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eResearch Corporation 78 Cameron Crescent, Suite 202 Toronto, Ontario M4G 2A3 www.eresearch.ca The Next Big War Zone eResearch Corporation is pleased to provide an article, authored by Ivan Lo of Equedia, in which Mr. Lo discusses the implications of ISIS terrorism, the shooting down of the Russian plane by Turkey, and the building of a gas pipeline to feed Europe. _______________________________________________ Equedia and the Equedia Weekly Investment Newsletter is aimed at mining and resource stocks with a strong focus on the top Canadian stocks in the industry including gold and silver precious metals stocks, rare earth stocks, oil and gas stocks, energy stocks, as well as the top performing and undervalued TSX and TSX Venture stocks. Our newsletter features investment ideas and content from our performance- driven and respected partners including N. America's leading analysts and investment personalities. Equedia is also a social network aimed at the investment community, with many advanced social networking features. The Equedia platform caters to companies who want to communicate with stakeholders via video content, as well as through blogs, shared calendars, and other features. Equedia is a community site for media, analysts and investors, who can participate with various online publishing and rating features. Equedia also boasts a best-of-breed video transcoding and streaming architecture, and has a growing and loyal user base. The new world of finance through Equedia’s web portal is no longer a one way street. It’s about connecting information across social networks, the people looking for it, as well as the conversations that connect them. Equedia helps the investment community by giving it a single resource that provides them with everything they need – an informative social media experience dedicated to the investment community. You can learn about Equedia at its website: http://equedia.com/ eResearch was established in 2000 as Canada's first equity issuer-sponsored research organization. As a primary source for professional investment research, our Subscribers (subscription is free!!!) benefit by having written research on a variety of small- and mid-cap, under-covered companies. We also provide unsponsored research reports on middle and larger-sized companies, using a combination of fundamental and technical analysis. We complement our corporate research coverage with a diversified selection of informative, insightful, and thought-provoking research publications from a wide variety of investment professionals. We provide our professional investment research and analysis directly to our extensive subscriber network of discerning investors, and electronically through our website: www.eresearch.ca. Bob Weir, CFA, Director of Research Note: All of the comments, views, opinions, suggestions, recommendations, etc., contained in this Article, and which is distributed by eResearch Corporation, are strictly those of the Author and do not necessarily reflect those of eResearch Corporation. Third Party Research December 7, 2015
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Page 1: Third Party Research December 7, 2015 The Next Big War Zone€¦ · While the media have you focused on ISIS, there is an even deadlier terrorist group: "Boko Haram overtakes ISIL

eResearch Corporation 78 Cameron Crescent, Suite 202 Toronto, Ontario M4G 2A3

www.eresearch.ca

The Next Big War Zone

eResearch Corporation is pleased to provide an article, authored by Ivan Lo of Equedia, in which Mr.

Lo discusses the implications of ISIS terrorism, the shooting down of the Russian plane by Turkey, and

the building of a gas pipeline to feed Europe. _______________________________________________

Equedia and the Equedia Weekly Investment Newsletter is aimed at mining and resource stocks with a

strong focus on the top Canadian stocks in the industry including gold and silver precious metals stocks, rare earth stocks, oil and gas stocks, energy stocks, as well as the top performing and undervalued TSX

and TSX Venture stocks. Our newsletter features investment ideas and content from our performance-driven and respected partners including N. America's leading analysts and investment personalities.

Equedia is also a social network aimed at the investment community, with many advanced social networking features. The Equedia platform caters to companies who want to communicate with

stakeholders via video content, as well as through blogs, shared calendars, and other features.

Equedia is a community site for media, analysts and investors, who can participate with various online

publishing and rating features. Equedia also boasts a best-of-breed video transcoding and streaming architecture, and has a growing and loyal user base.

The new world of finance through Equedia’s web portal is no longer a one way street. It’s about

connecting information across social networks, the people looking for it, as well as the conversations that connect them. Equedia helps the investment community by giving it a single resource that provides them

with everything they need – an informative social media experience dedicated to the investment

community.

