Editors: Louis Meixler, John Fraher.

To contact the reporters on this story: Yeganeh Salehi in Dubai at yalehi@bloomberg.net; Glen Carey in Riyadh at gcarey8@bloomberg.net

and...

Turkey Attempts to Trigger War Vs. Syria

Tony Cartalucci 
Infowars.com
Oct 4, 2012

After over a year of harboring foreign terrorists and supporting their operations near and across the Turkish-Syrian border, NATO-member Turkey has claimed it has retaliated with military force against “targets” inside Syria for an alleged attack on Turkish territory that it has blamed on the Syrian government.

Despite heavily armed listed-terrorist organizations operating in large numbers on both sides of the Turkish border with Turkey’s explicit approval and logistical support, the government in Ankara appears to have excluded the possibility that these terrorist forces, not the Syrian military, were responsible for the attack which consisted of mortar rounds the armed militants are known to widely use.

Image: Terrorists operating in Syria pose next to a large mortar. Mortars of all sizes are a favorite of terrorists operating in and around Syria in NATO’s proxy bid to effect violent regime change. The mortars fired into Turkish territory could just as likely have come from terrorists Turkey itself is funding, arming, and harboring on behalf of long-planned NATO machinations. Unlike the Syrian government, the terrorists, Turkey, and by consequence, NATO, all have an actual motivation for launching the initial attack that has caused Turkey to retaliate and predictably call on NATO to intervene.

….

The New York Times itself, in its article titled, “Turkey Fires Artillery at Syrian Targets in Retaliation for Civilian Deaths,” concedes that:

It was unknown whether the mortar shells were fired by Syrian government forces or rebels fighting to topple the government of President Bashar al-Assad. The Turkish response seemed to assume that the Syrian government was responsible.

Turkey’s immediate, unwarranted act of military aggression, along with knee-jerk condemnations from the US bear all the hallmarks of an orchestrated event – or at the very least an attempt to opportunistically seize upon an isolated incident to disingenuously advance the West’s collective geopolitical agenda.

Syria clearly has no interest in threatening the security of Turkey, nor any reason to attack Turkish territory which would surely give NATO the excuse it has been looking for to directly intervene on behalf of its faltering terrorist proxies.

Turkey Has Longed for a Pretext to Start War with Syria

It was previously reported that Turkey was intended by NATO, and more specifically, Wall Street and London, to lead efforts in carving out “safe havens” in Syria’s north, and to do so either under a false “humanitarian” or false “security” pretext.

This has been confirmed by Fortune 500-funded, US foreign-policy think-tank, Brookings Institution which has blueprinted designs for regime change in Libya as well as both Syria and Iran. In their report, “Assessing Options for Regime Change” it is stated (emphasis added):

“An alternative is for diplomatic efforts to focus first on how to end the violence and how to gain humanitarian access, as is being done under Annan’s leadership. This may lead to the creation of safe-havens and humanitarian corridors, which would have to be backed by limited military power. This would, of course, fall short of U.S. goals for Syria and could preserve Asad in power. From that starting point, however, it is possible that a broad coalition with the appropriate international mandate could add further coercive action to its efforts.” -page 4, Assessing Options for Regime Change, Brookings Institution.

Image: The Brookings Institution, Middle East Memo #21 “Assessing Options for Regime Change (.pdf),” makes no secret that the humanitarian “responsibility to protect” is but a pretext for long-planned regime change.

….

Brookings continues by describing how Turkey’s aligning of vast amounts of weapons and troops along its border in coordination with Israeli efforts in the south of Syria, could help effect violent regime change in Syria:

In addition, Israel’s intelligence services have a strong knowledge of Syria, as well as assets within the Syrian regime that could be used to subvert the regime’s power base and press for Asad’s removal. Israel could posture forces on or near the Golan Heights and, in so doing, might divert regime forces from suppressing the opposition. This posture may conjure fears in the Asad regime of a multi-front war, particularly if Turkey is willing to do the same on its border and if the Syrian opposition is being fed a steady diet of arms and training. Such a mobilization could perhaps persuade Syria’s military leadership to oust Asad in order to preserve itself. Advocates argue this additional pressure could tip the balance against Asad inside Syria, if other forces were aligned properly. -page 6, Assessing Options for Regime Change, Brookings Institution.

