Slouching toward a small Armageddon

There are three brewing disasters developing simultaneously:

1. A possible war with Iran.
You see it coming. The US govt is trying to discourage Iran from building atomic bombs with sanctions. The sanctions aren't working. For one thing, the sanctions are being ignored by China and the Europeans and for another, the Ayatollahs do not care how much their economy is hurt. Iran is now enriching uranium to 20% and when they have enough, they will test a weapon. For the US, Iran having nukes is a nigthmare of proliferation, but for Israel, it is an existential question. The US has moved an anti-missile defence system into Israel, anticipating that Iran (like Saddam) will launch multiple rockets into Israel. Iran is threatening to close the Straight of Hormuz and when that happens, it's bombs away.

2. Europe marching toward financial calamity.
A possible Greek default is on again. What now? Remember the agreement negotiated between Angela Merkel (Chancellor of Germany) and French President Sarkozy? The Agreement was to have lowered Greek indebtedness by a "haircut" of European banks - meaning a partial default of Greek debt. Well, the banks decided not to take the deal.

The European Central Bank has digitized over 500B Euros into existence, but a Greek default will set off a chain reaction of defaults of banks that can be papered over only by further digitizing of Euros. The Euro has been falling, which has been driving up the US Dollar and keeping gold and silver in check. Following on the heels of this financial uncertainty, S&P downgraded half of the European states and put the rest of them on watch. This will put a further pressure on European economies by raising interest rates. In order to keep interests low, the ECB will digitize more Euros which will fuel inflation.

3. The coming of QEIII.
The Obama regime is cooking the books to give the impression that the economy is recovering. FED governors, on the other hand, admit that the US economy is soft and are now talking about QEIII. A third injection of paper money will drive up inflation. Gold and silver shorts will be squeezed and gold will quickly rise to $2000/oz. This will accelerate the rise of gold and commodity prices. Things could turn really ugly if cowardly Republicans block Obama's request for another Trillion dollars.

These are interesting times.