319. Escalating from Suez to Waterloo

Principles of Economics My complete guide to understanding economics

is now available in hardcover, audio book, and ebook from SafedDeen.com, Amazon, and

many more booksellers worldwide.

And now I am also teaching a course based on this book on my website, SafedDeen.com.

Principles of Economics will run the whole academic year from September to June and will

have a new lecture every two weeks, as well as weekly live online discussion seminars

open to learners from all over the world and from all walks of life.

Whether you're a student, a professional, or a retiree, you are making economic decisions

every day and this course will arm you with the wisdom of centuries of economists to improve

your economic decision making.

You'll also get a free book of Principles of Economics if you sign up for the course,

go to SafedDeen.com and sign up now.

So this analysis is tentative, but there are clear changes in the facts on the ground so far

that indicate the US has suffered a significant setback with important ramifications.

And if the US chooses to double down, it may exacerbate it, with momentous political,

economic, and military implications for the Middle East, the US, and the world at large.

A massive global economic crisis might unfold.

The presence of the US in the Middle East is in serious danger.

The US empire may be in its death-throws, the fiscal fate of the US hangs in the balance,

and the world may finally be free of dollar slavery.

Militarially and technologically, this might go down in history as a decisive turning point

in which a 20th century superpower was defeated by a 21st century medium power,

which used newer technology at 1% of the cost.

Drones and hypersonic missiles that defeat aircraft carriers, jet fighters, tanks,

and other 20th century relics remind us of small gun-wielding armies,

defeating larger armies carrying swords.

What is remarkable about this war is the disconnect between the real-world battlefield outcomes

and the public understanding of what is happening.

Over the past few decades, American military dominance has been so complete

and its opponents so mismatched that Americans seem no longer capable of even conceiving a defeat,

and cannot recognize it even as it stares them down.

In America's other recent conflicts, the range of outcomes was almost entirely determined

by inter-American politics, with the opponent a passive subject.

Defeat simply referred to the other country failing to fully adopt the form of government

and social customs that America sought to impose.

It did not mean the failure to achieve military and strategic objectives,

as American soldiers conquered Kabul and Baghdad in a matter of weeks.

But Iran, we have so far had a remarkable American failure to achieve strategic objectives,

and the option of escalating to achieve these objectives threatens dire consequences.

To assess the war so far, we look at the objectives set by each party and how they have

failed. At the initiation of the American Zionist regime's attack on Iran, these appear to be

its declared goals. U.S. goals. One, unconditional surrender. X. Two, regime change. X.

Three, end of Iran's nuclear program. Question mark.

Four, destroy Iranian industrial, military, air force, and navy capacity.

Partial checkmark. Five, end of Iran's missile program. X.

U.S. achievements so far. One or two out of five achieved.

The U.S. has likely not achieved any of the essential goals in the fourth week of what was

initially sold as a quick operation that would take a few days than later revised to three to four

weeks. One, surrender seems out of the question in a country that has been preparing for this very

war for decades, and in which millions are seemingly happy to die. X. Two, the Israel U.S. forces

have succeeded in assassinating many individual leaders, which is the Israeli regime's signature move.

And something that its American puppet has recently adopted in contravention of centuries of

civilized Western norms of war. The regime has survived so far. Iranians seem to have rallied

around it, and it seems unlikely that it will fall, even after countless senior assassinations.

The country is large enough, and the regime established enough that individuals do not seem to

matter so much, and the institutions continue to operate. The extent of domestic opposition to the

regime was likely overstated by Israeli intelligence to sell this war to America's easily impressionable

president. Opposition to the government is one thing, but support for a foreign war is something

entirely different. As Professor Robert Pape has argued, aerial bombardment alone has never produced

regime change. Instead, it usually causes people to rally around the flag, and that seems to have

happened in Iran. This has likely been intensified by Zionist regimes targeting more Iranians,

civilians, schools, and hospitals. Trump has already conceded defeat on this as he's desperately

trying to assure markets that he is negotiating with the regime he promised to destroy, while

the regime denies talking to him or his intermediaries. Three, we do not know what happened to the

Iranian nuclear materials, but we do know that the regime now has a far stronger incentive to acquire

a nuclear bomb. Question mark. Four, the US has likely succeeded in destroying much of Iran's

industrial capacity, and the longer the war goes on, the more of it will be destroyed.

This terrorism will cost the people of Iran dearly in the many years to come. Whatever the outcome

of the war, the US has also massively degraded Iran's conventional military forces, but this is a

peric victory. Conventional military equipment constitutes very little threat to Israel and the US,

and is not very useful for Iran in this war, which is why they control hormones even if their navy

is gone. Iran does not need tanks, helicopters, boats, airplanes, or other 20th century technologies

to achieve its objectives in this war. It has high precision hypersonic missiles and cheap

accurate drones, which are allowing it to achieve its objectives. When Trump brags about destroying

conventional military assets, he may as well be bragging about murdering Iranian horses and cavalry

divisions. Zionist regime's forces have also succeeded in bombing many civilian targets. Most

notably, the Minab Girl School, demonstrating that schools, hospitals, and civilian structures

are among potential targets, terrorizing the civilian population, which is another signature

Israeli move. Both the assassinations and the targeting of civilians are unlikely to make a

difference to the outcome of the war, but Israel observers will not be surprised to find Israel

persists with them, because Israel's real objective is to turn Iran into a failed state as discussed

below. Checkmark 5. The biggest and most consequential failure so far is the failure to eliminate the

threat of Iranian missiles and drones, which continue to reign on US bases in the region and on

Israel, and show no signs of abiding. As I write this in Aman Jordan on the 26th day of the war,

in the pathway of Iranian missiles to Israel, we may be witnessing the day with the most missile

sirens since the war started. A clear indication that Iran's missile capabilities are still strong.