Turkish leaders have clearly spent much time fabricating various excuses to meet Washington’s demands in this regard by fabricating or taking advantage of violence Turkey itself is fostering along its own border with Syria.

The report would also mention Turkey’s role in helping undermine, subvert, and carve out the ancient northern city of Aleppo:

Because creating a unified national opposition is a long-term project that will probably never fully succeed, the contact group, while not abandoning this effort, may seek more realistic goals. For example, it might concentrate maximum effort on breaking Asad’s hold on, say, the elite of Aleppo, which is the commercial capital and which is also the city where Turkey has the greatest leverage. If Aleppo were to fall to the opposition, the demoralizing effect on the regime would be considerable.

Should this option fail, the United States can simply accept a bad situation in Syria or escalate to one of the military options below. -page 6, Assessing Options for Regime Change, Brookings Institution.

The military options include everything from perpetuating violence to, in Brookings’ own words, “bleed
it, keeping a regional adversary weak, while avoiding the costs of direct intervention,” to Libyan-style “no-fly zones,” to a full military invasion. It is clear, upon reading the Brookings memo, that the conspiracy has indeed begun to unfold since its writing – with various military options being prepared and various co-conspirators positioning themselves to execute them.

The Brookings Institution’s “safe havens” and “humanitarian corridors” are meant to be established by NATO-member Turkey, who has been threatening to partially invade Syria for months in order to accomplish this. And while Turkey claims this is based on “humanitarian concerns,” examining Turkey’s abysmal human rights record in addition to its own ongoing genocidal campaign against the Kurdish people both within and beyond its borders, it is clear they are simply fulfilling the agenda established by their Western patrons on Wall Street and in the city of London.

Photo: Turkish tanks entering Iraq to raid Kurdish towns and hunt suspected rebels in 2008. More recently, Turkey has been bombing “suspected” rebel bases in both Turkey and Iraq, as well asconducting mass nationwide arrests. Strangely, as Turkey verifiably does what Libya’s Qaddafi and Syria’s Assad have been accused of doing, in all of their hypocrisy, have been calling for a partial invasion of Syria based on “humanitarian concerns.”

….

This latest exchange between Turkey and Syria is not the first. Turkey has fabricated stories before involving Syrian troops “firing across” the Turkish-Syrian border. The New York Times published these bold accusations before admitting further down that “it was unclear what kind of weapons caused the injuries on Sunday around six miles inside Turkish territory,” and that “there were conflicting accounts about the incident.” As are all the accusations used by NATO, the UN, and individual member states to justify meddling in Syria’s affairs, these tales involve hear-say from the rebels themselves.

It is clear that Turkey, NATO, and the UN are continuously attempting to set a pretext for the establishment of “safe havens” and “humanitarian corridors” intended to circumvent the UN Security Council which has seen attempts to green-light military intervention vetoed multiple times by Russia and China.

That the UN has failed utterly to condemn the combined provocations and meddling in Syria’s affairs illustrates the absolute failure of supranational, let alone, global governance.

Tony Cartalucci is the writer and editor at Land Destroyer

and...


http://www.debka.com/article/22404/Continuous-Turkish-artillery-barrage-cuts-out-10-km-buffer-strip-inside-Syria

Continuous Turkish artillery barrage cuts out 10-km buffer strip inside Syria

DEBKAfile Exclusive Report October 4, 2012, 1:29 PM (GMT+02:00)

Tags:  Turkey   Syrian army   Syrian rebels   Barack Obama   Erdogan 

Turkish artillery barrage against Syria

Constrained from a substantial military incursion into Syria by US President Barack Obama’s veto and Saudi and Qatari refusals to help pay for it, Turkey’s government and military decided to make do with carving out a buffer strip 10 kilometers deep into Syria by continuous artillery barrages.
Thursday morning, Oct. 4 at 0300 GMT, Ankara ordered the Turkish army to keep up its cross-border shelling of Syria after the first bombardment Wednesday night in response to the deaths of five Turkish civilians and eight injured by Syrian mortar shells which exploded in their village.

