GEN. KELLY TELLS CONGRESS OF IRAN'S INFLUENCE IN LATIN AMERICA

FROM: U.S. DEPARTMENT OF DEFENSE
Southcom Chief: Iran Working to Expand Influence in Latin America
By Nick Simeone
American Forces Press Service

WASHINGTON, March 20, 2013 - U.S. Southern Command's top officer told Congress today that Iran is actively working to expand its presence in Latin America to cultivate allies at a time when Tehran is facing tough U.S and international sanctions for its alleged nuclear weapons program.

Marine Corps Gen. John F. Kelly told the House Armed Services Committee that Iran "has been very, very active over the last few years" in cultivating diplomatic and cultural ties to the region, especially by befriending Venezuelan President Hugo Chavez, who died earlier this month.

"They've opened embassies, they've opened cultural centers," he testified, adding that on the surface, all of this appears to be normal.

"But to what end is obviously the issue," he told the House panel.

Kelly told lawmakers he could discuss details about what the Iranian government's goals might be only in a closed session. He mentioned Bolivia, Ecuador and Argentina as countries that have been the target of Iran's diplomatic and economic outreach.

Despite Iran's outreach to countries that he said have interests unfavorable to the United States, the general cast Iran's overtures as being far from successful and described a region as largely uninterested in Tehran's diplomatic engagement.

"The region as a whole has not been receptive to Iranian efforts," Kelly said in his prepared testimony. But he cautioned that Iran's allies, including Hezbollah, have established a presence in several Latin-American countries to deadly effect, recalling that Iran and Hezbollah were blamed for the 1994 bombing of a Jewish community center in Buenos Aires, Argentina, that killed more than 80 people.

"Proselytizers with ties to global Islamic groups are attempting to radicalize and recruit among the Muslim communities throughout the region," he said, adding that the United States and its partners "should be extremely concerned whenever external extremist groups or state sponsors of terrorism see the Western Hemisphere as attractive or, even worse, vulnerable."

Kelly pointed out that Venezuelan government officials have been sanctioned for providing financial support to Hezbollah, as well as for supporting rebels in neighboring Colombia.

Kelly said China is another country far outside Latin America that wants to compete with the United States for influence in the region, and is very engaged economically, "buying commodities in a big way and also investing in port facilities." This, he added, is all the more reason for the United States to continue working to strengthen partnerships in the region.

CLEVERNESS AND TOOL EVOLUTION



Photo caption: Ancient stone tools showing the pace of remarkable technological enhancements over time (1.75 to 0.85 million years ago). Credit, Los Alamos National Laboratory.

FROM: LOS ALAMOS NATIONAL LABORATORY
Documenting Stone Age Cleverness By Tool Development
Ancient handaxe craftsmanship gives insight into mental advances

LOS ALAMOS, N.M., March 12, 2013—LOS ALAMOS, N.M., March 12, 2013—Stone Age man’s gradual improvement in tool development, particularly in crafting stone handaxes, is providing insight into the likely mental advances these early humans made a million years ago. Better tools make for better hunting, and better tools come from more sophisticated thought processes. Close analysis of bits of chipped and flaked stone from across Ethiopia is helping scientists crack the code of how these early humans thought over time.

Los Alamos National Laboratory Fellow Giday WoldeGabriel and a team of Ethiopian, Japanese, American and German researchers recently examined the world’s oldest handaxes and other stone tools from southern Ethiopia. Their observation of improved workmanship over time indicates a distinct advance in mental capabilities of the residents in the entire region, with potential impacts in tool-development skills, and in overall spatial and navigational capabilities, all of which improved their hunting adaptation.

"Even though fossil remains of the tool makers are not commonly preserved, the handaxes clearly archive the evolution of innovation in craftsmanship, acquired intelligence and social behavior in a pre-human community over a million-year interval," said WoldeGabriel.

The scientists determined the age of the tools based on the interlayered volcanic ashes with the handaxe-bearing sedimentary deposits in Konso, Ethiopia. Handaxes and other double-sided or bifacial tools are known as the first purposely-shaped tools made by humanity and are closely associated with Homo erectus, an ancestor of modern humans. A paper in a special series of inaugural articles in the Proceedings of the National Academy of Sciences USA, "The characteristics and chronology of the earliest Acheulean at Konso, Ethiopia," described their work.

Some experts suggest that manufacturing three-dimensional symmetric tools is possible only with advanced mental-imaging capacities. Such tools might have emerged in association with advanced spatial and navigational cognition, perhaps related to an enhanced mode of hunting adaptation. Purposeful thinning of large bifacial tools is technologically difficult, the researchers note. In modern humans, acquisition and transmission of such skills occur within a complex social context that enables sustained motivation during long-term practice and learning over a possible five-year period.

Making the right tools for the job

Researchers observed that the handaxes’ structure evolved from thick, roughly-manufactured stone tools in the earliest period of Acheulean tool making, approximately 1.75 million years ago to thinner and more symmetric tools around 0.85 Ma or megaannum, a unit of time equal to one million years. The Acheulean is a stone-age technology named after a site in France where handaxes from this tradition were first discovered.

The chronological framework for this handaxe assemblage, based on the ages of volcanic ashes and sediments, suggests that this type of tool making was being established on a regional scale at that time, paralleling the emergence of Homo erectus-like hominid morphology. The appearance of the Ethiopian Acheulean handaxes at approximately 1.75 Ma is chronologically indistinguishable from similar tools recently found west of Lake Turkana in northern Kenya, more than 125 miles to the south.

"To me, the most intriguing story of the discovery is that a pre-human community lived in a locality known as Konso at the southern end of the Ethiopian Rift System for at least a million years and how the land sustained the livelihood of the occupants for that long period of time. In contrast, look at what our species has done to Earth in less than 100,000 years – the time it took for modern humans to disperse out of Africa and impose our voracious appetite for resources, threatening our planet and our existence," WoldeGabriel said.

The research team

WoldeGabriel is a specialist in field and volcanic geology and geochronology, and together with his research collaborators examined the scattered geologic sections in which early hominid fossils and tools are found. Through geological fieldwork, volcanic ash chemistry and geochronology, he helps to rebuild the time and space framework of the paleo landscape.

In addition to the Konso research project, WoldeGabriel is also co-leader and lead geologist of the Middle Awash project, a collaborative research project in Ethiopia of the Institute of Geophysics, Planetary Physics and Signatures and University of California, Berkeley, which has recovered the fossil remains of at least eight species, including some of the earliest hominids, spanning the past six million years.

The team that studied the handaxes and their geological context includes researchers Yonas Beyene (Association for Research and Conservation of Culture, Ethiopia) and Berhane Asfaw (Rift Valley Research Service, Ethiopia), Shigehiro Katoh (Hyogo Museum of Nature and Human Activities, Japan), Kozo Uto (National Institute of Advanced Industrial Science and technology, Japan), Megumi Kondo (Ochanomizu University, Japan), Masayuki Hyodo (Kobe University) and Gen Suwa (University of Tokyo), William K. Hart (Miami University of Ohio), Paul R. Renne (Berkeley Geochronology Center and University of California, Berkeley) and WoldeGabriel (Los Alamos National Laboratory) and Masafumi Sudo (University of Potsdam, Germany). The Institute of Geophysics, Planetary Physics and Signatures provided partial funding for the Los Alamos research.

NAVIGATING THE SUEZ CANAL

FROM: U.S. NAVY

The guided-missile destroyer USS Jason Dunham (DDG 109) transits north in the Suez Canal as part of the Dwight D. Eisenhower Carrier Strike Group. Jason Dunham is deployed to the U.S. 5th Fleet area of responsibility promoting maritime security operations, theater security cooperation efforts and support missions as part of Operation Enduring Freedom. U.S. Navy photo by Mass Communication Specialist Seaman Andrew Schneider (Released) 130316-N-XQ474-223

The aircraft carrier USS Dwight D. Eisenhower (CVN 69) transits the Suez Canal. Dwight D. Eisenhower is deployed to the U.S. 5th Fleet area of responsibility promoting maritime security operations, theater security cooperation efforts and support missions as part of Operation Enduring Freedom. U.S. Navy photo by Mass Communication Specialist Seaman Apprentice Kameren Guy Hodnett (Released) 130316-N-KG407-025

NEWS FROM AFGHANISTAN FOR MARCH 21, 2013

FROM: U.S. DEPARMENT OF DEFENSE
Combined Force Arrests Weapons Broker in Kandahar
From an International Security Assistance Force News Release

KABUL, Afghanistan, March 21, 2013 - A combined Afghan and coalition security force arrested a Taliban weapons facilitator and detained another insurgent in the Arghandab district of Afghanistan's Kandahar province today, military officials reported.

