The Silk Cord

66
Fri, Dec 20, 2013 - 1:24pm

I have long had a contentious relationship with Turkey. One of my favorite novels since childhood is a historical tale about the apex moment of the Ottoman Empire. The only fly in the ointment was that my countrymen were the last ones to fall to the military machine of Suleiman the Magnificent – after about a century of TRYING, Turkey finally ground up the borders. Though it STILL needed another 30 years to secure the whole area, ultimately Turkey ruled directly or had dominion over the entire land.

But then again, it was a case of tables being turned – a millennium earlier, it had been Constantinople receiving the raids and paying the tribute

While I was growing up, Turkey was known for three things. One was guest workers commuting to Austria and Germany, swarming the borders and roads in the summer and during Christmas. That institution of legalized ‘illegal immigration’ (e.g. non-assimilative, visibly ethnically different workers of a foreign culture, language and religion toiling at below-average wages WITHOUT enjoying the civil rights and social benefits of the host country) started in the sixties. While the program officially ended in 1973, the vast majority of workers stayed on, becoming ultra-long-distance commuters who would go home 2-3 times a year. The other two notable features of Turkey at the time were leather and gold. If you wanted either, Istanbul was the place to go – both because you did not have to pass through the iron curtain to get there, but mainly because both were available at a large variety and minimal prices (in terms of premium to spot, re: gold). The bazaar was held (grudgingly) in awe for its sheer volume and variety of goods both mundane and exotic. The fact that only a few had resources to make the trip, let alone buy anything, only added to the mystique.

I have been trying to keep an eye on developments vis-a-vis anti-government protests: true grass-roots movement of discontent against a corrupt and overbearing regime? Western meddling and attempted ‘Syria-style’ revolution highjack? Second wave of Arab spring (though I realize Turks and NOT Arabs)? And of course, one must not forget the connection of the story to precious metals – it appears by many (all) accounts that Turkey has been buying Iranian natural gas for gold bullion.

“The system was simple. As Reuters notes, Turkey purchased Iranian natural gas in Turkish lira, and transferring the proceeds to Halkbank accounts. Iranian gold traders then accessed the funds to buy gold in Turkey, which was subsequently carried in luggage to Dubai, and then sold for foreign currency to help sure up Tehran's dwindling foreign exchange reserves.

Remarkably, it was legal under the current sanctions regime, as long as the Obama administration couldn't prove that Turkish gold payments were made to the government of Iran (which strained credulity given Turkey's public admissions that they were selling gold to Iran in exchange for Iranian energy).” – May 17, 2013, The Atlantic

Some have speculated that Turkey has ALSO been facilitating a similar trade between the sanction-beleaguered Persians and the rest of the world – but in any case that trade seems to have been taking place, with or without Turkey.

“The second-largest producer in the Organization of Petroleum Exporting Countries, Iran said last month it will accept payment in any local currency or gold as new sanctions make it harder for trading partners to pay in dollars and euros.” – March 30, 2012, Bloomberg

So I got to thinking – if petrogold is indeed re-emerging, what is happening in terms of the ongoing gold price movements? If gold is ‘worth’ less denominated in fully convertible, ‘hard currency’ like Euros, Dollars or Yen, then the gold that Iran may or may not receive in exchange for its exported barrels has less purchasing power, thus benefiting the enemies of Iran. At the same time, lower gold prices might allow those who might USE gold as payment to acquire MORE oil for the same amount of fiat – but only presuming that the trade agreement for the sale of oil was denominated in weight of gold.

In light of all of the above, the news item perhaps lost in the tumult of this week is as follows:

Two parts Crazy Eddie, one part Gatsby and one part Trump, Ali Agaoglu, No. 527 on Forbes’ billionaire list, is Turkey’s most famous and arguably most notorious construction mogul, a man known just as much for his collection of luxury cars and ex-wives as he is for his links to Erdogan’s government and the state housing authority in particular. […]

Today, Agaoglu is in police custody. Tuesday morning, in a series of raids that seemed to catch all of Turkey, including Erdogan’s government, entirely off guard, Turkish police detained at least 50 people on suspicion of tender rigging, money laundering and bribery. In a country where corruption investigations, at least those involving figures close to the ruling Justice and Development Party (AKP), are rare, this one has netted a number of very big fish: the sons of three Cabinet members, the mayor of one of Istanbul’s biggest boroughs, the general manager of Turkey’s second biggest state bank, Halkbank, several prominent businessmen, as well as a number of civil servants. And finally, Agaoglu.” 12/19/13, TIME