DEBKAfile's military sources report the artillery squads were told to aim primarily at Syrian military targets inside this strip, including bases, outposts and Syrian forces on the move.
Several Syrian bases and outposts have been hit so far and a large number of Syrian soldiers killed or wounded. Neither Ankara nor Damascus is offering information on casualties. They have imposed a heavy blackout on events so as to keep them under control and avoid the risk of a full-blown war.
It was the first time in the 18-month Syrian uprising that Turkey had staged military action against Syria.The first Turkish barrage was fired as NATO foreign ministers met in emergency session in Brussels and the UN Security Council in New York condemned Syria.

US Secretary of State Hillary Clinton also harshly condemned the Syrian shelling but did not commit to any action against Syria except to state that Washington stands behind Ankara

According to our sources, Turkish Prime Minister Tayyip Erdogan’s hands are tied. When he asked Washington in the last 48 hours whether the Syrian attack would serve as the pretext for imposing a no-fly zone over northern and central Syria with US Air Force participation, the Turkish prime minister encountered a flat refusal.
He was told by administration officials that the president would not change his mind about withholding US military intervention in Syria - especially after US intelligence briefed him last week that, according their latest assessment, Syrian President Bashar Assad would not hold out more than another six months. That is, until February-March 2013 at latest.

At the same time, say DEBKAfile's Washington sources, the White House did not rule out a limited Turkish border operation for forcing Syrian troops to go on the run and giving the Syrian rebels greater freedom of movement to cross back and forth for arms supplies and medical treatment.

We reported in September that Turkish officers had taken command of two Syrian rebel brigades, the North Liberators and the Tawhid Brigade, which operate mostly in Aleppo. Turkish officers orchestrate their operations without crossing into Syria themselves.
By the saturation bombardment of the 10-kilometer strip inside Syria, Turkey plans to drive the Syrian military presence out and enable the two rebel brigades to move in and start establishing a 50-kilometer long protected corridor from Aleppo up to the Killis region of southern Turkey.
The big question is how long will Syrian President Bashar Assad tolerate Turkish artillery control of this border strip without fighting back. This decision is not only up to Assad but also to Tehran and Hizballah, both of which are deploying large-scale military strength in Syria in his support.

Did Turkey Just Declare War On Syria?

Submitted by Tyler Durden on 10/04/2012 08:14 -0400

• Turkey

Just out from the WSJ:

• Turkey's parliament has approved a bill authorizing the military to conduct cross-border operations in Syria, a day after a deadly shelling from Syrian territory killed five civilians

So, how is this different to war?

and....

http://www.aljazeera.com/news/middleeast/2012/10/2012103181110169706.html

Turkey renews shelling of Syrian targets

Retaliation follows mortar attack from Syrian territory that killed family of five in border town of Akcakale. Last Modified: 04 Oct 2012 12:11 inShare8 Email Print Share Feedback

