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"Wars, Rumors Of Wars, Skyrocketing Oil Prices And Global Economic Chaos – Why Is All Of This Happening?"

ilene's picture




 

Michael Snyder writes about "Wars, Rumors Of Wars, Skyrocketing Oil Prices And Global Economic Chaos." He argues that, if we're not running on empty already (though we probably are), we will be if the price of oil continues rising.   Ilene 

Courtesy of Michael Snyder at Economic Collapse 

Did anyone out there anticipate that 2011 would be such a wild year?  The year is barely over two months old and we have already seen multiple civil wars erupt, rumors of more wars all over the mainstream media (potentially even including the United States), riots and revolutions breaking out all over the globe, oil prices soaring into the stratosphere and chaos on global financial markets. 

So why is all of this happening?  Is all of this one big coincidence or is there a reason why we are witnessing such global chaos right now?  Is it just coincidence that revolutions have broken out in over a dozen countries in the Middle East all at the same time?  Is it just a coincidence that global prices for oil, food and precious metals are all skyrocketing?  Is it just a coincidence that world financial markets suddenly seem more vulnerable than at any time since 2008?  Looking at what is going on in the world right now, it is very tempting to use the phrase "a perfect storm" to describe it.  Unfortunately, this "perfect storm" is very likely to plunge the global economy into yet another financial collapse if it continues to get even worse.

After decades of relative stability, the Middle East has erupted in chaos in 2011.  In the post-World War 2 era, we have never seen a time when there have been so many major internal revolutions all at once.  All of these simultaneous revolutions are driving the price of oil rapidly upwards.

The price of West Texas crude is now over $102 a barrel and the price of Brent crude is now over $116 a barrel and if the chaos in the Middle East continues those numbers are likely to go a lot higher.

Meanwhile, gold has set a new all-time record this week and the price of silver is absolutely exploding.

In fact, just about every kind of "hard asset" that you can possibly name is going up in price.  Investors don't like all of this instability and they are looking for safe places to put their money.

Unfortunately, the global situation looks like it may become even more heated.

The calls for military action against Libya are rapidly reaching a crescendo.

The U.S. Senate has unanimously passed a resolution calling for the UN Security Council to impose a no-fly zone over Libya, and many members of Congress are openly declaring that the U.S. and NATO should take unilateral action no matter what the UN ultimately decides.

But implementing a no-fly zone is not a simple thing.  It is not just a matter of telling Libya not to fly their planes.  Rather, imposing a no-fly zone over Libya would constitute a major military operation.

U.S. Secretary of Defense Robert Gates is even admitting that enforcing a no-fly zone over Libya would begin with a huge military strike.....

"Let's just call a spade a spade. A no-fly zone begins with an attack on Libya to destroy the air defenses ... and then you can fly planes around the country and not worry about our guys being shot down."

U.S. commander General James Mattis made a similar comment on Tuesday....

You would have to remove the air defense capability in order to establish the no-fly zone so it - no illusions here, it would be a military operation.

Essentially, imposing a no-fly zone over Libya would be an act of war.

Most of our representatives in Washington D.C. seem to be quite ready to go to war in Libya, but it is another story entirely when it comes to the American people.  A recent Rasmussen poll found that a whopping 67 percent of Americans do not want the U.S. to get more involved in the unrest going on in Arab countries and only 17 percent of Americans do want the U.S. to get more directly involved.

But the American people don't get to decide whether we go to war or not.  Our leaders in Washington D.C. do.  The USS Enterprise and other major warships are on their way to Libya, and U.S. forces throughout the Mediterranean are on high alert.

So could the U.S. really get involved in another war in the Middle East?

Well, if the U.S. and NATO choose to get involved they will do it without the approval of the rest of the world.

On Wednesday, the Arab League issued a statement which specifically rejected "any foreign interference within Libya on behalf of the opposition".

Not only that, but any military action by the UN will most likely be blocked by both China and Russia.

Russia's ambassador to NATO, Dmitry Rogozin, says that any military action against Libya without UN approval would be a violation of international law....

