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U.S. Unhappy With Warning Letter From Japan

The U.S. State Department appeared displeased by a warning letter from Japanese Ambassador to the U.S. Ryozo Kato.
Kato warned in the letter that Japan-U.S. relations could suffer serious, long-term harm if the House of Representatives passes a resolution urging Japan to apologize for forcing women into sexual slavery during World War II.

The letter cited Japan’s support for reconstruction in Iraq as an example of what could be hurt by the vote.

A U.S. official, who asked to remain anonymous, strongly criticized the Japanese government for linking the comfort women issue with Iraq. “Japan has aggravated the situation by placing an advertisement denying its role in the comfort women issue and sending the warning letter.”

When asked in a press briefing whether the Bush administration has tried to persuade Congress not to pass the resolution, State Department spokesman Sean McCormack said, “I know that President Bush, when he met with Prime Minister Abe, talked about — you know, talked about this issue. And President Bush was reassured by his conversation with Prime Minister Abe specifically on this issue.”

U.S. Congressman Mike Honda, who submitted the resolution, said in an interview with U.S. media that the resolution is likely to be voted on by the House on July 30, a day after Japan’s parliamentary elections. Honda said the resolution would “definitely” be taken up before Congress starts its summer recess Aug. 6.

As to Kato’s warning in the letter that the resolution would undermine U.S. ties with its “closest Asian ally,” Honda said, “I don’t think it’s going to hurt the relationship between our two countries. When people make amends, usually a friendship gets stronger.” He added, “This resolution is seeking reconciliation. Reconciliation doesn’t have a timeline.”

Meanwhile, the San Jose Mercury News said in an article, “In Japan, individual high-ranking officials have apologized over the years. But the Diet, Japan’s parliament, has resisted passing a formal apology.”

The daily newspaper was critical of Japan’s politicians. “Apologies have been followed by high-level visits to the Yasukuni Shrine, where 14 convicted war criminals are buried. Textbooks undergo a whitewashing. Prime Minister Shinzo Abe said in March that there was ‘no evidence’ to prove comfort women were coerced. No wonder apologies seem insincere.”

http://english.chosun.com/w21data/html/news/200707/200707200016.html

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Bond bears turn tail in subprime scareBy Burton Frierson – Analysis

NEW YORK (Reuters) – The latest rumblings from the U.S. mortgage debacle is seen turning bond bears timid in the coming weeks or at least until the extent of contamination from subprime assets is clear.
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Credit ratings agency Standard & Poor’s stunned markets on Tuesday by warning of possible downgrades to a slew of mortgage-backed debt, boosting Treasuries but sending shivers through the riskier sectors of the fixed-income market.

Even though the economy has bounced back from earlier scares in the subprime sector, which targets borrowers of lower credit quality, this latest bout of jitters should still tamp down yields until the scope of the damage is known.

“It could keep rates artificially low for the next four to six weeks,” said Ajay Rajadhyaksha, co-head of U.S. fixed income strategy at Barclays Capital in New York.

If it weren’t for housing and its credit implications, rebounding economic growth and nagging inflation concerns would be applying downward pressure on bond prices.

This was the case last week, when the Treasury market suffered its biggest losses in over a year, based on the rise in benchmark 10-year yields .

By Tuesday afternoon, however, a powerful bond market rally pushed benchmark 10-year yields down to 5.03 percent, well off Friday’s two-week highs near 5.20 percent.

FIRST STEP?

Worries that S&P’s announcement could be the first step in a wave of downgrades that could affect investment-grade assets drove the rally in Treasuries.

In particular, analysts say typically conservative classes of investors — such as banks, insurance companies and money managers — may be holding positions in assets destined for downgrades, including collateralized debt obligations.

CDOs are a rapidly growing class of securities created by packaging together bonds, including risky subprime loans, junk or high-yield bonds and high-grade debt.

Securities backed by subprime loans are often carved into pieces of varying degrees of risk, some including triple-A tranches made up of the most secure income stream in a CDO.

Uncertainty over such a scenario led investors to dump some risky assets in favor of Treasuries, the market’s usual safe haven in times of trouble.

“People are worried about CDOs they cannot sell because when you want to sell things like this nobody wants to buy from you,” said Michael Cheah, vice president, portfolio manager, at AIG SunAmerica Asset Management in Jersey City, New Jersey.

“So these people are forced to sell junk bonds and corporate bonds, or pay in the swap market,” he added.

The fear now is that a large amount of assets have been masquerading as investment-grade. Ultimately they may have to be dumped, or offset by selling of other risky investments.

“We have less than 10 companies that are triple-A rated,” said Cheah. “Triple-A companies include GE (NYSE:GE – BRKA – news) and are we to believe that these CDO tranches made up of garbage are the equivalent of GE and Berkshire Hathaway?”

“It’s a joke. It’s a fake. A lot of people are now just waking up to reality that these are fake triple-As — while a few still need the rating agencies to tell them when to sell,” he said.

Still, some doubt subprime alone will bring an extended bond rally. Given that long-term rates are well below the 5.25 percent fed funds rate, it will take a solid conviction that the Federal Reserve will cut interest rates to get the market going.

“Other than a flight-to-quality bid, Treasuries definitely have a limit to how far they can run,” said David Coard, head of fixed-income sales and trading at the Williams Capital Group in New York. “The 10-year yield probably won’t go below 5 percent.”

Saturday, 21 July 2007

A large forces of the American Occupation Forces raided the headquarters of the Association of Muslim Scholars in Iraq at the west of Baghdad.

AMSI Net Special = The raid came after the occupation forces surrounded the area by tanks armored vehicles, different types of mechanisms and the attribution of extensive air.

These brutal forces stormed AMSI Headquarters at dawn prayer entered into the office as their usual acts smashed all the contents of the office computers furnitures files as well as breaking the reserveoirs and theft.

These occupation forces also arrested all of officers who were there and took them to one of their military headquarters.

The occupation forces stole all the computers and then attacked and beat AMSI officals up who were at AMSI headquarters arrested.

This present attacks is as a result of the insistence and fixed positions of the Association of Muslim Scholars in Iraq that reject the hateful occupation which caused the scourge of the Iraqi people and destroyed the Iraqi lands.

It is noteworthy that the headquarters of the Association of Muslim Scholars in Iraq has suffered several previous raids by the occupation forces

which act the same way every time.

On the other hand the sectarian militias and the government forces had attacked with mortar shells to AMSI headquarters many times.

http://heyetnet.org/en/content/view/1261/1/