The Turkish military has renewed firing at targets inside Syria after a woman and four children from the same family were killed in southeastern Turkey by shelling from across the border. Several Syrian troops were killed as a result of Turkish shelling inside the Syrian border town of Tal al-Abyad, a UK-based Syrian activist group said.Meanwhile on Thursday, Turkey's parliament authorised military operations against targets in neighbouring Syria, the Anatolia news agency reported. The mandate, valid for one year, was passed by 320 votes in the 550-seat Turkish parliament, it added. An aide to Recep Tayyip Erdogan, Turkey's prime minister, said on Thursday that his country had no intention of declaring war on Syria, pointing out that the shelling - now in its second day - should be seen as a "warning" to the authorities in Damascus. "Turkey has no interest in a war with Syria. But Turkey is capable of protecting its borders and will retaliate when necessary," Ibrahim Kalin, a senior adviser to Prime Minister Erdogan, said on his Twitter account. "Political, diplomatic initiatives will continue," he said. The parliament had already been due to vote on Thursday on extending a five-year-old authorisation for foreign military operations, an agreement originally intended to allow strikes on Kurdish bases in northern Iraq. 'The last straw' But the memorandum signed by Erdogan and sent to parliament overnight said that despite repeated warnings and diplomatic initiatives, the Syrian military had launched aggressive action against Turkish territory, presenting "additional risks". "Turkey will never leave unanswered such kinds of provocation by the Syrian regime against our national security" - Statement from Turkish PM's office "This situation has reached a level of creating a serious threat and risks to our national security. At this point the need has emerged to take the necessary measures to act promptly and swiftly against additional risks and threats," it said. In the most serious cross-border escalation of the 18-month uprising in Syria, Turkey hit back after what it called "the last straw" when a mortar hit a residential neighbourhood of the southern border town of Akcakale on Wednesday. It was not clear who fired the mortar into Turkey, but security sources said it had come from near Tal al-Abyad and that Turkey was increasing the number of troops along its border. "Our armed forces in the border region responded immediately to this abominable attack in line with their rules of engagement; targets were struck through artillery fire against places in Syria identified by radar," Erdogan's office said in a statement late on Wednesday. In-depth coverage of escalating violence across Syria "Turkey will never leave unanswered such kinds of provocation by the Syrian regime against our national security." Syria said it was investigating the source of the mortar bomb and urged restraint. Information Minister Omran Zoabi conveyed his condolences to the Turkish people, saying his country respected the sovereignty of neighbouring countries. Following the attack, Bulent Arinc, the deputy prime minister, said Turkey was "not blinded by rage". "There is definitely a response to it [the attack] in international law ... We are not blinded by rage, but we will protect our rights to the end in the face of such an attack on our soil that killed our people." Al Jazeera's Andrew Simmons, reporting from Antakya on the Turkish-Syrian border, said Arinc's mention of "certain responsibilities" contained within NATO treaty articles, could mean that Turkey responded without consulting international bodies first. 'Breach of peace' NATO said it stood by member-nation Turkey and urged Syria to put an end to "flagrant violations of international law". Al Jazeera's Anita McNaught, reporting from Akcakale, said that one has to ask the question of whether Syria "would want to draw Turkey into the conflict, and would Turkey want this to be the start of a larger and widening escalation of the battle regionally". The US-led Western military alliance held an urgent late night meeting in Brussels to discuss the matter. That meeting was only the second time in NATO's 63-year history that members had convened under Article 4 of its charter which provides for consultations when a member state feels its territorial integrity, political independence or security is under threat. Turkey also asked the UN Security Council to take the "necessary action" to stop Syrian "aggression". In a letter to the president of the 15-nation Security Council, Turkish UN Ambassador Ertugrul Apakan called the firing of the mortar bomb "a breach of international peace and security". UN diplomats said Security Council members hoped it would issue a non-binding statement on Thursday that would condemn the mortar attack "in the strongest terms" and demand an end to violations of Turkey's territorial sovereignty. Members had hoped to issue the statement on Wednesday, but Russia - a staunch ally of Syria's, which along with China has vetoed three UN resolutions condemning President Bashar al-Assad's government - asked for a delay, diplomats said.

and



Iran and Syria items of the day.....


http://www.zerohedge.com/news/2012-10-03/guest-post-hyperinflation-has-arrived-iran

Guest Post: Hyperinflation Has Arrived In Iran

Submitted by Tyler Durden on 10/03/2012 17:08 -0400

• Guest Post
 
• Hyperinflation
 
• Iran
 
• President Obama
 
• Purchasing Power
 
• Volatility

As we have been actively warning for a few days now (Iran's Misery Index and here) - and has now become mainstream media-critical - Iran is accelerating toward significant regime volatility... it seems our note on hyperinflationary case studiesand the 'blame' and 'denial' extension is particularly timely...

Submitted by Steve H. Hanke via Cato-at-Liberty,

Since the U.S. and E.U. first enacted sanctions against Iran, in 2010, the value of the Iranian rial (IRR) has plummeted, imposing untold misery on the Iranian people. When a currency collapses, you can be certain that other economic metrics are moving in a negative direction, too. Indeed, using new data from Iran’s foreign-exchange black market, I estimate that Iran’s monthly inflation rate has reached 69.6%. With a monthly inflation rate this high (over 50%),Iran is undoubtedly experiencing hyperinflation.

