When you're feeling down and pessimistic about the outcome of the current conflicts, it is always a good thing to listen to Martin Armstrong. No matter how negative your views may be, he will always see the sky darker than you do.
Unfortunately, he also tends to be correct although of course, his timing is less precise than the outcome he foresees. That the global economy, inflated on the fumes of fiat money will eventually blow up should be obvious to anyone with a modicum of financial understanding. The problem is timing.
The war with Iran is far more dangerous for the world economy than the war with Ukraine. There is of course the issue of oil and gas, but also of fertilizers, and other essential materials which sooner than later will transform the crisis into a global catastrophe. The world can live with less energy for a while, we will just plunge into a recession, but less fertilizers? Not so much. April is planting season in the Northern Hemisphere. Higher prices for fertilizers means less availability which implies lower crops this Summer and starvation in some developing countries next Winter.
Remember the four horsemen of the apocalypse. They always come in the same order: War, starvation, pestilence and death. Most people believe that our modern society has finally succeeded in leaving them stranded far away in the past. Let's hope that after summoning the first, the other three do not come back galloping with a vengeance.
More practically? Energy cost up means that countries like Pakistan or Egypt with their huge and bulging populations which are already virtually bankrupt, become practically, unable to repay their debt denominated in US dollars. When this happens in the coming months, it will be 2008 again but on steroids and we will see which banks were swimming naked. Then finally we will get the 10 trillion dollar wipe out of "fake" money which has been hanging above our heads for the last 20 years. And Martin Armstrong will be vindicated.
by Greg Hunter’s USAWatchdog.com,
Legendary financial and geopolitical cycle analyst Martin Armstrong warned in February, “This is where the volatility starts kicking in.”
What do we have? Oil, gold and silver spiking in price, and violent exchanges between Iran, the United States and many other countries in the Middle East.
Now, water assets like desalination plants in Bahrain and Iran are being blown up. Add the worst water shortage in decades in Iran as a backdrop to constant bombing, and you have a situation that could turn very ugly, very fast.
The water shortage is so bad that there has been water rationing in Tehran for months. This water rationing was part of the reason there were huge protests in Iran a few months ago. Armstrong explains:
“Part of the protests (in Iran) were about water rationing. The Islamic Republic Guard were called the ‘water mafia.’ They control the water.
It’s kind of like North Korea. If you want to be fed, you join the army. All food goes to the army first, and water will also go to the military first.”
Remember, they are water rationing in Iran now, and they don’t have a lot left. So, what happens if the US, Israel and other Persian Gulf nations knock out what’s left of Iran’s water? What happens if Iran is completely out of water? Armstrong says:
“Personally, I would ask Pakistan for a nuke. Look, you are talking about the death of a country. When you get to that point, if you’ve got a nuke, you are going to use it.”
So, what happens if the dams and reservoirs are bombed and Iran is completely cut off from water? Armstrong says:
“If you do that, is that a war crime because you are wiping out the average population and civilians? Would you do that? This is a mess. It’s a complete mess.”
On the other side, what happens if Iran knocks out all the Persian Gulf oil refineries? Armstrong says:
“If I were Iran, I would attack all the oil refineries of the neighboring states. You do that, and you will bring the entire West to its knees. The US only gets about 3% of our oil from the Middle East. You would wipe out Europe for sure.”
Armstrong sees gold going as high as “$8,800 an ounce . . . and silver $150 per ounce. . .. Oil could test $200 a barrel. . .. It’s going to get worse this summer, and it’s a 250-year drought cycle in Iran. I wrote about this on my site.”
In closing, Armstrong says, “Winston Churchill said, ‘In time of war, truth is very precious, and it needs a bodyguard of lies to protect it.’”
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