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Why The Turkish Government May Be The Casualty Of A $119 Billion PetroDollar "Loophole"

Tyler Durden's picture


It was in October 2012 when we explained how Iran evades the Western blockade (ostensibly with the implicit nod of none other than the US), and when we first defined the concept of PetroGold in the context of the Turkey-Dubai-Iran crude-for-gold triangle. For those who need a quick refresher, here it is:

In recent months there has been a lot of incorrect speculation that because Iran has been shut off from the petrodollar, SWIFT-mediated regime, its economy will implode as the country has no access to the all important greenback and can thus not conduct international trade - the driving factor behind the international sanctions that seek to topple the local government as Iran dies an economic death. And while there have been bouts of substantial inflation, which so far the local government appears to have managed to put a lid on by curbing gray market speculation, Iran continues to more or less operate on its merry ways with international trade most certainly taking place, especially with China, Russia and India as main trading partners. "How is this possible" those who support the Western-led embargo of all Iranian trade will ask? Simple - gold. Because while Iran may have no access to dollars, it has ample access to gold. This in itself is not new - we have reported in the past that Iran has imported substantial amounts of gold from Turkey, despite the Turkish government's stern denials. Today, courtesy of Reuters, we learn precisely what the 21st century equivalent of the Great Silk Road looks like, and just how effective Iran has been as a lab rat in escaping the great petrodollar experiment, from which conventional wisdom tells us there is no escape. Presenting: petrogold.

One year later, following Iran's unperturbed ability to exist in a world without US dollars, the blockade of Iran is a thing of the past, and the west has engaged in a full-blown detente with the country, much to the fury of both Israel and Saudi Arabia, in exchange for the symbolic gesture that Iran will limit its nuclear enrichment, lowering and in many cases outright eliminating Iran sanctions, which proved completely futile.

So a happy ending for Iran, if only for now thanks to the fact that despite all the status quo's lies gold is and always has been money and can substitute for dollars.

However, one country that has seen better days, whose government may be on the edge of collapse due to an unprecedented corruption scandal precisely for enabling said PetroGold scheme, and which has been in the news on a daily basis recently, is Turkey. As Turkey's Today's Zaman explains in "Iran's Turkish Gold Rush", the political crisis Turkey finds itself in may be nothing but a consequence of the PetroGold scheme conceived over a year ago, and in which Turkey played a crucial role. 

Here is how the Turkey-Dubai-Iran PetroGold triangle, or as the Zaman calls it, "gas for gold", may soon result in the toppling of yet another government, simply because it showed that existence outside of the clutches of the 'Petrodollar' is perfectly possible...

* * *

From Iran's Turkish Gold Rush, highlights ours:

Turkey's Islamist government is being rocked by the most sweeping corruption scandal of its tenure. Roughly two dozen figures, including well-connected business tycoons and the sons of top government ministers, have been charged with a wide range of financial crimes. The charges ballooned into a full-blown crisis on Dec. 25 when three ministers implicated in the scandal resigned, with one making a dramatic call for Prime Minister Recep Tayyip Erdogan to step down as well. An exhausted-looking Erdogan subsequently appeared on television in the evening to announce a cabinet reshuffle that replaced a total of 10 ministers.

The drama surrounding two personalities are particularly eye-popping: Police reportedly discovered shoeboxes containing $4.5 million in the home of Süleyman Aslan, the CEO of state-owned Halkbank, and also arrested Reza Zarrab, an Iranian businessman who primarily deals in the gold trade, and who allegedly oversaw deals worth almost $10 billion last year alone.

The gold trade has long been at the center of controversial financial ties between Halkbank and Iran. Research conducted in May 2013 by the Foundation for Defense of Democracies and Roubini Global Economics revealed the bank exploited a "golden loophole" in the US-led financial sanctions regime designed to curb Iran's nuclear ambitions. Here's how it worked: The Turks exported some $13 billion of gold to Tehran directly, or through the UAE, between March 2012 and July 2013. In return, the Turks received Iranian natural gas and oil. But because sanctions prevented Iran from getting paid in dollars or euros, the Turks allowed Tehran to buy gold with their Turkish lira -- and that gold found its way back to Iranian coffers.

This "gas-for-gold" scheme allowed the Iranians to replenish their dwindling foreign exchange reserves, which had been hit hard by the international sanctions placed on their banking system. It was puzzling that Ankara allowed this to continue: The Turks -- NATO allies who have assured Washington that they oppose Iran's military-nuclear program -- brazenly conducted these massive gold transactions even after the Obama administration tightened sanctions on Iran's precious metals trade in July 2012.

Turkey, however, chose to exploit a loophole that technically permitted the transfer of billions of dollars of gold to so-called "private" entities in Iran. Iranian Ambassador to Turkey Ali Reza Bikdeli recently praised Halkbank for its "smart management decisions in recent years [that] have played an important role in Iranian-Turkish relations." Halkbank insists that its role in these transactions was entirely legal.

The US Congress and President Obama closed this "golden loophole" in January 2013. At the time, the Obama administration could have taken action against state-owned Halkbank, which processed these sanctions-busting transactions, using the sanctions already in place to cut the bank off from the US financial system. Instead, the administration lobbied to make sure the legislation that closed this loophole did not take effect for six months -- effectively ensuring that the gold transactions continued apace until July 1. That helped Iran accrue billions of dollars more in gold, further undermining the sanctions regime.