"If someone in Washington is seeking a blitzkrieg in Libya, it is a serious mistake because any use of military force outside the NATO responsibility zone will be considered a violation of international law."

But Libya is far from the only crisis point in the Middle East.

In fact, a much larger problem may be brewing in Saudi Arabia.

On Facebook, a "Day of Rage" is being hyped for March 11th.  Other dates being promoted for "revolution" in Saudi Arabia include March 20th and March 21st.

But if Saudi Arabia sees the same kind of chaos that we have seen in other countries in the Middle East there is no telling how high the price of oil could go.

Could we see $125 oil?

Could we see $150 oil?

Could we see $200 oil?

Saudi Arabia exports more oil than anyone else in the world, so if their oil production gets interrupted it is going to have a dramatic impact on the global economy.

For example, are you ready to pay 5 dollars for a gallon of gasoline in the United States?

For decades, the entire globe has been blessed with very cheap oil and this has resulted in a massive economic boom.

But times are changing.

The economic situation over in Europe is already deteriorating and any additional bad news could plunge that entire continent into a major crisis.  A recently released report from Ernst & Young is warning that if oil goes up to 150 dollars a barrel and it stays there, "at least" one eurozone country will default and the entire eurozone will be plunged back into recession.

A much higher price for oil would obviously not be good for the U.S. economy either.  Do you remember what happened back in 2008?  The price of oil hit a record high in June and then the entire financial system came unglued just a few months later.

But if we see a repeat of 2008 it may be a lot worse this time because the global financial system is now more unstable than ever.

The truth is that the entire world is still trying to recover from the last financial crisis.  The Federal Reserve is pumping massive quantities of dollars into the U.S. economy in an attempt to stimulate it back to life, but so far it is not working too well.

The rest of the world does not appreciate all of this "money printing" and the inflation that this is causing is beginning to create massive imbalances on global financial markets.

The world is starting to lose faith in the U.S. dollar.  Right now, approximately 85% of all foreign-exchange transactions in the world involve the U.S. dollar.  Not only that, 60% of all the currency reserves in the world are in U.S. dollars.  With the U.S. dollar rapidly becoming less stable, many are now wondering if it should continue to be used as the reserve currency of the world.

The truth is that if the U.S. dollar falls, it is going to create a tremendous amount of financial chaos in almost every nation on the globe.

Unfortunately, as I have written about so many times previously, the U.S. economy is dying.  The U.S. government is absolutely drowning in debt, and leaders all over the planet are calling for the establishment of a new global reserve currency.

The days of the United States being the "economic engine of the planet" are rapidly coming to an end.

The U.S. economy is not ever going to fully "recover".  In fact, the U.S. economy is basically "running on empty" at this point as Gerald Celente recently noted during an interview on RT television....

The entire U.S. economy was designed to operate on massive amounts of very cheap oil.  Americans do more driving than anyone else in the world.  Many of us are so lazy that we won't even walk to a store if it is on the other side of the parking lot.

If oil hits record levels in 2011, it is going to be a massive shock to the U.S. economic system.  Any hopes for an "economic recovery" will be completely dashed.

In fact, if one wanted to "take down" the U.S. economy, driving up the price of oil would be a perfect way to do it.

And if one wanted to drive up the price of oil, a perfect way to do that would be to create all kinds of chaos in the Middle East.

So is all of this craziness that we are seeing in 2011 just a big coincidence or is there a reason why all of this is happening?

Please feel free to leave a comment with your opinion on the matter below.... 

 

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Fri, 03/04/2011 - 07:41 | 1017924 StychoKiller
StychoKiller's picture

From CBS.com:

Agent: I was ordered to let U.S. guns into Mexico ATF agent says "Fast and Furious" program let guns "walk" into hands of Mexican drug cartels with aim of tracking and breaking a big case.

This certainly does NOT help matters! Is it still debatable that the US Govt. should be shrunk in size?

Fri, 03/04/2011 - 07:34 | 1017923 JimboJammer
JimboJammer's picture

go  to  Youtube..

