Looming Train Wreck: Sinking US $ Could Drag World Under

As an American traveling in Europe, I have watched in horror as the dollar plummets against the euro and the British pound. Today, it is a heart-stoppingly $1.48 against the euro. Never in the last 60 years has the dollar been so weak world-wide. And we have done it to ourselves, kicking back and letting the government spend money there was NO WAY we could raise and now no way we can pay off without huge sacrifices. Sacrifices that not one candidate for president can talk about if that candidate wishes to stay in the race at all.

It was as if the parents left the teenagers for the evening with full access to the credit cards, stayed away for 8 years, and never checked online to see what havoc was being wreaked while they were gayly sipping cocktails at the neighbors.


Sinking Currency, Sinking Country
by Pat Buchanan
Fri Nov 2, 3:00 AM ET

The euro, worth 83 cents in the early George W. Bush years, is at $1.45.

The British pound is back up over $2, the highest level since the Carter era. The Canadian dollar, which used to be worth 65 cents, is worth more than the U.S. dollar for the first time in half a century.

Oil is over $90 a barrel. Gold, down to $260 an ounce not so long ago, has hit $800. Have gold, silver, oil, the euro, the pound and the Canadian dollar all suddenly soared in value in just a few years?

Nope. The dollar has plummeted in value, more so in Bush's term than during any comparable period of U.S. history. Indeed, Bush is presiding over a worldwide abandonment of the American dollar.

Is it all Bush's fault? Nope.

The dollar is plunging because America has been living beyond her means, borrowing $2 billion a day from foreign nations to maintain her standard of living and to sustain the American Imperium. The prime suspect in the death of the dollar is the massive trade deficits America has run up, some $5 trillion in total since the passage of NAFTA and the creation of the World Trade Organization in 1994.

In 2006, that U.S. trade deficit hit $764 billion. The current account deficit, which includes the trade deficit, plus the net outflow of interest, dividends, capital gains and foreign aid, hit $857 billion, 6.5 percent of GDP. As some of us have been writing for years, such deficits are unsustainable and must lead to a decline of the dollar.

A sinking dollar means a poorer nation, and a sinking currency has historically been the mark of a sinking country. And a superpower with a sinking currency is a contradiction in terms.
What does this mean for America and Americans?

As nations realize that the dollars they are being paid for their products cannot buy in the world markets what they once did, they will demand more dollars for those goods. This will mean rising prices for the imports on which America has become more dependent than we have been since before the Civil War.

U.S. tourists traveling to the countries whence their ancestors came will find that the money they saved up does not go as far as they thought.

U.S. soldiers stationed overseas will find the cost of rent, gasoline, food, clothing and dining out takes larger and larger bites out of their paychecks. The people those U.S. soldiers defend will be demanding more and more of their money. U.S. diplomats stationed overseas, students and businessmen are already facing tougher times.

U.S. foreign aid does not go as far as it did. And there is an element of comedy in seeing the United States going to Beijing to borrow dollars, thus putting our children deeper in debt, to send still more foreign aid to African despots who routinely vote the Chinese line at the United Nations.

The Chinese, whose currency is tied to the dollar, and Japan will continue, as long as they can, to keep their currencies low against the dollar. For the Asians think long term, and their goals are strategic. China — growing at 10 percent a year for two decades and now growing at close to 12 percent — is willing to take losses in the value of the dollars it holds to keep the U.S. technology, factories and jobs pouring in, as their exports capture America's markets from U.S. producers.
The Japanese will take some loss in the value of their dollar hoard to take down Chrysler, Ford and GM, and capture the U.S. auto market as they captured our TV, camera and computer chip markets. Asians understand that what is important is not who consumes the apples, but who owns the orchard.

Other nations that have kept cash reserves in U.S. Treasury bonds and T-bills are watching the value of these assets sink. Not fools, they will begin, as many already have, to divest and diversify, taking in fewer dollars and more euros and yen. As more nations abandon the dollar, its decline will continue.