In defending its decision not to enforce its own sanctions, the Obama administration insisted that Turkey only transferred gold to private Iranian citizens. The administration argued that, as a result, this wasn't an explicit violation of its executive order.

It's possible that the Obama administration didn't have compelling evidence of the role of the Iranian government in the gold trade. However, the president may have also simply sought to protect his relationship with Ankara and didn't want to get into a diplomatic spat with Erdogan, who he considers a key regional ally.

If the administration didn't feel that the sanctions in place at the time were sufficient to take action against Halkbank, after all, it could have easily shut down the gold trade by amending its executive order. But at the time, Turkey was also playing a pivotal role in US policy in Syria, which included efforts to strengthen the more moderate opposition factions fighting President Bashar Assad's regime.

It's also possible, however, that the Obama administration's decision had less to do with Turkey, and more to do with coaxing Iran into signing a nuclear deal. In the one-year period between July 2012, when the executive order was issued, and July 2013, when the "golden loophole" was closed, the Obama administration's non-enforcement of its own sanctions reportedly provided Iran with $6 billion worth of gold. That windfall may have been an American olive branch to Iran -- extended via Turkey -- to persuade its leaders to continue backchannel negotiations with the United States, which reportedly began as early as July 2012. It could also have been a significant sweetener to the interim nuclear deal eventually reached at Geneva, which provided Iran with another $7 billion in sanctions relief.

Indeed, why else would the administration have allowed the Turkish gold trade to continue for an extra six months, when Congress made clear its intent to shut it down?

This brings us back to the current corruption drama in Turkey. The ruling Justice and Development Party (AKP) has been claiming that it is a victim of a vast conspiracy, blaming everyone from Washington to Israel to US-based Islamic cleric Fethullah Gulen for its woes. Some Turkish media have pointed a finger at David Cohen, the Treasury Department's undersecretary for terrorism and financial intelligence, who happened to be in Turkey as the news began to break. Erdogan even raised the possibility of expelling the US ambassador to Ankara, Francis Ricciardone.

But if the charges stand against the panoply of well-connected figures fingered, the AKP will have only itself to blame. While the gas-for-gold scheme may have been technically legal before Congress finally shut it down in July, it appears to have exposed the Turkish political elite to a vast Iranian underworld. According to Today's Zaman, suspicious transactions between Iran and Turkey could exceed $119 billion -- nine times the total of gas-for-gold transactions reported.

Even if the Turkish-Iranian gold trade represents only a small part of the wider corruption probe, the ongoing investigation could provide a window into some nagging questions about the relationship between Ankara and Tehran. Perhaps we will finally learn why the Turkish government allowed Iran to stock up on gold while it was defiantly pursuing its illicit nuclear program -- and whether the Obama administration could have done more to prevent it.

* * *

Bottom line: dare to mess with the Petrodollar and the wrath of the US government will hunt you down... sooner or later.


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Sat, 12/28/2013 - 16:32 | 4282112 darteaus
darteaus's picture

So, after the Turkey hits the fan, how about reimposing the sanctions?

That way you kill the Turkey with the golden eggs, you show what happens when Turkeys think they don't need the dollar, and you can show you're taking a stand against nuke proliferation, helping the Saudis and Israel-just in time for the fall erections!

Sat, 12/28/2013 - 17:46 | 4282251 Pseudonymous
Pseudonymous's picture

Here comes the petrobitcoin.

Sanction that!

Sat, 12/28/2013 - 18:35 | 4282336 max2205
max2205's picture

Barry sure is a pill

Sat, 12/28/2013 - 19:24 | 4282392 Thomas
Thomas's picture

If I was a Hope and Change liberal democrat I would be a tad bit disappointed by Potus.

Sun, 12/29/2013 - 02:54 | 4282861 Troll Magnet
Troll Magnet's picture

Libtards??? This shit's too complicated. They'll just blame Bush.

Sun, 12/29/2013 - 14:54 | 4283452 Triggernometry
Triggernometry's picture

I'm rather alarmed by the author's presupposition that Iran's nuclear program is somehow illicit. Bears the odor of an all too familiar stench...

Sat, 12/28/2013 - 16:27 | 4282115 Sudden Debt
Sudden Debt's picture

Yep, America has the biggest army and can bully anybody who walks in their shadow.

The dollar isn't fiat.

The dollar is backed by the most precious commodity in the world!!!


America has the biggest and strongest army. And that's the dollar backing.

And if the people pose a problem, they'll make robots that can be controlled by one man.

The day we'll have robot terminators, we're all doomed.

Sat, 12/28/2013 - 16:34 | 4282124 wee-weed up
wee-weed up's picture



America has the biggest army and can bully anybody

Uh, with the wussy Commander in Chief we currently have in the White House...

That's a bit of a stretch!

Wait for it...

He's about to draw yet another red-line...

Sat, 12/28/2013 - 17:08 | 4282194 Sudden Debt
Sudden Debt's picture

America is owned by Arabia and is more of a organisation than a country.

And Obama is the Spokesperson, not the CEO.

Going againsts muslims or say anything bad about them will become a crime in the short fututre.
It's even a crime to say "merry christmas"... but that's because the American employees wanted so by voting for it.

Sat, 12/28/2013 - 17:40 | 4282240 tony wilson
tony wilson's picture

america is run by the jew nicely corrected no need for thanks you fucking tool : )

Sat, 12/28/2013 - 21:02 | 4282521 Tijuana Donkey Show
Tijuana Donkey Show's picture

By Zionists. Not all Jews are Zionists. 

