"Trump Decides to Launch War With The World
to Defeat Iran and Destroy the Dollar"
by David Haggith
"Before we get into Trump’s suicide mission to end the Iran war by destroying the US dollar, we should lead off with Treasury Secretary Scott Bessent’s confession about how stupid he is because we have to grasp the ignorance level of those in charge to really believe they are embarking on their dumbest war plan to date.
The Jerry Lewis Klutz Award for Mental Gymnastics has to go this week to this statement by Secretary Bessent: On Thursday, hours after announcing that Washington would keep its naval blockade and hit Iran with the too toughest sanctions in history, the Treasury Secretary watched crude climb and told CNBC, “I’m not sure why oil has popped up on this.” He called it a spike he doesn’t understand, and waved it off as noise. Buried in the bafflement is a remarkable assumption: that slapping draconian sanctions on a major oil producer should make oil cheaper.
It actually includes a lot more asinine assumptions than the overall thought that Bessent’s new financial war against Iran will make oil cheaper. For example: It assumes Iran won’t fight back with its own economic warfare against the US and many other Western nations.
It assumes that Iran won’t even think up the possibility of fighting back with heavy artillery in the Strait of Hormuz and Bab el Mandeb to disable more tankers, making the blockades complete.
It assumes Iran will not fight back with physical destruction brought to American soil, perhaps even chemical or biological, to cripple the US economically and seriously raise the cost in US lives and suffering. It did, after all, use WMD with Iraq. It may not have nukes, but it has chemical and biological weapons, and missiles and bombs are not the only means of delivery.
Bessent’s ignorance as to why on earth laying siege on Iran with the most hostile and crippling sanctions ever imposed would possibly cause a rise in the price of oil should scare anyone into realizing that the people who have devised Trump’s new warfare strategy haven’t thought anything through past Day One - economic D-Day, as Trump & Team were calling yesterday when the plan commenced.
Iran immediately promised it would retaliate with a much hotter war within forty-eight hours - a countdown that is now down to something around twelve hours. Oil did go down today, slavishly following any headline by Donald Trump, who told the same old lie that the US fully controls the strait AND that Iran desperately wants to make a deal!
Meanwhile, Iran kept running the clock toward whatever higher escalation its next salvo will bring. However, Bessent’s likely satisfaction today that oil finally moved the direction he thought it would should be short-lived because Iran has been very good about no longer engaging in mere saber rattling, as was long its practice, and actually carrying out, unlike Donald Trump, every threat it makes. And they have been very measured in their responses - not being the ones to wildly escalate the war, but increasing pressure with new types of impact whenever they see escalation by the US.
Blowback is certain: Before we even get to Iran’s war response, let’s consider how shortsighted Trump’s promise of a huge economic war that will devastate Iran is in terms of how the shock waves from his attack will ricochet and cause severe economic damage to the US even if Iran does nothing.
Bessent just published an article in the FT. It reads like an economic suicide note. I think the US is legit about to blow its brains out by imposing secondary sanctions on China as the USD global system unwinds. Bessent’s threat in broad strokes was this: The alternative for those who tether themselves to Tehran is the foreclosure of any path to lasting prosperity. Illicit finance will flourish, as it so often does, where confidence has collapsed. And any nation that serves as a financial artery of a withering regime should expect to share in its isolation. To become a sanctuary for terror is to become, in the eyes of the United States, a global pariah.
In an announcement ahead of the move, The Trump administration on Monday announced a plan to isolate Iran’s economy by threatening to impose secondary sanctions on the “enablers” keeping the Islamic Republic afloat. “We are launching an economic onslaught against Iran’s financial connections around the globe,” Treasury Scott Bessent said as he unveiled the new sanctions scheme, dubbed “Operation Economic Outcast.” President Donald Trump is calling world leaders and making “specific requests to cease their interactions” with Iran, Bessent said at the Treasury Department.