Notice the BANK involved in the story above. Now, the Western media has been very quick to pin the affair on THIS man, a Turkish cleric who is living in Pennsylvania:

Whether or not that is the case, I leave for readers who are more familiar with him and with Turkish current affairs. While on one hand he himself denies/deflects any involvement, or even HAVING a movement behind him in the first place, his students (devotees? disciples?) have opened a network of schools in 140 countries – and by many accounts, the graduates from these schools have reached the highest positions at levels of Turkish government. What perhaps makes all this even MORE interesting is this:

That the U.S. government and, specifically, the Central Intelligence Agency support the Gülen movement is conventional wisdom among Turkey's secular elite even though no hard evidence exists to support such allegations. […]

Gülen attached twenty-nine letters of reference to his June 18, 2008 motion, mostly from theologians or Turkish political figures close to or affiliated with his organization. John Esposito, founding director of the Saudi-financed Prince Alwaleed Bin Talal Center for Muslim-Christian Understanding, who, after receiving donations from the Gülen movement sponsored a conference in his honor, also supplied a reference. Two former CIA officials, George Fidas and Graham Fuller, and former U.S. ambassador to Turkey Morton Abramowitz also supplied references.

The letters may have worked. On July 16, 2008, U.S. district judge Stewart Dalzell issued a memorandum and order granting Gülen's motion for partial summary judgment and ordering the U.S. Citizenship and Immigration Service to approve his petition for alien worker status as an alien of extraordinary ability by August 1, 2008.” – 2009, Middle East Quarterly

Hmmmm…… So is this a simple shot across the bow to the Turkish PM from an elusive, shadowy figure who acts as a puppeteer, moving his ‘sleeper cell’ followers against the PM at will? Is Gülen in league with/controlled by/ a creature of the US-based NatSecAgencies? Or merely a political player and ersatz spiritual/cultural authority exerting his influence to retain the lifeline of his movement (the Turkish government apparently planned to close the schools in question)? The network of religious schools propagating his brand of Islam is eerily reminiscent of the organization of Wahhabi institutions sponsored by Saudi petrodollars (in their structure, funding and proliferation, if not their principal philosophy). And it would seem convenient that the Agencies mentioned earlier already have substantial experience in funding, working with and exploiting assets educated in such institutions. But this really seems to be taking it to a whole new level:

“His school network is impressive. Nurettin Veren, Gülen's right-hand man for thirty-five years, estimated that some 75 percent of Turkey's two million preparatory school students are enrolled in Gülen institutions.[12] He controls thousands of top-tier secondary schools, colleges, and student dormitories throughout Turkey, as well as private universities, the largest being Fatih University in Istanbul. Outside Turkey, his movement runs hundreds of secondary schools and dozens of universities in 110 countries worldwide.” – 2009, Middle East Quarterly

Destabilizing Syria DID work, but not with the degree of efficiency those directing it might have hoped. All-out, multilateral war did not break out. Whether that bit was off-script, or if we just aren’t far enough along in the play yet remains to be seem, but in any case SOMEONE seems to be keen on at a minimum reducing the power of government in countries in the area – including neighboring Turkey. Who it seems is also a key trading partner of Iran. Who may or may not be involved in a high-volume gold settlement system centered around Iranian oil and gas. Could this be considered a warning to stop the trade or to restore/increase it to levels seen before the tightening of Iranian sanctions? Was Erdogan’s outfit simply skimming too much from the top?

Another (to me) intriguing angle: with the Geneva deal, US-enforced sanctions have eased, giving S. Korea, China and India waivers for buying Iranian oil. However, even if said countries are allowed to pay Iran with their own currency, or Euros, or USD, there are potentially a significant amount of things Iran wants/needs but cannot acquire with fiat currencies, due to the limits on outbound financial transactions it can make, and the types of goods which may be traded. Could it be that Iran isn’t so much accepting gold because it is one of the few types of payment it can RECEIVE, but that it is preferred as a form of payment because it is one which Iran can use most widely to make PAYMENTS? So could the recent developments in Turkey have anything to do with the fact that Iran has just interrupted negotiations in Geneva over the future of global relations with the country?

Or could it be the case that honest, forthright members of law enforcement and the judicial system are standing up, and attempting to take back their country from a ruling caste corrupt to its core?

