posted on June 21, 2004 10:32:05 AM new
Unsettling signs
Posted: June 21, 2004
1:00 a.m. Eastern
Vox Day
For the last three months, contrarian economists have been looking at the Fed's wild and crazy increase of the M3 money supply, which has been jacked up by $1.4 trillion since January, and wondering what in the world is going on. It has led some to conclude that the Fed is aware of an imminent disaster approaching as the Fed usually only cranks the printing presses up to high after an event like 9-11 or the 1987 Long-Term Capital Management disaster.
But what sort of event can you expect and plan for months in advance? Consider the other evidence. Last November, during a visit to Washington, Israeli Defense Minister Shaul Mofaz warned that Iran would reach a "point of no return" in its nuclear program within a year. On May 6, the House of Representatives passed a resolution to authorize pre-emptive military strikes against Iran, 376-3. On March 10, France, Germany and the U.K. "sharply criticized" Iran in a resolution presented to the United Nation's atomic agency, which is rather more than the cheese-eating surrender monkeys and the schnitzel-snarfing stormtrooper spawn were willing to do to Iraq.
Such developments make the assertion of the anti-war Sydney Morning Herald appear less stratospheric, as it has claimed that a plan for an Iranian invasion was completed last May, involving attacks from Georgia and Azerbaijan as well as Iraq. Debka, an Internet news site which throughout the Iraqi war demonstrated itself to be rather more credible than the mainstream newspapers, noted on June 17 that Iran was building up its forces along a 350-km stretch of its border with Iraq.
Now, all of this could be much sound and fury signifying nothing. It's entirely possible that, as one old trader told me, George Bush simply grabbed Alan Greenspan by the collar and said: "Look, you old fraud, you're not going to sink me the way you sunk my father" and ordered him to keep the money spigots open. Easy money in an election year is not a new concept, and it's not as if we invaded North Korea – another card-carrying member of the Axis of Evil – for the crime of possessing nuclear weapons either.
It is hard, though, to shake the notion that all of these tiny tremors and discordant sounds do not harbor some degree of chaos ahead. Having finished an uncharacteristic period of reflection following the loss of our late, great president, we are back to the throes of the silly season and a return to the never-ending love triangle of Bill, Hillary and Monica. Ah, if only Hillary would leave Bill for Monica – then our joy would be complete.
There are those market technicians who worship at the altar of Fibonacci, that Golden series of numbers. For months, they have been projecting June 15 as either a significant top or bottom, and now that the date has finally arrived, the consensus appears to be that it would appear, given the state of the market, to be a top. If they are wrong, we'll know soon enough, if not, then perhaps we will discover why the Fed has been printing all that money.
In any case, June 30 is not all that far away from June 15, and it would certainly be interesting if President Bush were to announce that American troops were going leave Iraq ... as they moved next door into Iran.
While I have no objections at all to the forcible prevention of nuclear proliferation, especially with regard to terror-sponsoring states that direct murderous groups like Hezbollah, I do seriously question the wisdom of presenting the expansion of the war to a third nation-state without the involvement of the American people. It seems to me that if there is any likelihood of an attack on Iran – and it is entirely possible that there will be no such action – that there will be no avoiding the reality of a global clash of civilizations that the administration has been attempting to sweep under the carpet since 9-11.