When President Obama signed the Comprehensive Iran Sanctions, Accountability, and Divestment Act, in July 2010, the official Iranian rial-U.S. dollar exchange rate was very close to the black-market rate. But, as the accompanying chart shows, the official and black-market rates have increasingly diverged since July 2010. This decline began to accelerate last month, when Iranians witnessed a dramatic 9.65% drop in the value of the rial, over the course of a single weekend (8-10 September 2012). The free-fall has continued since then. On 2 October 2012, the black-market exchange rate reached 35,000 IRR/USD – a rate which reflects a 65% decline in the rial, relative to the U.S. dollar.

The rial’s death spiral is wiping out the currency’s purchasing power. In consequence, Iran is now experiencing a devastating increase in prices – hyperinflation.  As Nicholas Krus and I document in our recent Cato Working Paper, World Hyperinflations, there have been 57 documented cases of hyperinflation in history, the most recent of which was North Korea’s 2009-11 hyperinflation. That said, North Korea’s hyperinflation did not come close to the magnitudes reached in the recent, second-highest hyperinflation in the world, that of Zimbabwe, in 2008, nor has Iran’s hyperinflation – at least not yet.

Iran pumps large Bassij militia forces into Tehran as riots flare

DEBKAfile Exclusive Report October 3, 2012, 6:41 PM (GMT+02:00)

Tags:  Iran nuclear   sanctions   Tehran   Basijj 

Police clash with Tehran merchants

The Iranian government Wednesday, Oct. 3, invoked the emergency measures drawn up for the 2009 protests to deploy large-scale Bassij militia forces in the capital and put down the first angry protests against mounting economic hardship and the plummeting rial.
DEBKAfile’s Iranian sources report two waves of riots swept through Tehran’s trading centers Wednesday:
the stores trading gold coins and foreign currency on Fereowsi, Estanbol and Manoucheri Streets, and the celebrated gold jewelry market in the Tehran Bazaar.
Money changers and gold traders attacked police forces and torched their vehicles, playing cat and mouse with the officers after they arrested some of the money changers and accused them of black market dealings.
This was part of the regime’s effort to curtail the steep plunge of the Iranian currency against the dollar. Wednesday, a dollar went for 40,000 rials compared with 37,500 rials Tuesday and 24,000 only a week ago.

Fearing that the troubles Wednesday presaged a general strike shutting down the bazaar for an indefinite period, the authorities decided to draw the line before the unrest spread to the rest of the capital and other cities.
Two teams are now at work to deal with the crisis before it gets out of hand: One is meeting at the office of supreme leader Ayatollah Ali Khamenei; the second, including Interior Minister Mostafa Mohamnmad-Najjar and Revolutionary commander of the Tehran district, is working on ways to rein in the crisis in the presidential bureau of Mahmoud Ahmadinejad.

Both have received intelligence briefings, according to which there was a real risk of the Tehran merchants’ revolt igniting a popular uprising in Tehran that may well encompass the entire country.
The brutal Bassij militia were accordingly sent into Tehran. They were told to spread out early Thursday and force the merchants to open their shops. They were directed to act firmly but cautiously and avoid loss of life. Iran’s rulers are fully aware the any blood spilt at this stage would quickly inflame the masses.

and Nato issues a strongly worded statement to Syria  - no actions taken .....

http://www.zerohedge.com/news/2012-10-03/nato-issues-statement-syrian-turkish-hostilities

NATO Issues Statement On Syrian-Turkish Hostilities

Submitted by Tyler Durden on 10/03/2012 16:53 -0400

• Turkey

Via Nato:

As stated on 26 June 20l2, the Alliance continues to closely follow the situation in Syria. In view of the Syrian regime’s recent aggressive acts at NATO’s southeastern border, which are a flagrant breach of international law and a clear and present danger to the security of one of its Allies, the North Atlantic Council met today, within the framework of Article 4 of the Washington Treaty, and discussed the continuous shelling of locations in Turkey adjacent to the Turkish-Syrian border by the Syrian regime forces.