That means an onslaught against the nations that trade with Iran, as if Trump has the right to tell other sovereign nation whom they can trade with. To be a little more specific, here is one of the big actions carried out since economic D-Day: The Trump administration’s “Operation Economic Outcast” has expanded the sanctions campaign across China and Hong Kong, targeting dozens of individuals and businesses while intentionally holding off on sanctioning major Chinese banks that keep Tehran connected to the global financial system. Beijing, meanwhile, signaled earlier Tuesday that it would not retreat from its economic relationship with Iran, raising the risk that Trump’s economic war against Tehran could evolve into a direct confrontation with China, the largest buyer of discounted Iranian crude.
First, by ruling out fooling around with China’s big banks, the plan practically renders itself too harmless to make a big enough change. “Sanctions against specific entities are meaningless, as entity-specific sanctions can’t be applied quickly enough to match the speed at which substitute entities can be created,” said Derek Scissors, a senior fellow at the American Enterprise Institute who tracks Chinese trade, according to Bloomberg. Scissors said some sanctioned entities could create pop-up shell companies to evade Treasury sanctions, adding that the dozens of entities named by the US “exist in a universe of tens of thousands.”
“No one is above the reach of US sanctions,” Bessent warned during Monday’s press conference. To be effective, the sanctions will have to be against major banks, not just against specific companies or individuals. So, this will escalate in time into sanctions on banks if it is to have any serious effect.
Beijing has said it will not back down to this siege being laid against its own economy by the US; so, of course, it will heat the trade war with China back up. Bessent responded, “This is a sustained campaign to collapse every last option for Iran. Let there be no ambiguity as to the position of the United States: an economic engagement of any kind with this murderous regime will expose those responsible to the full reach of American power.”
The starting salvo looked like this: Late Monday afternoon, Treasury Secretary Scott Bessent unveiled nearly 60 Iran-linked sanctions under what he called Operation Economic Outcast, a campaign designed to sever Iran’s remaining trade, technology and financial lifelines.
Is the Trump administration seriously dumb enough to think that all of those nations involved will not fight back with their own raised tariffs and embargoes on US goods? Obviously, it is that dumb, given Bessent’s total dumbfounded bewilderment over how oil rose upon his announcement before finally falling obediently today. These nations that are now being pulled directly into the war by Trump’s effort to economically damage them for not obeying his demands will exact their own damage on the US in creative way we haven’t even thought of.
“China’s cooperation with Iran has always been conducted within the international framework and should not be interfered with or undermined,” Lin said. “China is closely monitoring relevant developments and will take all necessary measures to firmly safeguard its own interests.” Financial Times reports that Beijing could retaliate if Chinese firms are included in any expansion of the economic war against Iran.
Most importantly, Treasury stopped short of targeting large Chinese banks because doing so could have derailed next month’s summit between Xi Jinping and Trump. With their economies already being damaged extremely by Trump’s oil war, and with some facing food shortages already because of Trump’s War, and with the promise of US sanctions severe enough to turn them into economic outcasts along with Iran, we can certainly expect an intensified financial war against the US petrodollar. As noted in my last Deeper Dive, dispatching of US Treasuries picked up some during the last month reported, but nothing severe as of yet. That could become severe if a number of nations are finally just done with the dollar, given how Trump has now promised his war will be fought by using the dollar as the primary weapon. This is the part where it gets really dumb: “Any entity that facilitates money laundering on behalf of Iran will be removed from the U.S. dollar system,” he said. “The clock just started ticking.”
Every time the United States has weaponized the dollar by cutting those it doesn’t like out of the global financial system, it has weakened the dollar’s value as a global trade currency. It has increased distrust and left nations to wonder when they will be next to be hated for some unexpected reason by the mercurial Trump, like Canada just was for blowing smoke up our backside, resulting in newly imposed tariffs has high as 50% and the schoolboy wail that he will rename Lake Ontario as Lake America just to show them whose boss (as if such a lame move would do anything to change what all Canadians call it!)
So, the new economic war will work by pulling out the old US trick of cutting anyone seen as an enabler for Iran out of the SWIFT dollar transaction system. “We want to make clear here today that no one is above the reach of U.S. sanctions,” Bessent said when asked if the administration would target Chinese banks, or if it would avoid doing so in order to preserve relations with Beijing. “If they facilitate transactions and are part of the ecosystem that turns Iranian oil into money, into repression, they will be targeted,” Bessent said…
Bessent said Monday that the new U.S. objective “is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.” The regime’s enablers include those who buy or transport its oil, facilitate its financial transactions, accept its flights and allow it conduct seaborne transfers, he said.