You can learn about Equedia at its website: http://equedia.com/

eResearch was established in 2000 as Canada's first equity issuer-sponsored research organization. As a

primary source for professional investment research, our Subscribers (subscription is free!!!) benefit by

having written research on a variety of small- and mid-cap, under-covered companies. We also provide

unsponsored research reports on middle and larger-sized companies, using a combination of fundamental

and technical analysis. We complement our corporate research coverage with a diversified selection of

informative, insightful, and thought-provoking research publications from a wide variety of investment

professionals. We provide our professional investment research and analysis directly to our extensive

subscriber network of discerning investors, and electronically through our website: www.eresearch.ca.

Bob Weir, CFA, Director of Research

Note: All of the comments, views, opinions, suggestions, recommendations, etc., contained in this Article, and which is

distributed by eResearch Corporation, are strictly those of the Author and do not necessarily reflect those of eResearch

Corporation.

Third Party Research December 7, 2015

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The Next Big War Zone

December 6, 2015

Dear Readers, On March 11, 2002, six months after terrorists took the lives of nearly three thousand, the world's most powerful nation vowed to fight the war on terror and make the world a safer place. More importantly, it vowed that terrorists would feel the wrath of the United States:

"...And the terrorists will remember September 11th as the day their reckoning began. ...thousands of terrorists have been brought to justice, are in prison, or are running in fear of their lives. ...Every nation should know that, for America, the war on terror is not just a policy, it's a pledge. I will not relent in this struggle for the freedom and security of my country and the civilized world. And we'll succeed."

Nearly 14 years later, has this promise lived up to the power of emotion it delivered? According to the Global Terrorism Index:

"There has been a dramatic rise in terrorism over the last 15 years. There are nine times more people killed in terrorist attacks today than there were in 2000. In 2014, 32,658 lives were lost to terrorism, the highest number recorded, and an 80% increase from 2013."

See the graph on the next page.

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Take a look:

Not only has terrorism spread, but deaths directly caused by terrorist attacks are rising at an alarming rate. That is not even the biggest news.

The Deadliest Terrorist Organization While the media have you focused on ISIS, there is an even deadlier terrorist group:

"Boko Haram overtakes ISIL to become the most deadly terrorist group in the world. Deaths attributed to Boko Haram increased by 317 per cent in 2014 to 6,644. ISIL was responsible for 6,073 terrorist deaths."

So while ISIL/ISIS may be the "richest" terrorist organization in the world, Boko Haram (an Islamic extremist group based in northeastern Nigeria) has actually killed more people than any other terrorist group in the world. So how come our televisions and newspapers are not splashed with images of the Boko Haram terrorist group? Boko Haram operates mainly in Nigeria. Nigeria is a nation with vast resources of oil and gas. In fact, it just announced that it made over $294 billion in royalties from oil and gas companies between 2006 and 2012 alone. Currently, all six of Nigeria's oil and gas exportation terminals are owned and controlled by Western corporations: Shell owns two, while Mobil, Chevron, Texaco, and Agip own one each. In other words, there is no reason for Western nations to spend money against terrorists in a country it already controls from an energy standpoint. More importantly, Nigeria does not sit smack in the middle of one of the most important energy corridors - one that connects the major countries in the Eastern Hemisphere. ISIS, on the other hand, is heavily embedded in a nation smack in the middle of an important energy corridor that connects the Middle East with the biggest importer of gas in the world: the European Union.

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Syria: The Pipeline Crossroads On September 13, 2013, I wrote a Letter talking about the Real Reason for War in Syria. Much of what I wrote more than two years ago has been unfolding as expected:

"...Many wars have been fought over the control of energy. The current conflict in Syria is no different. Let me rephrase that so I don't get into trouble: Yes, there is a serious civil conflict in Syria that is not about energy. But Russian and American involvement in Syria is..."

I go onto to talk about just how important Syria is to both Russia and the USA:

"Russia is already the dominant energy powerhouse in Europe, supplying and controlling nearly 40% of total gas imports to Europe. Russia's energy dominance in the Eastern Hemisphere has allowed the nation to amass fortunes; fortunes used to continue its energy dominance through resource acquisitions and the buying of support from resource-rich allies. Russia wants this dominance to continue. That's why it needs to maintain control over Syria.”

Syria: The Perfect Target Syria is bordered by Turkey to its north, Lebanon to the west, Israel to the southwest, Jordan to the south, and Iraq to the east.

