>End Times File: W. Europe faces bankruptcy, international investors flee E. Europe, Japan plows into recession, Kremlin leverages capitalist crisis

>– Soviets Extend Control over Portland-Based Oregon Steel through Proposed Merger of Major Russian Corporations

The economies of the capitalist countries are unquestionably in the midst of convulsions. No government, even those of the communist and “post”-communist states, is immune from the ripple effects surrounding this crisis of faith in money. World financial and commodity markets continue to tumble. The Dow Jones Industrial Average has long since fallen below the psychologically important benchmark of 8,000 points. In spite of threats last year from Russia and the Organization of Petroleum Exporting Countries (OPEC) to artificially jack up the price of oil, crude futures are sagging precipitously below US$40 per barrel. Two major OPEC players, Iran and Venezuela, are close allies of Moscow.

Pictured above: Russian Prime Minister Vladimir Putin speaks during a visit to an oil refinery in the town of Kirishi, near St. Petersburg on February 12.

Ireland has joined a growing list of Western European states, like the United Kingdom, Greece, and Iceland, which are confronting the specter of defaulting on debt. In Asia, Japan, according to that country’s economic minister Kaoru Yosano, faces “the worst economic crisis in the postwar era.” Martin Schulz, an economist at the Fujitsu Research Institute in Tokyo, explains that Japan’s economic recovery after the “lost decade” of the 1990s has stumbled to a halt. “The recovery was unsustainable,” Schulz laments, “It was built on a major global bubble, and now basically the economy is paying the price.”

Most ominously, for those observers of world politics who fear an open resurgence of communism in Eastern Europe, international lenders are fleeing the old Soviet Bloc. British journalist Ambrose Evans-Pritchard, who exposed corruption in the Clinton Administration during the 1990s, describes the panic in Central Europe and the Balkans. Citing Erik Berglof, chief economist for the European Bank for Reconstruction and Development, Evans-Pritchard states that Eastern European banks may need 400 billion euros to cover loans and sustain the credit system there. Under the title “Failure to Save East Europe Will Lead to Worldwide Meltdown,” he writes:

Europe’s governments are making matters worse. Some are pressuring their banks to pull back, undercutting subsidiaries in East Europe. Athens has ordered Greek banks to pull out of the Balkans.

The sums needed are beyond the limits of the IMF, which has already bailed out Hungary, Ukraine, Latvia, Belarus, Iceland, and Pakistan – and Turkey next – and is fast exhausting its own $200bn (€155bn) reserve. We are nearing the point where the IMF may have to print money for the world, using arcane powers to issue Special Drawing Rights.

Its $16bn rescue of Ukraine has unravelled. The country – facing a 12pc contraction in GDP after the collapse of steel prices – is hurtling towards default, leaving Unicredit, Raffeisen and ING in the lurch. Pakistan wants another $7.6bn. Latvia’s central bank governor has declared his economy “clinically dead” after it shrank 10.5pc in the fourth quarter. Protesters have smashed the treasury and stormed parliament.

“This is much worse than the East Asia crisis in the 1990s,” said Lars Christensen, at Danske Bank.

“There are accidents waiting to happen across the region, but the EU institutions don’t have any framework for dealing with this. The day they decide not to save one of these one countries will be the trigger for a massive crisis with contagion spreading into the EU.”

Thus we see that the governments in Eastern Europe, most of which are staffed by apparatchiks from the old communist regimes who failed to affect a successful transition from socialism to capitalism, will in the end be responsible for bringing down the whole system. “We are nearing the point where the IMF may have to print money for the world, using arcane powers to issue Special Drawing Rights,” Evans-Pritchard writes above. Intriguingly, for students of Bible prophecy, such comments foreshadow the rise of Revelation’s mark of the Beast, where commerce is prohibited apart from absolute submission to a world dictator.

In Russia itself, reports the Financial Times, industrial production plunged a whopping 20 per cent in January, the largest month-on-month drop in seven years. “The horrendous industrial production data in January have left no doubt that the economy has come to a screeching halt,” opined Ivan Tchakarov, chief Russia economist for the investment bank Nomura. “This indicates,” he explains, “that the combined effect of the credit squeeze in the banking sector and falling global and domestic demand has filtered through to the real economy.” In December Russia’s economy dumped 500,000 jobs, bringing the total unemployment level to 7.7 per cent. Billionaire Mikhail Prokhorov has emerged as Russia’s wealthiest oligarch after the economic turmoil vaporized two-thirds of the fortunes of Russia’s top 10 tycoons. Bleak statistics like this will provide the Communist Party of the Russian Federation with ample ammunition to agitate for the reconstruction of a full-blown command economy and the placement of open communists in the Kremlin.