Sun, 12/29/2013 - 09:14 | 4282989 AvoidingTaxation
AvoidingTaxation's picture

Yep, 'murikans can just try to hijack the country (from leftists, tribals and muslims) via a new third party and persuading the army to side with the people. Some 20-30 millions deaths, no more! Then a new constitution. I would say a normal long democratic cycle. Look @ france or britain or germany on how it works. Now, we also know that the USSA are less and less an "european derived" country.

Sun, 12/29/2013 - 20:38 | 4284115 Rafferty
Rafferty's picture

Muslims aren't the ones driving the War on Christmas.  Jeez.........

Sat, 12/28/2013 - 16:31 | 4282125 darteaus
darteaus's picture

Not to nitpick, but doesn't China have the largest army?  It's kinda centrally located too.

Sat, 12/28/2013 - 17:09 | 4282201 Sudden Debt
Sudden Debt's picture

nah, the chinese amry has more meat in it's ranks but that's it.

The Russians had a bigger army than the germans in WOII but they just counted on the numbers and if the Germans didn't had 3 fronts they'd won easely against the russians.

Sat, 12/28/2013 - 17:21 | 4282212 Tinky
Tinky's picture

"...if the Germans didn't had 3 fronts they'd won easely against the russians."

drinking, eh?

Sat, 12/28/2013 - 18:13 | 4282307 Sudden Debt
Sudden Debt's picture

No, the germans where superior in every way. It took the world to bring them down. America was at the point of surrender if Normandie failed and thank god there where all those fronts.

You should read some books and not base all you knowledge on Disney movies.

Sat, 12/28/2013 - 21:04 | 4282526 Tijuana Donkey Show
Tijuana Donkey Show's picture

Uhhhhhh, no. The USA had plenty of reserve production, and a little item called the nuclear bomb. Normandy was a poorly planned operation, and American's suffered because of it. 

Sat, 12/28/2013 - 21:20 | 4282544 lakecity55
lakecity55's picture

The Allies had Ultra, the German cipher system. Captured it with Germany unaware.

The Germans almost won even after we had read all their encrypted traffic.


Sun, 12/29/2013 - 06:10 | 4282921 silvermail
silvermail's picture

Defeat of the Germans was began on July 17, 1942 in Russia, at Stalingrad. Everything that happened after that date, it was only a technical completion of victory.
Stalingrad cauldron, it is that was a true defeat of Germany.
The Germans could not withstand vs the Siberian Divisions Russian, who are accustomed to life in the winter cold.
Russian cold winter was like a killer for German soldiers. But for Stalin's Siberian divisions, cold winter was like a usual tradition - as a grunt from own mother.

If you think, that the Russian might be loses this war without any codes or without any external help, then you have forgotten the lessons of history.
I remind you: Napoleon conquered Moscow and already celebrated victory. Russians celebrated victory a little later - in the Paris.

Sun, 12/29/2013 - 20:50 | 4284127 Rafferty
Rafferty's picture

True.   It also seems to be accepted generally that  the German WW II army was the finest fighting force the world has ever seen.

Tue, 12/31/2013 - 16:11 | 4289292 DanDaley
DanDaley's picture

Russia has always had 2 of the greatest generals in history: General Snow and General Mud (worth many divisions each).

Sat, 12/28/2013 - 18:10 | 4282302 TimmyM
TimmyM's picture

Sudden Debt, I don't disagree with you much, but the Germans had no chance. Russian weather was an insurmountable obstacle. They did not have the right vehicles, clothes or fuel. The US should have stayed out of the war and let those two kill each other off. The world would be so different now.

Sat, 12/28/2013 - 18:19 | 4282316 Sudden Debt
Sudden Debt's picture

I agree with you there.
And I'm pretty sure you will agree with me than that we should just let all the Middle eastern countries kill each other off.

Sun, 12/29/2013 - 06:24 | 4282927 silvermail
silvermail's picture

Harry Truman spoke in the U.S. Senate on June 23, 1941: “If we see that Germany is winning,” he said, “we ought to help Russia, and if Russia is winning we ought to help Germany, and that way let them kill as many as possible.”


Sun, 12/29/2013 - 14:23 | 4283388 casfoto
casfoto's picture

Very similar to when in the beginning of the war England sent their troops up to Finland. The poor lads were not suited for the harsh climate. Their cloths were thin and there weapons did not work in such cold areas. Many of the boys died just do to these problems. If we send our people in we should send them to win with proper attire.

Sun, 12/29/2013 - 15:46 | 4283571 silvermail
silvermail's picture

Only good clothes not allows you to live in the cold. If a man and his body does not have the experience of living in the cold, then the best warm clothing is a small help for him.
Warm clothing will not save you if you need to live in the snow a few weeks. You should have experience of such life and body, accustomed to such a life and such a cold.
The human body, which was born and raised in Siberia or Alaska is very different from the human body, which born and raised in Spain or Greece.

Sat, 12/28/2013 - 18:52 | 4282356 Abitdodgie
Abitdodgie's picture

The "US ARMY" is a privatly owened corperation, just like the "UNITED STATES" is just like" NASA" just like " UNITED STATES POST OFFICE' The United States of America does not have shit , just like you dont own your houes or car or yourself , or your children , remember you gave them to the state when they were born ,YOU signed the birth cert.