The facilitator is accused of brokering deals for weapons and ammunition for insurgent fighters to use in attacks on Afghan and coalition forces.

In Helmand province's Nawah-ye Barakzai district yesterday, a combined security force arrested a Taliban leader and detained two other insurgents believed to have carried out a significant number of improvised explosive device attacks against Afghan and coalition forces.

In other news, Afghan and coalition security forces today confirmed the death of Hazratullah, a Haqqani network leader, in Khost province's Sabari district. He had a long history of procuring weapons, IED components, ammunition and other supplies for militants to use in attacks against Afghan and coalition forces.

GEN. DEMPSEY SAYS GULF CRITICAL TO U.S.

FROM: U.S. DEPARTMENT OF DEFENSE
Gulf Remains Critical to U.S. Interests, Dempsey Says
By Karen Parrish
American Forces Press Service

WASHINGTON, March 18, 2013 - The U.S. commitment to security in the Persian Gulf remains firm, the nation's senior military officer said here today.

Speaking as part of a recurring Persian Gulf forum hosted by the Center for Strategic and International Studies, Army Gen. Martin E. Dempsey, chairman of the Joint Chiefs of Staff, discussed how budget pressures and a force drawdown will affect U.S. military engagement in the Gulf region.

Countries bordering the Persian Gulf include Iran, Iraq, Kuwait, Saudi Arabia, Qatar, Bahrain, United Arab Emirates and Oman.

Dempsey noted he lived and worked in Iraq and Saudi Arabia for many years. "I came here today with a message of assurance -- a little peace of mind in the context of uncertainty," the general told the audience.

Nations and people share an interest in a common future, he said, "and that will always be the case, and always factor into the decisions we make about distribution of forces, partnering, engaging -- all the things we've done, really, for the past 25 or 30 years -- to make sure that the Middle East, in particular, is on a path for greater security and stability."

The U.S. presence in the Gulf since 1991 was originally because of Saddam Hussein's aggression, Dempsey said. "But we stayed there because, I think, we came to a realization that the future of the region was tied to our future ... [through] shared interests in a common future where people would be able to build a better life, and where threats could be managed collaboratively -- not by the United States uniquely, but by the relationships we would build," he added.

Dempsey said his view is that while the number of U.S. boots on the ground or airplanes in the sky varies over time, that's not a good measure of regional commitment. He said multinational training and military school exchanges, for example, offer U.S. and allied forces opportunities to build commitment and partnerships in the Gulf region.

Dempsey noted the 10-year anniversary of the start of the Iraq War serves as an occasion to reflect on U.S. actions there.

"I spent three years in Iraq. ... We're all aware that tomorrow is the 10-year anniversary, and the debate goes on about whether we should have, whether it was worth it -- and that debate will go on," he said.

Dempsey said his personal belief is the United States achieved two significant results in Iraq.

"First of all, there is no longer the strongman, the dictator, and the threat to the region ... that there was," he said, referring to the fall from power and subsequent execution of Saddam Hussein.

"Secondly, and I think importantly, we've given the Iraqi people an incredible opportunity," the chairman said. While he acknowledged the Iraq War included missteps and opportunities gained and lost, he noted that, in the end, the nation gained a partner and lost an adversary.

"It remains to be seen, still, about how strong a partner they are willing [to] and can become," he said. "But we have a partner."

Dempsey said he seeks to build relationships in the Gulf, as in other regions, that are not measured simply in terms of air wings or carrier battle groups. Where allied and partner nations are willing to build their capabilities, he said, the United States is eager to help. He noted a recent counter-mine exercise involving some 24 nations.

"That's the future," he said. "Not necessarily the United States of America sitting there with half of the United States Navy positioned in the Gulf, but rather ... a long-term strategy that's feasible given the resources available."

The United States has strong Gulf allies in countries such as the United Arab Emirates, Saudi Arabia and Jordan, Dempsey said.

"We just have to figure out, 'How do we help you do more, so we can do less?" he said. "But that doesn't mean less well."

From September 2001 to June 2003, Dempsey served in Saudi Arabia, training and advising the Saudi Arabian National Guard. In June 2003, he took command of the Army's 1st Armored Division in Baghdad, where he led the division for 14 months. In August 2005, he returned to Iraq for two years to train and equip the Iraqi security forces. From August 2007 through October 2008, Dempsey served as the deputy commander and then acting commander of U.S. Central Command.

MARTIAN ROCK VARNISH



This dual image of a Martian rock taken by the ChemCam instrument aboard the Curiosity rover shows a rock at the "Rocknest" area on Mars before it was interrogated with ChemCam's high-powered laser (left) and after interrogation by 600 laser blasts (right). The crosshairs in the darkened portion of the image at right shows where the laser beam penetrated to a depth of at least 1 mm as a result of the repeated shots. The ChemCam laser vaporizes a small amount of material that can be read by a spectrometer to determine the target's composition. Los Alamos National Laboratory postdoctoral researcher Nina Lanza is studying whether Martian rocks are coated with dust or some other substance, and she presented her research at the 44th Lunar and Planetary Science Conference at The Woodlands, Texas. (photo credit: Los Alamos National Laboratory)

FROM: LOS ALAMOS NATIONAL LABORATORY
Los Alamos Science Sleuth on the Trail of a Martian Mystery
Postdoctoral researcher sees promise in data from cutting room floor


THE WOODLANDS, Texas, March 19, 2013—When it comes to examining the surface of rocks on Mars with a high-powered laser, five is a magic number for Los Alamos National Laboratory postdoctoral researcher Nina Lanza.

During a poster session today at the 44th Annual Lunar and Planetary Science Conference at The Woodlands, Texas, Lanza described how the laser-shooting ChemCam instrument aboard the Curiosity rover currently searching the surface of Mars for signs of habitability has shown what appears to be a common feature on the surface of some very different Martian rocks during Curiosity’s first 90 days on the Red Planet.

But exactly what that common feature is remains an intriguing mystery—and one that Lanza intends to solve.

The ChemCam instrument uses an extremely powerful laser to vaporize a pinpoint of rock surface. The instrument then reads the chemical composition of the vaporized sample with a spectrometer. The highly accurate laser can fire multiple pulses in the same spot, providing scientists with an opportunity to gently interrogate a rock sample, even up to a millimeter in depth. Many rocks are zapped 30 to 50 times in a single location, and one rock was zapped 600 times.

Members of the ChemCam team generally discard results from the first five laser blasts because of a belief that after the first five blasts, the laser has penetrated to a depth that provides a true representative sample of rock chemistry.

Instead of tossing out those data, however, Lanza looked at them specifically across a diverse set of Martian rocks. She found that the first five shots had chemical similarities regardless the rock type. What’s more, after five shots, like other scientists had noticed, the spectrum from the vaporized rock stabilized into a representative sample of the rock type below.

"Why is it always five shots?" Lanza wondered.

It could be the first five shots were reading a layer of dust that had settled onto the surface of every rock, but results in laboratories on Earth seem to indicate that the first laser blast creates a tiny shockwave that is very effective at clearing dust from the sample. Therefore, if the first blast is dusting off the rocks, the remaining four blasts could be showing that Martian rocks are coated by a substance, similar in structure if not composition, to the dark rock varnish appearing on Earth rocks in arid locations like the desert Southwest.

"The thing about rock varnishes is the mechanism behind why they form is not clearly understood," Lanza said. "Some people believe that rock varnish results from an interaction of small amounts of water from humidity in the air with the surface of rocks—a chemical reaction that forms a coating. Others think there could be a biological component to the formation of rock varnishes, such as bacteria or fungi that interact with dust on the rocks and excrete varnish components onto the surface." Lanza is quick to point out that she’s making no concrete claim as to the identity or origin of whatever is being seen during the first five shots of each ChemCam sampling. The common signature from the first five blasts could indeed be entirely surface dust, or it could be a rock coating or a rind formed by natural weathering processes.

As the mission progresses, Lanza hopes that integrating other instruments aboard Curiosity with ChemCam sampling activities could help rule out unknowns such as surface dust, while careful experiments here on Earth could provide crucial clues for solving the Martian mystery of the first five shots.

