Throughout history there has always been a war going on somewhere, so it is nothing new that right now there are many pockets of the world currently embroiled in violence and unrest.
But it is when grander dialogues emerge that those small pockets of conflict take on greater significance. When those conflicts shift from being about territory and resources to being about ideologies, philosophies, and human rights, they begin to take on an epic, historical narrative for their participants. The stakes become raised and the momentum towards potential war snowballs to inevitability.
Several troubling events of the past year indicate that we could be moving toward a widespread global conflict in the near future. No one is really sure just how quickly that momentum will build. It could happen very fast or it could take years. What we do know is that going by recent trends, as each day passes, we move closer to the brink.
While the East and West vie for economic and nuclear dominance, the Islamic Caliphate is trying to incite another Crusade and literally bring about the apocalypse.
Secret currency wars are being waged to manipulate economic growth and Central Bank policies have left markets and assets over-inflated. Unemployment is reaching catastrophic levels across parts of Europe and the United States.
The meltdown of 2008 was foreshadowed by the Fed raising rates. They are expected to do so again later this year. When that happens, we could be facing a much bigger crisis this time and any sense of “recovery” will be far more difficult to regain.
World War II pulled us out of the Great Depression. Will World War III pull us out of the next one? When will we hit the breaking point and what will spark the fire?
The proxy war in Ukraine continues to escalate and a cease-fire agreement made last week was broken almost immediately.
The uprising in Ukraine is being framed as a rebellion of ethnic Russians fighting for their independence from the fascist, Neo-Nazi government of Ukraine, but the real reasons behind the war have little to do with ethnic origins and more to do with the location of NATO military installations.
The U.S. and NATO want to continue their program of placing missile defense systems in all of the countries bordering Russia. Russia is continuing to push back by slowly retaking the territory of the former Soviet Union.
They started in Georgia in 2008 and last year they took Crimea. Now they are focused on the rest of Ukraine. The recently constructed $1B airport in Donetsk has been completely destroyed and this week it was reported that the town of Debaltseve was the latest to fall to rebel control.
The U.S. claims that the separatists are being supported by the Russian military. Russia claims that the U.S. is supporting the fascist Neo-Nazi government in Kiev. Major media outlets for both countries have been pumping out propaganda at such a frenetic pace that the truth of what is happening there, who is supporting who, and what the motivations are, remains shrouded in fog.
Sanctions have been useless. Some intelligence analysts have put forth the theory that the sanctions aren’t actually punishment for the takeover of Crimea and invasion of Ukraine, but punishment for Russia’s sovereignty.
The same has been said for the suppression of oil prices. Both have hurt the ruble, but it is the fall in energy prices that has hurt the currency the most. The price of oil and the ruble have fallen by more than 50% since July of 2014.
When the ruble began its decline, many predicted Putin would tap into the country’s gold reserves. He didn’t. Instead, he bought more gold.
And when the ruble took its biggest plunge in December of last year, Russia increased its gold reserves for the 9th straight month.
It certainly looks like they are preparing for something. It could be all-out war or it could be a move to back the ruble with gold. Either action would have colossal ramifications for the West.
A move to back the ruble with gold would stop its decline immediately and obviously be a safer bet than war, but it would still be a bold gamble. If the ruble was fully convertible into gold, it could cause a run on the currency similar to what the Swiss Franc experienced last month and quickly deplete Russia’s gold reserves.
A smoother transition would be for the BRICS’ New Development Bank to create its own version of the SDR while at the same time have those countries shift to a partially gold-backed currency. The economy of Russia may be weak but the country’s monetary policy is sound. Russia has a low debt to GDP ratio and most of its foreign-held debt is privately owned. The country has been able to drastically reduce poverty since 2001 and now has a middle class that makes up over 80% of its population. By contrast, the United States’ middle class makes up around 45% and continues to shrink.
A conversion to a gold-backed currency would be easier for Russia than the U.S. or other countries because they have little debt and a sizable gold reserve. If the switch was timed with China, it could gut the value of the dollar.
Both the U.S. and Russia seem to be pushing for all-out war. U.S. Senator Jim Inhofe released faked photos last week of Russian tanks inside Ukraine. The photos turned out to be from the 2008 invasion of Georgia.
Putin has been saying for months that the U.S. has been sending arms (and some believe special forces) to Ukraine, but yesterday it was confirmed. CNN reported that the U.S. was sending in a fleet of A-10 Thunderbolt “Tankbusters”: “Thunderbolts would be deployed to Spangdahlem Air Base, Germany, as part of Operation Atlantic Resolve, which was formed after Russia’s intervention in Ukraine. The Air Force is increasing rotational presence in Europe to reassure our allies and partner nations that our commitment to European security is a priority,” said Lt. Gen. Tom Jones, vice commander, United States Air Forces in Europe.
