Our view has been all along that Iran is bluffing. Bluffing or not, we still could highlight this situation a few weeks back as a real threat to US growth, given the near-term direction of gasoline prices.
Key is that the mullahs get their choreography just right.
As part of the dance, further talks have been scheduled, this time with six world powers - US, UK, Fr., Ger., Russia & China. The last set of talks, in Istanbul of Jan/11 broke down.
We have written often of tension in the Middle East, of impact on crude, then impact of higher gasoline prices on US consumers. In this case, although the mullahs sound crazy, we believe they are not. They have no intention to bomb Israel or anyone else. It is that they are a failed theocracy (oxymoron) and so need an enemy offshore for sake of diversion. That would be the West.
Of course we can get in a lot of trouble if they misjudge, taking the dance a tad too close to the edge of the stage. But if things go right for them, they’ll be able to remain in power by appeasing the masses with gifts from the West. If not, they fear they will be thrown out – the West’s preferred method all along; yet lacking the support of Obama, the last attempt (2 years ago) failed.
The mullahs can’t risk another uprising.
Robert Craven
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