Sat, 12/28/2013 - 16:28 | 4282121 jekyll island
jekyll island's picture

I suspect the bank of Rothschild had a hand in this somewhere along the line.  

Sat, 12/28/2013 - 17:11 | 4282203 Sudden Debt
Sudden Debt's picture

The Saudi's did when the Turkish army commanders stepped down a few years back.

Sat, 12/28/2013 - 16:31 | 4282122 ebworthen
ebworthen's picture

Probably a back-door way to smash gold down too; get it all sent to Iran, China, anywhere but the West (The Land of Fiat).

Perhaps a long term strategy in the works to try to affect sentiment towards precious metals and change 6,000 years of tradition.

p.s. - "It's nobody's business but the Turk's", but what the hell were they thinking getting rid of all that Gold?  They pulled a Gordon Brown.

Sat, 12/28/2013 - 16:33 | 4282131 BigJim
BigJim's picture

I doubt the Turks were exchanging their gold - I expect they bought it on the open market, and then sent it to Iran.

Sat, 12/28/2013 - 16:44 | 4282148 ebworthen
ebworthen's picture

Right, but instead of buying Gold with Lira and holding it and buying fuel oil and gas with Lira; they bought fuel with Gold and exchanged it for Lira - meaning they devalued their currency in exchange for fuel and not holding any Gold.

Sat, 12/28/2013 - 16:49 | 4282161 dark pools of soros
dark pools of soros's picture

just listen to the guy..  do you really expect to explain anything to him?

Sat, 12/28/2013 - 23:31 | 4282690 emersonreturn
emersonreturn's picture

"i expect they bought it on the open market..."


turkey has gold, it wouldn't surprise me it they import as well.

Sun, 12/29/2013 - 02:14 | 4282848 Hongcha
Hongcha's picture

Yes ebworthen.  The Chinese will be coming here to buy whatever bullion is left; well, they already are with Cash4Gold.  But by then any transaction involving gold will be illegal in the U.S.

Sat, 12/28/2013 - 16:38 | 4282138 Peter Pan
Peter Pan's picture

Only one detail matters in this story......that gold is still money.

Those stupid Turks who got caught, got caught with fiat. If they had been reading ZH they would know about gold and boating accidents.

Sat, 12/28/2013 - 16:45 | 4282151 Kirk2NCC1701
Kirk2NCC1701's picture

Wait till "Bitcoin for Gold" exchanges hit the Fan.  That's when the real Shock & Awe show starts.

Sat, 12/28/2013 - 16:52 | 4282163 Colonel Klink
Colonel Klink's picture

Fail, there's not enough bitcon value to substitute for oil and gold.

Sun, 12/29/2013 - 02:31 | 4282852 TheHound73
TheHound73's picture

Lol, BTC doesn't give a fuck how valuable it becomes.

Sun, 12/29/2013 - 07:52 | 4282959 Pseudonymous
Pseudonymous's picture

Dunno about "Bitcoin for Gold", but there already is Gold 4 Bitcoins.

Sat, 12/28/2013 - 16:46 | 4282154 h0oS
h0oS's picture

The reality is far more complex than the article suggests and any belief that the US is some how calling the shots is grossly over estimating US influence. Erdogan's regime is in trouble due to massive incompetence and arrogance, principally with his domestic policy (to grab as much power for his cronies as possible and piss on his own military mostly from fear) and its utterly inept handling support for NATO/Al-Qaeda alliance in Syria.

Gold plays a key role in Iran's sanction busting, but oil plays a larger role. The bilateral trade agreements and capacity trades that Iran relies upon for international trade hugely diminish the need for US dollars for international trade. US dollars are principally required to placate the small and medium sized business not, the key industries that Iran relies upon.

Sat, 12/28/2013 - 16:48 | 4282157 Seize Mars
Seize Mars's picture


Yeah, but it still benefits the petroUSD, doesn't it? Funny how that seems to happen?

Sat, 12/28/2013 - 17:03 | 4282185 h0oS
h0oS's picture

Well, maybe, but the détente with Iran will benefit the petroUSD far more so. The Saudi dictators will make all sorts of noises, mostly generated from gas escaping from various orifices at any US rapprochement with Iran. But ultimately they take their orders from Washington. As Churchill said "The Americans will always do the right thing, after they have exhausted all alternatives". The reality is that the US needs Iran as much as Iran needs the US. The Iranian state has by far the best prospects for stability in very unstable region and has historically been the regional hegemon. The Arab dictatorships are falling apart and the Zionist entity is decaying under its apartheid policies.   

Sat, 12/28/2013 - 17:27 | 4282225 Winston Churchill
Winston Churchill's picture

It would be a natural partnership with the Saudi oilfields running on fumes.

Not quite sure how TPTB are going to reverse 40 years of propaganda to achieve it in the

face of AIPAC though.Russia and China will have something to say about as well.

Obozo and his minions are incapable of pulling this type of diplomacy and a raproachment on

this scale would have to be done very quickly.

Sat, 12/28/2013 - 17:59 | 4282260 h0oS
h0oS's picture

I agree with you on several key points. Obozo and his minions are highly unlikely to accomplish much, but all they really have to do is a keep a lid on AIPAC, the nutters running Israel will do the rest by pursuing their apartheid agenda which will result in further net immigration from Israel while Palestinian demographics goes to work continuing to increase the Arab Muslim population. They should be able to achieve this, its just a matter of saying one thing and doing quite another, no problem for this administration.