>> Currency  Extinction Event;

   U.S. Pledged  to  the  Chinese

  by  W.  O'Brien

 

 

Fri, 03/04/2011 - 04:15 | 1017820 GFORCE
GFORCE's picture

Fate and the fourth turning.

Fri, 03/04/2011 - 03:11 | 1017784 Number 156
Number 156's picture

Many of us are so lazy that we won't even walk to a store if it is on the other side of the parking lot.

 

..... alright, alright... Ill get a damn bicycle.

 

 

Fri, 03/04/2011 - 05:29 | 1017864 Marcus McSpartacus
Marcus McSpartacus's picture

Segway?

Fri, 03/04/2011 - 08:54 | 1017985 VinniPukh
VinniPukh's picture

target practise...

Fri, 03/04/2011 - 01:52 | 1017697 pomogranate
pomogranate's picture

this is different than any other 2 months ... how?

Fri, 03/04/2011 - 00:36 | 1017583 Jasper M
Jasper M's picture

Article seems to be depending on inelasticity of demand, which in my experience, is a poor bet. 

If oil goes to $200/barrel, who would pay it? Most petro consumption in this country is commercial. Depression would gut demand. 

Thu, 03/03/2011 - 23:32 | 1017347 Unlawful Justice
Unlawful Justice's picture


Delia Surridge[wakes in an apparently empty room] It's you, isn't it? You've come to kill me.
V[from the shadows] Yes.
Delia: Thank God... After what happened, after what they did, I thought about killing myself, but I knew that one day you'd come for me. I didn't know what they were going to do. I swear to you. Read my journal.
V: What they did was only possible because of you.
DeliaOppenheimer was able to change more than the course of a war. He changed the entire course of human history. Is it wrong to hold on to that kind of hope?
V: I've not come for what you hoped to do. I've come for what you did.
Delia: It's funny. I was given one of your roses today. I wasn't sure you were the terrorist until I saw it. What a strange coincidence that I should be given one today.
V: There are no coincidences, Delia. Only the illusion of coincidence. I have another rose, and this one is for you.
Delia: Are you going to kill me now?
V: I killed you 10 minutes ago, [holds up a small hypodermic needle] while you slept.
Delia: Is there any pain?
V: No.
Delia: Thank you. [pauses briefly] Is it meaningless to apologize?
V: Never.
Delia: I'm so sorry. [dies]

Thu, 03/03/2011 - 22:40 | 1017297 flaunt
flaunt's picture

The U.S. "should take unilateral action?"  They may have already done just that.  According to this website, anyway: http://pakobserver.net/detailnews.asp?id=78009

Thu, 03/03/2011 - 22:31 | 1017284 dark pools of soros
dark pools of soros's picture

SNEAKERS BITCHEZ!!!

Thu, 03/03/2011 - 22:26 | 1017273 JimboJammer
JimboJammer's picture

People  of  Israel  are  surrounded  by  angry  Muslims... on  top  of  that,  the  new  president  of  the  USA  is  a  Muslim ....

they  should  move  far  away  from  there..

Get  a  loan  if  need  be...

Thu, 03/03/2011 - 22:33 | 1017288 dark pools of soros
dark pools of soros's picture

blah blah - Rham made this White House and VP is a total Zionist...  just like Rove and Cheney ran the last puppet

Fri, 03/04/2011 - 05:24 | 1017860 Marcus McSpartacus
Marcus McSpartacus's picture

Whose side are you on? Why are you using FACTS?

Thu, 03/03/2011 - 22:13 | 1017247 Vendetta
Vendetta's picture

of course, with all the manipulation in the 'markets' few can see (or quantify accurately) what is real or what is simply a manipulation.

Thu, 03/03/2011 - 21:44 | 1017179 locinvestor
locinvestor's picture

While everyone has a right to their opinion, I've never been very impressed with Celente's "predictions". If you take the time to try and be reasonably informed with reputable information, he's just pushing the obvious. So why bother putting him on.

Why is this happening? Unchecked global greed, that's why. Powerful corporations have been given unchecked power by the system. In the States, legally corporations are "people". Many states have "right to work" laws which give you no rights at all.