The most recent shelling on 3 October 20l2, which caused the death of five Turkish citizens and injured many, constitutes a cause of greatest concern for, and isstrongly condemned by, all Allies.

In the spirit of indivisibility of security and solidarity deriving from the Washington Treaty, the Alliance continues to stand by Turkey and demands the immediate cessation of such aggressive acts against an Ally, and urges the Syrian regime to put an end to flagrant violations of international law.

and.....

http://www.zerohedge.com/news/2012-10-03/turkey-fires-artillery-shells-syria-alleged-retaliation

Turkey Fires Artillery Shells Into Syria In Alleged Retaliation

Submitted by Tyler Durden on 10/03/2012 12:56 -0400

• Reuters
 
• Turkey

Following this morning's reported shelling of a Turkish town (from Syrian lands):

• *NINE INJURED AS SHELL FROM SYRIA LANDS IN TURKISH TOWN: NTV

The Turkish foreign ministry has held emergency talks and, according to Zaman, Turkey has now begun firing 'warning' shots into Syria and 'the bombardment continues to be heavy'.

• *TURKISH ARTILLERY BOMBARDS SYRIA IN WARNING, ZAMAN REPORTS

And it would appear things are escalating:

• *TURKISH FOREIGN MINISTER CALLS NATO AFTER SYRIA BORDER SHELLING

On the earlier Syrian shelling of Turkey...

Via Reuters: Mortar from Syria kills five family members in Turkey

AKCAKALE, Turkey, Oct 3 (Reuters) - A mortar bomb fired from Syria landed in a residential district of the southeastern Turkish town of Akcakale on Wednesday, killing a woman and four children from the same family and wounding at least eight other people.

A cloud of dust and smoke rose up over low-rise buildings as residents ran to help the wounded. Others, infuriated by the increasing spillover of violence from Syria's civil war, took to the streets shouting protests against the local authorities.

Foreign Minister Ahmet Davutoglu phoned U.N. Secretary General Ban Ki-moon to brief him about the incident and also spoke with senior military officials and Syria crisis mediator Lakhdar Brahimi, his ministry said in a statement.

Davutoglu signalled over the weekend that Turkey would take action if there was a repeat of a mortar strike which damaged homes and workplaces in Akcakale last Friday.

"It (latest mortar round) hit right in the middle of the neighbourhood. The wife and four children from the same family died," Ahmet Emin Meshurgul, local head of the Turkish Red Crescent, told Reuters, adding he knew the victims personally.

"People here are anxious, because we got hit before. Security forces tried to convince people to empty the neighbourhood near the border, but now we've been hit right in the middle of the town," he said.

A Reuters witness saw three police officers among the wounded being taken to hospital.

Prime Minister Tayyip Erdogan long cultivated good relations with Assad but became a harsh critic after Syria's popular revolt began last year, accusing him of creating a "terrorist state". Erdogan has allowed Syrian rebels to organise on Turkish soil and pushed for a foreign-protected safe zone inside Syria.

GUNFIRE STRAYING OVER BORDER

Syria's worsening bloodshed has increasingly affected border zones, with stray bullets flying into Turkish territory.

"Over the last 20 to 25 days there have been very heavy clashes on the Syrian side. We have felt the effects of these in Akcakale," Labour Minister Faruk Celik, an MP for the province where Akcakale is located, told parliament.

In April, Turkey reported an incident to the United Nations in which at least five people, including two Turkish officials, were wounded when cross-border gunfire struck a Syrian refugee camp in Kilis, further west along the frontier.

Turkey beefed up its troop presence and air defences along its 900-km (560-mile) border after Syria shot down a Turkish reconnaissance jet in June. But residents in Akcakale said there was still not enough security.

"People here are rising up, there is no security. People were chanting for the local governors to resign," local resident Ibrahim Halil Arslan told CNN Turk television.

"Everybody here is so anxious. We keep our children locked at home, and we are trying to live under this psychological pressure," he said.

Washington sees Turkey as the pivotal player in backing Syria's opposition and planning for the post-Assad era. But Ankara has found itself increasingly isolated and frustrated by a lack of international consensus on how to end the conflict.