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Syria's location puts it smack in the middle of Qatar and Turkey, and a perfect crossroads for a natural gas pipeline that could make Qatar, the world's largest exporter of liquid natural gas (LNG), a strong supplier of gas to Europe. A gas pipeline from Qatar to Turkey means Russia will lose its dominance and control over energy supplied to Europe; thus, Russia will lose lots of money and power. Of course, Qatar interests want to supply Europe with gas because it will make them a lot of money. That's where the Nabucco-West pipeline comes in ...

... The aim of the Nabucco pipeline is to diversify the natural gas suppliers and delivery routes for Europe, thus reducing European dependence on Russian energy. The original project was backed by several European Union member states, and by none other than the United States. However, Nabucco's future is far from assured, because its proponents have yet to reach agreements with gas suppliers. While there are other options, the most logical and economic solution would be a pipeline from the Middle East to Turkey, with gas supplied by Qatar. Herein lies the conundrum. In order for Qatar gas to reach Turkey, it has two options*: One option would lead a pipeline from Qatar through Saudi Arabia, Kuwait, and Iraq to Turkey. The other would go through Saudi Arabia, Jordan, Syria, and then to Turkey.

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Saudi Arabia already said no to the first route because it wants to ensure that it gets a piece of the action and maintain control over the gas that goes through its region. Of course, that means fewer profits and less control for Qatar. So, that means option one will not happen. On to Syria.

*If you look at the map, you may be wondering why Qatar cannot go through Iran (not to be confused with Iraq). That is because Iran and Qatar share the South Pars / North Dome field - the world's largest gas field. In other words, Iran does not need Qatar. As a matter of fact, if the Iran-Iraq-Syria pipeline goes through, it would deal a major blow to Qatar. Furthermore, it would deal a major blow to America, whose strategy in south-west Asia since the Clinton administration has been to bypass, isolate, and hurt Iran by all means necessary. More importantly, it would keep Russia in control of the pipelines as Russia would be the primary owner and operator of the Iran-Iraq-Syria pipeline.

Syria: The Russian Ally Syria's President Bashar Hafez al-Assad has long been Russian President Vladimir Putin's ally. Russia has been helping Syria by supplying arms, fighter jets, tank parts, advanced anti-ship cruise missiles, long-range air defense missiles, military officers as advisers, diplomatic cover, and a boat load of cash, since the Syrian conflict began more than (5) years ago. It is no wonder why Assad said no to the second route; he is obligated to help block the flow of natural gas out of the Persian Gulf into Europe to ensure that Russia remains in control of European energy. It is no wonder why Qatar has spent more than $3 billion supporting the rebels in dethroning Assad. If Assad is forced out, Qatar could put in place a puppet regime in Syria that will allow them to build a pipeline into Europe and give Qatar the ability to sell natural gas to Europe, undermining Russia. Of course, the Saudis have also been helping the rebels because it too wants to control the flow of energy from the Persian Gulf to Europe. There are even rumours that Saudi Arabia and Qatar may be 'bribing' US congressmen to approve war on Syria in order to dethrone Assad. Via Presstv:

"American historian Webster Griffin Tarpley says that Saudi Arabia and Qatar are offering bribes to the US congressmen for a military strike against Syria. "The Saudis and the Qataris are reported to be deploying huge amounts of money for bribery, bribery to the families and political and business interests of these members of congress," Tarpley said in an interview with Press TV on Friday.

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"Hillary Clinton has received 500,000 dollars in jewelry from the king of Saudi Arabia and Hillary Clinton just came out for war," he added."

If Qatar or Saudi Arabia gains control of Syria, it would be a major blow to Russia.

American Involvement The USA wants to supply Europe with gas; this was made clear when it backed the Nabucco-West pipeline. America reaffirmed its natural gas stance last year with Exxon and Qatar proposing a $10 billion U.S. energy export project. The USA has the world's largest supply of natural gas, and it has boldly made plans to profit from supplying gas to Europe. Combine that with the fact that Washington and Iran are direct enemies, and you can see why it is in America's best interest to dethrone Assad. Dethroning Assad will kill two birds with one stone; it will bypass Iran and loosen the control Russian energy has over Europe. All of this means that the USA and its energy allies, Qatar and Saudi Arabia, will do whatever they can to remove Assad and implement their pipeline wishes. Russia, on the other hand, wants Assad to stay in power so that a new pipeline from the Middle East to Turkey will not undermine Russia's profits. Note my second last paragraph:

"U.S. and its energy allies, Qatar and Saudi Arabia, will do whatever they can to remove Assad."

