Currency Wars Return, 1930s Style

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As countries try to weaken their currencies to boost exports, the risk of a currency war similar to events seen in the 1930s has heightened, and policymakers are making sure they are on the winning side, according to Morgan Stanley.

The balance of power now rests with Japan, according to the bank, as Japan’s policy-makers’ more dovish approach looks set to bring the world a step closer to a currency war.

The Bank of Japan doubled its inflation target to 2 percent in January and made an open-ended commitment to continue buying assets from next year. This follows a leadership change, with new Prime Minister Shinzo Abe openly calling for aggressive monetary stimulus from the country’s central bank.

This move, Morgan Stanley said, is a “game changer” as Japan tries to invigorate its stagnating economy .

“If a weaker yen is an important pillar of the strategy to make this export-oriented economy more competitive again, it brings into the picture something that was missing from earlier interactions among central banks of the advanced economies – competitive depreciation,” it said in a research note.

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Video: General Says of Benghazi, ‘We Never Received a Request for Support from the State Department’

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General Martin Dempsey, the chairman of the Joint Chiefs of Staff, said the State Department never requested “support” in Benghazi:

“Why didn’t you put forces in place to be ready to respond?,” Senator John McCain asked the general.

Dempsey started, “Because we never received a request to do so, number one. And number two, we –“

McCain iterrupted, “You never heard of Ambassador Stevens’s repeated warnings?”

See video:

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Pyongyang Provocation: North Korea Set For Test Launch Of New Mobile ICBM With Upcoming Nuclear Test

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Photo Credit: APU.S. intelligence agencies monitoring North Korea for signs of a third underground nuclear test recently reported that the isolated communist state appears set to conduct the first test launch of a new road-mobile ICBM built with Chinese technology.

U.S. officials with access to intelligence reports said the North Koreans are expected to test fire either a new KN-08 road-mobile ICBM—capable of reaching parts of the United States—or a new medium-range advanced missile called the Musudan, also built on hard-to-detect mobile launchers.

New intelligence on the KN-08, which was showcased for the first time last April during a North Korean military parade atop a Chinese-made mobile transporter-launcher, indicates the North Koreans are preparing to launch one or more of the missiles around the time they conduct a future nuclear test.

Six of the missiles were shown during the parade. The range of the missile is not known because it has not yet been flight-tested. However, intelligence agencies believe it can range Alaska and Hawaii and possibly the U.S. West Coast.

The missile test preparations coincide with new intelligence indicating the North Koreans could conduct a third underground nuclear test at a remote facility in the northern part of the country called Kilju. Earlier nuclear tests were conducted in 2006 and 2009.

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Catholic Bishops Oppose Revisions To Contraception Mandate

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Photo Credit: DougtoneThe U.S. Conference of Catholic Bishops (USCCB) said Thursday that it remains opposed to the Obama administration’s contraception mandate, arguing Catholic institutions will have “second-class status” under the policy despite recent tweaks to its rules.

The USCCB said the policy will require Catholic institutions to have a hand in healthcare coverage they find immoral.

“Because the stakes are so high, we will not cease from our effort to assure that healthcare for all does not mean freedom for few,” Cardinal Timothy Dolan, president of the USCCB, said in a statement.

The group was initially noncommittal last week after the Obama administration released new regulations on the contraception mandate and its “accommodations” for religious-affiliated institutions, such as Catholic hospitals and universities.

But on Thursday, the bishops said last week’s rules ensure that employees of a religious institution would automatically receive contraception coverage through their insurance companies.

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The GOP, Fox Political Purge (+video)

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Photo Credit: Mike LichtRepublicans and Fox News are moving to purge the controversial political creatures they created.
Both were damaged badly in 2012 by loud, partisan voices that stoked the base — but that scared the hell out of many voters.

Now, the GOP, with its dismal image, and Fox News, with its depressed ratings in January, are scrambling to dim those voices. To wit:

Fox ousted contributors Sarah Palin and Dick Morris, two of the most obnoxiously partisan figures on the network’s air.
Karl Rove, himself sidelined by Fox after the election, has helped start a new super PAC, the Conservative Victory Fund, designed to keep controversial conservatives like Rep. Steve King (R-Iowa) from winning Senate primaries.

Senate GOP leaders created what amounts to a buddy system with their caucus’s most popular tea party members, Sens. Rand Paul of Kentucky and Ted Cruz of Texas, to get their help in taming anti-establishment conservatives.

