There is a time bomb waiting to explode – that no one wants to talk about publicly. Its not Greece or the state of Europe’s fragile economies (Italy, Portugal, Spain, Ireland …) and its not China that is about to witness a property bubble that will make the U.S. housing bubble a side show in comparison. Notice I said “Property” not housing …. that is because if you travelled to China as I have (many times) you would see cranes all over every major city where they were building sky scraper after sky scraper …for offices and apartments…that have now been sitting vacant for years. NO the real time bomb is the state of $75 Trillion (yes with a T) of unsecured, risky derivatives being carried by 4 major US banks that if even 1% of which goes bad, there will be an economic crisis of unprecedented proportions….worse than the deprresion in the 1930’s.
Bank of America is getting ready to file bankruptcy, and right behind BofA is Goldman Sachs, Citicorp etc. BofA recently moved all their derivative contracts from their subsidiary (Merril Lynch’s) books to their principal bank’s ledger – which means that the US government (that is vis the FDIC) is now on the hook (guaranteeing) the viability of these contracts.
So what does this mean for Iran or even Israel (that is seriously contemplating war)? Well most of these derivatives are interest rate swap derivatives. That means that if there is a major shift in interest rates (upwards) the Banks stand to lose everything – I mean in fact we (the public) stand to lose everything. The world’s whole economic output on an annualized basis is $65 Trillion dollars (that US, Europe, China, etc.). The money caught up in these derivatives is more money that the whole world put together today.
Now, let me tell you, I was in favor of an outright invasion of Iran 5 years ago. I know, and you probably know, that with the IRGC in charge in Iran, there is absolutely no hope of any democracy or freedom inside Iran. The only way to change things in Iran is to have an invasion where these bastards (the IRGC) are basically killed …otherwise they will kill any and all Iranians who demand a life with dignity, freedom and democracy. I see no other way. They regime will NOT reform itself.
I personally do not like that option, but, I see no other way. Likely if there is a war, Iran will be cut up. And we will NOT have an Iran as we know it today. That is no good. But who is strong enough to take on these bastards …certainly no one inside Iran.
But, (Big BUT), now is NOT the right time. If the straits of Hormuz are shut down, or even if they are not…do you remember the increase in the price of oil when US invaded Iraq?…well the same thing (maybe even worse) could happen. And if Oil prices go up, this will automatically lead to heavy inflation in the West…which will result in Central Banks automatically increasing interest rates…and voila …there will be a major crisis with these derivative contracts. The only way these contracts don’t bite is if interest rates stay down or go even lower – then the banks will actually make profits from them.
The financial ruin – will far exceed any damage that the war will or can cause….it would be worse than a nuclear bomb exploding in the center of New York. What is even worse, is that this bomb (the financial bomb) will be self inflicted, self caused, self exploding….it will have NOTHING to do with Iran.
Now I agree that Iran is a nuclear threat. I agree that Iran probably has an ABB (all but the bomb) – I mean every piece of the bombs except the final assembly. I agree that this is a serious threat to the region and beyond, BUT…a war today is a big mistake.
Years of meaningless sanctions, years of appeasement, years of silly diplomatic efforts – have all brought nothing. And today, the world and Iranians themselves are impotent. Right this minute there is nothing that can be done. This my friends is the unfortunate truth.
The only thing that CAN be done is a slow steady war of attrition – of neutralizing Iranian allies (such as Syria, and Venezuela etc.), carefully (surgically) imobilising parts of the regime …if they are serious about dismantling the regime. My own theory is that in fact the West is NOT interested in War and is NOT interested in dismantling the regime – and has used the Mullahs in Iran to scare the neighbors and force the Saudis, etc. to cough up money for more arms …and that the regime that the West (Britain and America) put in power inside Iran will NOT be toppled by them. There are many, many benefits to the IRI for the West – not least of which has been the stealing of Iranian oil from the Caspian Sea unchallenged by the Mullahs in Tehran; and the ‘scaring’ of Israel into making peace … The Mullahs still serve a purpose.
Now if Israel decides unilaterally to atack Iran, the West will get drawn into something they do not want. Which is why they keep sending people to Israel to tell Netenyahu to chill out. But – no one – I mean no one can control “Bibi” (which is what the Israeli’s call Netenyahu). Bibi is a loose cannon. And that is the risk the “world” is facing.
The good news is that Jews in America control a dominant portion of U.S. net assets, and control most of the major financial institutions; and ultimately finance Israel. If Israel takes the first step to attack Iran, Israel’s backers in the U.S. will be the first group to be impacted by the financial melt down in the U.S. and the rest of the world. Ultimately it will be they – not Obama, or Hillary, or Paneta (who recently visited Israel) – who will persuade Bibi to cool down.
If indeed there is an attack by Israel will likely lead to a quick counter attack by Iran …that will initially desimate a major Israeli city (enough to ‘scare Israel’ into making peace); and then the ‘war’ will have to be ‘quashed’ very quickly….it can not open out into a full scale invasion or anything like that. It has to be put out like a fire – very quickly. But this is the worst case scenario. More likely, nothing will happen…and the psychological war of words will go on for many more years.
Meanwhile, of course, Iran will have made enough enriched Uranium for many more bombs than the 4 it has in stock today (and the 3 Nuclear war heads it bought from Eukraine 10 years ago). Meanwhile, the people of Iran will have been repressed even more – under the heavy load of sanctions and the IRGC. Meanwhile many more thousands of Iranians will be killed in Prisons… it is a sad state of affairs for sure.
War today – will cause much greater harm to the world than to the Mullahs.
