Why has the United States pursued a foreign policy which has destabilized the Middle East? Why are we supporting the opposition (and even ISIS behind the scenes) in the war in Syria? Why are we continuing to build US military bases around the region, in preparation for an expanded conflict with Syria’s major ally, Iran? And why are Russia and China dead set on stopping us? Most importantly, why is this happening now?
The answer is the same reason why we invaded Iraq in the early part of this new century. The truth is, over the last two decades, US military and foreign policy has always been focused on one thing – oil, and retaining US control over the last remaining super reserves in the Middle East. The final act in this plan, the toppling of Assad and then Iran, would give us a lock on the Middle East and control of the world’s oil.
One of the truths which has been successfully hidden from the American public is we never really left Iraq; we merely replaced the US military with corporate mercenary forces, who now operate behind the scenes overseeing the Iraqi oil fields. So why are we going for the oil?
The answer is quite simple. Peak oil is a reality, for the era of cheap oil is over, and the US Empire is broke. The dollar is nearing the end of its reign as the world’s reserve currency, and is ready to tumble, but if we can grab control of the oil, we can assure the dollar remains the currency for global oil sales and thus the world’s reserve currency as well. If we lose control over the Persian Gulf, we will lose the petro-dollar, and then we lose the economic might which supports the US military budget, which itself exceeds, all other nations combined.
Empire USA exists only as long as we retain the ability to print dollars with impunity, without impacting currency exchange rates. If the dollar were to fall, our trade deficit would explode, because much of our imports are actually inelastic as to price. Our demand for imported oil or the parts which run our foreign auto and truck fleets, or the electronics we use in our modern society, even the chips for our smart bombs, they are all imported now. We would have to continue these imports even if prices rose as the dollar fell.
Today, we painlessly finance our structural federal budget deficits on the backs of our trading partners, through the trade deficit. The dollars we export through the trade deficit must be re-circulated back into the US financial markets, and thus are invested in US Treasury debt, to finance the American dream.
If the petro-dollar were lost and the dollar devalued, given the size of our trade deficit, and the short term character of our outstanding federal debt (which must be rolled over every three to four years), we would have to raise interest rates to attract foreign investors. If interest rates were to rise, the US economy would sink like the Titanic. The federal deficit is $18 trillion today, with $12.8 trillion held by third parties.
This debt is financed with near zero interest rates at an annual cost of $231 billion. The average interest rate on this debt is only 1.8%. If the dollar were to be devalued, US interest rates will be forced higher, and then the federal deficit would explode. At 5% interest, the debt service or interest costs would jump to $640 billion, adding $410 billion to the annual budget deficit. At 10%, the debt service rises to $1.3 trillion, adding a cool $1.1 trillion to the annual deficit.
Interest rates at 5% or even approaching 10% may seem ridiculous in terms of today’s zero interest rate policies, but interest rates between these levels were quite common in normal economic times. In the event of a devaluation of the dollar, actual interest rates could go far higher. In the last major currency crisis in the US, in the early 1980’s when Paul Volcker whipped inflation, US interest rates approached 14% on federal bonds.
Beyond the impact on the federal budget, if rates were to rise, the stock and bond markets would also crash. These markets rest on valuations which are pegged or hinged to interest rates. As rates move higher, the value of US stocks and bonds fall, as the present value of these securities is a mathematical formulation based on only one key variable – interest rates. Now you understand why the US Federal Reserve can no longer raise interest rates.
The Russians know all of this as well. If they allow the US to seize control of the oil region, they concede control over the largest supply of the most valuable resource in the world, and for them, that means game over. Our military technology is leaving them in the dust on a conventional battle field, so if they wait, and watch us take control over the balance of the Mid East, it’s over, and they missed the perfect window of opportunity.
ISIS, Ukraine, Iraq, Iran and Syria are all battles for control of the world’s oil, and if the Russians and Chinese don’t fight us now, through proxy forces in these wars, they will be unable to confront us later, directly. If we take down Iran and Syria, and insert pro-western puppet governments controlled by corporate mercenaries, there will be no further wars required. And thus there may be no chance to fight the US via proxy.
The other reason the communist powers intend to confront us in the near future, is our vulnerability has never been as great. The financial position of the US is tottering; the fiscal deficits are now structural, and compounded with our massive trade deficits, they are the Achilles heel of our empire.
If they hand us a military defeat in the Middle East, or inflict a devastating attack on the mainland through what will appear to be Islamic terrorist attacks, our allies in the gulf will run for cover, and the dollar as a reserve currency will be over.
The domestic economy will then be reduced to ruins, our ability to project military power around the world will become severely degraded and our position as the world’s sole super power compromised. Thus the window of vulnerability has never been more open than it is now.
Why do the communists want to challenge US dominance in the first place? Simple, they want to eliminate American power so they can force the Europeans to negotiate a bi-polar sharing of power under the New World Order which is coming – and it will rise quickly following the war.
The communists DO NOT want a direct fight with us, at least not at first; we would do too much damage if we faced them off directly. So they will let the crazy, hash smoking, Allah man do the job, while behind the scenes, their Special Forces units will detonate a few suitcase sized nuclear bombs in our cities. From that point on, everything will happen very quickly. First “ka boom” and then we will all be told to blame the Allah man. And what do the Russians or Chinese care if we take out Iran in response, and maybe Damascus too, or we get the Israelis to do it. They lose a pawn but win the Queen of Nations.
Most people don’t understand the truth behind the news, because they haven’t done the research to get to the truth. They don’t understand the military balance of power; nor do they realize the depletion consequences of the Saudi oil fields. One of the largest oil discoveries in the world in the last 50 years, off Brazil a few years ago, will supply only eleven days of global consumption. With China and India industrializing, global demand is projected to grow from 85mm barrels per day (BPD) to 120mm BDP in the next 20 years.