Whatever the case, this could be a story worth keeping tabs on. Just because it does not remain in the headlines ALL the time does not mean nothing’s happening. An actively simmering Middle East that can be ‘whipped’ into all-out war pretty much at will is an ongoing requirement for the preservation/life-support of the petrodollar. Turkey itself is in a crucially important strategic position geographically, making it a target of imperial interests (and perhaps manipulation) from more than just one side. And it’s not like there have been any conflicts in recent years/decades due to the production, sale and transport of hydrocarbons in this region…

In the Ottoman Empire, a ritual/custom of succession for the seat of monarch developed over the centuries:

In earlier times, the Turkish sultans sent to high-ranking personalities who were sentenced to death, a silk thread - stylishly usually in a small jewelry box. After receiving, the condemned was strangled by a servant or soldier. This method offered the very great advantage that the sultans could vacate brothers and nephews out of the way to secure their rule, without shedding their royal blood. Occasionally, even the convicted had the opportunity to escape the strangling by suicide. If the blood flowed, this was thus the responsibility of the individuals affected.

(For those inclined to do more historical reading on what a REAL game of thrones might have looked like, and more macabre details on royal fratricide and similar hobbies, I can recommend this post and this Smithsonian article.)

A fascinating twist was also introduced for top officials/nobility who were NOT a direct threat to the ruler's position:

"For a grand vizier, however, there was still a chance: as soon as the death sentence was passed, the condemned man would be allowed to run as fast as he was able the 300 yards or so from the palace, through the gardens, and down to the Fish Market Gate on the southern side of the palace complex, overlooking the Bosphorus, which was the appointed place of execution.
If the deposed vizier reached the Fish Market Gate before the head gardener, his sentence was commuted to mere banishment. But if the condemned man found the bostanci basha waiting for him at the gate, he was summarily executed and his body hurled into the sea." -- Smithsonian Magazine

The silk cord is one step worse than a severed horse’s head – it is not so much a warning to cooperate, but rather a notification of imminent violent death. It definitely seems to me that this episode was a warning, not a ‘true’ silk cord (yet) – the only question is who was the sender? Will the current government 'run for it', or try to make a stand?

About the Author

  66 Comments

SilverDog66
Dec 20, 2013 - 2:57pm

Ag1969

I had a quick look back and it happens more often then every 823 years?! It's special because??.......it's in august?

ag1969
Dec 20, 2013 - 3:04pm

No clue silverdog

I received it today in an email. I have been researching since I posted it and all I can find is the same text I copied and pasted from my email.

AlienEyes tyberious
Dec 20, 2013 - 4:06pm

Re: Watcha Gonna Do When They Come For You?

At the local firing range several years ago, I saw a guy shooting at what I thought were silhouette targets. I aimed at his target to see how he was doing and through the scope I could see a drawing or copy of a drawing of a black tee shirt with the white letters DHS on it. I started laughing and the fellow said with a grin, "you looking at my target?" I said, yes I am. Then he asked, "Where do you live?" I answered, Standing Oaks. He said, me too.

As we chatted a bit, he said several people (12) had bought a twenty-six acre farm about eight miles from our neighborhood and were fortifying it. (don't ask how). Eight of the owners were ex-military and the rest were long time NRA members and prepers. He handed me six of his DHS targets and a card with just his name and phone and an American flag on it. He asked what I did before I retired and I said civil engineer. He said, perfect! Now I'm a member, we have our own shooting range. The farm is a "go to" for when the shtf. It has two wells, a creek and most (about 3/4) of a six hundred foot hill on it. I designed a small steel reinforced concrete building and the younger guys are building it. One of our members owns a construction company and another owns 1/2 interest in a concrete plant. We have added several earthen berms with broken concrete rubble and stone rip-rap cores. They can stop a .50 cal. with no sweat. The only road in is rigged with pop up flares and fireworks to let us know if any uninvited guest should drop in late at night. About five acres is open and the rest is old growth forest. It's crawling with deer.

Needless to say, I know what I'm going to do.

why do I even bother
Dec 20, 2013 - 4:07pm

The Time Value Of Gold – Ignore It At Your Own Peril

https://www.gold-eagle.com/article/time-value-gold-%E2%80%93-ignore-it-y...

