Though he was wrong on just about everything, John Maynard Keynes was on target when he said: “Lenin was certainly right, there is no subtler, no surer means of overturning the basis of existing society than to debauch the currency. This process engages all the hidden forces of economic law on the side of destruction, and does it in a manner not one man in a million is able to diagnose.”
Like a carton of spoiled milk left out on the kitchen counter, the fiat currency system is long past the end of its shelf-life.
Shutting down Hormuz visualized and put into perspective... During the first oil shock in 1973, about 5 million barrels were removed from the global oil market. Daily global oil production was approximately 56 million barrels per day at the time, which means about 9% of the supply vanished. Oil prices roughly quadrupled. During the second oil shock in 1979, about 4 million barrels were removed from the global oil market. Daily global oil production was approximately 67 million barrels per day at the time, which means about 6% of the supply vanished. Oil prices nearly tripled. During the third oil shock in 1990, about 4.3 million barrels were removed from the global oil market. Daily global oil production was approximately 66 million barrels per day at the time, which means about 7% of the supply vanished. Oil prices more than doubled. If Iran were to shut down the Strait of Hormuz, it would remove a whopping 21 million barrels of oil from the global market. Today, global oil production is approximately 94 million barrels per day, which means about 22% of the worldwide oil supply could disappear. As we can see in the chart below, it would be the largest oil supply shock the world has ever seen… by far. image
Whoever prevails in this battle will win WW3 and get to shape the new world order.
Changes to the world order are historical events with enormous implications—investment and otherwise. We’re living through one of these rare times right now.