Turkey is also sheltering more than 90,000 refugees from Syria and fears a mass influx similar to the flight of half a million Iraqi Kurds into Turkey after the 1991 Gulf War.

and.....

http://news.antiwar.com/2012/10/02/is-this-the-beginning-of-insider-attack-units-in-afghanistan/

Is This the Beginning of ‘Insider Attack’ Units in Afghanistan?

US Troops Came Under Fire From 'Multiple Persons'

by Jason Ditz, October 02, 2012

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The details surrounding this weekend’s green-on-blue attack, in which the 2,000th US soldier was slain in Afghanistan, continue to be murky, but officials are now expressing concern at indications that it was not just another “lone insider” attack, but a whole “insider unit.”

The official investigation isn’t complete, but the troops say they came under fire from “multiple persons” and possible attacking from “multiple directions,” which would be a first for the insider attacks which usually begin and end with one attacker emptying his weapon and either being killed or running off.

The story actually seems to jibe with the Afghan government’s first version of the attacks, in which they claimed the US troops fired on Afghan troops, and that the Afghan troops returned fire. The Afghans chalked the whole thing up to a “misunderstanding.”

At any rate the initial report that an attacker killed the US soldier, a translator and three Afghan soldiers may not be the case, and it seems that the Afghans may have killed the US soldier, and themselves been killed by other US soldiers. Accidental gunbattles are nothing new in the Afghan War, but if this was actually an “on purpose” insider attack by a whole unit, it could be yet another gamechanger in the endless war.

and don't expect our cowed MSM to speak on this , but under what authority would the US be acting to engage is special Forces or Drone Attacks inside Libya presently ???

US Preparing for JSOC ‘Kill-Capture’ Operations in Libya After Consulate Attack

The preparations illustrate the administration's penchant for secrecy and killing, instead of transparency and trials

by John Glaser, October 02, 2012

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The top-secret Joint Special Operations Command may be preparing to engage in kill or capture operations targeted at some of the militants suspected of attacking the US consulate in Libya last month that killed four Americans.

JSOC is preparing what senior military officials described as “target packages,” which are the first step what might eventually be deployed operations in Libya to kill or capture – but usually kill – suspects of last months attack.

President Obama has not yet ordered such actions, reports The New York Times, but these are preliminary procedures in the event that he does make the order.

Since the attack, which the Obama administration belatedly admitted was a planned attack and not a spontaneous protest, many options at the administration’s disposal have been prepared – from drones, to JSOC, to deploying Marines on the ground.

The fact that the President is considering using a top-secret JSOC raid or attack on suspects illustrates the administration’s penchant for secrecy, without congressional oversight or open discussion with the public, in its foreign policy operations.

It also demonstrates their preference to kill suspected perpetrators as opposed to apprehending suspects and carrying out a transparent trial in court, something the administration seems long ago to have abandoned in favor of night raids or drone strikes.

and in Iraq , we see the military "finding " money to just do what they want to do in Iraq- where the hell is Congress ? How many other secret slush funds exists , how many other secret death squads are deployed ? 

Pentagon Works Around Congress, Finds Funding for US Units in Iraq

Small units of a couple of hundred US troops are still in Iraq training Prime Minister Maliki's abusive security forces

by John Glaser, October 02, 2012

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The Pentagon says it will be able to continue funding for at least the next 90 days US military personnel in Iraq who are training Iraqi security forces, even though Congress stripped money for the program in a recent resolution.

About $1.7 million will be taken “from a special combatant commanders initiative fund” to continue the training that a couple hundred US troops are performing for the Iraqi forces.

Most Americans have been led to believe that all US forces besides those guarding the massive American Embassy in Iraq have been withdrawn since the end of last year. But small units have remained in Baghdad to support elite Iraqi forces that report directly to the increasingly authoritarian Prime Minister Nouri al-Maliki.

These forces have essentially been used as a secret police force for Maliki to attack, detain, and torture his political opponents and crack down harshly on public dissent.

The funding scheme is a temporary solution the Pentagon has come up with to get around Congress’s failure to continue to back the remaining US military presence.

and more instability in Libya as the Government attempts to show they are in charge....