"If we can find a reason for this widespread alteration of the surface of Martian rocks, it will tell us something about the Martian environment and the amount of water present there," Lanza said. "It will also allow us to make the argument that what we’re seeing is the result of some kind of current geological process, which could give us insight into extraterrestrial geology or even terrestrial geology if what we’re seeing is a coating similar to what we find here on Earth."
 

STAR FLASH

 

FROM: NASA
Light Echoes from V838 Mon

What caused this outburst of V838 Mon? For reasons unknown, star V838 Mon's outer surface suddenly greatly expanded with the result that it became the brightest star in the entire Milky Way Galaxy in January 2002. Then, just as suddenly, it faded. A stellar flash like this had never been seen before -- supernovas and novas expel matter out into space. Although the V838 Mon flash appears to expel material into space, what is seen in the above image from the Hubble Space Telescope is actually an outwardly moving light echo of the bright flash.

In a light echo, light from the flash is reflected by successively more distant rings in the complex array of ambient interstellar dust that already surrounded the star. V838 Mon lies about 20,000 light years away toward the constellation of the unicorn (Monoceros), while the light echo above spans about six light years in diameter.

Image Credit: NASA, ESA

EUCOM CHIEF SAYS EUROPEAN COMMAND STILL IMPOTANT TO U.S. INTERESTS

FROM: U.S. DEPARTMENT OF DEFENSE
Eucom Chief: NATO, European Partners Remain Critical
By Army Sgt. 1st Class Tyrone C. Marshall Jr.
American Forces Press Service

WASHINGTON, March 19, 2013 - The commander of U.S. European Command emphasized to Congress today the importance of the region to future U.S. interests.

Navy Adm. James G. Stavridis, who also serves as NATO's supreme allied commander for Europe, testified before the Senate Armed Services Committee on the importance of maintaining U.S. connections in Europe.

"I think that, as I look at the challenges for U.S. European Command, where I am focused at the moment is, first and foremost, our work in and around Europe," he said.

This includes the NATO missile defense system that is coming online, Stavridis said.

"We are, of course, monitoring the situation in the Levant extremely closely," he said. "It's very close at hand to Europe, and part of U.S. European Command's responsibility includes military-to-military relations with Israel. So we watch that area very closely."

Stavridis mentioned other countries that fall within his area of responsibility that aren't as frequently discussed.

"We don't talk as much about areas like the Balkans, the Caucusus, the Baltics," he noted. "All of those remain extremely important as well, and ... there are a wide variety of other issues, from special operations to humanitarian, disasters, countering terrorism, organized crime [and] cyber. So it's a very rich agenda."

The admiral said if he had one overriding message for the committee, he'd like to answer the question, 'Why Europe?'"

"Why should we continue to be engaged in Europe?" Stavridis asked. "What's important about this part of the mission for the Department of Defense? I would say very quickly that, first and foremost, it's the values that we share with this pool of partners in Europe, democracies who stand with us on freedom of speech, freedom of religion, freedom of the press.

"Secondly, it's the economic bonds that bind us together," Stavridis continued. "The United States represents about a fourth of the world's gross domestic product. The nations of Europe represent another fourth."

NATO, he added, cumulatively is about 50 percent of the world's gross domestic product. "So I think that trans-Atlantic connection has an important economic component as well," he said.

The admiral said his third reason for the U.S. staying connected with its European partners is that "geography matters."

"People say to me, 'Why do we need bases in Europe? They're just bastions of the Cold War,'" Stavridis said. "I would counter by saying that they're not. They're forward operating bases in the 21st century. And they allow us to extend support from Eucom to [U.S. Africa Command], to [U.S. Central Command] and the Levant area as well."

To put perspective on it, Stavridis said, about 20 or so years ago, during the Cold War, the United States had 450,000 troops in Europe on 1,200 bases.

"We've come down 85 percent since then," he said. "So we have taken a great deal of infrastructure out of Europe."

Stavridis said the U.S. conceivably could, over time, draw down a bit further. "I feel we're positioned about right for the moment in time in which we find ourselves," he said. "But I believe that downward trajectory over time will probably continue."

The admiral said the NATO alliance is another reason for maintaining European connections. "We serve together around the world in a wide variety of missions that we can talk about this morning," Stavridis said, adding that nowhere else in the world offers such a complete and capable group of allies who have the technology, training and force levels to help the United States.

"We need to encourage our European partners to spend more on defense," Stavridis said. "I do that consistently."

U.S. DEPUTY DEFENSE SECRETARY CARTER ON THE U.S.- PHILIPPINE ALLIANCE

Deputy Defense Secretary Ash Carter, right center, meets with Philippine Defense Secretary Voltaire Gazmin, left center, at the Ministry of Defense in Manila, the Philippines, March 19, 2013. DOD photo by Glenn Fawcett

FROM: U.S. DEPARTMENT OF DEFENSE
Carter: U.S., Philippines Enjoy 'Longstanding' Alliance
By Cheryl Pellerin
American Forces Press Service

MANILA, Philippines, March 19, 2013 - On the third stop of his weeklong trip to Asia, Deputy Defense Secretary Ash Carter met today with top officials here and carried greetings from President Barack Obama and Defense Secretary Chuck Hagel to be delivered to President Benigno Aquino III.

During meetings with the president's executive secretary, Paquito Ochoa, Defense Secretary Voltaire Gazmin and Foreign Affairs Secretary Albert del Rosario, Carter discussed a range of regional range of regional security issues important to the U.S.-Philippines alliance.

Carter began his visit in Manila by meeting with Gazmin at Camp Aguinaldo, the military headquarters of the Philippine Army and the Armed Forces of the Philippines, or AFP. The men discussed the importance of the U.S.-Philippines alliance, including the continued U.S. commitment to work together on maritime domain awareness, capacity building of the AFP, defense modernization and continued assistance in counterterrorism. Carter emphasized the importance of working together to resolve incidents.

Later in the day, Carter met with del Rosario and senior Foreign Affairs Department officials, followed by a lunch that del Rosario hosted. The two discussed a range of issues including U.S.-Philippine efforts to enhance cooperation across security, diplomatic and economic sectors, the Association of Southeast Asian Nations and a code of conduct for resolving disputes in the South China Sea, as well as other bilateral and regional topics.

Carter wrapped up his Manila visit by meeting with Ochoa at the Malacanang Palace complex. The deputy defense secretary addressed issues involving the U.S. rebalance to Asia and concerns about the possible impact to that effort because of defense budget cuts. Discussions ranged from ASEAN and the regional security architecture to Philippine defense modernization efforts.

During a media interview this afternoon, Carter said he came here "because this region of the world is so important to America's future in many ways -- political and economic, but also in the security sphere."

And because of his position as deputy defense secretary, he said, "obviously, I'm focused on the security area. In that context, the United States has deep and abiding security roots here."

As he met with officials, Carter took time to share a more personal reason for his appreciation of the Philippines. A physicist by training, the deputy defense secretary received part of that training in at the Massachusetts Institute of Technology. In the coffee room there, he got to know a senior fellow from the MIT Center for International Studies.

"He was such a great advisor and mentor to students," Carter said of the man who turned out to be Benigno Aquino Jr., father of the current president of the Philippines. Aquino was assassinated in 1983.

"He and his wife would come to social events at MIT, ... and I got to know them and had great affection for them, ... so I've always had a little place in my heart for the Aquino family," he said. "And that's another good reason to be here in the Philippines."

The United States and the Philippines "have lots of human connections together, all of us," Carter said, "as well as having important global responsibilities and regional responsibilities that we exercise together."

U.S. engagement is part of what has helped to maintain the region's security structure since World War II, he added. Such engagement has allowed Japan, South Korea, the Philippines and the rest of Southeast Asia "to rise and prosper because they've had peace and security, and now China and India are rising and prospering."

The Philippines, Carter observed, "is a longstanding friend and ally and partner with us in providing that kind of security."

The United States recognized the Philippines as an independent state and established diplomatic relations in 1946. Except for the 1942-to-1945 Japanese occupation during World War II, the Philippines had been under U.S. sovereignty since the end of the Spanish-American War in 1898, according to a State Department fact sheet.

The U.S.-Philippine Bilateral Strategic Dialogue -- the third held last December in Manila -- advances discussion and cooperation on bilateral, regional and global issues. The United States has designated the Philippines a major non-NATO ally, and the nations have close security ties.