Peak oil depletion assures us, we can’t match that demand, so which nation will agree to voluntary rationing and turning off 25% of their lights, cars, industry and going back to the technology of the 1800’s? None of them; the world will fight over these resources. That is why we invaded Iraq in the first place.
Peak oil is real and you can forget about alternative energy solving this problem; that would be like trying to bail out the Titanic with a paper cup. These technologies are in no way scalable to the size required to impact the problem of depleting petroleum reserves, and you can’t make synthetics with solar power anymore than you can fuel tanks and jets with the wind.
And the thought that the massive US reserves of the Bakken fields will save us is sophomoric; the geology prohibits any major increases in production, and the depletion rates burn out each well within two to three years. What about shale oil? That is also a sad joke; we don’t have the fresh water, or natural gas to dramatically increase production, and the ecological damage from this energy source ruins the environment. So the American centered world which we have known since 1945 really is over… get ready for the show of a lifetime. It really is this simple: here are the key fundamental economic issues facing the US.
- The federal debt is $18 trillion headed to $20 trillion in three more years.
- At 5% interest rates, which are low in historical terms, the debt service begins to dominate the entire budget.
- The near zero nominal interest rates are below the rate of inflation, whether you count real inflation or the much lower official inflation rates.
- Real interest rates are therefore very negative.
- The US is the largest debtor in the world and it continues to run massive structural trade deficits of $500 billion or more.
- The US pays no real interest on its debt, and makes no real payments to its trading partners, other than exporting more printed greenbacks in the form of more US debt.
- The only thing keeping this Ponzi scheme going is the fact our trading partners (OPEC, Saudi, China, Japan, et al) are still accepting dollars at the moment.
- The only reason they agreed to play this game in the first place, is US military power guaranteed support for their regimes.
- In the early years, the inflation cost of this scheme, which was born by our trading partners, was actually quite low, (2 to 3%), and it was considered a small subsidy paid by OPEC for the cost of the US policing their region, and ensuring stability of the existing regimes.
- As US economic power has eroded, and our budget deficits have exploded, the costs and risks of this game have now become quite high.
- As the US has also abandoned numerous long time allies in the region, the trust we once had with our trading partners and allies is all but gone.
- All of the players are now quietly trying to get out of the dollar as fast as possible.
- Most of these players have acknowledged publicly that this game has been going on way past its real life expectancy, and they are all planning leaving at some point soon.
- Everyone in the world knows this is about over, except the Americans.
The nations are all planning for the next war, which is coming, and when it comes, it will start with a massive terrorist strike on US soil. The dollar will then be abandoned by OPEC, and its value will begin to fall. If the war turns against the US, (a likely risk and a topic of a future article), the dollar will fall to the same level as the original Continental currency of the United States, which became worthless. You may remember the saying, “Not worth more than a continental.”
To find more information on the world’s march towards World War III, look for the author’s first book, The Day of the LORD is at Hand, 7th Edition.
President John F. Kennedy warned America on April 27, 1961, and the days he warned us of are about here:
Tonight, I want to talk about our common responsibilities in the face of a common danger. The events of recent weeks may have helped to ILLUMINATE (ed. note-Illuminati reference) that challenge for some; but the dimensions of its threat have loomed large on the horizon for many years. Whatever our hopes may be for the future — for reducing this threat or living with it — there is no escaping either the gravity or the totality of its challenge to our survival and to our security — a challenge that confronts us in unaccustomed ways in every sphere of human activity…
For we are opposed around the world by a monolithic and ruthless conspiracy that relies primarily on covert means for expanding its sphere of influence — on infiltration instead of invasion, on subversion instead of elections, on intimidation instead of free choice, on guerrillas by night instead of armies by day. It is a system which has conscripted vast human and material resources into the building of a tightly knit, highly efficient machine that combines military, diplomatic, intelligence, economic, scientific and political operations…
Its preparations are concealed, not published. Its mistakes are buried, not headlined. Its dissenters are silenced, not praised. No expenditure is questioned, no rumor is printed, no secret is revealed. It conducts the Cold War, in short, with a war-time discipline no democracy would ever hope or wish to match…”
JFK was speaking about what he called the “Gnomes of Zurich”. He was specifically referring to the banksters, the NWO and the enemy of humanity as a whole. These gnomes are planning to use the Russians to bring about the complete destruction of the United States, and then, they will lift up, their New World Order.
- CBO’s Projection of Federal Interest Payments.Federal debt held by the public will reach about $12.8 trillion by the end of this fiscal year, an amount that equals 74 percent of the nation’s total output (gross domestic product, or GDP) this year. If current laws generally remained unchanged—the assumption that underlies CBO’s baseline projections—CBO projects that such debt would climb to $20.6 trillion, or 77 percent of GDP, in 2024. Interest payments on that debt represent a large and rapidly growing expense of the federal government. CBO’s baseline shows net interest payments more than tripling under current law, climbing from $231 billion in 2014, or 1.3 percent of GDP, to $799 billion in 2024, or 3.0 percent of GDP—the highest ratio since 1996. The rising debt accounts for some of that increase, but much of it stems from CBO’s expectation that—largely owing to the improving economy—the average interest rate paid on that debt will more than double over the next 10 years, from 1.8 percent in 2014 to 3.9 percent in 2024. (Although interest rates are projected to rise sharply, CBO’s current projections of those rates are lower than its projections earlier in the year, reflecting the agency’s reassessment of the factors influencing real interest rates.) September 3, 2014
- The Powewr Hour: JFK Speech Transcript
© 2015 Benjamin Baruch – All Rights Reserved
Benjamin Baruch, July 18, 2015 NewsWithViews.com