The oil-producing and exporting nations, with trade surpluses, like China, have also begun to take the stash of dollars they have and stuff them into sovereign wealth funds, and use these immense and growing funds to buy up real assets in the United States — investment banks and American companies.

Nor is there any end in sight to the sinking of the dollar. For, as foreigners demand more dollars for the oil and goods they sell us, the trade deficit will not fall. And as the U.S. government prints more and more dollars to cover the budget deficits that stretch out — with the coming retirement of the baby boomers — all the way to the horizon, the value of the dollar will fall. And as Ben Bernanke at the Fed tries to keep interest rates low, to keep the U.S. economy from sputtering out in the credit crunch, the value of the dollar will fall.

The chickens of free trade are coming home to roost.

http://www.washingtonpost.com/wp-dyn/content/article/2007/11/07/AR2007110700574_pf.html

Spanish King Tells Hugo to "Shut Up!" and He Doesn't!

From BBC News online:

Spain's King Juan Carlos told Venezuelan leader Hugo Chavez to "shut up" as the Ibero-American summit drew to a close in Santiago, Chile. The outburst came after Mr Chavez called former Spanish Prime Minister Jose Maria Aznar a "fascist".

Mr Chavez then interrupted Spanish PM Jose Luis Rodriguez Zapatero's calls for him to be more diplomatic, prompting the king's outburst. Latin American, Portuguese, Spanish and Andorran leaders were meeting in Chile. Mr Chavez repeatedly tried to interrupt, despite his microphone being turned off.

The king leaned forward and said: "Why don't you shut up?"

The king addressed Mr Chavez as "tu", the familiar version in Spanish of "you" which is normally used only for close acquaintances, family, or children, and can be regarded as insulting when used in other circumstances.


Mr Chavez responded to the king's rebuke. According to the Associated Press news agency, he said: "I do not offend by telling the truth. The Venezuelan government reserves the right to respond to any aggression, anywhere, in any space and in any manner."

Another take:

The Juan Carlos-Chavez Spat
Royal Incident Signals Arrival of Latin America's 'Underdog' Class

By Marcela Sanchez

Special to washingtonpost.com Friday, November 23, 2007; 12:00 AM

WASHINGTON -- King Juan Carlos of Spain made a lot of people happy when he recently told Venezuelan President Hugo Chavez to shut up. Yet to many in the Latin American underclass, the incident was proof that, politically, they had finally arrived.

Even Chavez-haters acknowledge that he is a folk hero to many in Venezuela and beyond because they see him as a manifestation of their own empowerment. That it was a king and not the president of some other country telling Chavez to keep quiet amplified a sense of satisfaction among Chavez followers -- because of the colonial overtones and the history of imperial Spain in the region.

And so the incident provides an excellent starting point to talk about the new social mobilization of Latin America's poor. Latin American discontent has been around for a long time. But there is an important distinction today. When social movements of the past began to make demands of Latin American governments, the typical response was suppression by various means -- imprisonment, execution, isolation. Some of these groups believed that the only way of resolving their grievances was by arming themselves to fight their way to revolutionary change.

Latin America's social movements of today are effective because democracy has become so consolidated in the region that their concerns can no longer be ignored or easily dismissed, much less silenced. Now states believe they have to accommodate these concerns and promote consensus or risk losing popular support and even be forced out of office. In Argentina, for instance, los piqueteros, a movement of unemployed workers that grew in strength following the country's 2001 economic collapse, have successfully pressured the state to give them welfare subsidies to spread among members. Had this movement emerged 15 years earlier and not in 1995, it might well have met another, and violent, fate.

Not that long ago, groups such as the piqueteros would have been seen as an undesirable development, putting unwelcome pressure on young democracies. But persistent economic inequality and social exclusion, despite more than two decades of democracy and a decade of market reforms, have forced a reassessment of those social movements -- less as a problem and more as a solution.

