Monday, June 9, 2008

Why we all owe Shaul Mofaz a big 'thank you!'

The big news last week was the report that Shaul Mofaz, a Lieutenant-General and former IDF Chief of Staff under no less than four prime ministers, declared that an Israeli attack on Iran was "inevitable". Most observers understood that Mofaz, who is currently a Deputy Prime Minister and Minister of Transportation, made these statements as an opening shot in his campaign to succeed Ehud Olmert. Even the US immediately distanced itself from such threats. Still, the barrel of crude immediately shot up by 11 dollars to $139 and that send a panic throughout the world economy (the oil prices have since diminished, just a little).

What is interesting here though is that all it took to spike up the price of oil were the reports of the threats made by one Israeli politician; so just imagine what will happen when the real shooting war actually begins!

It is often debated whether the Iranians can shut down the traffic across the Strait of Hormuz, but is this really the only big threat to the world economy out there? Just imagine what will happen when the shooting war starts and the Iranians only *threaten* to mine the strait. That will be plenty enough to create a huge panic, and while the USN might or might not be able to keep the strait open, there is exactly nothing the USN can do to prevent such a panic rippling across the markets.

Mofaz, in his reckless sabre-rattling, actually made us all a huge favor by showing how truly volatile and panic prone the markets are nowadays. Whether that will be enough to stop the Neocons is dubious, but at least it gives us all a much needed warning and one less excuse to plead ignorance for the Neocons when they will have to answer for the many disasters their crazy policies inflicted upon the world.