Further, Iran's missiles and drones remain intact enough for Iran to credibly threaten

energy infrastructure in the region and deter attacks on Iranian energy infrastructure.

If the Iranians destroy energy infrastructure in the Gulf, the impact on the US and world

economies will be devastating for many years. Iranian drones cost around $7,000 to make,

as cheap as the average social media influencer Israel buys. They weigh 200 pounds and are easy

to hide. They are easy to manufacture from cheap parts, earning the nickname, flying lawnmower.

There is an enormous productive capacity of these drones in Iran, and it is extremely unrealistic

to imagine that aerial bombardment can destroy all its production capabilities.

Iranian missiles have improved significantly in accuracy in this war compared to the previous war.

Many of these missiles and drones can be fired from trucks, which means it is not simple to

just pinpoint their bases and destroy them. The bases are hidden underground, and the trucks

can fire from a different location every time. The continued sustained pace of Iranian rocket

in drone attacks suggests that there will likely be serious shortages in the Zionists alliance

defensive capabilities, and that explains why air defense systems have been moved from Korea

to the Middle East, and WAPO reports more defense systems may be moved from Europe. On March 19th,

Ryan Metals CEO said the war lasting another month would deplete air defense stockpiles,

given that Iranian drones and missiles are very cheap and fast to produce, whereas American

interceptors are expensive and slow to produce. The longer the war lasts, the more vulnerable regional

defenses are, and the more likely interceptors are to become insufficient. Rather than the U.S.

destroying Iran's military capabilities, Iran is depleting American weapons stocks,

leaving American allies exposed worldwide, and exposing how limited the American military

really is in this new military technology world. If America is fairing like this against a medium-sized,

relatively poor country under sanctions, imagine how it would fare against China.

Iran's goals. One, maintain regime in power. Checkmark.

Two, end U.S. Israel attacks. X. Three, receive reparations for attacks. X.

Four, maintain nuclear program. Question mark. Five, maintain missile program. Checkmark.

Six, establish control over Hormuz traffic. Checkmark. Seven, expel the U.S. from the Middle East.

Checkmark. Eight, remove sanctions. Partial checkmark.

Iranian achievements so far. Five or six out of eight goals achieved. Six, control over Hormuz.

Checkmark. Thanks to its drones and missiles, Iran has established defacto control over the

strait of Hormuz. It took only a few drone attacks in the first few days to completely freeze

traffic in the Hormuz strait, and now only Iranian-approved boats dare to traverse it.

Iran has said that it will impose a toll on the strait of Hormuz and has asked vessels to pass

through a particular route between two Iranian islands to ensure safe passage, allowing them to

be under close Iranian watch and easy inspection. Several ships have traveled that path in the last

few days, suggesting the toll booth is operational. It seems Iran is charging around $1 per barrel

of oil for passage, and that is a very small price to pay for the world's energy consumers

compared to the alternative of hoping Trump's war can bring this to an end.

Control over Hormuz gives the Iranian regime enormous leverage over global energy markets

in the entire Gulf region. All the Gulf states looking to export oil must get their tankers through

the Persian toll booth, and their governments need to stay on Iran's good side.

There is no obvious military strategy for quickly ending Iranian control of Hormuz.

Iran has thousands of square miles of mountainous territories,

overlooking the narrow Hormuz, like a stadium overlooking a pitch,

allowing easy targeting of giant tankers like fish and a barrel.

Iran has a considerable arsenal of cheap drones and missiles hidden all over this landscape,

and they can be launched from mobile launchers in different locations, making them difficult to

detect. Trump and his cabinet of TV bimbos seemed to have had no idea that Iran closing the strait

was a possibility, thanks to their Israeli bosses trying to sell them on this misguided war

by ignoring all the possible downsides. Trump and his regime have gone from claiming the

strait is open, to saying that the US did not care if it was open, to demanding China, Europe and

other countries send their navies to deal with it. A ridiculous demand which all nations rejected,

except for the Chinese, who did not even dignify it with any kind of response.

When it finally dawned on orange colligula that Israeli intelligence had duped him into plunging

the US and world economies into a massive crisis, he lost his marbles and issued a 48-hour

ultimatum to Iran, to clear the strait or face the annihilation of its power infrastructure,

an astonishingly brazen admission of intent to commit a war crime.

Now for a quick word from our sponsors.