In other words, the West, Turkey, and the Gulf Countries such as Qatar, support the Assad opposition, while Russia, China, and Iran support the current Syrian regime. Now here is where it gets interesting and extremely controversial.

Whatever It Takes According to the Department of Defense (DoD), documents leaked by Judicial Watch, the DoD stated that the driving forces behind (Syria's) opposition were the Muslim Brotherhood, Al Qaeda in Iraq, and a group called the Salafists. The Salafist movement is an ultra-conservative reformist movement within Sunni Islam that references the doctrine known as Salafism. Salafism is very close to Wahhabism, the basis from which ISIS draw their radical, violent, and heartless views. The DoD document states that:

"...If the situation unravels, there is a possibility of establishing a declared or undeclared Salafist principality in Eastern Syria and this is exactly what the supporting powers to the opposition want in order to isolate the Syrian regime, which is considered a strategic depth of the Shia expansion (Iraq and Iran)."

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That means the opposition, which includes the USA, Jordan, and Qatar, wanted a Salafist or fundamentalist group to take over Eastern Syria in order to isolate and overthrow the Syrian president, Bashar Hafez al-Assad. Once Assad is gone, then the opposition can put in place a puppet regime. Note this is exactly what I said the USA was trying to do over two years ago before the documents were leaked. Is it a coincidence that just a couple of years ago the USA - and other allies - have gone from no military strikes in Syria to an all-out onslaught of military strikes, with England and Germany now joining the fight? Remember, less than a year before I wrote the above piece, ISIS - as we know them today - did not exist. And yet, they are now not only one of the biggest terrorist groups in the world but also the richest, amassing fortunes of well over $1 billion. Was ISIS allowed to grow so that it could wipe out the Syrian government?

Unintended Consequences The reality is that numerous countries, such as Saudi Arabia, Qatar, the European Union, the United States, and other Gulf countries, have supported several rebel groups against the Assad regime. Their support indirectly contributed to the strengthening of the Islamic State within the region, and their strategy has completely backfired. Assad is not only still in power after three years, but also a new and extremely violent terror group is deep into Syria and Iraq while exporting terror to both Europe and the USA. In other words, the consequence of control of Syria has led to the creation of ISIS, a Frankenstein that is now out of the creator's control and has become a common enemy against both Assad and the opposition. But why didn't the oppositions' plan work? You can thank Russia for that. Let me explain.

Pipeline Control Over the past few years, both Russia and its Western oppositions have continued to play their pipeline games. To refresh your memory here is an excerpt from a Letter I wrote in June 2014:

"...(the) South Stream (more than double the cost of the scrapped Nabucco pipeline project) runs from Beregovaya on Russia's Black Sea coast through to Burgas in Bulgaria, and then further to Greece, Italy, and Austria. Now you may be thinking: "Why Would Russia Need Additional Pipelines if it Already Maintains Control of Europe's Gas?"

As I mentioned in a letter,

"… almost half of the gas Russia sells to Europe runs through pipelines in Ukraine.

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That means Russia needs Ukraine's cooperation in order to continue delivering gas to the European market. But Ukraine is under the direct influence of Western nations. The South Stream pipeline - which is expected to be completed in 2015 and started two years ago - will allow Russia to completely bypass a Western-controlled Ukraine, thus giving Russia a tremendous position in Europe and allow Russia to dictate the price of gas while easily undercutting America's LNG exports to Europe."

Of course, do not think for one second that Western powers would let this happen. Stay with me on this one:

"If you think the West has been sitting idle as Russia continues its energy dominance, think again. Under major pressures from the USA and the EU, the South Stream pipeline has now been put on hold after Bulgaria's announcement that it will suspend the process of awarding tenders for the project."

I go on to predict:

"...the South Stream project may cease altogether - or be delayed significantly, thus giving more time for the West to secure a better position."