What Trump’s plan will actually accomplish is to make sure the US stands alone. The US will be the economic attacker here against nations that did nothing expressly against the US simply because Trump demands that he has the right to unilaterally control their trade and punish them with sanctions that will leave them isolated financially as economic “pariah” if they do not cooperate with his imperial demands. As Hal Turner comments, "Bessent threatens to turn China, the UAE, Türkiye, Iraq, the EU, India, Pakistan, Russia, Afghanistan, and Oman (Iran’s top ten trading partners) into global pariahs."
That won’t fly with any of those nations. So, it makes all of them direct enemies of a US economic war agains those nations, not just a war with Iran. It turns the Trump-Iran War into a defined world war against the economies of other nations, intended to hit them so hard as to “obliterate” them, to “decimate” them, as Trump likes to say - to turn them into isolated outcasts wandering the most austere steppes of the global economy.
It is not Iran that will be seen as the hostile attacker against these nations. They WANT to trade with Iran, and Iran simply wants to trade with them. So, Iran will not be viewed as the enemy by any of the nations Trump takes action against. The US will isolate itself as being the sole threat in all of this turmoil against all of those nations. Can anyone even for a moment believe this won’t strengthen their determination to destroy the tool that is specifically being used to crush them - the US dollar? After all, the damage to them by the dollar will now be part of an actual war plan by the US. Talk about currency wars! And that is why others are writing that Bessent’s plan reads like a suicide note.
The U.S. is also expanding its sanctions scope to target those who participate in Iran’s digital assets, technology, gold, aviation, and shipping sectors, said Bessent. Bessent added: “Iran’s enablers purchase and transport its petroleum. They facilitate the flow of its finances through exchange houses and free trade zones.” All of that will come under economic fire, and the dollar will be the gun - cutting off their ability to move US dollars through the international banking system.
US Treasury Secretary Bessent announces any country that helps Iran will be removed from the US dollar system, any country that supports Iran in any form globally including China should now be prepared to face US sanctions, and countries that “stick with Iran will be isolated alongside them,” as Trump is now making phone calls to world leaders to cut economic ties with Iran.
By removing them from the dollar system, we are the ones sabotaging the petrodollar system that has served the US well for decades by financing our now highly burdensome and imperiled debt. Each member of the system that we totally remove takes all of their dollar transactions out of play. If they don’t immediately bend to the United States’ iron will, they have no other choice but to find a different currency for trade, and I think many will be disinclined to treat this time of their cancelled membership in the system as temporary. They would be wise, I think, to say, “You know what? The US has just taken us out of the dollar’s global trade currency system. Let’s just plan to stay out for good and finish establishing other alternatives.”
The US will be reducing the size of the petrodollar system with every participant that it disconnects - likely for good if those nations have any sense and any courage.
Escalation promised: Now let’s get to Iran’s response. First, the overview of how Iran says it will escalate the war during the new war plan: “Any country that becomes a partner in creating economic restrictions against us will be regarded by us as an enemy,” he said in an interview with Iran’s state broadcaster.
Meanwhile, the flow of oil but also other goods through the strait will not be anything like what the oil markets just repriced following Bessent’s bewilderment over their disobedience to his will: In a series of posts on X on Sunday, Iran’s state-controlled Persian Gulf Strait Authority, or PGSA, warned that vessels violating its transit rules in the Hormuz Strait could face penalties, including “fines, seizure, or confiscation” during future passages. Clearly, Iran will intensify its effort to bomb tankers, but it sounds here like they will become hostile toward confiscating the goods on cargo ships as well. Tehran’s parliament approved on Sunday a provision stipulating that ships passing through the Hormuz choke point will pay for services provided by Tehran.
Read the words not quite said: the tolls that Trump has ruled out will be imposed on all ships going through the strait. “Paying for services” does not mean paying for refueling while at sea or paying for food services. It means paying insurance money for being assured safe passage when only Iran is threatening your passage.