Additionally, last week Russia was conducting military exercises in the Eastern Mediterranean, near Greece and Cyprus, and practicing bombing runs in Russia, just outside of Ukraine. Cyprus recently granted Russia access to military installations and other resources on the island.
Before the 2008 crisis, Russia invaded Georgia. Some have speculated that Putin could be waiting until the U.S. is distracted with the next economic crash or a war with ISIS before waging a full-scale invasion of Ukraine. This notion is troubling because a multi-front war would strain the U.S. military and many economists have been warning for months that another economic crash is unavoidable for the U.S.
The stock market has been hitting record highs despite several indicators that we are in serious trouble. We have had a consecutive two month drop in retail sales and the wholesale inventory-to-sales ratio is at its highest level since 2008.
A recent spike in 10-year treasury yields showed a jump of 21% in less than 2 weeks. Such a rapid rise generally indicates the market is approaching a peak. Last month, the Dow had its worst month since January 2014.
Despite media reports to the contrary, there is massive unemployment around the globe. Austerity protests have been happening throughout Europe and a Greek exit from the euro (Grexit) could spark a domino effect that causes other countries to finally pull out as well– that could mean the end of the euro, once and for all.
Greek’s finance minister, Yanis Varoufakis has stated explicitly that he is unwilling to compromise with the troika of the IMF, ECB, and eurozone. At this point it seems that a Greek exit from the euro is not only possible, but likely.
If that happens, and the euro does fail, the IMF’s SDR (Special Drawing Rights) will become weak and unbalanced, causing the dollar to strengthen. A stronger dollar will further hurt US exports.
If Greece decides not to work with the IMF or ECB, it could be bailed out by BRICS’ New Development Bank or by Russia or China individually. Two weeks ago, Greek Prime Minister Alexis Tsipras met personally with Putin.
For the past year or more, Russia has been meeting with various countries of the Eastern Hemisphere to broker currency swap agreements and further distance themselves from the dollar. The biggest alliance has been through gas deals with China, but in the past few weeks, Putin has been diversifying his alliances away from China by meeting with India, Japan, and other major players in the East. The country seems to be hedging its alliances and shoring up its foreign currency, gold, and oil reserves to further distance itself from the U.S.
China, Russia, India, Germany, the Netherlands, Venezuela, and others around the world have also been rapidly increasing their oil reserves, repatriating their existing gold reserves and purchasing more gold as quickly as possible; all of this is behavior that is typically associated with preparations for a forthcoming war.
In the past 50 years, there has only been one other year that countries around the world purchased more gold than they did in 2014. Russia has increased its gold buying for the past nine months straight.
Russia and the U.S. have also both been rapidly trying to upgrade their standing nuke arsenal and according to RT news, in the year 2012 alone, Moscow constructed more than 5,000 NEW fallout shelters.
In January, the Bulletin of Atomic Scientists moved the hands of the “Doomsday Clock” to 3 minutes until midnight. According to Scientific American, “the clock is a visual metaphor to warn the public about how close the world is to a potentially civilization-ending catastrophe.”
While all of this has been unfolding, ISIS has continued to strengthen the Caliphate and provoke the West. Every week new videos and reports surface of captured westerners being beheaded, set on fire, or buried alive. Obama has asked Congress for authorization of force against ISIS including a limited number of troops for ground operations. The Qur’an explicitly states that the apocalypse will come when the Roman army (which some interpret to be the West) is defeated by ISIS outside of Dabiq, a town on the border of Syria and Turkey. The Islamic State has been preparing for the conflict and trying to coax the U.S. and coalition fighters into battling them there.
Obama has granted permission for “moderate rebels” in Syria to call in the U.S. Air Force’s B1 Bombers as air support.
Egypt has attacked ISIS in Libya and Jordan has pledged a relentless war against the Islamic State.
The Atlantic published a story this month about “What ISIS Wants” consisting of interviews with various spokesmen of the Islamic State. The article said in no uncertain terms that the new Caliphate is not just willing to die, but is trying to bring about the apocalypse and the end of the world as we know it.
All of this means that the fighting in Iraq and Syria is no longer a war over oil, but a Holy War over greater ideologies and religious control of the region.
The difference between Al-Qaeda and ISIS is that ISIS has re-established “The Caliphate” or official nation-state of Islam. The group is operating under the precept that they are directly fulfilling the prophecies of Mohammed, who put forth the frightening notion that: “The Last Hour (of history) would not come until the Romans land at (either) al-A’maq or in Dabiq. An army consisting of the best (soldiers) of the people (the Muslims) of the earth at that time will come from Medina (to counteract them).”
Let us hope that the U.S. groundtroops don’t experience a setback at Dabiq.