Dr. Tom Fischer is professor of financial mathematics at the University of Wuerzburg, Germany. His research interests lie in the areas of asset and derivative pricing, systemic risk, risk capital allocation and FX risk management. As a gold and silver investor, professor Fischer closely follows the precious metals markets and has developed a proprietary stochastic gold price model for Approximity. He is a member of the German Association for Actuarial and Financial Mathematics (DGVFM) and the German Risk Management Association (RMA e.V.). Prof. Dr. Fischer can be contacted under tom[dot]fischer[at]uni-wuerzburg[dot]de.

tyberious
Dec 20, 2013 - 4:15pm

Awesome AE

Welcome to the resistance!!!

ag1969
Dec 20, 2013 - 4:38pm

Thanks Alien Eyes

I now have a serious case of bugout envy.

Dagney Taggart
Dec 20, 2013 - 4:45pm

Comex Registered Gold Counterparties

Remember a month ago when there were 65+/- counterparties to each Comex registered ounce of gold?

As of yesterday, it was 92.

How is any of this possible? Not that I'm complaining

(Thanks Thorus)

AlienEyes
Dec 20, 2013 - 4:56pm

Counterparties

Ninety-two per ounce???

Damnit! If they all show up at one time wanting my stack, I'm going to need twice as much ammo as I have.

DeaconBenjamin
Dec 20, 2013 - 5:05pm

Turkey's EU Minister strongly refutes charges in corruption prob

EU Minister Egemen Bağış has strongly refuted the charges and denouncing alleged efforts to “build a parallel state within the state.” AA photo

EU Minister Egemen Bağış has become the first minister to issue a public statement on his involvement as a suspect in the massive corruption probe, strongly refuting the charges and denouncing alleged efforts to “build a parallel state within the state.”

“In recent days, in print and visual media and on the Internet, a series of news stories and comments regarding the ongoing investigation in Istanbul are being made. Accusatory and slanderous assessment are being made about myself,” Bağış said in a written statement issued on the evening of Dec. 20.

“Irresponsible reporting being made within this framework is completely based on misleading and speculative information. These scenarios are being deliberately produced and are completely false … and are part of an outrageous conspiracy,” he added.

The sons of three members of the Cabinet – Interior Minister Muammer Güler, Economy Minister Zafer Çağlayan and Environment and Urban Planning Minister Erdoğan Bayraktar - have been detained as part of the investigation. Bağış’s name is also being cited in news reports as being involved in a large bribery scandal, including allegations that he facilitated the issuing of Turkish citizenship and passports for gang members.

“Those who have been instrumental in smear campaigns of organizations, and gangs that have been exerting efforts to build a parallel state within the state, have become evident in terms of both execution without trial and assassination of personality,” was the phrase used by Bağış in describing the alleged circles behind the operation targeting the government.

The term “parallel state” is commonly used by critics of the followers of the U.S.-based Islamic scholar Fethullah Gülen, many of whom have been employed in the judicial and security bureaucracy.

Bağış said those who are instrumental in these circles are committing a “big crime,” adding that he had initiated legal processes against those who “reflect nonsense, and who claim to have found evidence for these denigrations in a way that would lead to a judgment [of me].”

December/20/2013

https://www.hurriyetdailynews.com/turkeys-eu-minister-strongly-refutes-c...

BGSilverBull
Dec 20, 2013 - 6:49pm

Speaking of history......

Thanks JY896 for the interesting read, sins you are on the subject history I would like to add something too, from the same geographical place but few hundred years earlier, this is the condensed version:

It was in Constantinople (Istanbul today) in and around ~700-750 AD, the Arabs were advancing towards the Eastern Roman Empire capitol and were concurring any and every stronghold in their path, next in their path was the old Capitol city. The Emperor needed an army fast, but how can he afford to buy or pay this new army, he needed money and fast. Back then, coincidentally enough they didn't have printing presses like we do today, so how can you make money to pay for these military expense? Well, back then money was Gold and Silver (imagine that, but all you folks on this site know this), Gold and Silver were also status metals, the more golden statues you've build in your name, the grater the Emperor you were. There for - there were "few" golden and silver statues in the city. Faced with this foreign danger invading his land and no new money coming in his vaults, the current Emperor ordered all Golden and Silver statues to be melted and struck into coins, with these coins he bought food and soldiers from near by friendly allies and eventually weathered the foreign invasion and the Byzantine Empire lived for few more hundreds of years.

My point here is that Gold and Silver are always been valued for their monetary capability but also for their status creating capabilities, I hope I didn't bore anyone, but I love history because it teaches me about the future.

So, stack on my friends..........stack on

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