OIL BOURSE

While a regional Oil Exchange attempted by Dubai failed, partly because they play by international rules and monetary exchange norms, Iran's Bourse, in Euros or in barter trade agreements and Hojatieh willingness to sacrifice the world and its own people to achieve its religious ends of bringing back their 12th Imam, presents a special set of givens. Specifically in the area of damage to world financial stability, as opposed to a conventionally deemed "successful", venture for Iran .

Experts from the International Petroleum Exchange (IPE) and New York Mercantile Exchange (NYMEX) have apparently already confirmed the feasibility of the project, bearing in mind Iran 's much greater reserves of petroleum products with which to operate and weight the market.

Realistic argument posits that the Iranian oil fields are old and require huge investments to continue production or to keep them at anywhere near current levels. New oil fields will take time to come online and hamper the speed of Iran 's negative activity. In addition, Iran's natural gas fields, the second largest reserve in the world after Russia, have yet to be developed fully and cannot provide a big enough supply to make a significant immediate difference in the markets.

Because U.S. sanctions on the sale of American technology to Iran, the most modern systems for effective, large scale liquefaction of natural gas have been denied to Iran and hampers their ability to bring important liquid natural gas prominently into the mix.

While the Bourse may be wishful thinking as a constructive revenue source for Iran , according to Western standards of logic and assessment of success, missing from the equation of production targets and capability is that oil-currency - not oil or natural gas itself - is the principle fulcrum and danger factor.

If the Euro became the reserve currency and choice of oil producing countries, the U.S. would have to purchase Euros to purchase oil, the reverse being the case today with countries having to pay a "Dollar Tax" to buy oil in dollars.

Experts agree the effect over only a very few years would be devastating to the status of the dollar globally. Then, Euros (in their role as petro-currency) would affect the U.S. Dollar, U.S. economy and the interest rates America must offer to attract buyers. Former U.S. Reserve Chairman Paul Volcker has already placed the likelihood for a Dollar crash in the next five years at 75%.

The Iranian Oil Bourse's trade in Euros instead of dollars could possibly hasten the crash and the percentage of likelihood. Some feel Volcker was unable to assess Federal Reserve matters knowledgeably but with experts like George Soros and Warren Buffet putting their own billions into betting against the dollar, Volcker's comments gather strength.

If major oil and natural gas supply and trade quantities become easily available only in Euros or barter, Central Banks will have ever less reason to overstock their portfolios with U.S. currency and will eventually begin replacing unwanted Dollars with necessary Euros, unleashing a dollar decline of great proportions.

Any crash would bring Iran, with a wealth of oil and natural gas reserves with which to barter with China, Russia, India and Far East nations, to the fore as a new superpower, in a future scenario where money or devalued currencies might have much less, little or even no value.

The latest flavor of Islamic Republic would suffer only tangentially and try to obtain all their needs through barter or exchange. Their life styles would remain similar to what they had until very recently as military men and whether the populace is unhappy – preferably so for the Hojatieh – means little or nothing in their big picture.

At very best, the USA would enter another Carter administration era financial pattern:

1. Interest rates were so high nobody could afford to finance a house, so this market sector, like many other big-ticket items such as automobiles, slowed to almost a halt in some instances.

2. Grocery items had multiple superimposed price stickers as the cost of goods rose faster than customers bought them. Imported retail merchandise normally sells or distributes through national chains like Walmart or food chains, so a drop in the dollar makes these more expensive for the buyer and leads to layoffs as the retail chains find their sales volumes and profit margins eroded.

3. The price of energy shot up so much people resorted to wood burning stoves to stay warm at a price they could afford. The quality of life went down.

4. People on fixed incomes could no longer afford to live and the more solvent could not keep abreast of rising prices and interest rates. A drop in the dollar immediately cuts into the value of saved money.

5. Running a business became almost impossible as the price of goods and materials skyrocketed. Sales to a greatly less solvent market plummeted and marketing assumptions needed for advertising, budgeting and planning became wild guesses at best.

What might happen if the dollar devalued rapidly? Global ruin.

With economies so interdependent and interwoven, a global not just American Depression would occur with a domino effect throwing the rest of world economies into poverty. Markets for acutely less expensive US exports would never materialize.

The result, some SME's estimate, might be as many as 200 million Americans out of work and starving on the streets with nobody and nothing able to rescue or aid them, contrary to the 1920/30 Great Depression through soup kitchens and charitable support efforts.

Iran would most likely intentionally sabotage any return to stability and market balance/adjustment with their fossil fuels; their newfound nuclear deterrent probably discouraging use of force against them until too late.

A close look shows Ahmadi-Nejad holds the key to throwing the world into the tribulations of the Weimar Republic of Germany after World War I. High inflation and interest rates drove the value of the Mark into the ground and allowed Hitler to present himself as a savior.

To provide an adequate cash flow to the working class, Hitler promised to pay them once a week, then twice a week, then once a day. When this failed, he allowed workers two hours off work every day to trundle wheelbarrows full of German currency, which barely sufficed to buy a loaf of bread.

Iran succeeding in unlinking the Dollar as the primary currency for oil purchases, were it to occur, creates the same outcome for the USA and consequently within short time frames for the rest of the civilized world.

To deny history repeating itself with Ahmadi-Nejad's Hojatieh minded governing group filling in for Hitler, suggests a refusal to face and counteract an indescribable menace beyond the reach of Western logic but totally in alignment with this specific brand of Islamic fervor to intentionally create an apocalypse. Then to impose Islamic rule on a shattered world.

CONCLUSION

Apart from the use of nuclear arms by the West to bring down the new regime in Iran, only an internal effort by the old-guard Ayatollahs to overcome Ahmadi-Nejad and his allies, at the clear risk of a civil war they would lose, has a hope of preventing a potential global Depression.

Few other counter measures come to mind. Mostly because of the shortcoming of the global "family" of nations to withstand mindless nihilism and an untrammeled desire to destroy in the name of their 12th Imam.

When Iran 's lately announced pull back from subsidizing refined gas prices domestically and import of this fuel takes hold on the population, who will suddenly be unable to afford to operate vehicles, the dissatisfaction could translate into riots and open a new window to remove the Islamic regime of whatever flavor.

In-depth bombing, specifically of all Iranian military and nuclear facilities at that time – possibly the 5,000 locations mentioned above – would weaken or remove any government ability to suppress the riots and allow a smooth overthrow of the current regime.

The unanswered question – as was the case in Gulf War I with Iraq and Saddam Hussain – will be with what or with whom to replace it.

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