Army and police hit by string of attacks in Benghazi

Tripoli, 2 October:

Members of the army and police have come under a string of attacks in Benghazi in the past few days in the midst of ongoing efforts to establish full control over the restive eastern city.

As many as six personnel are reported to have been injured, two in an attack on Gar Younis police station today and four in two separate attacks near the children’s hospital yesterday.

Conflicting reports have emerged of the assault yesterday, which took place after assailants threw a bomb at the police station from a Hyundai-type vehicle. Some sources have claimed two officers were injured, whilst others have said only parked police cars were hit.

Two military personnel were wounded in an explosion from a RPG shortly after midnight yesterday, one seriously. A police checkpoint was then attacked a few hours later in a reported grenade attack.

A senior member of the army’s newly created National Mobile Force has said that the grenade was thrown from within the grounds of the children’s hospital. The officer said the move was a calculated attempt by the assailant to avoid being shot, for fear of causing collateral damage. The man was subsequently arrested.

On Friday, a police station near to Benghazi’s Al-Jalaa hospital was attacked by an armed mob protesting against the disbanding of the Islamist Ansar Al-Sharia brigade, believed to have been involved in the fatal attack on the US consulate on 11 September.

Four police vehicles recently delivered from Dubai were machine-gunned and grenades thrown at the building by the assailants, two of whom were reported to be wearing suicide vests.

It is said that the men were not intending to blow themselves up, but wore the vests as an extreme insurance policy against getting shot, again for fear of collateral damage.

The National Mobile Force arrived on the scene within 40 minutes of the onset of the attack after the police failed to intervene.

A senior officer within the force, who requested to remain anonymous, denied reports that anyone had yet been arrested in connection with the incident, in which nobody was injured.

The previous day, however, a police officer was wounded when an unknown assailant dropped a grenade onto his vehicle from a bridge overhead.

The army and police have been struggling to assert their authority over Benghazi in the wake of a fatal assault on the US consulate and nearby safe house on 11 September, which left four people dead, including the US Ambassador to Libya Christopher Stevens.

Several militias, including the Ansar Al-Sharia brigade, were disbanded in the wake of the incident, whilst others were placed under the full authority of the army.

However, security officers have complained that many members of the disbanded militias have simply taken their weapons and gone to ground. It is believed that some of them may have been involved in the recent attacks.

Egypt politely inquires as to when Libya plans to pay its hotel tab.....

Egypt presses Libya over unpaid hotel bills for wounded Libyans

By Ashraf Abdul Wahab.

Tripoli, 3 October:

The Egyptian government is pushing Libya to pay outstanding hotel bills racked up to accommodate Libyans wounded in last year’s revolution and sent to Egypt for treatment.

The Egyptian Minister of Tourism, Hisham Zazou held a meeting on Sunday with the new Libyan ambassador to Egypt, Ashour Hamad Abu-Rashid, to discuss Libya’s proposals to pay the million of dollars owed for accommodating the wounded and their families while treatment in Egypt.

During the meeting, the Libyan ambassador promised he would seek approval from the Libyan authorities to pay 50 percent of the outstanding bills owed to of Egyptian companies and hotels in a single payment and the rest to be paid, after auditing, over an agreed period of time. He promised to discuss the matter with the Libyan authorities when he was back in Tripoli this week.

The Egyptian minister is reported to have said that once Libya made the initial 50-percent payment there would have to be another meeting between with the ambassador to agree a timetable for the payment of the rest of the money.

As to bills owed to hotels that are still accommodating wounded Libyans, Abu-Rashid agreed to hold a meeting at the Libyan embassy in Cairo to try and find a means to at least pay part of them.

The ambassador’s offer of a 50-percent payment without auditing is, however, thought unlikely to find receptive ears at the Ministry of Health which is now responsible for payment of healthcare costs of the wounded abroad, including hotel accommodation for them and their families.

Treating the war wounded abroad has cost Libya over $3 billion so far, a significant part of which is viewed by the Libyan authorities as having disappeared through corruption, false claims and mismanagement.  The ministry is now insisting that all bills are rigorously audited before payment.