The Manila Declaration, signed in 2011, reaffirmed the 1951 U.S.-Philippines Mutual Defense Treaty as the foundation for a robust, balanced and responsive security partnership. Such a treaty, Carter said, "opens the door to the U.S.-Filipino relationship, which exists along with other key treaty relationships in the region."

During this week's Asia trip, the deputy defense secretary has visited South Korea and Japan, which are also key treaty partners. And the United States has important treaty relationships with Australia and Thailand.

"These longstanding treaty relationships and other kinds of emerging partnerships are ... part of a historical role that we play with countries in this part of the world -- to protect them, to protect us, but also, very importantly, that is what provides the foundation for peace and security in the region," he said.

"That's the climate in which all countries, the Philippines among them, have been able to ... develop politically and prosper economically in an environment of peace," Carter said. "That's what everybody deserves, and that's what we're about when we talk about our alliance with the Philippines and our alliance structure in this part of the world."

Fin prochaine des observations d’Herschel

Fin prochaine des observations d’Herschel

NEWS FROM AFGHANSTAN FOR MARCH 20, 2013

 

U.S. Army Staff Sgt. Claudia Caberoherbas, right, provides perimeter security outside a village where troops search for a weapons cache in the Spin Boldak district in Afghanistan's Kandahar province, March 3, 2013. Caberoherbas is assigned to the 2nd Infantry Division's Company B, 2nd Battalion, 23rd Infantry Regiment, 4th Striker Brigade Combat Team. U.S. Army photo by Staff Sgt. Shane Hamann

 

FROM: U.S. DEPARTMENT OF DEFENSE
Combined Force Arrests Taliban Facilitator in Kandahar
From an International Security Assistance Force Joint Command News Release

KABUL, Afghanistan, March 20, 2013 - A combined Afghan and coalition security force arrested a Taliban facilitator in the city of Kandahar in Afghanistan's Kandahar province today, military officials reported.

The facilitator was responsible for procuring components for improvised explosive devices, building them, and distributing them to other insurgents or personally planting them for attacks against Afghan and coalition forces, officials said.

In Afghanistan operations yesterday:

-- A combined force in Balkh province's Mazar-e Sharif district arrested a Taliban facilitator who is accused of procuring IED components, suicide vests and other weapons and distributing them to insurgents for attacks against Afghan and coalition forces. At the time of his arrest, he was believed to be actively planning an attack against high-ranking government officials in conjunction with celebrations marking the traditional Afghan new year, or Nowruz. The security force also arrested another insurgent.

-- In Helmand province's Nahr-e Saraj district, a combined force killed a man who was engaging in insurgent activity.

In other news, Afghan and coalition security forces today confirmed the death of a Taliban leader, Ruhulla, in Nangahar province's Khugyani district March 17. Ruhulla was a known IED expert responsible for numerous attacks against Afghan and coalition forces.

ANTARTIC INSECTS AND THE GENETICS OF HOW TO COPE WITH THE ENVIRONMENT

Photo:  Antartica.  Credi:  CIA World Factbook.

FROM: NATIONAL SCIENCE FOUNDATION
Antarctic and Arctic Insects Use Different Genetic Mechanisms to Cope With Lack of Water
Although they live in similarly extreme ecosystems at opposite ends of the world, Antarctic insects appear to employ entirely different methods at the genetic level to cope with extremely dry conditions than their counterparts that live north of the Arctic Circle, according to National Science Foundation- (NSF) funded researchers.

Writing in the Proceedings of the National Academy of Sciences, the researchers concluded, "Polar arthropods have developed distinct... mechanisms to cope with similar desiccating conditions."

The researchers noted that aside from the significance of the specific discovery about the genetics of how creatures cope in polar environments, the new finding is important because it shows how relatively new and developing scientific techniques, including genomics, are opening new scientific vistas in the Polar Regions, which were once thought to be relatively uniform and, relatively speaking, scientifically sterile environments.

"It's great to have an Antarctic animal that has entered the genomic era," said David Denlinger, a distinguished professor of entomology at Ohio State University and a co-author of the paper. "This paper, which analyzed the expression of thousands of genes in response to the desiccating environment of Antarctica, is just one example of the power that the genomic revolution offers for advancing polar science. "

The collaborative research which included contributions from scientists at Ohio State University, the Centre National de la Recherche Scientifique (National Center for Scientific Research) in France, Catholic University of Louvain in Belgium, Stanford University, and Miami University in Ohio--was supported in part by the Division of Polar Programs in NSF's Geosciences Directorate.

Polar Programs manages the U.S. Antarctic Program, through which it coordinates all U.S. research on the southernmost continent and aboard ships in the Southern Ocean as well as providing the necessary logistical support.

The finding also adds to the developing picture of the Polar Regions as having similarities and yet subtle and perhaps very important differences, previously undetected by science. NSF-funded scientists late last year, for example, published research indicating that differing contributions of freshwater from glaciers and streams to the Arctic and Southern oceans may be responsible for the fact that the majority of microbial communities that thrive near the surface of the Polar oceans share few common members.

Although Antarctica's surrounding oceans and coastal margins are home to a variety of large creatures such as seals, penguins and whales, insect life is rare, except on the Antarctic Peninsula.

There, the Antarctic midge, Belgica antarctica, occupies its unique ecological niche.

The research team that produced the new findings collected specimens for their research from offshore islands near NSF's Palmer Station on Anvers Island in the Peninsula region.

Surrounded by an ocean, the Antarctic continent is a polar desert where creatures have adapted to life with infrequent access to liquid water. The researchers note that Antarctic midge larvae, for example, "are remarkably tolerant of dehydration, surviving losses of up to 70 percent of their body water."

They also note that, in general, "insects, in particular, are at high risk of dehydration because of their small body size and consequent high surface-area-to-volume ratio."

Among Antarctic insects, the ability to tolerate dehydration is an important evolutionary development, allowing the creatures to successful survive the cold and dry southern winter.

"The loss of water enhances acute freezing tolerance," they write. "In addition, overwintering midge larvae are capable of undergoing another distinct form of dehydration, known as cryoprotective dehydration.

Cryoprotective dehydration is a mechanism in which a gradual decrease in temperature in the presence of environmental ice "creates a vapor pressure gradient that draws water out of the body, thereby depressing the body fluid melting point and allowing larvae to remain unfrozen at subzero temperatures."

The researchers compared the midge's strategy to those of other terrestrial arthropods that cope with prolonged periods when water is lacking, including the Arctic springtail Megaphorura arctica and Folsomia candida, which are more widely distributed across the globe; both species are members of a group of arthropods, which are closely related to insects, known as Collembola.

The differences, they concluded, lie in the way that various genes express themselves.

After a detailed analysis of gene expression in the various species, the researchers concluded that "although B. antarctica and M. arctica are adapted to similar environments, our analysis indicated very little overlap in expression profiles between these two arthropods."

They add that "these differences in expression patterns may reflect different strategies for combating dehydration; whereas B. antarctica shuts down metabolic activity and waits for favorable conditions to return, F. candida [instead] relies on active water-vapor absorption to restore water balance during prolonged periods of desiccation."

They further add that because of the taxonomic difference between the Antarctic midge and the collembolan species with which gene expression was compared, more work is needed "to better understand the evolutionary physiology of dehydration tolerance in this taxonomic family."

-NSF-

SEC FILES FRAUD CHARGES REGARDING MEXICAN BONDS

FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today filed fraud charges against E-Monee.com, Inc. ("E-Monee"), its president, Estuardo Benavides ("Benavides"), and one of its directors and a licensed Florida attorney, Robert B. Cook ("Cook"), for offering shares in E-Monee to investors under the false pretense that the company owned Mexican bonds worth billions of dollars.

The SEC’s complaint, filed in the United States District Court for the Southern District of Florida, charges E-Monee.com, Inc., Estuardo Benavides, 59, of Margate, Florida, and Robert C. Cook, 70, of Tequesta, Florida for fraudulently offering shares in E-Monee from at least January 2010 through May 2011, while claiming, among other things, the company owned Mexican bonds purportedly worth approximately $5 billion, and that E-Monee’s shares would substantially increase in value. The complaint alleges that the Mexican bonds the company owned, in reality, were essentially worthless and there was no valid basis for the claims by Benavides and Cook that E-Monee’s shares would substantially increase in value.

The SEC’s complaint charges E-Monee, Benavides and Cook with violations of Section 17(a)(1) and 17(a)(3) of the Securities Act of 1933. The SEC is seeking permanent injunctions and civil money penalties against all three defendants. The SEC will also seek penny stock bars against Benavides and Cook.