Poll after poll has shown the majority of US citizens support a peaceful resolution to the Israeli problem and the re-establishment of ties with Iran. The realignment of US policy to pursue US objectives over Zionist objectives will allow the MSM brand anyone supporting Israel as unpatriotic and somewhat of a racist.

China and Russia will back the détente, they all stand to gain from rebuilding trade ties with Iran and of course the ensuing engergy, infrastructure and arms deals that will follow.   

Sun, 12/29/2013 - 09:01 | 4282984 o2sd
o2sd's picture

But Oceania has always been at war with East Asia, you were never at war with Eurasia. 

40 years of propaganda is easy to unravel, you just begin a new line of propaganda.

In fact, it has already begun. Look on the interwebs for documentaries of journalists visiting Iran in recent months (I saw one recently, but it's name escapes me). Everywhere they go, the Iranians love Americans and want to be their friends. It was all just one big misunderstanding on both sides you see.


Sun, 12/29/2013 - 11:11 | 4283062 Winston Churchill
Winston Churchill's picture

The US population would have to be dumb as a box of rocks to buy it.

Oh wait.

Because Obama.

Sun, 12/29/2013 - 06:29 | 4282931 silvermail
silvermail's picture

Speaking at the Bali Democracy international summit over the weekend, Turkish PM Recep Tayyip Erdo?an blasted the IMF’s role in the global debt crisis, stating that  “It is thought-provoking that the IMF is not using gold as a global currency’‘ and that “One would wish that the IMF would help the countries in trouble, but this is not the case.

Not content to stop there, Erdo?an likely placed a target on his/Turkey’s back when he stated that the world should flee the petro-dollar for gold: The world should consider switching to a monetary unit such as gold, which is at the very least an international constant and indicator which has maintained its honor throughout history. This is something to think about.

Sat, 12/28/2013 - 16:45 | 4282156 Seize Mars
Seize Mars's picture

Wow. Kudos, ZeroHedge.

Great reporting.

This shit never ends. At least the scumbags in power are predictable, right? I mean at least that's something.

Sat, 12/28/2013 - 20:07 | 4282450 Excursionist
Excursionist's picture

Yeah, except this:  "Indeed, why else would the administration have allowed the Turkish gold trade to continue for an extra six months, when Congress made clear its intent to shut it down?"

How's this for a prosaic explanation...  it took the career paper pushers, responsible for executing legislative edicts, half a year to ensure all the TPS forms were correctly filled out.  Government efficiency in all its glory.

Sat, 12/28/2013 - 16:47 | 4282160 Colonel Klink
Colonel Klink's picture

Every one of these top leaders is a fucking snake in the grass.  Say one thing, do another.  Even if it's breaking the laws of the country, the Constitution, or international UN sanctions.

Roll the motherfucking guillotines for all of them!!

Sun, 12/29/2013 - 06:50 | 4282936 silvermail
silvermail's picture

You forget that it is the leaders of sovereign states, but not the governors of the American colonies. What does it mean for Turkey not to buy oil and gas from Iran? For Turkey, it means - to die for the prosperity of the United States.
This is a very good example that clearly demonstrates the truism that there is no need for the U.S., in the country's-allies. For the U.S., country's need only as colony - a slaves country's.

Sat, 12/28/2013 - 16:49 | 4282166 giggler321
giggler321's picture

$119000000000 with $1200US/OZ is like 3000+ metric ton's of the yellow stuff, where did all that physical come from?

Sat, 12/28/2013 - 17:02 | 4282190 Carpenter1
Carpenter1's picture

My thoughts exactly.

Sat, 12/28/2013 - 19:00 | 4282366 Abitdodgie
Abitdodgie's picture

ther is about 5 times more gold in the world than what is reported , just like dimonds they control the supply to keep the price up .

Sat, 12/28/2013 - 17:02 | 4282191 zerozulu
zerozulu's picture

They simply move it from one room to another and than back again.

Sat, 12/28/2013 - 17:24 | 4282213 debtor of last ...
debtor of last resort's picture


Sat, 12/28/2013 - 18:55 | 4282362 adeptish
adeptish's picture

I work it out to be 337 metric tonnes, still a shit load.


Sat, 12/28/2013 - 18:47 | 4282351 Colonel Klink
Colonel Klink's picture

It's paper "gold".

Sat, 12/28/2013 - 16:59 | 4282180 maskone909
maskone909's picture

Funny thought; congress deciding economic fate of other countries.

Sun, 12/29/2013 - 06:57 | 4282943 silvermail
silvermail's picture

Any leader of any state of the union will be overthrown if he refused to follow the dictates of the United States.
More precisely dictates cartel of private individuals who are the true masters of the United States and all American citizens worldwide.

Sat, 12/28/2013 - 17:03 | 4282189 Carpenter1
Carpenter1's picture

No guillotine colonel, they don't hurt. A slow roasting over a week or two while watching their children and spouse get dismembered and eaten by a pack of hyenas, also slowly, one limb at a time over a few days each.

Hmm, nah, too good for them, anyone got a better idea?

Sat, 12/28/2013 - 18:53 | 4282353 Colonel Klink
Colonel Klink's picture

Should be used for all the criminal elite and supporting politicians.

Sun, 12/29/2013 - 05:33 | 4282908 saulysw
saulysw's picture

That's nasty.