On December 1, 2014, President Vladimir Putin said Russia had been forced to cancel South Stream, as the EU did not support the project. However, as I also mentioned in that Letter, Bulgaria is poor and has invested billions into the South Stream Pipeline. So it is no surprise that, despite stopping the project several times under the pressures of the EU, the USA, and NATO, Bulgaria's Prime Minister Boyko Borisov said his country was ready to issue all the necessary permits for the construction of the South Stream pipeline. Coincidentally, following that announcement, Russia's Gazprom has bought out the shares of South Stream Transport BV, a company that was in charge of the construction of the cancelled gas pipeline marine section. Russia now owns 100% of the abandoned South Stream project. Via RT:

"Italy's Eni, Wintershall of Germany, and France's EDF have decided to withdraw from the South Stream project. They have sold their shares to Gazprom, which already owned 50 percent of South Stream Transport BV."

That means Putin is keeping the South Stream as an option and believes he still has an opportunity to proceed ahead. His biggest obstacle, however, is not Bulgaria. While Ukraine is still an option, the advancement of NATO makes Ukraine an extremely unfriendly route.

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So what is Putin's next option? It is where I believe the next hot spot war zone is, and what we are witnessing there now is only the beginning.

Turkey: The Next Hot Spot Earlier this year, Russia's Gazprom reaffirmed its plans to cut off gas transits through Ukraine to Western Europe in 2019 by switching flows to Turkey through pipes beneath the Black Sea. This project is known as Turk Stream in Europe and Turkish Stream in Russia. It was approved by both Turkey and Russia this past February. Via BBC:

"Russia's state-controlled gas giant Gazprom says Russia and Turkey agreed in February on the Turk Stream route. It was planned to come ashore at Kiyikoy, north-west of Istanbul, and continue up to the Greek border."

With Russia announcing this heavy focus to bypass Ukraine through Turkey, and the Turkish Stream, it is no wonder the action has now moved to Turkey. Turkey is an ally of the West and part of the European Union, which makes Russia's pipeline plans extremely difficult to pursue. But, Turkey also happens to be the second biggest customer of Russian gas after Germany. However, now that Turkey shot down a Russian plane, in what many call an act of war, the hopes of the agreed upon pipeline are all but stalled. What is worse is that there have been numerous sources telling us that the downing of the Russian plane was a planned attack, citing conspiracy that Turkey was never provoked, and the Russian planes were leaving Turkey's airspace. The question, however, is why?

The Most Important Question Revisited It was only two weeks ago that I wrote the Letter, "The Most Important Question You Should Ask Your Government." Here is a recap:

"While we are all focused on the refugee situation, the media has deflected us into asking the most important question we should really be asking: Who Buys Oil from ISIS?" We are not talking a few barrels of oil. We are talking half a billion dollars per year in illegal oil revenue. What bank allows for the transfer of such vast amounts of illegal terrorist funds? How can any terrorist group launder and transact in half a billion dollars a year - likely more - without the USA or other government officials knowing? Who are the middlemen that facilitate these massive oil trades?

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Do not tell me it is all done in cash, or Bitcoins. Ask these simple questions. Look for answers. Perhaps it will change your view of the world forever."

Less than a week later, new evidence released by Russia and other sources now point to the fact that ISIS could be, in fact, selling oil to none other than Turkey.

click to watch video

What is worse is that there are sources that cite Berat Albayrak as one of the facilitators. Albayrak is the President of Turkey's son-in-law and, coincidentally, also Turkey's Minister of Energy and Natural Resources. Via Aljazeera:

" Russia has upped its dispute with Turkey further by claiming to have evidence that proves President Recep Tayyip Erdogan and his family are benefiting from the illegal smuggling of oil from territory held by the Islamic State of Iraq and the Levant group (ISIL). “Moscow has repeatedly been making the claim that Ankara buys oil from ISIL since Turkish jets shot down a Russian warplane near the Syrian border last week - instantly sparking a diplomatic dispute that has seen both sides wage a war of words through the media. “Russian Deputy Defence Minister Anatoly Antonov went further, implicating Erdogan's family in ISIL's oil supply chain.

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"Turkey is the main consumer of the oil stolen from its rightful owners, Syria and Iraq. According to information we have received, the senior political leadership of the country - President Erdogan and his family - are involved in this criminal business," he said. “Maybe I am being too blunt, but one can only entrust control over this thieving business to one's closest associates. "In the West, no one has asked questions about the fact that the Turkish president's son heads one of the biggest energy companies, or that his son-in-law has been appointed energy minister. What a marvellous family business!"

