Hold your Gold! Persian “Gray Swan” lurks

With so many threats to an already tipsy global currency regime lurking within the balance sheets of every sovereign nation of meaningful size outside of China, another potentially catastrophic event could take investors by surprise—including, of course, a Black Swan Event—but also an event, which Nassim Taleb refers to in his book, “The Black Swan,” as a gray swan, an event which could have been  foreseen.

Buried under the ever-growing tantalizing news stories of critical budget meetings in Europe and the U.S., gazillion-dollar hedge fund managers predicting fiscal Armageddon by 2012, 2013 or 2014, clarion calls for a renewed gold standard by marquee writers in the financial business, and a verbal sparing in Congress between a champion of free money and his villain at the Fed, lies an equally threatening event to the markets:  War.

But not just any war, whereby a bunch of Western counties pick on a “dictator” or a “terrorist” political party harboring other “terrorist” in a part of the world where few in a U.S. high school class can point to on a world map, but the real biggy—with Iran.

Attack Iran?  How’s $200+ oil (for openers) for a dying U.S. economy to digest?  How would the already-bogus budget deficit projections fair as the U.S. economy collapses into, not a Depression, but a comma?  The double-whammy of deficits soaring as GDP plunges would bring Greece to the U.S. much sooner than 2014.

Can the Fed call on the autonomous and clandestine Exchange Stability Fund (ESF) to fix that?  The $600 billion of currency swaps released by the Fed a  couple of years ago to come to the aid of Europe, as the scheduled ticking time bomb was set to explode in the counties comprising the PIIGS, will turn out to be mere token gesture of support.  The $5+ trillion stimulus already injected into bank balance sheets, as well as into the coffers of Keynesian government spending, will be laughed at as “soooo 2011.”

Giving the story about proposed plans for an attack on Iran was given legs to run wild on the Net thanks to our friends at zerohedge.com, who recently posted a news story from news source Al Jazeera about a former CIA agent assigned to the Middle East who paints a rather frightening scenario he sees coming into focus for September.

According to an Al Jazeera report, former CIA agent Robert Baer told KPFK Los Angeles that hardline Israeli Prime Minister Benjamin Netanyahu is “likely to ignite a war with Iran in the very near future.”

“ . . . there is a warning order inside the Pentagon to prepare for war,” said Baer. “There is almost ‘near certainty’ that Netanyahu is planning an attack [on Iran] … and it will probably be in September before the vote on a Palestinian state. And he’s also hoping to draw the United States into the conflict.”

Never mind sending floating flotillas to the Palestinian people, start planning on sending them to the U.S. if this story is not a COINTELPRO operation by a former spook.   If true, the 44 million people presently on food stamps in the U.S. will be considered the early birds to the come wave of additional public trough money if Washington goes along with Netanyahu on this Armageddon plan.

No doubt, reports from the likes of a Robert Baer a decade ago indicated that Iran had equally ambitious plans to Iraq’s escape from U.S. dollar hegemony through the sale of its oil in other currencies besides the dollar.  How else, then, did Iran achieve the enviable Axis-of-Evil member status?  Was it because of Iran’s “nuclear weapons” program?  Did George Bush mistakenly confuse Iran for Iraq when he said Iraq was hiding “weapons of mass destruction?”

Here’s the link to the original October 2000 Reuters piece regarding a UN approval of Iraq’s “request” to accept the euro as payment for Iraqi oil.

Fast forward to today.  OilPrice.com just released an article entitled, “Iran Opens Oil Borse – Harbinger of trouble in New York and London?”  It’s author, John Daly, wrote that the three-decade long U.S.-led sanctions on Iran has been long enough (that is, as long as the dollar was an acceptable exchange for Iranian oil).  Apparently Mahmoud Ahmadinejad, too, wants change he can believe in.  He, too, wants an end to the decades-long dictatorships of North Africa and Middle East.  And the U.S. is the tool of his enslavement.

“Iran is working a program, that, if it succeeds, could help undermine the dollar’s preeminence as the world’s reserve currency more effectively than a Republican filibuster,” stated Daly. “Iran’s sly weapon against the Great Satan’s currency? An oil bourse on Kish Island in the Persian Gulf, which has now begun selling high-grade Iranian crude oil.

Mohsen Qamsari, the Iranian National Oil Company’s deputy director for international affairs Mohsen Qamsari commented, “The commodity stock exchange has been pursuing a mechanism for offering crude oil on the stock exchange for a long time, and it has taken the preliminary steps, to the extent possible.”

He added, “Considering the existing banking problems, foreign customers are not expected to be taking part in the first phase of offering crude oil on the stock exchange, and this will be done on a trial basis. Today Bahregan heavy, high quality, low sulfur crude oil with less sourness will be offered on the stock exchange for the first time. In the first phase, a 600,000 barrel shipment will be offered.”

Let freedom reign.  Sounds like another U.S. serf stepping out of line, doesn’t it?  Well, it gets a little sticky.

“China, the world’s largest buyer of Iranian crude oil, has renewed its annual import pacts for 2011,” continued Daly.  “In 2010, Iran supplied about 12% of China’s total crude imports.”

As far a China is concerned, making nice with the Dalai Lama at the White House is one thing; cutting off oil supplies to its rapidly growing industrialized nation is another.  Wasn’t the straw that broke the back of the Japanese start (some suspect) serious animosity between the U.S. and Japan prior to the attack on Pearl Harbor?  It appears that the same old U.S. playbook is being used to execute yet another war, using Israel as its post-WWII tool, again.

Some (pretty intelligent analysts) say the threat of WWIII isn’t imminent; it’s already begun, and is being rolled out, appropriately, in an easy pain-free installment plan.  But this time, both the U.S. and China import much too much oil whose cheap supply is running out.

It’s a them versus us game being played.  Or, as George Bush put it following the 9-11 attacks, “You’re either with us, or against us.”  And what a great way to get out in front of a dollar collapse.  Blame it on the Axis-of-Evil.