With Fiat money constantly debasing, preserving your wealth isn't an option or luxury,

it's a financial and moral imperative. If you're familiar with my work, you know the only

financial advice I ever give is to buy and hold Bitcoin for the long term. This has never failed

anyone. If you want to buy Bitcoin, I strongly recommend using Swan, a group of hardcore

Bitcoiners laser focused on making Bitcoin easily accessible. While most scramble to react to

each new crisis, Swan private clients are already positioned in the only monetary asset with

absolute scarcity. Bitcoin, Swan private partners with families and institutions who share a

principled conviction in Bitcoin as the foundation for multi-generational wealth. With concierge

service, deep expertise, and uncompromising security, the Swan team helps clients exit the

crumbling Fiat system and secure their future in sound money. Today, Swan private serves more than

5,000 high-net worth clients who have purchased more than 4.5 billion dollars of Bitcoin and put

it into cold storage. If you're ready to move beyond the false promises of Fiat, start your long-term

Bitcoin strategy at swan.com slash safe. SAIF. But now, finally, daylight have delivered a fantastic

full-function tablet with a paper-like screen that's easy on your eyes and great for outdoor use.

I've been using the daylight computer to write my next book and it is absolutely fantastic

and it has led me to invest in this company myself. Check out my interview with Anjan Kata in

episode 249. The Bitcoin standard podcast is brought to you by CoinKite. CoinKite are my favorite

makers of Bitcoin hardware. They produce the legendary OpenDime, the first Bitcoin bearer asset,

as well as the reliable cold-card hardware wallet, the excellent stainless steel seed plates for

storing your seed phrases and the block. But as the deadline approached, US government bond

yields spiked and Trump backed down from his threat, extending it by 5 days, claiming that a

breakthrough had happened in negotiations, although Iranian authorities repeatedly insisted no such

negotiations were taking place. And as the 5 days came to an end and bond yields began to rise

again, Trump chickened out again and extended his ultimatum another 10 days. There can be no more

blatant illustration of bumbling amateurism and strategic impotence than this humiliating capitulation,

while Iran ignored him and repeatedly denied that negotiations were taking place, continuing to

fire its trusted drones and missiles. 7. Expelling the US from the Middle East. Checkmark.

Perhaps the most important and remarkable geopolitical development in the war

is the de facto severe degradation and possibly even elimination of the US presence in the Middle

East. The exact extent of damage to US bases in the region is not clear, but after 26 days of

Iranian bombing, it is likely significant enough to have rendered them unusable. As the New

York Times reported, with the majority of US soldiers having been moved to European bases

or staying in civilian areas. Not only has Iran destroyed American bases, but it is also

succeeded in clearing US vessels from the Persian Gulf. The two aircraft carriers sent by the

Trump regime to the Gulf have stayed more than 1000 kilometers away, with the USS Lincoln hiding

in the wrong side of Oman in the Arabian Sea. While the USS Ford is in the Mediterranean,

undergoing repairs for a long list of suspicious problems, all possible explanations for these

problems are devastating to the idea that the US is a superpower, and the idea that they

suffered damage from Iranian missiles is the least bad. A worst possibility is that the boat is the

victim of sabotage from admirable soldiers who have decided their lives may be worthy of more

lofty goals than helping Zionists steal more land. But the worst explanation is the most likely.

The culprit is the incompetent engineering of the US military industrial complex,

whose only technological innovation in the past three decades has been to increase costs

by reducing reliability. Iran's entire military budget is less than the cost of one of these

carriers. What exactly is the point of spending billions of dollars on a giant boat that carries

many aircraft that need to have expensive living pilots trained to fly them over enemy territory

to launch air strikes? The most convincing answer seems to be that this is a great way to enrich

the military industrial complex. But if the actual goal is to achieve military and strategic

objectives, then swarms of cheap and unmanned drones and precision hypersonic missiles seem far

more effective, safe, and efficient. China's hypersonic missiles could hit any target on Earth,

more than what a US pilot, aircraft, and aircraft carrier can hit at a fraction of the cost,

and a tiny fraction of the time and risk since it doesn't require soldiers outside of China's

borders. The US is behind China, Russia, and Iran in these critical technologies because the

latter did not spend ten trillion dollars and a quarter century optimizing their militaries for

fighting militias and bombing civilian structures for Israel to steal Goyland and instead develop

the technology that can take on a superpower. Hypersonic missiles may turn out to be as superior

to aircraft carriers as guns are to swords. Since hypersonic missiles and guns allow you to

neutralize your opponent from afar, whereas the sword and aircraft carrier require you to get close.

Will aircraft carriers become as obsolete as swords in modern combat?

Iran has also focused much of its attacks on American radars, refueling tankers,

and AWACs, or airborne warning and control systems, which undermines air defenses and the ability

to carry out military attacks on Iran. The full extent of damage and its implications are

unclear so far, but the very precise targeting of high-tech essential equipment suggests a

deliberate, methodic, and cunning Iranian effort to blind and paralyze US operations in the region.

As the war goes on, this may come to be significant. The remarkable implication of the damage to

US bases and retreat of US aircraft carriers is that the US no longer has a functional military

presence in the Middle East from which it can project power. Destroying and removing US bases

from the region is a concrete and important objective of Iran's war, and reversing it will likely

require an enormous US military effort with a large number of casualties. Iranian attacks have

rendered American and host nation plans and hopes for these bases irrelevant. Whether they want

to keep them or not, there is no way to rebuild them without eliminating Iran's drones and missiles,

or obtaining the blessing of Iran, both of which are unlikely. Barring a quick turnaround in favor of

the US's Rayleigh War effort, the hosts of these bases may want to begin planning for life without

them. If the current status quo persists, with Iran maintaining its missile capacity,

its deterrence capacity, control of hormones, and with US bases dysfunctional,

we are entering a new Middle East, very different from what bloodthirsty Neocons have been

fantasizing about for 30 years. Eight, removal of sanctions, partial checkmark.

