THIS WAS OUR 2018 TREND FORECAST: The battle lines have been drawn. In Washington, there is absolute support for Israel and absolute hatred for Iran. Should these trend lines continue on their current path, we forecast war will ignite throughout the Middle East… and possibly worldwide.
When war breaks out, equity markets across the globe will crash… along with the dollar, euro, yen, yuan and other fiat currencies. Citizens of the world, gripped in fear, hysteria – and reality – will run for their lives, grabbing what they can carry and putting whatever cash they have into gold and crypto safe-haven assets.
MID-YEAR UPDATE: The U.S./Israel/Saudi alliance we forecast would form in 2018 has become so entrenched and deep-rooted, the stage is now set for confrontation against Iran, Syria and its allies.
Whether through military action that will ignite at the slightest provocation – false flag or real – or covert actions taken by outside forces to destabilize or overthrow regimes … one, or all of these wild card events will crash the already volatile equity markets worldwide.
In our Trend Alerts, Trends Monthly publication and nightly Trends In The News broadcasts, we identified how seemingly unrelated government policies were in fact directed toward major initiatives that united the US/Israel/Saudi alliance while setting the stage for future Middle East unrest.
For example, President Donald Trump announced in May he would exit the 2015 Joint Comprehensive Plan of Action in which Iran agreed to limit its nuclear activities and permit nuclear international inspectors in return for the lifting of crippling economic sanctions.
Calling Iran, “the world’s leading sponsor of state terror,” Mr. Trump further vowed to impose the strongest “sanctions in history” against Iran.
Israel and Saudi Arabia were among the very few countries encouraging Trump to abandon the JCPOA; China, France, Germany, Russia, Canada and the U.K. strongly opposed Washington’s decision.
Then, just days after withdrawing from the Agreement, U.S. and Israeli officials celebrated the relocation of the U.S. Embassy to Jerusalem, which was in violation of International law and opposed by 128 countries.
Concurrently, Israeli Defense forces killed 60 Palestinians who were marching against the opening of the Embassy during Nakba, the annual commemoration of Palestinians being driven from their homeland by Israelis, and holding daily anti-Israel protests since late March.
During that protest period over 5,000 Palestinians were injured and an estimated 110 killed by Israeli forces, while no Israeli suffered injury or death.
Also during this period, Israel launched bombing raids on alleged Iranian facilities in Syria, which ratcheted up the prospects for war and helped spike oil prices, a sign of the economic fallout should war ensue.
Subsequently, with oil prices rising over the threats of conflict and fears of less supply of Iranian oil on the market, President Trump called on OPEC to supply more oil to keep prices from moving higher.
Then, in late June when oil prices rose to 2014 levels following Mr. Trump’s orders for companies to cut all oil imports from Iran to zero by November, he tweeted: “Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference…Prices to high! He has agreed!”
Publisher’s note: The US/Israel/Saudi attack on Iran will be both overt and covert – outright war or orchestrated coup.
Already Trump’s new sanctions are weakening Iran economy and strengthening Saudi’s.
As the Wall Street Journal noted in late June, confirming our Top Trend 2018 forecast: “The benefits for the kingdom highlights the central place Saudi Arabia holds in President Donald Trump’s confrontation of Iran.”
The socioeconomic and financial effects of the sanctions have also caused domestic destabilization in Iran, with protests escalating in the face of a declining economy, record levels of unemployment that have left a third of under 30s out of work, rising inflation, and its currency, the rial, diving 40 percent since May 8, when Trump pulled out of the Iranian nuclear deal.
Fueling the latest round of internal uprisings in late June, U.S. Secretary of State, Mike Pompeo, fired a warning shot, claiming, “The people of Iran are tired of the corruption, injustice, and incompetence from their leaders. We condemn the government’s same futile tactics of suppression, imprisonment of protestors, and the denial of Iranians’ frustrations.”
Solidifying the US/Israel/Saudi alliance against Iran, and further pushing the coup message, Israeli Prime Minister Benjamin Netanyahu, after Iran’s soccer team achieved an unexpected tie with Portugal at the World Cup, said, “To the Iranian people I say, you showed courage on the playing field and today you showed the same courage in the streets of Iran. If you can stop Ronaldo from scoring a goal, you can stop your leaders.”
With no other media outlet capable of analyzing these events and making connections between disparate fields from a Globalnomic® perspective, we are the only news organization that has identified the alliance’s strategy that is now emerging and the implications that will ensue.
Thus, we forecast an attack against Iran, both covertly and overtly, will be launched.
OIL, THE DOLLAR AND WAR
The prospects for war and its economic fallouts, especially oil price spikes, come at a time of weakening economies and volatile equity markets worldwide. Of immediate concern are Emerging Market countries, whose currencies have been significantly devalued against the dollar index, which hit a 12-month high in June.
As U.S. interest rates rise and the dollar strengthens, the cost burden to EMs, whose debt, much of it dollar based, soared from $21 trillion in 2007 to $63.4 trillion last year, according to the Institute of International Finance, will be difficult to service. Thus, not only have EM currencies dropped 8.8 percent against the dollar in the second quarter, the MSCI’s 24-country EM index, down 17 percent from it year’s high, is approaching bear territory.
Now, with oil prices, which are dollar based, rising 60 percent already this year, EMs, as well as major oil-dependent nations, including those such as China and India, whose currencies are also declining against the dollar, will suffer downward economic pressure.
And as a result of sharply rising oil prices, even the U.S. will suffer economic fallout. As we have detailed, with gas prices hitting $3 a gallon, some $30 billion that would have been spent in retail and restaurant sectors, will instead be pumped into consumers’ gas tanks.
And even before gas prices began to rise, U.S. first-quarter growth slowed more than estimated, weighed down by the weakest consumer spending in nearly five years.
Yes, President Trump’s $1.5 trillion income tax cut package will spur more growth in the second quarter, but should oil prices spike, growth prospects, which by the nature of the tax cuts, will not only be temporary, they will be further minimized.