The SEC acknowledges the substantial assistance of the U.S. Secret Service in this investigation.

GEN. JACOBY TESTIFIES REGARDING NORTHCOM'S WATCH

FROM: U.S. DEPARTMENT OF DEFENSE
Northcom Maintains Watch Over Homeland, Commander Says
By Donna Miles
American Forces Press Service

WASHINGTON, March 19, 2013 - "We have the watch," the commander of U.S. Northern Command and North American Aerospace Defense Command told Congress today, emphasizing the dual commands' vigilance in protecting the homeland.

"That's my No. 1 priority mission," Army Gen. Charles H. Jacoby Jr. told the Senate Armed Services Committee, while acknowledging concerns that budget uncertainties could hamper the commands' ability to step ahead of evolving threats.

Jacoby reported on successes of Operation Noble Eagle, a mission stood up immediately after the 9/11 terrorist attacks and that continues today, providing "well-honed and uncompromising 24/7 defense of our skies."

But the security environment is becoming "increasingly complex and dynamic," he warned. "Threats are adapting and evolving. Technologies advance and proliferate, creating greater vulnerability in the homeland than ever before."

This complicates the homeland defense mission, he said, from cyber and ballistic missile defense to efforts to counter transnational criminal organizations.

Budget uncertainties add another wrinkle, he said, injecting additional uncertainties in what capabilities can be developed or procured to deal with these threats.

"Readiness concerns are sure to grow," Jacoby said. The most pressing, he said, will be unforecasted cuts to training and exercise programs that he called "fundamental to building partnerships essential for responding to events in the homeland."

"Unexpected loss of service capabilities and readiness could also, in the future, erode our ability to conduct our critical homeland defense missions," he said.

In the midst of these uncertainties, Northcom and NORAD will remain committed to deterring, preventing and defeating aggression against the United States and Canada, Jacoby said.
Meanwhile, Northcom also continues to focus on its mission of providing defense support to civil authorities, as required.

"Our citizens have a high expectation of our ability to defend and support them here in the homeland, and rightfully so," Jacoby told the Senate panel. "In the event of a natural or manmade disaster, Northcom meets those expectations by leveraging a tremendous capability and capacity of the Defense Department to support a lead agency," such as the Federal Emergency Management Agency.

Jacoby recognized Northcom's role in interagency response to Hurricane Sandy. "Hurricane Sandy offered us a glimpse of what a complex catastrophe which spanned several states and regions could look like," he said.

Jacoby called the appointment of dual-status commanders during the response one of the most important initiatives in the area of defense support to civil authorities in a decade that promotes a unity of effort among federal and state responders.

He pledged to continue maturing the successful dual-status command construct that Congress approved through the 2012 National Defense Authorization Act "so we will be ready to act swiftly and with unity of effort when the unthinkable happens and we are called."

In addition, he vowed to continue advancing security cooperation efforts with Mexico and the Bahamas. These efforts help the United States and its neighbors stand as a united force against their common goals, he said.

"When it comes to the security of North America and the shared pursuit of enduring stability and prosperity, we cannot afford to work in isolation," Jacoby said in his prepared statement.

NATO SEC. GENERAL RASMUSSEN DISCUSSES AFGHANISTAN

FROM: U.S. DEPARTMENT OF DEFENSE

NATO Secretary General Discusses Progress in Afghanistan

By Jim Garamone
American Forces Press Service

WASHINGTON, March 18, 2013 - Though setbacks may happen, real progress is taking place in Afghanistan, NATO Secretary General Anders Fogh Rasmussen said in Brussels today.

In a news conference at NATO headquarters, Rasmussen discussed a recent trip to Afghanistan's Helmand province, once a Taliban stronghold, to visit International Security Assistance Force service members and meet with Afghan officials.

Rasmussen said he saw a significant shift from NATO control and operations to Afghan forces in charge of security.

"The Afghan army and police are in charge of three quarters of the province," he added. "They are already conducting nearly all the security operations. ISAF's role has already shifted to training, advising and assisting."

Rasmussen stressed that in places such as Helmand, Afghan forces "are doing the job."

Now, the challenge for NATO and partner nations shifts from doing the mission to sustaining the effort, he said. "That means providing the training they need in leadership," he told reporters. "That means specialized skills such as logistics, management and maintenance."

The ISAF mission ends at the end of 2014, and Rasmussen acknowledged that the mission will not be easy. "There will be hard fighting. There will be casualties, and there may be setbacks," he said. "But already Afghanistan's forces are stronger than they have been at any other moment in history. They will continue to grow stronger, more effective and more experienced. And we are determined to support them through 2014 and beyond."

Security is just one aspect of progress in the country, he noted. Local governments are taking hold in Helmand, the secretary general said, and elected district councils are investing funds in development.

"This is the Afghan people's chance to take control of their security and to take control of their destiny," he added. "I believe, and the Afghans with whom I spoke believe, that this is a chance which they must seize."

In the Afghan capital of Kabul, Rasmussen said, he met with young Afghans who are committed to a democratic and stable country.

"A new generation has emerged in Afghanistan," he said. "This young generation wants a new way of life, not a return to the dark days of the past. The Afghan people have tasted freedom and seen what progress can bring. In the future, the enemies of Afghanistan must not only fight a strong Afghan army, they will also have to fight the aspirations of the Afghan people toward freedom, peace and prosperity."

HHS CLAIMS MANY GET SICK DUE TO IMPROPER FOOD HANDLING

Photo Credit:  FDA

FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
From the U.S. Department of Health and Human Services, I’m Nicholas Garlow with HHS HealthBeat.

Eat and be well? The Centers for Disease Control and Prevention says that, each year, 1 in 6 of us gets sick from food, largely due to improper handling and cooking of ingredients.

At the CDC, researcher Hannah Gould:

"Four foods have been linked to many outbreaks in the last two years. Beef, poultry, such as chicken and turkey, milk, particularly milk th at hasn’t been pasteurized, and fish."

Gould says you can’t tell when something has gone bad just by looking and smelling. So she says the best treatment is prevention in preparation. Clean by washing your hands and food prep surfaces. Separate so meat doesn’t touch vegetables. And cook and chill to correct temperatures.

An article on food handling is in CDC’s Morbidity and Mortality Weekly Report.

HHS HealthBeat is a production of the U.S. Department of Health and Human Services. I’m Nicholas Garlow.

Last revised: March 12, 2013

SECRETARY OF STATE KERRY MAKES REMARKS WITH IRISH FOREIGN MINISTER EAMON GILMORE

FROM: U.S. DEPARTMENT OF STATE, U.S.
Remarks With Irish Foreign Minister Eamon Gilmore
Remarks
John Kerry
Secretary of State
Treaty Room
Washington, DC
March 18, 2013


SECRETARY KERRY: Good afternoon, everybody. What a pleasure for me to welcome the Tánaiste here, our good Foreign Minister Eamon Gilmore. Thank you very, very much. He was kind enough to come all the way to Shannon Airport the other day to meet me when I was coming back from the Middle East. And we had a wonderful – I can’t even remember, it was early morning or late afternoon, it was such a mix. But we had a great visit.

It’s my pleasure now to welcome him here. He’s come in to celebrate St. Patrick’s Day, and we’re very happy to wish all the people of Ireland a Happy St. Patrick’s Day. You know what Ireland means to America, and particularly to those of us from Boston. So it’s great to welcome you here. We are so appreciative for the partnership for the EU presidency and the agenda of Ireland right now as the EU president. And in addition to that, the trade initiatives, the economic initiatives, their leadership on human rights and other issues, and the process that continues to bring peace to Northern Ireland.

We’re very, very appreciative, so welcome.

FOREIGN MINISTER GILMORE: Thank you very much, indeed, Secretary Kerry. And it’s a great pleasure to meet you again, and in particular, to meet you on – we no longer say St. Patrick’s Day. It’s kind of more St. Patrick’s week now, but – (laughter) – we’re here for St. Patrick’s week.

And I want to, first of all, emphasize again the very close cooperation that exists between Ireland and the United States. We’re hugely appreciative of the support that the United States and successive administrations have given to the efforts to bring peace to Northern Ireland and to maintain the peace in Ireland. We have a particular relationship now because Ireland holds the presidency of the European Union at this critical time when we are beginning the process of developing a trade and investment partnership between the United States and the European Union, which I believe will be to the mutual benefit of both the U.S. and Europe, and particularly Ireland because of the large amount of direct investment that we got from the United States.