The most astonishing development of the war has been that the US has resorted to lifting some

sanctions against Iran while the war is going on. Probably the first time a country has removed

sanctions against an opponent, it is fighting. Iran's closure of hormones made oil and gas prices

rise worldwide, and that is politically unpopular in the US, as Americans do not want to pay higher

prices for energy, and the knock-on effects of an energy shock will be devastating to the US

economy. While everyone with a brain could have foreseen the closure of hormones, the US regime

clearly doesn't fit the bill, as they seem to have made no preparations for the very obvious

and publicly proclaimed strategy of Iranian deterrence. In an astonishing display of incompetence

and negligence, Trump was so taken by surprise at the Iranian response that his only methods for

dealing with it was to tweet angrily, demanding others send their navies and then to lift some

sanctions against Russia and Iran itself, to allow them to sell more oil onto the market and bring

the prices down, a verdict or at least delaying economic catastrophe. With the spike in oil prices

and the easing of sanctions, the Zionist war on Iran has gifted Iran a windfall of tens of

billions of dollars in oil revenue at the exact time the Iranian regime needs them the most,

and if the situation at Hormuz remains, then Iran will also be able to tax the entire

planet's oil, gas, fertilizer, and more. Israel's goals. One, end of Iran's nuclear program.

Question mark. Two, end of Iran's missile program. X. Three, state destruction. X.

Israel's achievements. Zero or one goal from three achieved. Israel, from its inception,

is a product of land theft, and its actions are only understood through that lens. Zionism built

an ethno-state on a land in which the state's ethnicity owned no more than 5.67% of the land

in 1945, which necessitated the mass murder and expulsion of Palestinians, which, contrary to Zionist

propaganda, started and was well underway, long before any Arab armies had attempted to intervene

to stop it. Around a quarter of a million Palestinians had already been murdered or expelled

before any Arab soldier had entered Palestine. With global support for the original sin that

was Israel's birth through mass murder and theft, Israel has continued to get greedier

about capturing more and more territory over time. Israel's eternal problem is that it is a state

operating by barbaric pre-civilized norms of behavior and morality. Where everything is allowed

for the in-group and nothing is beyond being done to the out-group. But at the same time,

it is a parasite entirely dependent on the civilized world subsidizing it. But the civilized

world has long moved past Israel's barbarism. This is Israel's duality that explains why it can

be so polarizing. If you judge Israel by its actions in the real world, you are shocked to realize

this is a country that legally allows murder, rape, theft, starvation, pogroms, and torture of

goyem, including children, purely for being goyem. None of these are exceptions or individual cases.

These crimes are fully sanctioned by the state because it does not prosecute the perpetrators,

no matter the abundance of evidence. It's a state that stole the vast majority of the land it

controls from its rightful owners and prevents them from ever going back to their land or even

purchasing it. Just because they were born to the wrong race, it continues to expel peaceful

people from their homes every day for no crime except being goyem. But if you judge Israel based

on the astonishingly good propaganda it uses to trick civilized Westerners into subsidizing it,

you will cry like an idiot at the thought of anyone not worshipping it. This dichotomy is what

explains Israeli policies. Israel would like to expel and murder millions of goyem to take their land.

But they realize that the support of the civilized world, including global jewellery,

would be endangered by such barbarism. So they need to be slower and more gradual in their approach.

Relying on repressing their victims to elicit a violent reaction, which then allows the Israelis

to carry out their mass murder and expulsion under the cover of self-defense. With a dose of

added atrocity propaganda, Israel can get Western nations to abandon foundational laws and values

to support it. The US, Europe, and all the hosts on which the Zionist parasite relies have

laws that ban their countries from offering aid, military cooperation, or even trade with governments

that target civilians and engage in torture. But these are brushed aside because of propaganda,

political manipulation, and blackmail. Israel is the only country in the world that does not define

its borders because its theft of land is still a work in progress. No where near done.

If Israel defines its borders to include all the territories it occupies, it becomes a Jewish state

where the majority of the citizens are non-Jewish. If it doesn't give its subject citizenship,

it becomes a more blatant apartheid model and makes it impossible for it to pretend to be

interested in peace for Westerners. So it keeps its borders vague so it can keep expanding them

and to work on slowly and surely murdering and expelling the goyem who live there.

Israel's immediate plans are to murder and expel as many Palestinians as possible from the

West Bank and Gaza in order to steal their land and make it formally part of Israel.

The majority of the West Bank has already been cleansed of its goyem who have been gathered

into ever smaller concentration camps where they are left defenseless for Israeli land thieves

and soldiers to murder, rob, and torture them within punity. The next step is to begin settlement

in parts of Lebanon and Syria that Israel is occupying now. Remember that the Zionist claim

for Palestine, after all, is based on ancient scripture that says that the land of Israel

extends from the Euphrates to the Nile, as America's traitor ambassador to Israel recently clarified.

