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Gold and Energy Advisor's Real Wealth

Real Wealth #082  01/02/2007



How the next U.S. President can win World War III

How to defeat our Radical Islamic enemies and re-assert American economic and military dominance in the world - without firing a shot!

 

Dear Subscribers,

 

I'm often asked by my subscribers and acquaintances who discover I've written a book entitled "The Global War for Oil" if there's a way of preventing the Middle-East from blowing up... "Is there any chance of peace?"

 

The answer is YES, there is a way. What's more, it's something so easy that it really defies reason as to why our leaders in Washington haven't pursued this solution as an alternative to dropping bombs and sending our bravest to war.

 

Up until now, I haven't made an effort to share "The Middle East and Oil Solution" for a very simple reason: I didn't have the empirical evidence to prove my case, but that changed this past week thanks to research conducted and made public by the National Academy of Sciences.

 

Iran Oil Revenue Quickly Drying Up, Analysis Says

According to my research, which has been confirmed by the National Academy of Sciences, Iran, which actually holds the second largest oil reserves in the world, is suffering a staggering decline in revenue from its oil exports, and if the trend continues, income could virtually disappear in eight short years.

Iranian oil and gas production is declining sharply because the country's government has not been adequately reinvesting in its oil and gas production infrastructure. Instead, Iran has been investing its oil and gas revenues in ...

*        Arming Hezbollah in Lebanon with billions in weapons and logistical support designed to topple the Lebanese and Israeli governments

*        Funding Palestinian Suicide Bombers and terrorist cells in the West Bank and Gaza strip

*        Building Military command centers in Syria

*        Providing weapons to Shiite insurgents in Iraq

*        Building a standing army dramatically larger than can be justified for self defense.

*        Building a Nuclear Weapons program

The declining condition of Iran's Oil producing infrastructure is also occurring because of the tough U.N. and U.S. embargos that have been imposed since 1979. The lack of foreign investment in Iran's oil industry is certainly a big factor. The latest round of U.N. sanctions imposed last month will not help the Iranian economy either.

Currently, Iran produces about 3.7 million barrels a day, about 300,000 barrels below the quota set for Iran by the Organization of Petroleum Exporting Countries. The shortfall represents a loss of about $5.5 billion a year. In 2004, Iran's oil profits were 65 percent of the government's revenue, but within eight years, Iran will only be producing enough oil to meet its own domestic consumption, which is, by the way, heavily subsidized so that Iranians can afford it. The free flowing cash is going to disappear and so will the low prices being paid by Iranians.

Election Backlash against Ahmadinejad

The truth is Iran is heading towards an economic collapse with a 60% unemployment rate. Besides protests openly occurring in the country's Universities, evidence of building social unrest can now be seen in the body politic of the country. A prime example of the building political and social problems can be seen in the final results of last week's city council elections in Iran, which showed a clear and very serious backlash against President Mahmoud Ahmadinejad and his hard line policies.

President Mahmoud Ahmadinejad's closest political allies conceded defeat to the competition, namely the moderate conservatives and reformists in Tehran, as well as most major cities in Iran. Bottom line: None of the economic reforms promised by President Ahmadinejad have been delivered and the country is an economic basket case.

This is giving all of us a unique opportunity to change the future for the better!

How to win peace in the Middle-East without using military force

As we begin the 2008 election cycle in preparation of selecting a new President here in the United States, we're all asking the same four key questions...

*        How do we get out of Iraq?

*        How do we prevent Iran from obtaining Nuclear weapons?

*        How do we make sure democracy takes hold in both Iraq and Afghanistan?

*        How do we defeat Osama Bin Laden and his minions?

The answer is:

Every American must be made to understand that we are fighting World War III and the best way to win is for every American, all 300 million of us, to conserve energy! Reducing energy consumption in the United States by just 15%, will win this war — without bombs — without military casualties.  

Every time we turn a light off in a room when we leave, we improve our chances of eliminating the need to send troops overseas.

Every time you walk instead of ride, car pool instead of going it alone, ride a bus instead of driving your car — you'll be contributing to the war effort and helping to defeat these radical Islamists who want us all dead.

Turning off the heat or air conditioning when it isn't absolutely needed will mean far fewer casualties overseas. Cutting your personal trips, buying a Hybrid automobile can help save hundreds or even thousands of our bravest soldiers' lives. Wouldn't that be worth some discomfort and effort on all our parts? Of course it would!