BREAKING: Iran directly warns it will massively escalate the confrontation with the United States within the next 48 hours, declaring that its response to Washington’s economic war will carry “consequences” and that Tehran is “not empty-handed.” “The necessary warnings have been issued,…” Iran’s Foreign Ministry spokesperson said, confirming that any country cooperating with the U.S. campaign will face retaliation.
They are giving a chance for countries to declare their unwillingness to go along with the US before attacking any of them. The day before D-Day Iran said it believed kinetic hostilities in the Persian Gulf region are “likely to resume in the coming days.” Iran is not going to be dumb and agree to fight the war by US rules and keep this to just a purely economic war, as Trump would like. They will force Trump to keep expending his diminishing weaponry by fighting the economic sanctions with “kinetic hostilities.”
If Bessent & Buddies didn’t realize Iran would not play by US rules but would return to a hot war, they were as naive as Bessent’s statement about oil prices indicated. That’s scary to think they would be that stupid. And its stupid on oil traders’ part to not realize that this guarantees a return to hot war - likely hotter war than ever by Iran who has also said, “Any country that joins in the U.S. effort will be considered to be engaging in an Act of War upon Iran - and will be brutally attacked militarily.” Then, specifically mentioning Persian Gulf countries, Iran said “Not one drop of oil will flow from the Persian Gulf; triggering a global energy crisis and economic disaster.”
All of that as a response should have been a no-brainer for the Trump administration before they even announced their attempt to try to turn this into a war fought only on financial fronts. Of course, Iran will launch a brutal military response! Of course, oil is a big play in how Iran will fight back economically against the sanctions. It is their BIGGEST economic bomb! Only idiots would think they would not, first and foremost, resort to the weapon that has worked best for them, but with intensified measure.
Who can miss the likelihood that Iran will engage its allies, the Houthis to attack the Saudi Arabia port of Yanbu on the Red Sea, already known to be one of the primary targets for Iran, to halt the estimated 5.5 million barrels of oil per day flowing from there.
Why would they not seek to destroy it entirely? Up until now, Iran has seemed to want to contain its damage to levels that could be repaired within months of an actual end of the war. But, now that they know they must survive an all-out siege against their nation on every front, they are not likely to hold back on the damage they seek to bring. They are not likely to care if their warfare destroys entire ports that will take years to rebuild if their alternative is to be on the long and exhausting, torturous and eventually dying end of a war of attrition … as firmly laid sieges are. The Oman port of Fujairah is known to be a second major port facility shipping oil, which has also been previously named as a target by Iran.
All of these places likely become intensified targets for total destruction. The one thing holding Iran back is likely not wanting to get all of those nations engaged in a much more intense hot war against them, but that becomes a less significant concern once you see your enemy is fully intent upon starving you until you surrender because Trump’s siege, means Iran has ZERO income, ZERO imports. Its people starve to death slowly, at least to whatever extent Trump is actually capable of carrying out his threat, and assuming this is not going to be just another big TACO switch where Trump & Friends pocket huge gains on insider market trading when they announce tomorrow that Iran is so desperate to make a deal that Trump is going to give them more time.
And, oh, the naiveté: Speaker of the House, Mike Johnson, says war is about to enter a new phase: “We expect the war in Iran to soon enter a new phase, and that ‘American allies will assist the United States in ending the war.’”
What an idiot. When have America’s allies helped in any part of Trump’s ill-conceived, poorly planned war with Iran, other than with the rare use of a few bases? What a joke! But these are the fantasizing brains we have in charge. Totally delusional. Maybe it was an implied threat: Help us as we fight a war you never wanted or become one of those cut out of the dollar’s global trade currency system. But then, you might as well say, “Help us, or we move you from being our ally to being one of our direct enemies in long war.”
Iran’s response: “The third wave of the war is approaching, and this round will be the fiercest. The UAE, Bahrain, Kuwait, and Israel will participate in it, and most likely, this round will be the reason for the United States’ withdrawal from the region, unleashing a wave of change in American society. So, Iran has made clear the first areas into which it will aim with escalated attacks. Those areas will receive more destruction, not less, than what they’ve seen so far; but it won’t be limited to those named areas. They are just the certain spots to be attacked.