If Messianic fundamentalists' interpretation of ancient scripture overrules the millennia

long property rights of goyem in Jaffa and Ramallah, the goyem of Cairo, Baghdad, Damascus,

and Beirut don't have to wait till settlers from Brooklyn show up to steal their homes to begin

worrying. The full extent of biblical greater Israel as seen on the uniforms of Israeli soldiers,

currently houses more than 200 million goyem in Egypt, Palestine, Jordan, Syria, Lebanon, Saudi Arabia,

Iraq, and Turkey. Many Israeli extremists also aim to destroy Islam's third holiest site

to build the Third Temple, and extremists even want to make sure to destroy all Christian churches

for idolatry. The irreconciliable difference at the heart of the Middle East is that the region's

goyem do not share Israel's view of them as an inferior species who have no property rights,

so they are not keen on making way for this Messianic project that would destroy their lives.

Israel can't just fight them all, especially as such blatant aggression would alienate the

Westerners who subsidize Israel's entire parasitic existence. Israel thus has to adopt a gradual

approach to its expansionist plans, undermining all regional opponents individually by sicking their

American golem on them and conquering more and more land. Israel's agenda for Iran was laid out by

the project for the new American century three decades ago, and the Hinan plan for decades ago.

This is the plan that Israel's puppets in the Bush administration told Wesley Clark

in November 2001. They would topple seven countries, Iraq, Syria, Lebanon, Libya, Somalia,

Sudan, and Iran. Six of these countries have been successfully turned into failed states,

and now it is Iran's turn to enjoy Zionist liberation through mass murder,

state failure, and fragmentation. The ultimate goal is to turn all the goy-nations of the Middle

East into small warring tribes, fighting each other with light weapons that cannot threaten Israel.

The goal is far more ambitious than mere regime change, because regime change in an intact

and armed country could still constitute a threat. This makes the goals of Israel in this war

more ambitious than America's, but unachievable without US military might. Israel cannot just get

Americans to fight an all-out war with the purpose of destroying Iran and turning it into Syria,

but Israel can gradually boil the frog by getting the US to commit to modest goals after whose failure.

Israel can push for more US involvement until the American golem is fully consumed in the quagmire

of destroying Iran. As Narco-Rubio made clear thanks to his astounding stupidity,

Israel told the US it would attack Iran, and the US decided to join because they assumed Iran

must retaliate against American bases in the region. And the American traders are incapable of

even contemplating the possibility of using the billions of dollars in money and weapons

Israel robs from Americans every year as leverage to persuade Israel not to attack or to consider

disavowing the attack and informing Israel and Iran that it would not intervene and they are on their

own. Iran would have been more than glad to keep the US out of the war and point its entire

missile and drone fleet at Israel whose air force would be unable to make significant strikes

without US aircraft carriers and regional bases. The mere prospect would have deterred Israel

from starting the war and America and the world would be in a far better place today.

Israel has used American soldiers and military bases and the countries hosting them as a human

and military shield to protect Israel from the consequences of its attack. Those of us who thought

the US could not possibly be more servile to Israel continue to be proven wrong.

The start of the war makes the power dynamic between the two countries clear.

Thanks to bribes, blackmail, propaganda, and possibly more, the American government is entirely

captured by the Israelis and has no institutional capacity to deny Beebe's carefully calibrated

requests. Israel gave Trump delusional intelligence that a decapitation strike would cause Iranians

to rise up and remove the regime, with the war over in a few days. Nobody in the US government will

hold them accountable for their lies. This was the foot in the door Israel needed and now the war

takes on a life of its own. Israel will hope the same easily manipulable administration will keep

pushing the US to continue escalation. This likely explains why they assassinated larjani

as he would have been more likely to negotiate a deal with Trump. This explains why they escalated

dangerously by targeting the parse gasfield, which Trump had to disavow in fear of Iranian retaliation.

It also explains why they hit a desalination plant in Iran. They're not done, and it would not be

wise to bet against them getting the escalation they want. Even though Israel has not achieved its

objective so far, it is important to remember that Rome was not destroyed in a day, and they are

diligently working on it. Iranian deterrence

In summation, after one month, Iran has achieved most of its objectives. The US and Israel have not

achieved their substantive goals and have suffered serious setbacks compared to the pre-war situation.

With the degradation of the US presidents in the Middle East and Iranian control over Hormuz,

Iran's achievements are relatively sustainable, as long as it can keep firing its cheap,

plentiful, and well-hidden drones and missiles into US bases and unapproved Hormuz traffic.

It can maintain most of its gains so far. On the other hand, there's no easy way for the

Zio-Pido regime to snatch this victory from Iran. If the US wants to reverse this status quo,

it needs to eliminate Iranian drone and missile threats. The Epstein coalition likely already

targeted all of its important and consequential targets in the first few days, and if these didn't

achieve the intended objective, then the continued bombing of less important targets is unlikely

to achieve much. Especially since the conventional military targets are unlikely to materially

degrade the well-hidden missiles and drones on which Iran's strategy relies.

