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James Rickards, Senior Managing Director of Tangent Capital, is skeptical that economic sanctions with Iran will be effective
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We decided to take a look at Iran for the military angle that from the geopolitical angle the from the economic angle.
And we've got so I wanna get somebody who really knew his way around the world financial system said James jam record who is being.
Managing director of -- capital.
-- -- hedge fund guy and an enormous reputation.
You're the author of the best selling book currency wars here guys always advocated for a strong dollar.
You understand how international currencies work.
And -- international markets work.
I want to bring UN talk about Iran sure.
If there's a conflict in the Middle East if there's some kind of a crisis in the Strait of Hormuz if Israel attacks Iran.
If something goes wrong and there's some kind of disruption.
And the oil markets out of the Middle East what happens well.
It's really good question KG we see if a conflict throughout the conflict -- -- -- of the war has started right now it's a financial word runs the risk of turning into a shooting war.
I think sooner than later but -- the president.
Kicked -- ran out of the dollar payment system.
And we can write that Saddam out of the headlines right kicked him out of the globe -- swift -- As the global emphasis -- him out of that to those are destructive to the Iranian economy -- interest rates skyrocketed.
The currency crash and have.
They also if you're -- -- -- twice as many.
We dolls to get dollar's demise imported goods -- senator says -- -- to -- that controversial story be careful what you wish for.
There's Iran Missouri commenced workarounds.
For saying -- if you kicked -- -- fine we'll set up bilateral banking relationships with Russia China India.
We'll do oil for gold swaps will do well -- -- swaps.
And so many running work around there these these leading Asian countries those -- the brits plus Iran -- were already working on alternative payment system.
To the dollar payment systems this may actually -- Especially -- -- candidate -- -- -- countries off the dollar and then now I have now have direct -- very very destructive -- -- sure -- can be counterproductive in the long run because it's part of the diminution of the role of the dollar but.
Your specific question that we have a set of things we were pretty sure what happened.
Oil would go to somehow it 200 dollars a barrel mean they're arranged -- what I had because of the private because your eyes -- -- And marketers and it has every right that it will both actually it's very clear -- shut mistress of -- -- I have no doubt.
About the ability of the navy to reopen it but people a little glib about how easy that is -- -- days -- -- weeks and months my sweeping operations are extremely difficult.
They've got a lot of unconventional and -- -- warfare tactics you know swarming kamikaze -- -- good.
Sadly they have a lot of this -- -- router mile border takes opera around a water and I could shoot missiles from Iran mainland.
And I actually think you through the administration I think one of resilience highlight that -- I think Iran actually wants the war that sounds very strange way life is in negotiations are being -- for two choices.
Give up -- uranium enrichment program -- nuclear program verifiable -- Or will attack you.
-- run around -- round -- about well well another what what we're saying is give up your program -- and benefits or what -- -- they lose both ways out of his -- certainly am -- -- with.
Economically and -- neighbor always has program -- but I think continuing down the path through some probability that we won't do anything I don't think that's true but.
Thank you say we could actually get the nuclear weapon and calling upon Hamas called our bluff and others.
But if we attack them.
That's not a bit are confident they lose their program but remember they -- gonna have to give it up anyway to avoid the attacks are there no worse off -- not to mention.
They don't really care about the loss of lives in the immediate vicinity.
That -- the green light to attack Israel if they attacked Israel unprovoked.
They would be the villains but they attacked Israel after we attacked -- -- Israel -- them believe the victims so will be able to unleash thousands of missiles.
On Israel from all directions Hamas Hezbollah Syria.
And be the victim actually knock it.
World program and actually probably get some support because they will be responding to attack not launching -- -- for this reason they -- welcome.
This attack -- we don't attack they get the bomb and they win either way so if -- putting games here and experience to see how this -- -- if I make my day kind of a situation that's exactly right there's -- that you aren't SOS is.
Mercenary Arafat something happens to start a conflict is organizers somebody attacks around around counterattacks.
Israel and minds of straight of Hormuz Ben -- happens.
Well yeah I think the oil goes way up gold probably goes up.
It in a strange Medicare should be good for US stocks because we can be a flight to quality people say you know we just happen to be in the Middle East.
Probably don't want to be in Europe -- -- in the same neighborhood.
And remember Iranian oil doesn't go to that -- stays who goes to China and Europe.
So they could suffer as a result even though it is a world price.
So our market could be a flight to quality actually.
Our stock market market may go up but at the same time -- -- price of gold would go up the prices are always go up at the tank it goes -- as -- and then I think -- -- all -- -- -- for seeing unattended now once you start shooting in -- now where it's going that's hand right.
They talk about the sanctions and it sounds like you're skeptical about the sanctions that have been -- post and the ones that are going to be imposed starting July.
First -- there's good reason be skeptical of sanctions when you're in a large teacher contracts now.
As -- short run punishment for some kind of -- behavior sanctions have a place and sometimes as a bargaining -- but with very large strategic situations like -- ran.
Israel.
These sanctions are are not working there they're -- to a point but again they start to workarounds you know one of the things this happened Iranians have taken billions of dollars.
Put them on deposit Chinese or Russian banks play the Chinese -- Russian -- -- -- to the -- system and actors and agents from an undisclosed principles that's -- work around.
-- by the way Russia wouldn't mind -- war.
We're so -- Russian American dream scenario right released I can't get to market only -- target store and and a vice president and we'll have ourselves to work is not the only the questions was so I was.
So it's a win win for Russia higher oil prices through the world's largest energy right -- and tens of billions of ourselves.
To Iran to recycle stuff that we blow -- or Russia secretly wants is which is why they're not -- and Syria because that's just this is a complicated chess board that was Syria.
Syria is the land bridge from Iran to.
Hezbollah -- is counting on Hezbollah to attack Israel.
If Assad falls Iran loses a strategically -- so Russia wants to keep that Lincoln place.
Tax increase the chances yesterday I'm pretty impose sanctions as swiftly and severely enough to crash the Iranian academy.
To that point -- of -- us.
The people got -- the streets again and demanded pioneer regime our policy is something like that would probably take something close to what your last guest was talking about which is cyber warfare right strategic operations command.
More.
Covert action we'd actually have to say.
If you were now on the business that we weren't regime -- world war network while we're in the business of regime change -- -- -- welcome to the Somalis.
Change the course which I consider unlikely.
Diplomacy Bush Administration Obama administration tried -- -- think -- our -- military action which we know of that regime change.
And they economy related -- economic sanctions are very skeptical.
I mean Iran it was senator you can join the WTO they don't care about the W you know they don't have a mature manufacturing sector of the market -- they do is -- energy.
Import refined products and food and some you know iphones that's an interest ashes -- to -- it's not.
A complex that continuity could benefit from some of these carrots that were done when we're operating -- -- things they can they don't care.