In 2007, the United States will consume about 21 million barrels of oil a day, that's 7,665 million barrels in the next twelve months. BUT oil supplies are also estimated to be 21 million barrels a day, of which 12.25 million barrels must be imported daily. The supply/demand situation is so incredibly tight. That's why oil is trading in the $55 to $64 trading band. All it will take is one bad hurricane, one bad winter or even a terrorist attack and the supply/demand balance could force $75 even $100 oil. We're living with a very dangerous threat hanging over the United States economy and, for that matter, our nation's security.

Cutting energy consumption in this country by 15% would have the opposite impact. By conserving energy, we could decrease our oil consumption to just 17 million barrels a day and create an incredible OIL GLUT!

Reducing our consumption of oil by 15% would cause the price of oil to fall below $45.

Most critics of this scenario will say that OPEC would just lower its production quotas to match the lower consumption. That's true; but literally every time in history OPEC has been forced to cut production by reducing the oil production quotas, its members have cheated and produced and sold much more oil than they were supposed to, and as a result, the price of oil has dropped even lower.

In fact, that's exactly how oil prices were driven down to just $12 a barrel during the 1990s. OPEC members who were used to living on $22 oil were forced to produce and sell more oil to bring in the same money. The lower the price fell, the more they broke their official quotas. They CHEATED and created a big OIL GLUT.

We can create a new oil glut by conserving 15%.

An oil glut would mean the hard line government in Iran will not be able to build nuclear weapons, fund insurgents in Iraq or provide the weapons to Palestinian terror groups. Given the horrible state of their oil industry and its likely collapse in 8 years, a U.S. OIL GLUT could literally bring about a collapse of the hard line government in Iran.

The next U.S. President must be an environmentalist. He or she must have the ability to capture the American imagination and consciousness. This next President must convince the American public that cutting energy consumption 15% will not only improve the chances of preventing a devastating conclusion to World War III, but will in fact set the stage for an enormous economic boom here in the United States — which will help every working American by lowering unemployment, increasing wages and dramatically improving living standards. All of which is likely with much lower energy prices.

The truth is lower energy prices will act like a MEGA TAX CUT!

Dow 20,000, even 35,000, would be very likely with a drop in energy prices led by oil under $45 a barrel. The improvement to the bottom lines of U.S. business and the savings for the Federal, State and Local governments would be a huge economic stimulant that would bring prosperity to the United States which would be far better than the productivity gains produced from 1995 through 1999.

The next U.S. President must be a person who has tremendous communicative skills. He must be able to convince every American that energy conservation is a litmus test of being a PATRIOT, that every citizen is a soldier in this national cause and capable of eliminating the risk and need for war by simply conserving energy.

The next President must be able to explain and convince the American public that every day, every unit of energy consumed must be seen in the context of a war economy.

Our country must not be a nation focused on building or occupation. Instead, our focus must be on building the strongest and most powerful military deterrent on the face of the earth. We should be investing in more aircraft carriers, nuclear submarines, rapid deployment forces and cutting-edge weapons systems instead of paying hundreds of billions to support the occupation of Iraq.

A return to a foreign policy of walking softly and carrying a big stick is what is needed.

Our forces in Iraq should be moved to Afghanistan quickly; the Taliban and al Qaeda should be hunted down and destroyed along with the hundreds of billions of dollars of heroin poppy fields that serve to finance violent radical Muslim war lords, terrorists and even the Iranian Theocracy who owns massive drug producing fields. By focusing the war effort in Afghanistan, we will draw the insurgents in Iraq back to a more conducive battle field, one not divided by long buried sectarian hatred. The forces of Osama Bin Laden would face the same kind of routing they suffered when we invaded Afghanistan.

How would gold and energy investments do if the United States was able to cut energy consumption by 15%? Not anywhere as well as well as they would do with $60, $75 or $100 oil.

The truth is my Gold & Energy Advisor would not be anywhere near as profitable if our nation was suddenly infused with patriotism and fervor. I'm betting that every subscriber I have is with me on this and agrees that lower investment returns in exchange for lower energy prices is a small price to pay.

I'd gladly write the Gold & Energy Advisor and provide my subscribers with buy and sell recommendations that will produce a steady 7% to 9% annual return on investment if these lower profits are in exchange for bringing about the collapse of monetary power now being used by our enemies in the Middle East. It's literally how we can defeat our Islamic enemies overseas and re-assert American economic and military dominance in the world -- without firing a shot.

 

Finally, serious energy conservation, a 15% cut in consumption here in the United States, could have a substantial impact on reversing or stemming Global Warming. It would certainly go a long way to demonstrating leadership to the world community who has, to date, seen the United States as an obstructionist when it comes to recognizing and taking steps to reversing Global Warming.

 

Best Wishes

 

James DiGeorgia

Editor

 

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