Bombing civilian targets will only strengthen the regime and further undermine the legitimacy

of any opposition. Iran has also successfully established a degree of deterrence, at least for now,

as it still has several layers of escalation it can unleash. When it threatened to target regional

energy infrastructure, it got the US to commit to not target its energy infrastructure.

Iran could also get their Houthi allies to close Bob Al-Mandeb in Yemen, which would be a huge

disaster for the global economy, exacerbating the Gulf energy crisis by limiting exports from the

east of the Arabian Peninsula. The longer the war goes on, the greater the disruption to the global

energy and food industries, and the more devastating the economic consequences worldwide.

Not only does 20% of the world's oil and gas pass through Hormuz, but also a sizeable

percentage of the world's fertilizers and essential industrial chemicals. As I discuss in detail

in my principles of economics, hydrocarbon fuels are essential to our modern life, and a Hormuz

supply disruption would cause massive economic devastation, especially to the world's poor.

The disruption to fertilizer supplies would make this much worse, potentially resulting in

famines, and the shortages in industrial chemicals will also wreak havoc with global markets and

industry. I suspect Iranians think that time is on their side. Iran knows Trump can't handle

high oil prices, and they know he can't handle high treasury yields. They know that he and his

base care about this war about as much as they care about his mean tweets mocking Democrat

nobody's. IRGC knows that practically no American is willing to sacrifice anything for fighting

Iran, and they know the only Americans who support this war are the morons who think it will cost

them nothing, and the Israeli agents scamming them into thinking that. Iranians know that as soon

as the cost of the war starts showing up for the average American, the war, Trump, and Israel

will become unspeakably unpopular. They have also tried negotiations and realized that this

Israel-owned regime operates by pre-civilized war standards, where negotiations are used as

cover for murdering the negotiators. They may very strongly believe there is no point in negotiating

and will keep pushing. Israel's non-stop assassination of top leadership seems designed to ensure

this outcome and further entrap the US. Trump's inept strategizing has left him with few

carrots and sticks to try to achieve his favorite outcomes. He has already removed some of the

sanctions he placed on Iran, and showed Iran that three weeks of war are more effective for

sanctions relief than four decades of negotiations, and he's adopted Israeli diplomatic etiquette

by bombing the Iranian leadership during negotiations. The new leadership is highly unlikely

to trust him. He's already exhausted his most important aerial bombardment targets,

and his aircraft carriers are too petrified to come near the Persian Gulf limiting their effectiveness.

Perhaps even more significant than the impact on energy markets is the impact on the US government

deficit. The longer the war drags on, the more it costs. The more likely the US is to experience

insolvency and the more likely the dollars to be devalued and destroyed. The oil crisis exacerbates

this. Since the war on Iran began, the 10-Y yield has risen from 0.46 percent to 4.42 percent.

The rise in yields translates into tens of billions of dollars in higher debt service payments

for the US government and much more for the entire world economy, which uses treasury interest rates

as the risk-free base rate. When you add the hundreds of billions or trillions, likely to be spent

on the war and the impact of an energy shock, the US fiscal situation looks even more precarious.

The higher these rates rise, the more likely defaults and bankruptcies will be across the US

and global economies, creating unemployment and recessions, and requiring more government

handouts and inflation. In his last erratic heubristic catastrophe, Trump backed out of his tariff

tantrum when the 10-Y yield hit 4.5 percent. I predicted he might chicken out of this war as he

did with tariffs when the 10-Y yield hits 4.5 percent. And indeed, at around 4.44 percent,

he chickened out of his threat to destroy Iranian power plants if they don't open Hormuz.

Claiming to have made good progress on negotiations with Iran, and giving them an extra five days

to negotiate. Six days later, Iran continues to deny that any such negotiations have taken place,

and there is nothing concrete on the ground to suggest they have.

Now for a quick word from our sponsors.

The Bitcoin Standard Podcast is brought to you by TheSafeHouse.com, my independent publisher and

bookshop, selling the best Bitcoin books and high quality cloth hard covers built to last for

generations. Most books these days are pretty fiat, they're flimsy and they fall apart quickly,

and I did not want that for my books, so I set up TheSafeHouse especially to provide you with

beautiful long-lasting classic cloth hard covers you can proudly pass down for generations.

You can get copies of my three books, The Bitcoin Standard, The Fiat Standard and Principles

of Economics, and you can also get copies of Lynn Alden's broken money, Parker Lewis's

gradually then suddenly, and Matthew Lishyak's Fiat Food, to which I contributed a few chapters.

We now offer bulk discounts so you can buy books for yourself and for the friends and family

you'd like to learn about Bitcoin. Buy any two books for $50, any five books or more for $20

per book, and for more than 50 books, it's only $15 per book. Go to TheSafeHouse.com,

the SAIFHouse.com, where you can get all of these books in high quality cloth hard covers,

delivered worldwide, and yet 10% off for paying with Bitcoin.

This podcast is also brought to you by The Bitcoin Way, your professional Bitcoin IT team,

offering you personalized, secure, and comprehensive solutions for every step along your Bitcoin

journey. The Bitcoin Way offers live concierge service to guide you with your Bitcoin cold storage,

running your node, privacy best practices, inheritance planning, corporate strategy,

and multi-sick solutions. They don't touch your coins, they guide you through the process of

acquiring your coins and securing them. If you'd like to make your setup safer and more reliable,

book a consult with them and see what they have to suggest. If you want to give someone the gift

of Bitcoin, get them this professional service that will ensure they start off knowing exactly how

to manage their coins and not lose them. Go to TheBitcoinWay.com and start Bitcoining more confidently.