The other element in this? Who has the money and power. It's one thing to say, you need an attorney. Have you checked the hourly rates of attorneys? Not all but many say we'll give you a free consultation. But in reality, you're screened by a paralegal and never speak to one. Now, if you're rich and powerful, would this attorney avoid you or speak to you directly?

Fear's also involved. The obvious fears of losing everything because of something that's not your fault (an illness, losing your job and other things). But also, fear of other things as well. Example: imagine for a moment that 9/11 was an inside job. Imagine there's finally proof that the CIA did kill JFK.  

In this current climate, would anybody care? Would anybody be prosecuted? Look at the Wikileaks releases. Has anyone been prosecuted? No. Is anyone being tortured because of these? Bradley Manning.

My prediction? Millions won't march to stop this.

 

Thu, 03/03/2011 - 23:07 | 1017355 Randall Cabot
Randall Cabot's picture

Celente predicted ecomonic catastrophe and societal breakdown for 2008 and when it didn't happen then he moved it up to 2009, then 2010, now 2011...

Thu, 03/03/2011 - 21:58 | 1017198 born2bmild
born2bmild's picture

Or millions will march, NPR and Fox will say it was 100,000 and switch over to a story about Paris Hilton in rehab and up next sports.

Fri, 03/04/2011 - 05:14 | 1017852 Marcus McSpartacus
Marcus McSpartacus's picture

the only way millions will march like the '60s again, is if the chicks and drugs can compete with what's available on Wall Street

Thu, 03/03/2011 - 22:04 | 1017225 TheMerryPrankster
TheMerryPrankster's picture

+25

Thu, 03/03/2011 - 21:43 | 1017171 IQ 145
IQ 145's picture
 Because printing is easier than creating real value; because globaliaztion was sold to you; when what it really meant was send all the money to China, and see how that works out. and so forth. These problems were caused 100% by the government. Which was bought, and paid for. In 1971 Nixon refused to pay the legal debts of the USA; what did you think was going to happen. Uhm? What; something diffenrent; something new and wonderful; unicorn frizzles?; no the same old thing; bankruptrcy and death by leverage. Nothing new at all. Nothing.
Thu, 03/03/2011 - 21:53 | 1017170 born2bmild
born2bmild's picture

My mother used to be a chicken hawk, never saw a war that she didn't agree with Rupert Murdoch or Rumsfeld. I was in inactive reserves when the buildup for Gulf War 1 was starting, when the government came looking for me she suddenly didn't know how to find me...She told me about it a decade later.  Hypocrites, the lot of them. Super quick to bring the hammer down as long as it doesn't involve them directly. When do we reach critical mass for bullshit? Do we have some charts for that?

I guess China is planning to shut the internet down...: http://www.telegraph.co.uk/news/worldnews/asia/china/8356921/China-train...

It'll be great when they're wearing the global pants no doubt.

Thu, 03/03/2011 - 21:35 | 1017159 TheMerryPrankster
TheMerryPrankster's picture

If we're not careful we won't even make it till December 21st, 2012. Be a shame if we all die before the end of the world.

On a lighter note I planted a dozen cantaloupe seeds today and hope to get the rest of the vegetable and herb seeds in their starter pots over the weekend. Watch the world go to blazes makes a man hungry and I like knowing where my vittles came from whenever possible.

 

As pop used to say, life is a shit sandwich, but if you got enough bread you don't have to eat so much shit. He also said "save your money when your young so when you are old you can tell them to go hell".  He was not the most flowery speaker, but in fact managed to impart a good bit of wisdom to a child who thought he knew everything.

 

Good luck and keep your powder dry, things will eventually get better, but probably not until they get much worse first.

Thu, 03/03/2011 - 21:08 | 1017123 domains-are-har...
domains-are-hard-assets's picture

Re: In fact, just about every kind of "hard asset" that you can possibly name is going up in price.  Investors don't like all of this instability and they are looking for safe places to put their money.