Even in Washington, which historically has sided with stability, usually at the expense of the oppressed in Latin America, President Bush has referred to the desires of groups leading the "revolution in expectations" as "legitimate demands." In a recent report, the Inter-American Development Bank waxed optimistic about social mobilization as a necessary agent of change -- despite its potential to "aggravate social conflict and complicate democratic governance."
The ultimate manifestation of Latin America's social transformation has been the rise of indigenous movements. In countries such as Bolivia and Ecuador, individuals once deemed inferior to Spanish or other European descendents have mobilized in recent years to successfully reverse policies, bring down governments and elect native candidates to office, including the presidency.

Now, those countries in which the once subjugated have come to power will put to a test the maturity of Latin American democracy. The challenge is whether the grass-roots uprisings will "lead to an enduring, more complete inclusion in a political and social sense, reducing discrimination and inequalities" or to new forms of exclusion, as Mark Payne, one of the authors of the IDB report, put it in an interview.

Chavez, while not a true example of an indigenous leader, draws his popular support from Venezuelans previously oppressed -- namely, the country's poor in an oil-rich land. He has unquestionably used that power in many instances to right certain historical wrongs. But he has also taken to harassing or suppressing opponents. As David Smolansky, a 22-year-old journalism student and spokesman for the new student movement in Venezuela told me, "Here in Venezuela we are getting to the point that whoever does not concur with his (Chavez's socialist) ideas is a ... traitor" and will be excluded from participating in political life.

One hopes that all democratic leaders, indigenous or not, will find a path to greater inclusion rather than going down the road well worn by previous oppressive regimes. For the time being, though, it's not such a bad thing -- perhaps it is even a measure of democracy's success -- that there were some who saw a victory for the "underdog" in the Juan Carlos-Chavez incident. After all, it seems wholly appropriate to celebrate that a Spanish royal family's bloodlines are ever more diluted among Latin America's ruling class.

Marcela's e-mail address is desde@washpost.com.

Canas de Meca, Costa de la Luz

Caños de Meca
07 Nov
by Jim Mackie

Well away from the hustle of the busy Costa del Sol beaches and the increasing numbers of visitors to the Costa de la Luz you will find a small sweet unspoiled village nestled on the cliff top over looking the Atlantic Coast of Spain.

The village of Caños de Meca can be found by taking one of the small side roads off the CN340 coast road near Vejer de la Frontera or by taking the minor road through the pine forest from Barbate. It is located deep in the Parque Natural del Acantilado surrounded by beautiful pine forests.

The village has some beautiful beaches which offer the visitor something that is in short supply on other beaches in Andalucia, Space. The beaches are clean peaceful even in summer although the village is becoming increasingly popular.

Pirata is the main beach of the village with with fine sand and sandy seabeds. It is located right in the heart of the village and is the best equipped with lifeguards, toilets, bars and restaurantsIt ends in a pretty peak shaped by the action of the rocky reefs. At low tide, there are small islands.

The Faro zone, Varadero and la Curva is one beach made up of smaller beaches, stretching from the Lighthouse to Conil and Chiclana (LosBancos)and farther. You can enjoy the sun setting directly over the sea.Word of warning for those of you that have like to swim. The waters around here have very strong tide and currents especially in the area surrounding the lighthouse. The cape of Trafalgar that lays of the coast , the seabed and the cliffs provoke swirls and turbulence that can be fatal to anyone swimming too far out. 700m from shore you will find the Aceitera zone , an area which is greatly appreciated by fishermen and divers for its rich fauna and archeological remains.However this in one of the most dangerous for bathers, every year there are stories of disappeared divers in the area.

There are none of the usual facilities such as life guards, showers or rubbish bins, The beach is accessed from the main Faro road, you must park your car on the road here and walk across a broad strech of sand to reach this tranquil beach.Here you can also climb up to the lighthouse where you will be treated to some magnificent views of the area although there in no fence around the small cliff at the lighthouse so take care when looking over and especially if you have children or animals with you.