The idiots now running our country believe they are invincible. They believe in magical thinking, where they can just declare how the facts on the ground in a new war will go based on their own will. So far, nothing has gone as they planned. The situation has become the total quagmire, I said it would be, and Iran is now promising that, once the US has launched its new plan (so that Iran’s actions can be seen as purely defensive), Iran will greatly intensify its attacks on others in the Middle East, which clearly translates into longer-lasting damage to oil.
Expanding the types of damage and the fronts of war into cyberspace: BUT don’t think for a minute that Iran’s intensified attacks are limited to just more oil damage in the Middle East or just those nations named. Look at what we already witnessed in the UK: "Iranian cyber attack shuts down UK power plant for four days." Attack appears to be the latest escalation after London allowed Washington to use British bases in ‘defensive operations’ against Iran. According to the newspaper, the incident appears to mark the first time Iran-linked hackers have successfully shut down such a British facility. The incident occurred alongside a series of attacks on US water infrastructure last month, which affected at least 12 states and caused concern in the White House.
These are shots over the bow, intended to show us the reach that Iran is capable of. They intentionally did not cause serious lasting damage. Reportedly no one in the UK was left without power because other sources on the grid were able to take over the load from the facility that was put off line. The attack appears to mark an escalation following the UK’s decision to grant the US permission to launch “defensive operations” against Iran from British bases.
In March, Prime Minister Keir Starmer’s government had granted permission to the US military to use the Royal Air Force base in Fairford and the joint facility on Diego Garcia, for limited operations against Iranian missile facilities that “directly threatened British personnel”, regional allies, or sovereign assets…. In June, an Iran-linked hacker-activist group, Handala, claimed responsibility for a cyber intrusion targeting water facilities in California, saying the action was carried out in retaliation for alleged US strikes on water infrastructure in southern Iran.
This can readily escalate into a no-holds barred round of cyberattacks far outside of Iran, and it could go from that to more humanly destructive actions like destructive shutdowns of major power grids, shutdowns of complete regional water systems. Iran seems to be meting out its actions based on some sort of human proportional justice system, not doing its most cruel attacks unless and until it has no other recourse. The group said it had obtained data from the systems and described the breach as a warning to Washington.
Exactly, these are small warning shots over the bow to show what they CAN do. They are not the worst Iran can do, but are intentionally limited strikes - stings to say, “BEWARE!” In a statement, Handala said it had the capability to disrupt water supplies but “stopped short of actually cutting off water to American cities”, citing a different ethical code than its adversaries.
As we shut off the dollar banking system to everyone who attempts any trade with Iran, who knows what hacking abilities Iran has to shut off parts of our own banking system to us? Trump and Bessent are playing with some serious fire here, and the fact that they seem surprised when oil goes up for a couple of days because of their high-risk adventure indicates they really haven’t thought things through at all. I would expect them to experience many more days of “surprise.”
IF they are telling the truth, we have to assume they are truly stupid human beings running our nation who have no ability to see even the most obvious cause-and-effect reactions. The alternative, of course, is to believe they are just lying about not seeing or understanding the consequences and are willing to have us take the consequences. Either one does not look good for them, or for all the rest of us, especially, as TheRump is now back to engaging full-on dollar warfare against our former trading partners like Canada, ostensibly (at least, as first claimed) because they let their forest-fire smoke cross the border as an illegal alien entry into the US.
It’s easy to imagine many answers to this dilemma: are they intentionally destroying the US financially, or are they just this dumb? Watch oil prices return to rising as the truth about Iran’s increased hostility proves itself out in the ME and in entirely new battlefields. Only the oilbots are dumb enough to believe that won’t happen at this point because they take headlines at face value. It’s getting real with fuel prices regardless:
Already, the price of diesel is now at $6/gallon in parts of Pennsylvania, $6.35 on average in Washington State, and around $6.50 in California. Woohoo! We haven’t even hit the part where spotty fuel shortages start showing up in the US yet. Stay tuned until next month - just a week away when we are likely to have a much clearer picture of how hot the war is going to get."
"We're so freakin' doomed!" - The Mogambo Guru
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