Run by another 10 days. At the close of the week, 10Y crept up again to 4.42%. This pathetic

backtracking on empty threats shows a man out of his depth. In a world he doesn't understand,

flailing cluelessly, bluffing, blustering, vastly overestimating his strength, and utterly ignorant

of his enemy's weapons and strategy. Persians have a national average IQ of 105, by some measures

one of the highest in the world, and the highest outside East Asia. Persians invented chess,

but Trump's strategic thinking and relentless bullshitting and blustering suggest the three

card monty is the most sophisticated and honest game he's ever played. In the face of these

enormously unfavorable realities, Trump is changing his objectives. He's no longer talking about

regime change or unconditional surrender. He is instead seeking to negotiate with the regime,

and even boasting about making good progress, even as they deny any contact. He has gone from

wanting to eliminate Iran's missile program to being more tolerant of it. The new and more

modest goals of the USSR, revised US goals, opened Hormuz, and the nuclear program.

The US strategy now focuses on opening Hormuz, which was the status quo before the war started

in February 2026. If, after a month of the war, you started, you are fighting to recreate the

conditions you had before the war started, then you lost. Perhaps the most tragicomic and telling

aspect of this war is how, in all of the US administration's tantrums about Hormuz, blaming and

dumping the problem on everyone, none of them once suggested that Israel get involved in trying

to open the strait when it was the country that started the entire war. Trump lost his first

Iran war and is now faced with the choice of accepting defeat and cutting losses or fighting a new

war with new objectives, where he is in a far less favorable position because he has no more

Middle Eastern bases, lower domestic support, and more fragile and nervous markets. The first

option could give America its Suez moment, the second its Waterloo.

De-escalation and Suez. America ending the war now would be the smartest thing for Trump to do,

as it would end the energy crisis, reduce the fiscal burden on the US government and prevent

treasury yields from continuing to rise. This isn't so politically difficult since Trump isn't

running for re-election, and his core supporters are cultists who will venerate whatever he does and

call it genius. But accepting defeat cements the status quo, it seeds Hormuz to Iran, which will

impose attacks on the world's oil consumers, and the legacy of this war will be that it made the

whole world subsidize the regime Trump sought to overthrow. American regional bases will never

be rebuilt. Both developments will cement Iran's status as the regional superpower, and Gulf

oil producers will have to win Iran's good graces to sell their oil. Iran will likely never

again enter into the non-proliferation treaty and will likely develop a nuclear bomb.

Iran may not get reparations or sanctions relief in this scenario, but the new oil income and

regional dominance will make up for that. Such an outcome would likely constitute America's Suez

moment, in reference to the 1956 Suez crisis, which effectively ended the British Empire and

concluded the process of British decline that began with World War I. Even though this sounds

bad, it would be a blessing to the American people who get nothing from their governments for

an adventures, but inflation, taxes, poverty, and enemies. The US would lose all influence in the

Middle East and beyond. If China chose to invade or impose a blockade on Taiwan, it would be very

difficult to see the US being able to help. If all of the US military assets in the Gulf have failed

to defeat Iran, what hope do they have against Russia or China? Russia, China, and other smaller

rivals, will be emboldened to take on the US or its regional allies. The EU might even begin to

assert itself after the incredible abuse it has sustained at the hands of the US regime,

from destroying Nord Stream to Trump's tariffs' shakedowns, to threatening the takeover of Greenland.

But a US capitulation is too dangerous for Israel, as it leaves Iran in control of Hormuz,

with the ability to build better and stronger missiles and drones, and forces Gulf regimes to

realign with Iran if they want to export their oil. Israel's vice grip on American politics

makes it very difficult to see Trump capitulating and leaving Israel to fend for itself in a sea of

people who are not fond of their messianic land theft, with Iran as a regional superpower eager

for revenge. Incidentally, Israelis and Americans may want to familiarize themselves with what Iran

did over four decades to avenge Iraq's invasion of Iran in the 1980s, to get an idea of the horrors

that await them from kicking this hornet's nest. The same forces that got Trump into an idiotic war

that doesn't benefit America in any way whatsoever can also get him to foolishly escalate it at

devastating cost. Observing America's Israeli media agents recently makes it clear that escalation

is Israel's agenda, and they are adopting the usual incremental war-mongering strategy.

They begin by promising a quick, decisive victory. But when that doesn't materialize,

the failure is used as proof that a more aggressive campaign is needed. Most Americans are no longer

stupid enough to fall for these predictable tricks, but their government is.

The next bait Israel has laid for Trump seems to be to conquer islands or coastal areas

near the strait of Hormuz. That would almost certainly achieve none of the war's objectives,

but it would turn American soldiers into fish and a barrel, with drones and missiles raining

from mountains enveloping 270 degrees around them. One of Israel's most loyal servants in the Senate,

Lindsey Graham, in his attempt to sell this idea to the American people, likened it to Iwo Jima,

which killed 26,000 U.S. soldiers. This helps explain why none of the war cheerleaders is suggesting

sending precious Israeli troops to open Hormuz, as such dangerous jobs are only for goi slave soldiers.