The beach known as the Curva or Marisucia is located next to Los Bancos beach. Between these two beaches lies a strip small creeks and reefs goes all the way around the Trafalgar bay.The sand here is not as fine as that of Los Bancos and having an South Eastern orientation whenNudist beach and cliffs.

For those of you who prefer the natural look when it comes to sun bathing then head for the nudist beach which is located at the foot of the first cliffs in the park. This beach is very sandy and apart from the nudist it is also popular with small groups of illegal campers.
20 minutes walk east of Los Canos Beach across the rocks you will find the “Playa de las Cortinas” where fresh water falls from the cliffs above.

Apart from the villages stunning beaches and magnificent landscape the villageis also famous for its nightlife during the summer months and for windsurfing which is an extremely popular sport in the area. The best point to launch is at the western end of the “Playa del Estrecho” apartments in the town. Other water sports such as snorkeling are also popular and you will find that the reef just off the Los Caños beach has plenty of fish to see.

Costa de la Luz Eco-Backpackers Hostal

For 50 euros a week from Nov. 3-16, I joined David and Jane Cooney and their two kids Robin and Emily at the Costa de la Luz Eco-Backpackers Hostel, in southern Spain near Cadiz. I scored a bottom bunk in a dorm, cooked in the somewhat porous kitchen/bath building and hitched into Vejer or over to the beaches, catching rides with local old men or smitten tourists who thought they'd found the 'wild' side of Spain.

This British ex-pat couple came to Costa de la Luz 16 years ago as young 20somethings, bought a couple of acres of land in the middle of nowhere but with a fantastic view of the scrubby farmland and Atlantic rolling in on deserted beaches. Over the years, they and their friends have built several bunkhouses, a kitchen building and the very nice house they live in, learning more and building better as they went along.

They run an English-Spanish Language School in nearby Conil, cart their kids to school in Canas de Meca, and end up spending a lot of their time barreling down dirt tracks, driving hell for leather to schools, shops, work, and parties.

Unfortunately, David is a bit of a liar -- euphemistically stating on their web page that their incredibly remote outpost in the campo located between inland Vejer de la Fontera and Canas de Meca, the world famous beach for surfing and parasailing, was only 3 km. from the beach. Perhaps by ultralight, my dear!! We walked and hitched and walked and hitched and it took a better part of 2 hours. Very pleasant nonetheless, walking up a dirt road with the sea tantalizingly just ahead and yet the road took twists and turns through forests of umbrella pine and the small hamlet of San Ambrosio and a natural park and another natural park, and along the cliffs, before finally depositing us on the shore.

David also insisted that their place was ONLY 3 km from the village of Vejer. There are no busses or taxis and very few CARS in this area so walking in and out is the main method of getting to the beach or the town.

Tramping uphill, down hill, uphill, down hill, fruitlessly hitching, walking all the way into town, takes more than an hour. Coming back from town we usually managed to snag a ride and one English-speaking provider laughed when we asked if it was ONLY 3 km to David's barrio. He clocked it and it was 7 km, 14 RT, long way David, long way!

When we pointed out the discrepancy, he just laughed and admitted that maybe his odometer was off, then jumped into his battered 4 wheel drive and drove like a madman, off to pick up his kids at school.

Well you can see how beautiful it was, lovely vistas, remote, lonely, but elemental and wild. In the mornings I'd wake to roosters crowing and donkeys braying, and sip my coffee in the doorway soaking up the weak sun, waiting for the day to emerge. At night, the stars were so bright you could navigate in the pitch darkness by them. The Milky Way was a lacy swath across the sky and the constellations must have beeen from another world because I recognized none of them, they are natives of North Africa and the Sahara.

