United States Invasion of Iran Could Put Gold Over $1,000

iran.jpgMELBOURNE AUSTRALIA (Markets and Money) – When is the greatest opportunity? Is it when the threat is also the greatest? Or is it before the threat is at its greatest? More likely it is when the threat is barely being considered.

We recall watching an interview on CNBC (watching is a slight stretch, it was on in the background as we struggled to operate the coffee machine in a half dazed state) in the morning a couple of weeks ago. We weren’t paying close attention but did look up when the interviewee claimed that an attack by the United States on Iran was “imminent.”

“Wow!” We thought for a second or two before re-engrossing ourselves in the coffee machine. Is it possible or even probable that US President Shrub will invade another middle eastern country? It would make it a hat-trick following Afghanistan and Iraq. Wars have probably been started for much less.

These thoughts only came back into your correspondent’s brain when we heard the senile/childlike thoughts of President Hedgerow on our way home yesterday evening. It was, not to exaggerate, not too dissimilar to a schoolboy justifying to the headmaster why he HAD to throw a brick through a closed window.

Between a couple of weeks ago and last night, the thought of a US led invasion of Iran had slipped seamlessly into the darkness. Only the semi- coherent ravings of a madman were able to reawaken the thought and the memory of the interview.

Our conclusion? That a US led invasion of Iran is not only possible, but more than that, it is probable.

Now, we don’t need much poking and prodding in order to frame a view on something. This is no exception. We turned our mind back even further than a couple of weeks ago. Much further in fact. We turned our mind back about sixteen years. The reason?

On the snippets we heard on ABC NewsRadio, President Bush labelled a division of the Iranian Revolutionary Guard as being “elite”. Elite in comparison to what? We recall the last time a middle eastern military unit was described as being “elite”. It was during the first Gulf War in 1990. Then, President Saddam Hussein’s Republican Guard army were also described as “elite”.

So elite in fact that they were overturned within a matter of days. Where were they during the 2003 Iraq War? Not so elite then, were they? Now it is time for the US administration to overemphasise the power, ruthlessness and danger of the elite division of the IRG. They even have some obscure name which apparently translates to mean something like “Death” or “We are mighty” or some other such ridiculous phrase.

The other item that we are also being told to be very scared about is Iran’s involvement with planting IEDs. “Not IEDs!” we all gasp in unison. Prior to yesterday we had no idea what an IED was. We had heard of an LED, but we found it difficult to believe that Iran possessing tiny little light globes should be of global concern.

A quick search on Google soon set us right. In basic terms an ‘IED’ is the little brother of a ‘WMD.’ It is an ‘Improvised Explosive Device’ – a bomb to you and us. Given President Bush’s recent history with scary acronyms, we are surprised that he has even uttered IED in public for fear of it being associated with WMD. So far he seems to have escaped without being pulled up on it.

How much longer can that last? When will the ‘secret dossier’ be released on an unsuspecting public? Followed by Shock & Awe II?

If things do kick off – again – in the middle east, could this be just the catalyst to shove crude oil up to USD $100 and gold up to USD $1,000? The only reason not to think so is if you don’t believe in history repeating itself. It would also be the ultimate in diversionary politics – take the electorate’s mind off the war in Iraq by declaring war on Iran. Perfect. “To the head of the class Master Bush.”

Kris Sayce
for Markets and Money

Kris Sayce

Kris Sayce, dubbed the ‘Jeremy Clarkson of Australian finance’, began as a London finance broker specialising in small-cap stock analysis on London’s Alternative Investment Market (AIM). Kris then spent several years at one of Australia's leading wealth management firms. A fully accredited advisor in shares, options, warrants and foreign-exchange investments, Kris was instrumental in helping to establish the Australian version of the Markets and Money e-newsletter in 2005.
He is currently the Publisher, Investment Director and Editor in Chief of Australia's most outspoken financial news service — Money Morning.

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