I think that is indeed true.  One area to watch closely is internet domain names -- the online real estate of the Internet.  Domain names are a proxy investment for the growth of the internet. The online economy is outgrowing the offline economy, hence the insane valuation of companies like Demand Media. The value is in their enormous domain holdings.

For those unaware of the dynamics in this market, there is a sea-change under way. For almost a decade "Domainers" made insane amounts of money through a practice called "parking". The major feed providers notably Google and Bing/Yahoo have nipped this in the bed, substantially taking away that revenue stream.

What is happening now is the next phase of domain investment.  The land-grabbing domainers are finally selling domains at reasonable prices just as high net worth individuals are entering the market for "online real estate". The result is a brief window where new players in the market can enter cost effectively.

The most lucrative point of entry is so-called "Drop catching" -- every day 80,000 domains are dropped by the prior owners. New investors pick these up for pennies on the dollar. In our case, we go a step further and develop them for eventual retail sale to buyers. For a sampling see EpikDomains.com. For more on Domaining, see epik.com/blog

 

Thu, 03/03/2011 - 23:59 | 1017501 palmereldritch
palmereldritch's picture

How much is FEMA-R-US.com going for these days?

Thu, 03/03/2011 - 21:30 | 1017156 domains-are-har...
domains-are-hard-assets's picture

(my a tough crowd. forgive.)

Thu, 03/03/2011 - 23:38 | 1017435 Marcus McSpartacus
Marcus McSpartacus's picture

Can you register ".co.ck"?

Thu, 03/03/2011 - 22:00 | 1017205 BigDuke6
BigDuke6's picture

Why tough crowd? - its junk, you waste 30 seconds you wont get back reading your shitty advert.

Thu, 03/03/2011 - 20:53 | 1017090 THE DORK OF CORK
THE DORK OF CORK's picture

The central problem is that multinationals are trying to get more and more efficiency from systems as the price of oil rises - this infrastructure was built for a lower price.

As efficiency increases to counter the limited growth in oil consumption more and more redundancy is taken from the system.

This system will work until it does not - then it will break, it seems impossible to reverse the gears in the machine.

The world needs a more localised redundant supply chain but it seems inefficient from a profitability standpoint.

Such highly adapted efficient niche creatures in the natural world are very vulnerable to extinction while less efficient jack of all trades organisms can get through though times with more grace.

There seems to be a natural push to create such systems but the faster better cheaper organisms always hit a extinction wall with more certainty somehow , leaving whatever creature that can learn to turn its less adapted claw to new niches.

 

We are close to a economic extinction event with a real possibilty of mass die off.

Thu, 03/03/2011 - 21:46 | 1017182 IQ 145
IQ 145's picture

 I like your posts; you're a thoughtful person; but you have no idea what the central idea is. If you wish to know what the central idea is; let me know.

Thu, 03/03/2011 - 23:34 | 1017409 Marcus McSpartacus
Marcus McSpartacus's picture

Big Big Dinosaurs! Rrrawrrr! Lean, Mean Killing Machines - they only do one thing, but boy do they do it it well! World Domination! Rrrawrrr!

Little itsy bitsy mousey! Squeak Squeak Squeak! Where is he? Is he in the tree? Is he in the grass? Is he burrowing underground? Run away Mousey!

Oh shit! Asteroid!

Quick - Central Idea!

Thu, 03/03/2011 - 23:00 | 1017337 robobbob
robobbob's picture

by his last line, I think he knows exactly what the centrally planned idea is.

Thu, 03/03/2011 - 20:46 | 1017084 Scorpio69er
Scorpio69er's picture

re: "Most of our representatives in Washington D.C. seem to be quite ready to go to war in Libya"

Well, not exactly.

They're ready to send YOUR sons and daughters to fight and die. No one they know or care about will ever be in harm's way.

 

"Use up the Irish. The dead cost nothing."

--Longshanks, 'Braveheart' (1995)

Thu, 03/03/2011 - 20:34 | 1017073 Scorpio69er
Scorpio69er's picture

 

 

Dr Ray Stantz: Fire and brimstone coming down from the skies! Rivers and seas boiling!

 

Dr. Egon Spengler: Forty years of darkness! Earthquakes, volcanoes...