Sat, 12/28/2013 - 18:58 | 4282367 Zero Point
Zero Point's picture

Wall off Manhattan, and simply banish the lot of them in there together.

Make sure Kurt Russel is kept far away.

Sat, 12/28/2013 - 19:57 | 4282433 Winston Churchill
Winston Churchill's picture

The death of a thousand cuts descibed by Marco Polo would

seem to be what you are looking for.

The torture could be extended to any desired length according

to the executioners whim.

Along with their currect habit of executing crooked bankers,

Chinese civilisation does have merits.

Sat, 12/28/2013 - 17:08 | 4282195 realWhiteNight123129
realWhiteNight123129's picture

One of the obvious reason is that it would provide a bid under the Turkish Lira, which is now gone. 

Sat, 12/28/2013 - 17:40 | 4282238 Lokking4AnEdge
Lokking4AnEdge's picture

Now you know why there is no more gold at JPM....

Sun, 12/29/2013 - 00:17 | 4282749 BeanusCountus
BeanusCountus's picture

Hmmm. JPM lets their inventory fall. Right about the time Iran is no longer going to need gold to finance their operations due to sanctions. Demand for gold, and the price, dropping ever since then. Interested in any thoughts.

Sat, 12/28/2013 - 18:02 | 4282279 falak pema
falak pema's picture

btw : Turkey was not the only route. A lot of Petro economies from the ex russian zone were part of this scam like Azeri regime. So the blowback could hit a lot of countries that tried to benefit from this US ostracism, if IRan can now openly broker its oil OUTSIDE of a western embargo scenario.

Of course those who were not US controlled were doing it not for petrodollar gold but for commissions as some of that oil was being channeled from Iran to them via pipelines. 

Its such an incestuous family with a lot of dirty secrets : the big oil business. And it streches all the way to Brunei..and now beyond into Australia. 

Not saying that Erdogan's Turkey will not feel the blowback. Keep in mind that Turkey is ally as well as competitor to iran for regional domination down the road; Ottoman Safavid rivalry of old. Iran could play a bigger role in PAk/AFGHAN/INDIA link if the US hold on Afghan relinquishes...The Great game is what Putin/Iran have in mind as they sit on the future reserves of export fossil fuels bigtime, if you include Iraq. 

This is very disturbing for Saud and Qatar/EMirates as for the Templar kingdom of Jerusalem.

Sat, 12/28/2013 - 18:11 | 4282305 jballz
jballz's picture

You know who is amazeballs?

Those guys. It's like they always know which way the wind is blowing.

Funny thing is the Carlyle Group owns Booz Allen Hamilton. The guys who owned Ed Snowden. Or vice versa as it turned out.

You don't suppose the Carlyle group would use its total control of the NSA apparatus to leverage their global business dealings do you?

Never mind, wild conspiracy theory. Booz is a subsidiary so they would not share information with their parent company. Especially sensitive information extracted through clandestine espionage operations with total immunity and government cover.

Sat, 12/28/2013 - 18:20 | 4282320 falak pema
falak pema's picture

Carlyle is always one step ahead of the curve. See what I wrote here :


Sat, 12/28/2013 - 21:46 | 4282567 lakecity55
lakecity55's picture

Carlyle holds the Franchise on Arrakis.

Sat, 12/28/2013 - 22:02 | 4282581 Rock On Roger
Rock On Roger's picture

Too bad we can't call up a worm to devour the harkonen.


Stack On

Sat, 12/28/2013 - 18:34 | 4282335 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Some more on oil/gas pipelines and potential flare up zones as the Chinese and Russians chip away at Petro-dollar.

First a map of the middle east so people can reference since geography is not a strong point with people these days.

As we all know China is buying gold hand over fist but the question is for what use. To purchase oil and gas in petrogold is one scenario.

As one can see there are only 2 fairly direct routes into China from Iran and Afganistan is one of them. With that an article.

A major reason for the U.S.-led invasion and occupation of Afghanistan was the building of a pipeline through the country that would take natural gas from Turkmenistan to India and Pakistan. Canada and the other 44 Western countries occupying Afghanistan are supporting this U.S. objective by bolstering Washington’s military position in the country.

Turkmenistan, which borders Afghanistan, contains the fourth largest reserves of natural gas in the world (Iran is 3rd). The U.S. has been trying to set up the pipeline for a decade, having first negotiated the venture with the ousted Taliban government. Two months after these negotiations broke down, Washington overthrew the Taliban in October 2001 when it invaded Afghanistan.

Since then, the U.S. has persuaded India, Pakistan, Turkmenistan, and Afghanistan to sign an agreement aimed at constructing the pipeline, but the war in Afghanistan and the U.S.’s failure to defeat the Taliban stalled actual work on this project. Washington’s occupation of Afghanistan and pipeline plans are part of its strategy to gain control of Central Asia’s and the Caspian Sea area’s energy riches and divert them away from Russia, China, and Iran.


Russia and Turkmenistan have also agreed to build an east-west pipeline connecting all of the latter’s gas fields to one network so that the pipelines going to Russia, Iran, and China can take gas from any of the fields. (See the accompanying map for the routes of these new and proposed pipelines.)


So the US has cock blocked Iran so far from being able to deliver oil/gas to China cheaply and directly in turn for petro-gold well now you have this.

The energy relations between Iran and Pakistan are a marriage made in heaven, except for international politics.