The potential for casualties in this case exceeds anything the U.S. has experienced since Vietnam.

If this attack happens and a large number of Americans are murdered or captured by Iran,

then Israel's agents in the U.S. will capitalize on American anger to escalate further.

We have already seen Israeli mouthpiece rag Wall Street Journal make this argument,

eventually escalating all the way to a ground invasion or a nuclear attack.

Escalation and Waterloo

If Trump refuses to accept the Suez ending of this war, he opens himself up for something far more

devastating. Waterloo, an aggressive military push to defeat Iran could fail and bring with it the

economic, military and political destruction of the U.S. empire. The only powerful lever of escalation

left to secure Hormuz and achieve regime change is an overwhelming ground invasion to secure the

Iranian coastline and or overthrow the regime. A ground invasion would not succeed if limited.

It would need to control and completely comb the entire coastal area of Iran and likely invade

Taran, a city of 10 million people. Such an undertaking may require the greatest U.S. military

efforts since World War II. The cost in money and lives will be enormous and the outcome far from

certain. Iran is an enormous country the size of Western Europe with rugged and impenetrable mountain

terrain and a population of 93 million larger than Iraq and Afghanistan combined. Iran is also far

more militarily advanced than Iraq and Afghanistan and there is no way of dealing with Iran's drones

and missiles without sustaining significant damage. Iranians have been preparing for this war

against America since 1953 and the war so far shows that they are better prepared than the

American buffoon who started the war because his Israeli owners lied to him and told him it would be

as easy as Venezuela. And when that failed he had to scramble and sent soldiers and air defenses

to the region to face the ferocious Iranian response. But beyond the deaths of soldiers the impact

of escalation is likely to be devastating to the U.S. and world economies, to U.S. global military

dominance and to the U.S. dollar. Escalation will send treasury yields higher and increase the

fiscal pressure on the U.S. debt and GDP is already approaching banana republic levels and debt

servicing is already the largest part of the U.S. budget. Escalation of this sort is unlikely to

leave Iranian and Gulf energy infrastructure intact, destroying large percentages of the world's

energy supply, causing an energy and poverty crisis. The escalation will also likely disrupt

Hormuz traffic for a long period of time, resulting in devastating damage to the U.S. and world

economies. This could unleash a recessionary inflation worse than the 1970s, whose energy shock

was actually tiny and mostly a cover-up for inflation. As I explained in the Fiat standard,

with high inflation to fund the war, supply disruptions that cripple economic activity,

rising interest rates, destroying businesses, a collapsing bond market, destroying savings,

growing unemployment, increased pressure for inflationary and welfare policies to counter the

damage, and rising cost of debt servicing. A U.S. default is not an outlandish possibility in

this world. It may even be probable, and it would be devastating to the U.S. government,

the U.S. dollar, and the countless suckers who believe that U.S. bonds are a good saving instrument.

If the Treasury market loses its status as the ultimate safe haven, the dollar will likely

lose its status as the global reserve currency, and America's exorbitant inflationary privilege

will disappear. Further, if Trump escalates against Iran, his military will be stretched to the

point where it would be very difficult for it to engage elsewhere, opening it up for significant

geopolitical setbacks. It is already bordering undilusional to hear Americans talk about China

being an enemy, because if America were to start a war in China's surroundings,

Chinese hypersonic missiles could quickly and decisively end the war, as a leaked Pentagon report

explains. Without hypersonic missiles, the U.S. is at a severe disadvantage. With an expensive and

protracted quagmire in Iran, the U.S. would be even more vulnerable. The U.S. has no reason to be

involved in this war at all, and the only sane course of action for it is to evacuate all its

troops from the Middle East, stop giving military or economic aid to any government in the region,

and establish normal diplomatic relations with them and no alliances. But Israel is in control of

America, and Israel needs the U.S. to prosecute this war until it can destroy Iran as a society

and a country, and to turn it into a post-apocalyptic wasteland. Iran, on the other hand,

needs to make the cost of the war unbearable for the U.S. before the U.S. can destroy Iran.

Given that Trump isn't running for reelection and isn't a die-hard Republican who cares about

the party after him, it won't be political pressure that moves him, and given that his family is

likely making incredible gains from his manipulation of the market, selling pardons, and being

Miriam Adelson's perfect little puppet. He's unlikely to be moved by moderate inflation and

growing deficits. Iran will have to impose an enormous military and economic cost before the U.S.

retreats, which means very high inflation, a devastating depression, and or a fiscal crisis.

In conclusion, the choice facing Trump today is very difficult, and it is between bad options.

Deescalation is a humiliating defeat unacceptable to his Israeli bosses, even though it would be

much better for America and the world. Escalation risks economic catastrophe at home and worldwide.

The destruction of the U.S. empire, a fiscal crisis, high inflation, and maybe even hyperinflation.

Tragically, Israel's control of the U.S. means there is likely no end point to this conflict,

except through the destruction of Iran and its plunging into civil war, or the destruction of

the U.S. economy with tragic consequences for billions of people. We could also end up with both.