Louisiana Gov. Bobby Jindal has been running around the country warning anyone who will listen that Republicans must quit being the “stupid party” that nominates nutty candidates.

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Iran’s Supreme Leader Shuts Down Possibility Of Direct Nuclear Talks With US (+video)

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Photo Credit: APIran’s supreme leader today rejected the possibility of direct talks with the United States, nixing a proposal by Washington to ease the stalemate over Iran’s nuclear program.

Six world powers – including the US – are due to resume nuclear talks with Iran on Feb. 26 in Kazakhstan, after an eight-month hiatus. Few expect a breakthrough, not least because Iran is preparing for elections in June.

But the words of Ayatollah Ali Khamenei – who has the final say on all strategic decisions in Iran, as official holder there of the title “God’s deputy on earth” – appear to have scuppered chances of an immediate direct dialogue with the US.

“You [Americans] are pointing the gun at Iran and say either negotiate or we will shoot. The Iranian nation will not be frightened by the threats,”Ayatollah Khamenei told Air Force commanders in a speech today.

“Some naive people like the idea of negotiating with America [but] negotiations will not solve the problems,” Khamenei said in the remarks, which were posted on his website. “If some people want American rule to be established again in Iran, the nation will rise up to face them.”

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Donald Trump: ‘Karl Rove Is A Total Loser’

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Photo Credit: APDonald Trump has tweeted his way into the war between the Tea Party and Karl Rove, taking aim at the former adviser to President George W. Bush.

Trump bashed the veteran Republican consultant in a series of messages Thursday, calling him a “total loser” and encouraging people not to donate to Rove-controlled groups.

“Why are people giving money to Karl Rove when he just wasted $400M without any victories?” Trump wrote. “Use your head. Karl Rove is a total loser. Money given to him might as well be thrown down the drain. Karl Rove’s strategy and commercials were the worst I have ever seen.”

Trump’s messages came amid escalating tensions between Rove, who created a group to back establishment candidates in Republican primaries, and Tea Party groups who backed losing candidates like Christine O’Donnell in Delaware and Todd Akin in Missouri. Rove’s group, the Conservative Victory Fund, has drawn fire from Tea Party backers like FreedomWorks and the Senate Conservatives Fund.

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House Passes Bill Requiring Obama Submit Plan To Balance Budget

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On Wednesday, the House passed legislation that demands President Barack Obama produce a balanced budget or submit a supplemental budget plan by April 1, 2013 that outlines how and in what fiscal year he aims to achieve a balanced budget.

The Require a PLAN Act passed the House in a 253-167 vote, with 26 Democrats supporting the legisation.

Rep. Tom Price (R-GA), the fiscal conservative who introduced the Require a PLAN Act, said, “there is no way our nation can secure a future of growth and opportunity if the spending habits in Washington are allowed to continue to produce massive deficits while chasing every higher spending with ever higher taxes.”

“By passing the Require a PLAN Act, the House of Representatives is taking the next step in making sure Washington puts in place a plan to balance the budget so that we can begin to pay off the debt,” Price said. “All we are asking of President Obama today is that he tell the American people when and how he would balance the budget.”

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Video: Panetta Reveals Obama Absent on Night of Benghazi

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Defense Secretary Leon Panetta testified this morning on Capitol Hill that President Barack Obama was absent the night four Americans were murdered in Benghazi on September 11, 2012:

Panetta said that Obama left operational details, including knowledge of what resources were available to help the Americans under seize, “up to us.”

In fact, Panetta says that the night of 9/11, he did not communicate with a single person at the White House. The attack resulted in the deaths of four Americans, including Ambassador Chris Stevens.

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Lew’s Blues:
 GOP probing Jack Lew’s failure to respond to Medicare insolvency warnings

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Photo Credit: APThe Office of Management and Budget has declined to cooperate with a Republican inquiry into whether treasury secretary nominee Jack Lew was complicit in violating federal Medicare law.

Republicans on the Senate Budget Committee are probing Lew’s involvement in the administration’s alleged failure to respond to annual warnings about Medicare’s pending insolvency.

The administration is required by law to submit legislation to address the Medicare funding crisis within 15 days after a funding warning is issued by the Medicare Trustees.

According to Republicans on the Senate Budget Committee, the Obama administration has not responded to the last four years of funding warnings, including during 2010 and 2011 when Lew was director of the Office of Management and Budget.

The senators are requesting a detailed legislative proposal addressing the current Medicare funding warnings as well as all documents received or written by Lew regarding these warnings.

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