Pakistan’s current energy deficit problems are severe and increasing. Pakistan’s most respected English-language newspaper, “Dawn,” recently headlined an article, “Pakistan, Nuclear-armed but short of electricity” before noting, “Power can be out for up to 20 hours a day in the summer… The shortfalls that became the no. 1 issue in the recent election are estimated at 3,500 to 6,000 megawatts, up to a third of total demand.”

Pakistan’s ramshackle and investment starved private power companies have roughly 50 percent less electricity generation capability than the actual demand, leaving Pakistan’s National Grid facing more than a 5,000-megawatt shortfall in power generation, leading to blackouts (referred to in the Pakistani press as “load shedding”) in both urban and rural areas of the country.

Combined with rampant theft of electricity and massive corruption in the country’s power sector, Pakistan’s ongoing energy shortages are unlikely to end anytime soon, whatever Islamabad does. The country’s crisis peaked on 24 February, when a fault at one power station cascaded into multiple plant shutdowns and plunged the entire nation into darkness, with authorities warning that the power crisis would deepen as the summer approached. In June, “load shedding” led to blackouts of up to 18 hours in urban areas and up to 22 hours of outage in rural areas. Pakistan currently produces roughly 11,000 megawatts of electricity, but the country needs more than 17,000 megawatts of power to meet the rising demand of a growing population.

So, where to make up the electricity shortfall, short and long term?

Foreign investment, but here, Pakistani nationalism has hardly improved the situation.


Enter China, increasingly the world’s fiscal investment savior and Iran, seeking to circumvent increasingly stringent foreign sanctions imposed on the country for its purported cover nuclear weapons program.

Despite Washington’s displeasure, Pakistan has been engaged in discussion with Iran to construct a $7.5 billion “Peace Pipeline” to deliver 21.5 million cubic meters of natural gas a day to Pakistan from Iran’s massive offshore Persian Gulf South Pars field, currently being developed in conjunction with Qatar.


looks like someone is hedging their bets since they are stone's throw from Iran and can easily hook into that infrastructure.

I predict a full out US led invasion of Pakistan over this within a year or 2.

Now back to Turkey and Petrogold.

A “peace pipeline” that connects the natural gas resources and infrastructure of Israel, Cyprus, Greece and Turkey is nothing less than “inevitable,” a Turkish parliament opposition party member told The Jerusalem Post on Thursday.

“My rationale is not based on a drive for profit or access to energy resources; it is based on a moral imperative,” said MP Aykan Erdemir, a member of the party assembly of the Republican People’s Party.


Moral or not we can't allow Turkey position itself to be the blockchain bitcoin equivalent to petrodollar now can we.

Sat, 12/28/2013 - 19:25 | 4282343 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

A little aside on Aykan Erdemir and what drives his morals since he is one of the opposition leaders jockeying for head of the table when Erdogen is finally removed.

From the above article.

Erdemir, who has represented the city of Bursa in parliament since June 2011, has been a member of the social democrat opposition party in Turkey since December 2010. A social democrat opposition party named the Republican People's Party.

Before entering politics, the Harvard University doctoral recipient worked as an associate professor of sociology at Middle East Technical University between 2004 and 2011.

We know what 'club' he belongs to......


Sat, 12/28/2013 - 22:15 | 4282595 jonjon831983
jonjon831983's picture

"I predict a full out US led invasion of Pakistan over this within a year or 2."

Who knows.  There have been tidbits of fear about what will happen to Pakistani nuclear weapons if they collapse.  That could be a valid pretext for an invasion of sorts - not necessarily full blown.

Sat, 12/28/2013 - 18:40 | 4282342 max2205
max2205's picture

NATO ain't what it used to be.

Sun, 12/29/2013 - 11:34 | 4283082 silvermail
silvermail's picture

In the world there is no NATO and has never been before. There is only the United States and their vassals.

Sat, 12/28/2013 - 18:53 | 4282357 besnook
besnook's picture

let's see, here. petro gold bad. bitcoin now good. and you think bitcoin is the good guy.

Sat, 12/28/2013 - 19:03 | 4282368 KickIce
KickIce's picture

This is exactly what our bankers/politicians are doing to us.


The only difference is that the Turks are doing it with a party/country that will not cave to a central bank.

Sat, 12/28/2013 - 20:45 | 4282503 disabledvet
disabledvet's picture this trading is done "internally"...there is nothing "illegal" at all about it. i do agree among certain individuals these could be construed as "strategic assets" or "war aims." i would prefer oil or natural gas simply because there is so much of it and to "get it" all that is required is sound monetary policy. Europe, Britain or China don't seem to have this problem right now...and none of them are producing energy on the scale that the USA is right now...nor will be going forward for at least the next decade. so no...there is no need for a "petro dollar" when you have the "petro" (et al) in any currency you want it to be in "as long as the petro guy will take it." and yes that can include euros, pounds, yuan, gold, silver...i'm still not into copper...but apperently "ships" are okay. in other words "it's cheaper to ship American energy via a ship from the USA to the USA than it is to import it from another country." Since that could also include the Great Lakes you are talking potentially an ENORMOUS amount of raw materials "to be processed into a value added product." Here's one: "pre sliced." wow. "you gotta pay extra for that though."

Sat, 12/28/2013 - 20:57 | 4282517 flrzero
flrzero's picture

This article is an editorial by an Israel lobby, anti-Iran "think tank" called Foundation for Defense of Democracies. I am a bit surprised that it is in Daily Zaman, which is a pro-AKP newspaper. This editorial appears elsewhere if Zerohedge bothered to search. It's misinformation to state that "Daily Zaman" is the source of the information. Check the names of the authors of the article and their affiliation!