In an attempt to consolidate power at the center, this past Monday Russian “President” Dmitry Medvedev signed decrees to replace four regional governors. Medvedev removed the governors of Pskov, Oryol, and Voronezh, as well as the administrative head of the Nenets Autonomous Area. In his televised interview the day before, Medvedev complained that these regional governors were ‘inept and inefficient,” and not “responsible enough in dealing with unemployment” amid Russia’s financial crisis, the reality of which the Putinist regime has finally acknowledged. In light of the Kremlin’s sagging oil revenues and stubborn refusal to cut defense spending, more hardship for Russia’s citizen-slaves can be expected.

Notwithstanding problems at home, the Kremlin is using the global financial crisis and the personal misfortunes of Russia’s oligarchs, many of whom are graduates of the Soviet Komsomol, to re-nationalize (re-communize) Russian industries and leverage control over overseas enterprises like Oregon Steel. Roman Abramovich, the owner of Britain’s Chelsea soccer team, is one of two controlling shareholders in Evraz Group, which bought Portland-based Oregon Steel Mills for US$2.35 billion in 2007. However, Evraz Group, Russia’s largest steelmaker, is struggling with depressed world steel prices and a cumbersome foreign debt resulting from almost US$8 billion in foreign acquisitions. Russia’s state bailout agency, which is chaired by KGB-communist dictator Vladimir Putin, has loaned Evraz US$1.8 billion to refinance its foreign debts. Prime Minister Putin, according to The Oregonian, is now backing a proposed merger of Abramovich’s Evraz Group; Norilsk Nickel, which is owned by two Putin lackeys, Vladimir Potanin and Oleg Deripaska; mining-and-metals firm Metalloinvest; steel-and-coal producer Mechel; potash producer Uralkali; and titanium producer VSMPO-Avisma, one of whose customers is Boeing’s Gresham plant. The Kremlin–through its arms agency, Russian Technologies–would receive a 25 percent stake and one share of stock in the new monopoly in exchange for liquidating debts.

To make a long story short, the Kremlin-backed merger would indirectly prop up Oregon Steel. The resulting corporate “behemoth,” reports Oregonian journalist Richard Read, “would be large enough to compete with Australian-British giants Rio Tinto and BHP Billiton, a long-held dream of Russian tycoons.” Putin’s recent stern warning at the World Economic Forum about the uncompetitive nature of Soviet-style socialism apparently has limits.

On February 12 Putin and Chinese Premier Wen Jibao conversed by telephone on “issues of common concern.” According to Xinhua, Wen told Putin that both countries should “enhance coordination and cooperation for the sake of the entire world” and to reverse the effects of the global economic recession. In December Chinese President Hu Jintao called for stronger military cooperation with Russia in talks with visiting Defence Minister Anatoly Serdyukov, son in law of Gazprom Chairman Viktor Zubkov. “As the strategic partnership between China and Russia develops, the relationship between the two militaries has also continued to become more consolidated and stronger,” Xinhua quoted Hu as saying at the time. Hu added: “I hope… to advance the China-Russian strategic partnership and the relationship between the two militaries from a new historical starting point to better and faster development toward the future.” The two communist superpowers plan to hold their third combined war game some time this year. The first two Sino-Soviet military exercises took place in 2005 and 2007, under the auspices of the Shanghai Cooperation Organization (SCO).

False rivals during the Cold War, Moscow and Beijing inked a friendship treaty in 1999, 15 years after KGB defector Anatoliy Golitsyn predicted the rise of a body like the SCO in order to advance the communist strategy for world domination. Golitsyn referred to the Moscow-Beijing Axis as “one clenched fist,” a formidable alliance that would challenge the West after the bogus demise of Soviet communism eliminated all need for NATO.

Energy cooperation is another important element in the Trans-Asian Axis. Yesterday, Russian Deputy Prime Minister Igor Sechin, who is presently visiting Beijing, signed a raft of fuel and energy cooperation documents with Chinese Premier Wen. One document establishes an intergovernmental agreement on the construction of a branch of the East Siberia-Pacific Ocean (ESPO) oil pipeline that will link the two countries. According to Sechin, under the agreement, Russia will supply 15 million metric tons (110 million barrels) of crude annually for 20 years to China “on credit terms that suit both parties.” ESPO is currently under construction and expected to pump its first oil in December 2009.