And of course, we work in cooperation in a number of areas internationally. We – our aid programs, for example, we work together in Africa, the Thousand Days Initiative, the Scaling Up Nutrition addressing world hunger. And we are now both members of the Human Rights Council of the United Nations, where we give high priority to a range of human rights issues.

So it’s a great pleasure to meet you here again. I’m glad to meet you on home turf. And again, I remember very fondly the discussions that we had in Shannon. I can’t promise that I’ll meet you every time that you pass through Shannon. (Laughter.)

SECRETARY KERRY: Promise me my Guinness? (Laughter.) I had a wonderful half-pint.

FOREIGN MINISTER GILMORE: Very moderate.

SECRETARY KERRY: Very moderate.

FOREIGN MINISTER GILMORE: Thank you.

SECRETARY KERRY: Thank you. Great to see you. Thank you. Thank you all very much.

45th Space Wing Launches Second SBIRS GEO Satellite

45th Space Wing Launches Second SBIRS GEO Satellite

Press Briefing | The White House

Press Briefing | The White House

SEC OBTAINS ASSET FREEZE AGAINST MASSACHUSETTS-BASED INVESTMENT ADVISER STEALING MONEY FROM CLIENTS

FROM:  SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission today announced an asset freeze against a Massachusetts-based investment adviser charged with stealing money from clients who were given the false impression they were investing in a hedge fund.

In a complaint unsealed today in federal court in Boston, the SEC alleges that Gregg D. Caplitz and Insight Onsite Strategic Management in Wilmington, Mass., raised at least $1.1 million from clients that was used for purposes other than investing in the hedge fund they purported to manage. Investor money was merely transferred to the firm's chief investment officer and other members of her family who spent it on personal expenses. The firm reported in SEC filings that it has $100 million in assets under management, however the purported hedge fund actually has no assets.

U.S. District Judge Mark L. Wolf granted the SEC's request for an emergency court order to freeze the assets of Caplitz and his firm as well as others who received investor money and have been named as relief defendants for the purposes of recovering investor funds in their possession.

According to the SEC's complaint, Caplitz's scheme began around 2009. For example, Caplitz convinced one client and his wife to invest $275,000 in the hedge fund that Caplitz claimed would generate them about $1,000 per month in returns. Caplitz also solicited a 20-year client who after considering his sales pitch decided not to invest in the hedge fund because she considered it too risky of an investment for someone her age. But Caplitz apparently took action to obtain funds from the client's IRA account and wired thousands of dollars to an Insight Onsite Strategic Management bank account. The client was not aware of the transfers and did not authorize them.

The SEC alleges that instead of using investor funds to purchase shares in a hedge fund or to manage or develop a hedge fund, Caplitz transferred control of client money to Rosalind Herman, his friend who works at the firm. Investor funds also were transferred to her sons Brad and Brian Herman, daughter-in-law Charlene Herman, and a company called Knew Finance Experts. The Hermans, who all live in Las Vegas, own that company. The Hermans used investor money to pay legal bills and other personal expenses at gas stations, drugstores, and restaurants.

The SEC alleges that as part of his scheme, Caplitz obtained funds from a real estate investment trust (REIT) by falsely representing that a hedge fund he operated was interested in making an investment in that trust. The public, non-traded REIT gave $135,000 to Caplitz so he could conduct due diligence on the REIT as a precursor to his making a $5 million investment that never materialized.

The SEC alleges that Caplitz and Insight Onsite Strategic Management violated Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5, Section 17(a) of the Securities Act of 1933, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The Complaint seeks a permanent injunction plus disgorgement, prejudgment interest, and a penalty against Caplitz and his firm. The complaint also names the four Hermans and Knew Finance Experts as relief defendants and seeks disgorgement plus prejudgment interest.

CFTC COMMISSION CHILTON SPEAKS AT NATION GRAIN AND FEED ASSOCIATION'S ANNUAL CONVENTION

Photo:  Food.  Credit:  National Institue Of Health.

FROM: U.S COMMODITY FUTURES TRADING COMMISSION
"The New Prospectors"
Speech of Commissioner Bart Chilton to the National Grain and Feed Association’s, 117th Annual Convention, San Francisco, California
March 18, 2013
Introduction: The Gold Rush

Hi-ya! Thanks to Todd Kemp for the invitation to be with you in San Francisco, the great Dianne Feinstein's city. Nancy Pelosi's town. And a state that boasts many superb government servants like Senator Barbara Boxer and your earlier speaker Congressman Jim Costa.

It is hard to believe this is NGFA’s 117th convention. That’s way back. Your first was held in 1894. Wow!

I'm going to ask you to go with me now, to take a little trip, even further back—back to 1848.

It was a time of adventure and gambling on the future in a lawless land. That's when James Marshall discovered gold, about 140 miles from here. Not many people knew about the discovery. One fellow who had the ability to publicize the discovery, actually waited to do so. Samuel Brannan was the publisher of the San Francisco Star. Before touting the discovery, he set up a store to cater to gold prospectors. Then, he publicized the discovery. And he ran around San Francisco with a jar of gold in his clutches saying something like, "Gold, it's gold I tell ya!" And he made a fortune.

Brannan, and there's a street named after him, was the original business prospector who made it big on the Gold Rush. But there were many business prospectors who never picked up a pan or a pick themselves. Levi Strauss, whose company is still headquartered here, first profited in dry goods and then with those first-ever, blue jean baby queen, riveted, denim work pants. Henry Wells and William Fargo formed Wells Fargo with those iconic stage coaches transporting people and money. They focus on the money now, with $1.42 trillion—one of the largest banks out there. And there was John Studebaker who traveled from Pennsylvania to prospect in his own way. He made and sold wheel barrows and did extremely well. With his profits, he headed to Indiana where he started that famous Studebaker company. First they built wagons, then years later they built those wonderful cars—cars like the Silver Hawk, with those fins. My father owned one and let me drive it when I was 16. "Be safe, Bart. Two hands on the wheel at all times, 10 and 2, 10 and 2."

The Chicago Prospectors: CBOT

In that same year, 1848, roughly 2,100 miles to the east, in Chicago, there was yet another group of business prospectors. These guys had nothing to do with the Gold Rush, but were trying to figure out a way to solve an immense problem in grain markets. You know the story: farm prices were whipsawed with wild boom and bust cycles. When farmers harvested, the cash markets usually tanked. Then, some months later, when the supply bottomed out, processors and consumers would pay profoundly for the commodities

This assemblage of 25 business prospectors, in addition to grain merchants and a banker, included a druggist, bookseller and a tanner. They met above a feed store on Water Street, and they started the Chicago Board of Trade (CBOT).

CBOT was a place to gather ‘round and haggle, and it worked. It helped even out prices and provided for some risk transfer. What this commodity cadre created was to markets what the Gold Rush was to California

With regard to markets, there remain commercial producers (farmers and processors, etc.), and speculators. The speculators, prospecting, mining and digging their way through these markets for their own riches, continue to gamble that they can make money from a futures contract by selling it later if prices change. While some things are still the same, commercials and speculators, a lot has transformed since 1848. We’ve come a long way, baby.

Morphing Market Prospectors

So here we are 164 years later, and like the gold prospectors who changed the way they ventured for gold, the markets prospectors—in particular the speculators—have also changed, or morphed. The question I ask as a regulator is this: Are markets still performing the purposes envisioned by those 25 imaginative market prospectors who met above that feed store on Water Street in Chicago?

Today, we have two new types of market prospectors, speculating in markets.

Massive Passives

First, we have seen a "financialization" of commodity markets by a class of traders I call Massive Passives. Let me explain. Investors looking to diversify their holdings sought out the derivatives world. Between 2005 and 2008 we saw roughly $200 billion come into the regulated futures markets in the U.S.—there was even more that we don’t know about in the previously unregulated swaps world.

Say a pension fund wanted to diversify into commodities. There’s nothing wrong with that from my perspective (although I know some Members of Congress who disagree), but the type of trading that they do is different than what speculators have typically done. Instead of getting in and out of markets, maybe based upon a drought or other natural disaster, or in the energy markets getting in or out related to the driving season, these very large funds, pension funds and others like exchange traded funds (ETFs) bought and held their market positions. They invested in futures markets more like they invest in security markets. They are both massive in size, and fairly passive in their trading strategy. They are fairly price insensitive. They don’t get in or out of the market because prices change a little here or there. They are in it for the longer term.