Many oversea sources tell us that Russia's plane was shot down to protect the secret that Turkey was buying oil from ISIS, after numerous images revealed how Turkey was receiving the terrorist oil. Of course, do not think for one second that Putin is going let the shooting of its plane by Turkey go unpunished. Russia has already sanctioned Turkey, but Putin vows to do more. Via BBC:

"...If anyone thinks Russia's reaction will be limited to trade sanctions, they are deeply mistaken". "We will remind them again what they did - they will regret it." - Vladimir Putin

With tensions in Turkey just beginning, Russia's pipeline plans are now at a complete standstill. Or is it? If Russia cannot directly supply gas to Europe through Turkey, Ukraine, or Bulgaria, then at least it needs to control the pipelines that supply the gas.

Iran-Iraq-Syria Route The only other alternative route in supplying gas to Europe that avoids the Western Opposition is the Iran-Iraq-Syria route - a $10 billion pipeline that was signed back in 2011 between Iran, Iraq, and Syria - the same one that bypasses the US-backed Qatar to Turkey route. So what does this mean? Since Turkey is protected, attacking Turkey head-on would not be the best scenario for Russia. Since the West is leaving Russia with no real alternative, then Putin is going to flex his muscles in the place he is allowed to.

Boots on the Ground Remember when I said that the only way to really take control of a nation is with ground troops?

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In October, Obama announced plans to send 50 special ops to Syria, while Germany just announced plans to send 1,200 troops. Think Putin is going to let that one slip? According to the Express and other sources, Putin may be about to send a whopping 150,000 soldiers to Syria to wipe out ISIS. If his troops are successful, guess who is going to end up controlling Syria? But before we even get to that point, there are two scenarios that could occur which will intensify the boiling blood between Russia and the West: 1. Western troops "accidentally" bombs or attacks Russian troops. 2. Russian troops "accidentally" bombs or attacks Western troops. As more soldiers enter the battlefield, that is when the body count piles up - and that is also when things can easily spiral out of control - as if it hasn't already.

Coincidental Preparations? Here is an excerpt I want to reiterate from a Letter I wrote just a couple of years ago:

"Almost a year ago, I said we should be afraid - and prepared - for war. A few of my readers said that I was a fear-monger; that I was using scare tactics to influence my readers. But here we are almost a year later, and war is exactly what is happening. While citizens on this side of the world are cheering for a recovery fueled by cheap credit (that eventually has to be paid back with higher interest rates), much of the world is in chaos."

As global tensions rise, the number of U.S. officials preparing for World War 3 rises along with it. The fears of World War 3 have now even slipped into American politics, with GOP front-runner Donald Trump warning of a proxy war with Russia. But it is not only politics. The Pentagon has been aggressively preparing for such an event, believing that a military conflict with China and/or Russia is inevitable. Is it a coincidence that, after so many years, the Pentagon just announced that it would open all military combat jobs to women - right after Putin said he has 150,000 troops ready for combat? Via the NY Times:

"There will be no exceptions," Mr. Carter said at a news conference. He added, "They will be allowed to drive tanks, fire mortars, and lead infantry soldiers into combat. They will be able to serve as Army Rangers and Green Berets, Navy SEALs, Marine Corps Infantry, Air Force Para-jumpers, and everything else that was previously open only to men."

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We already know that the Pentagon has increased its spending, awarding billions of dollars of contracts to defense contractors. Is the Pentagon - whose sole purpose is to protect the United States - becoming more politically correct? Or, is it preparing for war?

IMF and China Meanwhile, the IMF just approved China's yuan into the Special Drawing Rights. However, there is a full year in between for China and other countries to make the adjustments, which means that it is still not a guarantee. That means over the next year, you will likely see China go through with wide-sweeping changes on financial reforms to ensure that its currency makes it into the SDR. I will get into the details of this in an upcoming letter. For now, pay attention to some of the financial secrets that may be unveiled in China over the coming year, including more revelations about rehypothecation, as China does whatever it can to make the SDR. Seek the truth, Ivan Lo The Equedia Letter

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