World View: U.S. and Russia Bitterlyn Split over Syria Intervention

This morning's key headlines from

  • Wealthy investors cheer bad unemployment report
  • U.S. and Russia split bitterly over Syria intervention issue
  • U.S. evacuates staff from Lebanon, Turkey, Iraq embassies

Wealthy investors cheer bad unemployment report

Labor force participation rate, 1978 to present (Zero Hedge)
Labor force participation rate, 1978 to present (Zero Hedge)

The unemployment rate declined from 7.4% to 7.3% in August, but it wasn't because of a growth in the job market, which was disappointing. Instead, it was caused by a new sharp fall in the "labor force participation rate" -- the percentage of workers who haven't given up searching for work, which fell to 63.2%, the lowest level since August 1978. A whopping 516,000 more workers dropped out of the labor market in August. The labor force participation rate began to fall after the Nasdaq crash in 2000 and has been plummeting rapidly since the financial crisis began in 2007. 

Friday's jobs report was good news for wealthy stock market investors, because it means that the Federal Reserve is more likely to continue its quantitative easing project of pouring $85 billion into the banking system EVERY MONTH. This money has been propping up the stock market, and from there going into the portfolios of wealthy investors. 

If you've heard the word "tapering" a lot on financial newscasts, it refers to the possibility that the Fed might start to gradually reduce the $85 billion monthly cash injection. This would be considered bad news for wealthy investors, since a lot of the $85 billion goes into their bank accounts. But the $85 billion has failed to stimulate growth in the economy, so there is an increasing amount of political pressure for the Fed to begin tapering. Friday's bad jobs report makes it less likely that the Fed will start tapering right away, and so investors are generally pleased. Zero Hedge and LA Times

U.S. and Russia split bitterly over Syria intervention issue

It was U.S. President Barack Obama versus Russian President Vladimir Putin on the last day of the G-20 meeting in St. Petersburg, Russia. Both of them were ranting, but Obama accused Putin of paralyzing the international community, and Putin accused Obama of violating international law. 

It's hard to take either of them seriously. Obama has been babbling, incoherent, and indecisive for so long, and nobody has a clue what he's going to do next. Putin talking about international law is a farce, with Russian troops still occupying Georgia in violation of international law following his 2008 invasion of Georgia, also in violation of international law. Nonetheless, the bitter divisions were obvious. 

The following countries sided with Obama: Australia Canada, France, Italy, Japan, Republic of Korea, Saudi Arabia, Spain, Turkey, and the United Kingdom. 

The following countries sided with Putin: Russia, China, Brazil, Argentina, Mexico, India, Germany, South Africa, Indonesia, and the European Union. 

The United Nations was started after World War II in order to prevent exactly what's going on now, but the United Nations is now as useless as the League of Nations. 

The only thing that matters now is what happens in Washington, the home of the Policemen of the World. The political battle is just as bitter and divisive as the battle at the G20, splitting both political parties, and far more consequential. 

Obama will give a televised nationwide address on Tuesday about Syria. It should be interesting. Independent (London)

U.S. evacuates staff from Lebanon, Turkey, Iraq embassies

Because of threats of retaliation over the situation in Syria, the U.S. State Dept. is evacuating some staff from embassies in Beirut, Lebanon, from Turkey, and from Iraq. According to the Beirut embassy: 

On September 6, the Department of State drew down non-emergency personnel and family members from Embassy Beirut due to potential threats to U.S. Mission facilities and personnel. The Department of State urges U.S. citizens to avoid all travel to Lebanon because of current safety and security concerns. U.S. citizens living and working in Lebanon should understand that they accept risks in remaining and should carefully consider those risks. 

U.S. citizens concerned for their safety should consider making plans to depart by commercial means. U.S. citizens will be responsible for arranging their own travel out of Lebanon. Beirut International Airport is open and commercial flights are operating. Travelers should check with their airlines prior to traveling to verify the flight schedule. 

Those who remain should prepare to depart at short notice. ... U.S. citizens should be aware that the Embassy does not offer “protection” services to individuals who feel unsafe. U.S. citizens with special medical or other needs should be aware of the risks of remaining in Lebanon given their condition and should be prepared to seek treatment in Lebanon if they cannot arrange for travel out of the country. U.S. citizens traveling or residing in Lebanon who choose to remain should be aware that the U.S. Embassy's ability to reach all areas of Lebanon is limited. The Embassy urges all U.S. citizens in Lebanon to monitor the media for the latest developments.

McClatchy and State Dept.

KEYS: Generational Dynamics, labor force participation rate, Federal Reserve, quantitative easing, tapering, Syria, Russia, Vladimir Putin, Lebanon, Iraq, Turkey 

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