This article overlooks the fact that the gold was converted into hard currency in Dubai. The gold for gas/oil trade is inefficient since ultimately Iran needs hard currency. In fact Turkish gold sells at a discount (versus bars from other refineries) in Dubai. The scandal here is that these people (Aslan and Zarrab) probably grabbed some per centage of the money in the course of the transaction.

Under the sanctions the money paid to Iran for oil (and gas mainly to Turkey) had to be held on deposit in local currency in the purchasing country.(E.g. lira in Turkey; yuan in China). Bigger customers (for Iranian oil) than Turkey include China, Japan, Korea and India. This meant that Iran had the money on deposit but could not use it. The recent deal released the money. Only Turkey got into the gold-for-oil scheme although I read that Indian purchases were also processed through Turkey. Calling this "illicit" is ridiculous. The US decided that it was "illicit" by executive order in Jan 2013.



Sat, 12/28/2013 - 22:15 | 4282588 Quaderratic Probing
Quaderratic Probing's picture

"The Turks exported some $13 billion of gold to Tehran directly, or through the UAE, between March 2012 and July 2013. In return, the Turks received Iranian natural gas and oil."

March 2012 March 2013 Gold average price about $1700 the gold they received in trade is now worth $500 per Oz less, a 30% loss in value. USD has averaged 82 over the same time.

Iran lost in the trade

Sat, 12/28/2013 - 22:20 | 4282597 Took Red Pill
Took Red Pill's picture

For now. Perhaps they don't care how many dollars their gold is worth.

Sat, 12/28/2013 - 23:02 | 4282648 Quaderratic Probing
Quaderratic Probing's picture

600 feet down they have huge oil fields worth more than any gold they hold or will hold.
What will they trade the gold for in the end?

Sat, 12/28/2013 - 22:26 | 4282608 tony bonn
tony bonn's picture

petrogold is here to stay along with turkey's middleman role....the only reason the usa attacked iran was because it defied the petrodollar, quickly becoming a quaint relic of usa hegemony.

the usa thinks it can hang on to its exorbitant privilege by saying ooops my bad, but it is really oops upside the head....the new world will consist of the petrodollar (for a while), petrogold, and petroyuan...

the usa's position in the middle east is over - it is the new britain.

Sun, 12/29/2013 - 03:09 | 4282865 Oldrepublic
Oldrepublic's picture

so 2013 is to the US like 1956 was to the UK?

Sun, 12/29/2013 - 00:40 | 4282774 walküre
walküre's picture

CIA is engaged in Turkey and stirring up shit against the current regime just like they did in Baghdad. Erdogan is no saint but this is as much about human rights in Turkey as it was about WMDs in Iraq. The issue is Iran and Iran's oil. Turkey's Erdogan has helped Iran to work around sanctions which have all but crippled Iran's economy and left millions of Iranians in Europe and North America scrambling for cash.

Sorry, Turkey you will not win this unless the US gets kicked into the nuts deep and hard. Maybe Russia can assist with that. Syria is still on the table. My prayers to the Gods (the true powers that be) for 2014 is that a weakened US led into bankruptcy and corruption by a Zionist cabal will get their ass handed to them on a copper platter.

It's about time this fucking charade ends and we can look into a future with more true freedom.

Sun, 12/29/2013 - 16:55 | 4283725 falconflight
falconflight's picture

12 fuking losers actually believing in a "zionist cabal."  loosssers

Sun, 12/29/2013 - 02:53 | 4282860 WTFUD
WTFUD's picture

' should old acquaintance be forgot. . . '

out with the old and in with the new there's nothing in this game for 3 in a bed.

bunch of criminal elitists ' do that to me one more time ' (up the arse)

Sun, 12/29/2013 - 05:38 | 4282912 Cdn1
Cdn1's picture

Did the author bother to tell us how Turkey got any gas and oil from Iran?  were there a middleman countries ?


Sun, 12/29/2013 - 06:53 | 4282941 lakecity55
lakecity55's picture

This whole affair reminds me of a sausage-making factory. Good thing we can't see all the details.

It might make a good movie, though: Two Turks fighting for power, gold, oil, skuldugery, mysterious Syrians and swarthy Islamic fighters...Iranians, Israelis, probably 10 spy services.

I wish Mr Clancy had not recently passed. He could turn this into a hit.

"The Hunt for the Golden Turk"

Sun, 12/29/2013 - 09:53 | 4283007 Magnum
Magnum's picture

This story was authored by these shmucks.

Sun, 12/29/2013 - 16:50 | 4283720 falconflight
falconflight's picture

I persued the think tank's web site.  What's yer point?

Sun, 12/29/2013 - 16:59 | 4283740 falconflight
falconflight's picture

What this article points out is the ever dublistic (sp) nature of US international policy.  Maybe Benito Obamalina got the Ayatollahs to agree not to hang gays.  Promoting homosexuality is a prime, front and center objective of US foreign policy. 

Mon, 12/30/2013 - 16:26 | 4286293 MeelionDollerBogus
MeelionDollerBogus's picture

the problem I have with this story:

Iran doesn't HAVE ANY illicit nuclear program.
They are compliant under the NNPT and Iran's punishment is for trying to even MEET what it is told it is allowed under the NNPT.

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