REPORT: Nuclear Iran would ‘double’ oil prices, cost millions of U.S. jobs…

October 10, 2012

Part of what we try to do at Coin Trader and on the Mind Your Money blog is to provide advance warning of external factors that may not seem to be investment-related at first glance, but which are in fact absolutely vital for investors.

One of the issues that we are following closely is the simmering conflict over Iran’s nuclear program.

We do not examine this conflict from a political standpoint, but rather strictly from an economic and investment standpoint. No matter what your view of Iran, its nuclear program, Israel or a possible US response, you MUST NOT ignore the possibility that a crisis could erupt over Iran’s uranium enrichment activity.

That means you must prepare ahead of time by diversifying into gold investments, something we deal with regularly.

But what types of conditions are likely to result from a crisis involving Iran?

Obviously, no one has a crystal ball, but a new report issued by a bipartisan association of national security and economic experts predicts extremely chaotic conditions. Here are a few of the highlights:

• The price of a gallon of gasoline in the USA could climb by an additional $2.75 per gallon

Inflation would increase to 5%, far above current levels.

• The US would be plunged into a recession, with 5 million jobs being lost.

In other words, an Iran armed with nuclear weapons would touch off a bout of 1970s-style stagflation.

Investors must be aware that in the 197os stagflation, the price of gold tripled and the stock market plunged by 45%.


Gold: Protection from Economic Turmoil and Military Crisis

October 9, 2012

JR Nyquist is a long-time respected observer of world affairs from an economic and financial standpoint. He has been writing on such subjects for some 15 years.

This week he has penned an informative analysis of various crises that are simmering around the world which could have a profound impact on the world economy and financial markets.

Paper assets provide virtually no protection from these exogenous factors. Gold is the crisis commodity that has historically protected wealth in such scenarios. But it is important that investors stay informed of these factors, which the mainstream media largely ignores…

Middle East Expert Walid Phares Explains the Economic Ramifications of an Iran Armed with a Nuclear Bomb

September 27, 2012

Fox Business Channel did a short segment on the potential for an Iran armed with a nuclear bomb to disrupt the world economy. This is an often overlooked aspect of the issue of Iran and its nuclear program. It is well worth a look…See the link below.

Investors need to keep in mind that in any scenario in which the world economy is disrupted, world financial markets will be disrupted as well. In the event of a crisis, investors need to turn to the “crisis commodity”–gold.


September 11th

September 11, 2012

As everyone remembers September 11th in their own way, investors should take a step back and examine the implications of a horrific terrorist attack.

In the case of 9/11, it shut down the financial markets for an entire week and sent certain sectors of the US economy into depression (notably the travel and hospitality industries). The financial markets reeled from the fallout and gold awoke from a decades-long slumber. 2001 marked the first of 10 consecutive years in which the price of gold has risen.

But what of possible future attacks? Such attacks almost certainly won’t take the form of the September 11th attacks. The article linked below examines the possibility and possible fallout from a cyberattack targeting America’s financial system. Such a scenario is not nearly as far-fetched as some would have us believe. The article comes from Rachel Ehrenfeld, a noted expert who heads the Economic Warfare Institute.

The U.S. financial industry, supposedly one of the most closely monitored sectors of our economy, remains susceptible to serious threats. Not all from the outside, either. While the streets will not be littered with bodies, when elements of our financial infrastructure – the monetary system, various exchanges – come under attack, the U.S. economy – and the world’s economy–could be severely damaged and millions of people devastated. Smaller attacks are already being carried out incrementally, yet rarely detected, periodically bleeding the market. The reaction, or lack thereof, leaves the stock market open to an overwhelming attack that is likely to leave the U.S. economy in dire straits for years.


Our financial markets’ vulnerabilities are well-known to those intent on sabotage. Despite an awareness of such threats, the nation’s tools for early identification of financial threats remain limited, as the latest survey of IT security executives concluded. These represented 100 companies and organizations with more than $100 million in annual revenue. Moreover, even when detected, financial-industry cyber attacks go underreported, or unreported, because officials are reluctant to divulge information that could prevent further losses.

The threat of a mega attack on the financial markets, a major factor in America’s economic stability, is very real. Crash attacks via high-frequency trading would further cripple investors’ confidence in U.S. financial markets and destroy America’s economy for many years. The present stagnant economy and the uncertainties associated with this year’s presidential elections could be a tempting opportunity to create an economic “perfect storm” that the U.S. is currently incapable of preventing.

In the event of such a horrific cyber attack on the US financial system, investors will need safe haven investments. But it will be too late if you do not already own safe haven investments ahead of time.

That’s why every investor needs to devote a portion of his or her wealth to gold investments. Only gold is real and not subject to being erased by a keystroke…

Sabre Rattling Over Iran

August 2, 2012

Few exogenous factors have the potential to turn the financial world and global economy on their heads the way that a potential conflict with Iran does.

It is important for investors to understand that there is a possibility of an armed conflict involving Iran and to view this contingency objectively, without regard to the politics involved.

The fact of the matter is, hostilities between Iran and a foreign power, whether it be Israel or the USA, would be devastating to financial assets and would potentially hijack any semblance of an economic recovery in Europe, the USA or Asia.

Such a scenario would likely result in a disruption in the flow of oil from at least Iran and probably from other Persian Gulf nations, sending the price of oil sharply higher. Worst of all, the end-game for such an escalation in oil prices is unknown. It could be days…or it could be months. Higher oil prices would impact the global economy like a freight train at this point, squeezing consumers’ pocketbooks and corporate profits alike, sending stock markets downward and spooking bond prices as well, since inflation is decidedly negative for bonds. Historically, gold has outperformed other assets in such a scenario. This is what occurred during the Arab Oil Embargo during the 1973 Yom Kippur War between the Arabs and Israel. The stock market declined precipitously, while the price of gold in London exceeded $100 per ounce for the first time ever, never to return to that level. Gold went on to triple over the next 3 years and ended the decade at over $800 per ounce.

There is also the frightening possibility that a war involving Iran could spread to other parts of the world. Iran is known to have operatives and terrorist proxies from South America to Thailand, including the USA and Europe. It is not unlikely that Iran would strike back at its foes with terrorist attacks on non-military targets around the globe. This type of warfare has a economic impact component all its own.

We bring this up now because Iran is back in the headlines today.

Today it was widely reported that Iranian President Mahmoud Ahmadinejad called on the Islamic world to annihilate Israel, echoing similar threats he and Iran’s Supreme Leader, Ayatollah Ali Khamenei, have made in the past.

Meanwhile, Israeli Prime Minister Netanyahu was quoted in today’s New York Times as having said that the time to solve the question of Iran’s nuclear program peacefully was “running out.”

Also, Efraim Halevy, a former chief of Israel’s intelligence agency and national security adviser, was quoted in the same article as saying that “If I were an Iranian, I would be very fearful of the next 12 weeks.”

Investors must take action ahead of time to position their portfolios before a crisis escalates into armed conflict. Once that happens, the potential side effects are simply too unpredictable. Take advantage of the current lull in gold prices to accumulate gold as an insurance policy before it is too late.