I shared the bunkhouse with a young German girl, Meike, who was wwoofing with David and Jane. We cooked together in the evening, I shared my wine, she shared her roll-up tobacco, and if things were really slow, we would watch the mice rummage through the cupboards in search of food. The previous guests had left all their food in unprotected drawers and the mice had had an easy time of it. They simply chose a drawer, gnawed through the packaging, and ate til they were stuffed.

We decided we actually wanted to eat our food ourselves, so placed everything in the fridge. Soon the mice became frantic as it dawned on them that their sources had dried up. They became brazen and bold and scampered through our dishes, into the sink, over the compost, even tried eating the label of the olive oil in the hopes of finding sustenance.

Meike and I had an ethical dilemma -- we both voiced the possibility of 'should we FEED the mice?' As we considered the ridiculousness of that proposal, we came to compromise. Any food in the compost bowl could be the mices', all other food was ours and would be put away. The mice could choose to move on or move out, their choice.

Somewhere along the line, the lid to the olive oil bottle got lost. For several days we sprinkled oil on our salads, used it to make omelettes and other food. As Meike picked up the bottle one dinnertime, she remarked that it seemed very dark, very dark indeed.

And there, perfectly preserved in the bottom of the olive oil bottle, was the small newly deceased body of a mouse.

At least we HOPED it was newly deceased.

Vejer de la Frontera, Cadiz province

One of the great pleasures of Vejer is simply walking around the quiet backstreets and cobbled lanes that wind their way through this very Moorish village. It is so easy to imagine being in another time, where history is not distant but happened only yesterday. Vejer de la Frontera is not grand or oppulent as Seville, Granada, or Cordoba are, but the history of the town is palpable, real, immediate, from conquering Phoienicians and Carthigians circa 400 BC, to the imperialist Romans, marauding Visigoths, civilizing Moors, to the reconquistador times in the 1400's.

The ancient town walls still trace the outline of the old village perched on the sides of several hills. In places they appear as they once must have been strong defenses against enemies; but the walls also disappear into homes and you'll just as likely see washing being hung on the ramparts. Heavily restored in places, the walls were built in the 15th century as part of the defensive investment after the Christian reconquest of the region.

Several arches lead into the old town through the walls and, unlike many other towns in Spain, all the original gateways still exist and are part of everyday life of Vejer. The old moorish 'alcazaba' is tucked away down a narrow backstreet with the town built right around the castle. The Church is built on the site of the old mosque -- the minaret is still standing now but houses a belltower. The church consists of two contrasting styles -- the front of the main aisle is visigothic while the remainder is mudejar. The interior of the church was damaged during the Civil War & little remains of the usual riches.

The Plaza de España or 'Plaza de los Pescaitos' is a beautiful plaza, ringed with date palms and bouganvilla. The Plaza de los Pescaitos (Plaza of the Little Fish) gets its name from the goldfish that swim around the fountain. Decorated with bright ceramics & 4 spouting frogs, the ornate brightly tiled fountain is not as old as it seems and dates only to the early 1900's.


Vejer is located just a few km. from the beaches at either El Palmar, Trafalgar Bay or Los Caños de Meca. Vejer itself is made up of 2 parts, the old medieval quarter & the newer part of town carefully designed in the style of the 'pueblos blancos' of the region. Vejer has many monuments to visit, flower filled courtyards to peer into & turreted walls to see views from. Vejer is surrounded on 2 sides by the 'Las Breñas' Natural Park a 5,000ha. forest of pine wood running down to the coast & the 'Marismas' Natural Park a smaller nature reserve through which the Barbate river runs through & home to an important collection of birdlife. Both parks have walking trails running through them & are perfect for day walks.

A short walk away is the recently restored roman acueduct of Santa Lucia, usually still working in the summer, with a water supply that feeds the small lush valley nearby where avocadoes, pomegranate & other semi-tropical fruits are grown. A myriad of walking trails & wider cañadas run through the local countryside.