I’m not suggesting the Massive Passives shouldn’t be allowed to do this, but it is different and it has impacted markets. It has helped push prices up at times, and when we have seen large price movements, we have then witnessed some reciprocal downturns. There are many studies that document this phenomenon.

Here’s the worrisome part: too much concentration in markets can influence prices and these Massive Passive traders, have contributed to price abnormalities.

Now, many people would say that any liquidity is good liquidity. But, are we sure? There are times when there is so much Massive Passive liquidity on the buy side—those going long and staying long—that prices cannot be based on the fundamentals of supply and demand. We’ve seen it.

Take 2008, when crude went from right around $99.62 at the beginning of the year to $145.29 in July, then all the way back to $31.41 in December. For those that claim the Massive Passives had no role in that market distortion, explain how it happened. I’ve asked hundreds of times and there have been no efforts to enlighten us.

Now, if some of you think, as I do, that the Massive Passive influx was problematic in 2008, what’s happened since then? We’ve seen well over the amount of speculation we had in 2008 at various times since then. With such large concentrations of market participants being these new speculative prospectors, it continues to raise the concern about how prices can be distorted and contorted. That’s not good for the traditional market participants like many of you. It’s not good for consumers and it isn’t good for our economy.

In response to what was going on in 2008, Congress instructed us (as part of the Dodd-Frank financial reform law in 2010) to put in place what are called speculative position limits. To date, they’re not in place. There’s fierce opposition from the largest speculative prospectors on earth. However, we are working to get them in place and we will do so. Word!

We need to have our hands firmly on the wheel to ensure markets are safe—10 and 2, 10 and 2.

Cheetahs

In addition to the Massive Passives, we have some new prospectors speculating in markets with the most advanced computer technology. High frequency traders (HFTs), "cheetahs" I call them, due to their incredible speed, are out there 24/7/365 prospecting for micro dollars in milliseconds. That’s how speedily they trade.

If you divide a second into 1000 parts, they trade in those teeny tiny fractions of a second. If you’re going 100 miles an hour, a millisecond is the time it takes you to go two inches. I know that’s true because it’s on the Internet. You can’t put anything on the Internet that isn’t true. (I’m a French model, bonjour!)

There are some noble things about these high frequency trading cheetahs. They are, admittedly, very innovative prospectors in their own right. Some use complex algorithms that boggle the mind. The cheetahs also add some liquidity to markets. However, it is "fleeting liquidity" and at times "fantasy liquidity." Let’s think on this a bit more, shall we?

Fleeting Liquidity: These cheetah traders want to get in and outta markets in a hurry. In fact, they don’t want to hold any risk for very long—for sure they don’t want to carry it overnight. So, when we think back to those original market prospectors in 1848, a speculator might hold a farmer’s risk for many months. Not today. If you want to off-load your wheat, bean or corn crop risk for 5 seconds, I have just the cats for you. This liquidity is, at best, fleeting liquidity, and that is different. Do the cheetahs help fulfill the vision of those original Chicago prospectors—those guys above the feed store? I’m not sayin’ what the cheetahs are doing in this regard is bad. I’m just sayin’.

Fantasy Liquidity: Then, there is the appearance of liquidity that is, in numerous instances, really an illusion—fantasy liquidity

The Commodity Exchange Act (CEA or Act) is our regulatory bible. Section 4c of the CEA says that it is: "unlawful for any person to offer to enter into, or confirm the execution of a transaction involving the purchase or sale of any commodity for future delivery … if the transaction … (i) is, of the character of, or is commonly known to the trade as, a ‘‘wash sale’’ or ‘‘accommodation trade."

And there are exchange rules out there that say, "No person shall place or accept buy and sell orders in the same product and expiration month … where the person knows or reasonably should know that the … transaction(s) [is a] wash sale(s). Buy and sell orders for different accounts with common beneficial ownership that are entered with the intent to negate market risk or price competition shall also be deemed to violate the prohibition on wash trades."

Another exchange rule says, "No Market Participant shall … c. make or report any wash trade...."

So, wash sales are clearly against the law, and against exchange rules. However, in voluminous instances these cheetahs are engaged in this activity. When they do so, it might appear to be liquidity, but it is not. It isn’t really there. It’s fantasy liquidity. The cheetahs are essentially singing that old Billy Idol tune:

"Oh dancing with myself

Well there’s nothing to lose

And there’s nothing to prove

I’ll be dancing with myself."

Well, they have nothing to lose or prove because they aren’t taking on any risk whatsoever—zero, zippo, nada. They aren’t providing liquidity when they wash whatsoever.

Why would the cheetahs do that? Why would any exchange allow that? There are algorithms out there to stop cheetah trading programs from washing. They call this wash blocker technology. Why don’t all the cheetahs use it? We should require that they do so. Well, those are good questions which deserve more review. We need to ensure that we have the correct policies and procedures in place.

Oh, one final point: these HFT cheetahs aren’t even mentioned in Dodd-Frank. These traders were part and parcel to the Flash Crash on May 6th, 2010 when the markets dropped precipitously in 20 minutes time. However, Dodd-Frank was nearly finished and no new language was added. So I think Congress needs to act to give us some fairly basic regulatory tools to assist in our efforts to somewhat cage the cheetahs. During the Gold Rush, prior to California becoming a state, it was a lawless wild west. They set up Vigilante Committees that took the law into their hands. Well, I’m not suggesting that, but here are just some of the things that I’ve called on Congress to consider.

One: Cheetahs need to be registered. As crazy as it sounds, they don’t have to be registered now. Once they are registered, it provides us with authority to examine their books and records, among other things, which is a key to our oversight and enforcement duties.

Two: They should be required to test their programs before they are put into the live production environment. Some do that already, but it’s sort of on the honor system. Markets are too important to leave this matter to chance.

Three: These cheetah programs also need to have built-in kill switches that shut them down, should they become feral. After all, a runaway automated trading system is actually what instigated the Flash Crash. Yup, didn’t have both hands on the wheel and it caused a crash.

Four: Our penalty levels have become antiquated. In many cases, we are currently limited to $140,000 in civil monetary penalties per violation. That needs to go up—and not just for HFTs—but for all market participants, both individuals and entities, who break the rules.

With these changes, and potentially some others, we can have safer markets, 10 and 2.

Conclusion

When we look back at those prospectors in 1848, in California and in Chicago, they really set the stage for some unbelievable development on the coast and in markets, respectively. Both were monumental undertakings—spanning all those miles—and impact us still.

And while futures markets have worked exceedingly well since that time, we are seeing some of the new prospectors having an influence which can be problematic. Both the Massive Passives and the cheetahs raise a lot of concerns. The question, as with most things in government and life, is balance. How do we protect the good parts of what is going on while avoiding potential obstacles that can limit the important functions of these markets from the beginning? What we don’t want is another tragic story of gaming and adventure in a lawless land

What would those guys above that feed store on Water Street say? And here’s why asking that question is so important: those guys established the Chicago Board of Trade for purposes of price discovery. When markets work well, they are good for folks involved in the commercial business of the underlying commodity. It works for the prospecting speculators—be they Massive Passives or cheetahs or others, and it works for consumers. So we have a responsibility to ensure these markets are efficient and effective and that we have steady hands on the wheel—10 and 2, 10 and 2.

Thank you.

SECRETARY OF STATE KERRY SPEAKS AT ROSS SEA CONSERVATION RECEPTION IN WASHINGTON, DC

FROM: U.S. DEPARTMENT OF STATE
Remarks at the Ross Sea Conservation Reception
Remarks
John Kerry
Secretary of State
National Geographic
Washington, DC
March 19, 2013

Well, it’s my pleasure to follow the comedian from New Zealand. (Laughter.) I’m happy to follow two guys who speak kind of funny. (Laughter.)

What a pleasure to be here with Ambassador Mike Moore, former prime minister, who is a great person and a terrific leader. And I am so grateful to him for the leadership of New Zealand, a country I’ve had a chance to visit several times beginning way back when I was in the United States Navy; and also my friend Bob Carr, and thank you, Mr. Minister, for being here with us. I told him today I have not yet been lucky enough to get down under, but I am sure to get there very, very soon and I look forward to it.