 

Winston Zeddemore: The dead rising from the grave!

 

Dr. Peter Venkman: Human sacrifice, dogs and cats living together... mass hysteria!

 

 

Thu, 03/03/2011 - 21:17 | 1017140 Jackfish
Jackfish's picture

You might as well continue because he rest of the scene could apply to the Fed's printing insanity!

 

Dr Ray Stantz; Everything was fine with the system until the power grid was shut off by dickless here.

Mayor; Is this true?

Dr Peter Venkman; Yes it's true, this man has no dick.

 

As long as the Bernack has the printing press power on........

/sarc off

 

 

Fri, 03/04/2011 - 05:10 | 1017849 Marcus McSpartacus
Marcus McSpartacus's picture

"Viggy Viggy Viggy You have been a bad monkey!"

Fri, 03/04/2011 - 05:10 | 1017848 Marcus McSpartacus
Marcus McSpartacus's picture

"Viggy Viggy Viggy You have been a bad monkey!"

Thu, 03/03/2011 - 20:32 | 1017069 apberusdisvet
apberusdisvet's picture

For the last 30 years, Soros has sought international instability to promote his Open Society Institute; which, coincidentally is providing the lawyers for Assange. 

Thu, 03/03/2011 - 20:14 | 1017035 Hannibal
Hannibal's picture

"cause we love to export "shock and awe",....and porn.

Thu, 03/03/2011 - 20:09 | 1017025 rjmchina
rjmchina's picture

A quote from one of my favorite authors a 100 years ago;There are not many, even among educators and statesmen, who comprehend the causes that underlie the present state of society. Those who hold the reins of government are not able to solve the problem of moral corruption, poverty, pauperism, and increasing crime. They are struggling in vain to place business operations on a more secure basis. You should hear what she said about unions before unions were even a force to be reckoned with.

Thu, 03/03/2011 - 20:07 | 1017022 dick cheneys ghost
dick cheneys ghost's picture

niall ferguson on oil going to $200 per barrel. see the video....

 

http://nakedempire.wordpress.com/

Thu, 03/03/2011 - 20:21 | 1017047 Calmyourself
Calmyourself's picture

NWO shill video..  His masters will be pleased and twitch the hand up his ass..

Fri, 03/04/2011 - 09:57 | 1018044 Flakmeister
Flakmeister's picture

  Hey, why don't you go to his website and debate him? He accepts comments. Take him up on any of weekly topics. If you are polite and well reasoned, he will discuss things. Be sure to let us all know so that we can watch, ok?

Thu, 03/03/2011 - 20:07 | 1017019 Drag Racer
Drag Racer's picture

just watched an interview of Ron Paul on Al-Jazeera on the topic of using US military/no-fly zone in Libya. His comments were to stay out of the whole thing.

Thu, 03/03/2011 - 19:59 | 1016998 DosZap
DosZap's picture

Man started it off badly, and he will end it worse.

So it is Written.............SELAH.

Thu, 03/03/2011 - 20:19 | 1017046 BigDuke6
BigDuke6's picture

Dos , sorry for the nerve but i saw a comment about birth units by u.  You hang out in these places?  Night shifts can be good for internet use.  Thats when i started buying gold on ebay years ago - the week after nights my wife used to look at the packages arriving saying 'wtf have u bought now!!'

Thu, 03/03/2011 - 20:59 | 1017106 DosZap
DosZap's picture

Big, Ya lost me bro?, birth units?

Thu, 03/03/2011 - 21:51 | 1017188 BigDuke6
BigDuke6's picture

Sorry dude, bit drunk and confused with something else.

 

Thu, 03/03/2011 - 23:56 | 1017496 Marcus McSpartacus
Marcus McSpartacus's picture

Beer: the solution to, and cause of, all life's problems.

Fri, 03/04/2011 - 01:08 | 1017637 IQ 145
IQ 145's picture

 "God must have loved us; because he gave us beer". "Malt does more than Milton can, to explain the ways of God to man".

Do NOT follow this link or you will be banned from the site!