Really privileged to have these two gentlemen supporting this endeavor, and I’m particularly grateful to the Pew Charitable Trust and to National Geographic. Terry, thank you so much for making this available tonight. Everybody’s favorite magazine; I think we all grew up with it and it just stays extraordinary. And tonight you’ll share in a film which will really underscore the importance of everything that that magazine tries to impart to all of us and has stood for all of these years.

I am a child of the ocean in many ways. From the first moment when I was a kid up at Cape Cod dipping my toes into Buzzards Bay looking for clams, literally a three or four year-old being shown the wonders of the ocean, shrimping and other things, to a time when we used to gather mussels in the evening and an hour later cook them and enjoy an incredible meal. Today, very difficult to find mussels anywhere in that area.

So I’ve watched the transition. I’ve seen it. As a senator I was privileged to bring efforts before the United Nations with Ted Stevens to end driftnet fishing, and also to try to work hard to preserve through a number of fisheries bills – I think I rewrote the Magnuson Fisheries Act at least three or four times – as we tried to get the balance right and protect our fisheries.

I’ve seen the struggle with respect to invasive species and I have seen this fragile ecosystem change before our very eyes, whether it’s a problem of acidification, a problem of pollution and development, a problem of ice melt and potential ecosystem collapse, to the rise of the sea levels, which is happening in various parts of the world more so than elsewhere, to the overfishing that takes place in almost every single fishery on the face of the planet.

We call this beautiful planet that we are privileged to inhabit for a short period of time, we call it Earth, but it could well have been called Ocean because three-quarters of it is ocean. And the oceans are responsible in many ways for life because of the cycle of rain and humidity and all of the protein and life that comes from the ocean. So we can’t be casual about it. We can’t be casual about it. And it is clear that we have an enormous challenge ahead of us as we face the extraordinary excess that we see with respect to each of those issues that I talked about: energy policy that results in acidification, the bleaching of coral, the destruction of species, the change in the Arctic because of the ice melt, and the change in the krill, the population of whales. The entire system is interdependent, and we toy with that at our peril.

So it is vital that we’ve come to this moment where we begin to see that this is not just an environmental issue. This is a security issue. It’s an economic security issue. It’s a national security issue. And it is in many ways a challenge with respect to energy security and our approach to energy policy, and ultimately it is a challenge to our commitment to science and facts and ultimately our basic sense of faith and what we believe in and our responsibility as human beings on this planet.

So climate change is coming back in a sense as a serious international issue because people are experiencing it firsthand. The science is screaming at us, literally, demanding that people in positions of public responsibility at least exercise the so-called "precautionary principle" to balance the equities and not knowing completely the outcomes at least understand what is happening and take steps to prevent potential disaster. I’ve often said to people, "What is the worst that could happen to you if you make a decision to put good energy policy in place and respond to what the science and the facts are telling us?" Well, the worst that can happen to you if you would employ a lot of people in alternative and renewable and clean energy; you would have less hospitalizations, cleaner air, more children with less asthma; and you would create an enormous number of jobs by moving to those new energy possibilities and policies and infrastructure. That’s the worst that can happen to you.

What if the other people are wrong and we are right; what’s the worst that can happen? The destruction of the ecosystem as we live with it today. So that’s really what’s on the line, and I’m here to tell you that, proudly, President Obama has put this agenda back on the front burner where it belongs, that he has in his Inauguration Address and in his State of the Union Address and in the policies he’s working on now said we are going to try to exercise leadership because of its imperatives.

So I want to thank the Pew Foundation and National Geographic for joining in this imperative. We need to try to pass the Law of the Sea. We attempted to do that earlier and we will continue to try to press for that. But most important when it comes to the Ross Sea and Antarctica, we’re not going to wait for a crisis before we take action. I think we’re making a smart choice now. We’re proud to join with New Zealand and Australia, two countries that have an extraordinary understanding of the sea and commitment to protecting it and who have been great stewards.

The Ross Sea, as we heard from Karen earlier, is a natural laboratory. And we disrespect it at our peril, as we do the rest of the ocean. The environment there is so extreme, as we know, that it’s difficult to live as a penguin or a killer whale or a seal, but they’ve adapted. And in their adaptation, we’ve learned what a remarkably diverse and productive ecosystem it is. We’ve learned from the scientists who go down there at McMurdo Station and spend those critical months trying to research it and understand it.

Now, you’ve probably never asked a waiter – any of you – for a nice Antarctic tooth fish, I suspect. You’re probably more used to ordering it as a Chilean sea bass. But American researchers working in the Ross Sea have actually discovered that the tooth fish produces a special antifreeze protein, and whenever ice crystals form in the fish’s cells, these proteins latch onto them and actually ferry the ice out of the body. That discovery has launched a whole new scientific field of structural biology, and it’s helping us to think now about other adaptations to extreme environment in new ways. It also has commercial applications. Think about perhaps fluffier bread or ice cream that stays frozen without ice crystals in it. These are real possibilities.

Another group of researchers from my home state of Massachusetts have done remarkable work studying the physiology of seals as they dive in the Ross Sea. And they’ve actually learned – they’ve helped unlock our understanding of hypoxia, which is a condition that develops when the body is deprived of oxygen. As a result of that, they have actually developed a treatment that has dealt with hypoxic newborns and saved more than 10,000 babies a year. That’s what we can learn, as well as many, many other things that we could talk about.

So imagine the possibilities of these discoveries that await us if we can encourage our innovators and our inventors to put our shoulder to the wheel and have the maximum preservation of the opportunity of that laboratory.

That’s why it is so important for the Commission for the Conservation of Antarctic Marine Living Resources to approve our proposals to establish this Marine Protected Area – and you’ve heard all the comparisons from Ambassador Mike Moore about roughly the size of this, that, several Californias, Alaska. It’s extraordinary. It will be quite simply the largest protected area in the world.

Now, I know the value of that, and the reason I know the value of that is I was the author in the Senate of the Marine Sanctuary called Stellwagen Bank off our cape. And we have seen what that preservation has been able to do. Imagine what this would do as a baseline study for what happens to the species that assemble in that area as we preserve a component of it as a managed fishery and the rest of it as a baseline laboratory for all of this research.

We also support the important proposal of Australia, the EU, and France that they have developed for protection of East Antarctica.

So my friends, I’d just summarize by saying this to you: Antarctica is a collection of superlatives. It is the highest, the coldest, the windiest, the driest, the most pristine, and the most remote place on Earth. And it has beguiled humankind for centuries as people have sought to understand it. Starting in the 1700s, explorers struggled to chart its contours and to cross its desolation without any guarantee ever of a safe return. And still today, curiosity and sheer doggedness are what draw people from all around the world to explore its southernmost shore.

So we signed the Antarctic Treaty in 1959. For those who doubt the benefit of treaties, go look at what we have achieved there, not to mention so many others. The world has shown that we can work together to ensure that Antarctica remains a place devoted to peace and devoted to expanding the human understanding of this fragile planet that we live on. This is one of the last places we could do this, and I think we owe it to ourselves to make it happen.

So I thank you for coming here tonight. I noticed coming in here there were a number of empty wine glasses on the tables, so I know you didn’t waste your time completely before I got here. (Laughter.) But I hope this movie will inspire you. I hope the support of our wonderful friends who understand the ocean as well as any people on this planet and who have worked to preserve it, I hope that will inspire all of you to connect to the rest of America and the rest of the world to apply our human responsibility during this time of stewardship that we have on this fragile planet.

Thank you for being here tonight. Thank you most of all for what you’re going to do. I’d just remind you, in the 1970s there wasn’t really an environment movement in America. We didn’t have an EPA. Just think of that. We had no EPA. And it wasn’t until Rachel Carson wrote her Silent Spring and inspired people to become activists that people became aware of Love Canal and Woburn dump and places which give people cancer and kill citizens.

And all of a sudden, people decided we don’t want to live next to these places, we think there’s a different choice. And 20 million people came out of their homes on one single day. They targeted the 12 worst votes in the United States Congress, labeled them the Dirty Dozen, and kicked seven of them out of Congress in the 1972 election. You know what happened? It unleashed a torrent of activity so that we passed the Clean Air Act, Safe Drinking Water Act, Marine Mammal Protection Act, Coastal Zone Management Act, Safe Drinking Water Act, and even created the EPA, which Richard Nixon, whose idea it was not, signed it into law. (Laughter and applause.)

So folks, that’s what being here is all about. That’s what tonight’s inspiration is all about. We can change everybody’s attitude about this because it matters to all of us. Thank you and God bless. (Applause.)