Israel-Hamas: The World Awaits "Whatever it Takes"
Will the United States do "whatever it takes" to stop the Global War on Jews?
Former European Central Bank President Mario Draghi famously said in July 2012 that the ECB would do “whatever it takes to preserve the Euro. And believe me, it will be enough.”
Draghi’s declaration singlehandedly halted the European debt crisis once and for all, and the ECB didn’t need to spend a single dime expanding its balance sheet. The mere threat of ECB balance sheet expansion was enough to send the 10-year Italian government bond yield from 6% to 1% over the next three years - in fact, over that time the ECB balance sheet fell by 1 trillion Euros.
Fast forward to the COVID crash in early 2020. On March 3 the Federal Reserve cut its policy rate from 150 to 100 bps. SPX continued to crash. On March 16 the Fed cut from 100 bps to 0. SPX continued to crash. Then on March 23 the Fed went all-in, committing to expand its balance sheet by any means necessary to stabilize the financial system. March 23 was the exactly bottom of the SPX COVID crash.
But in contrast to the Draghi ECB, the Powell Fed ultimately had to expand its balance sheet by almost 100% in the span of a few short months to beat back the crisis, and the US economy is still paying for that balance sheet expansion today in the form of higher-than-otherwise-necessary interest rates to bring down the inflation that resulted from the COVID policy response.
The lesson? In an existential crisis that demands a “whatever it takes” response, delay has a tremendous cost.
A Global War on Jews
As discussed on October 16, my secured-line discussion with a US Army strategist was pivotal to my thinking on Israel-Hamas. I asked a simple question: “Does Hamas view what they’ve done so far as missions accomplished and there isn’t another leg to this conflict?” His response:
“Not mission accomplished. They want every Jew dead. Phase 1 is complete…”
When you zoom out and look at the global response to Israel-Hamas through the lens of “They want every Jew dead,” it is crystal clear that this is a Global War on Jews that demands a “whatever it takes” response from the United States government:
The #FreePalestine protests around the world
The lack of condemnation of the Hamas sympathizers in the US Congress by the Democrat party
The pro-Hamas global mainstream media coverage of the conflict
The global pressure on Israel, not Hamas, to put Gaza’s citizens first
This global response EMBOLDENS Hamas. It EMBOLDENS Iran. It EMBOLDENS Hezbollah. These terrorist organizations know they have global sympathy for their cause as “oppressed people fighting for their land”. Do they have majority support from the Western world? Not even close. But they know 49% of US Democrats support Palestine, and that Democrats generally control the media narrative, so it is not an accident that Israel is losing the narrative war here despite being the victim of the worst terrorist attack since 9/11.
The bottom line: Until the United States government stands up and says that it will do “whatever it takes” to eradicate Hamas and end the Iranian-led Global War on Jews, the situation will continue to get worse by the hour. Iran and its allies know they have the global media narrative at their back and the Biden administration on its backfoot, so they are going to continue to push until they receive a credible response. It is their highest honor to martyr themselves for the sake of Allah, so they do not mind pushing until the point of death - something the Biden administration should keep in mind as it shuffles toward “whatever it takes”.
This is a highly combustible situation that will result in substantial negative geopolitical, economic, and financial market consequences if not addressed forcefully sooner than later. Unfortunately, the price action in oil and gold are saying a forceful response is not yet in sight.
Biden is Not Serious
It doesn’t help that the Biden administration was born out of an Obama administration that sought to cozy up to Iran in order to balance out the Middle East. It really doesn’t help that Biden unilaterally pulled out of Afghanistan in one of the biggest own-goal foreign policy blunders in US history, sending his approval rating from 55 to 41 in seven months.
It is no accident that Hamas starting planning its attack on Israel within months of Biden’s exit from Afghanistan. It is no accident that Russia invaded Ukraine within six months of Biden’s exit from Afghanistan.
Biden is not serious and the Iranians know it. And as illustrated above, oil and gold also know it.
I was actually done working for the day until I watched Biden’s address tonight. I was appalled at the message the terrorists were hearing in real time, so I had to write about it. We’re now finally at the address.
Did Biden say all the right things? 100%. But did he dog whistle to the terrorists? 1000%.
The good, the bad, and the ugly.
4 seconds | “We’re facing an inflection point in history. One of those moments where decisions today will determine the future for decades to come.” Good
25 seconds | “Most movingly” met with Israelis. Good
1:04 | “The terrorist group Hamas unleashed pure, unadulterated evil on the world.” Good
1:24 | Spoke to the Palestinian Authority leader and reiterated “the United States remains committed to the Palestinian people’s right to dignity and self-determination.” Bad
1:40 | Heartbroken at the tragic loss of Palestinian life, including the explosion at the hospital in Gaza. Ugly
2:45 | “Hamas’s stated purpose for existing is the destruction of the State of Israel and the murder of Jewish people. Hamas does not represent the Palestinian people. Hamas uses Palestinian people as shields.” Good
7:02 | We’re going to prevent this conflict from spreading. Good
7:11 | “At the same time, President Netanyahu and I discussed again yesterday the critical need for Israel to operate by the laws of war. The people of Gaza urgently need food, water, and medicine.” Ugly
7:52 | “As hard as it is, we cannot give up on peace. We cannot give up on a two-state solution. Israel and Palestinians equally deserve to live in dignity and peace.” Ugly
10:30 | “I caution the government of Israel to not be blinded by rage.” Ugly
It’s important to read the set of bad/ugly quotes above through the eyes of Iran’s foreign minister Hossein Amirabdollahian.
Biden spoke to the Palestinian Authority leader and reiterated the right to dignity and self-determination? It sounds like Biden doesn’t approve of our methods, but directionally he agrees with what we are fighting for.
Biden is heartbroken at the explosion in the parking lot at the hospital in Gaza that killed an unknown number of people and was the result of a Hamas rocket? If Hamas can grab the global narrative that quickly with a piece of fake news, we can control the narrative through this entire fight, keep Israel on its heels, and grind it out until they give up in Gaza.
Biden wants Israel to abide by the laws of war? Wow, sounds like Hamas can fight according to its own rules while Israel is hamstrung by the demands of the United States. Looks an awful lot like Israel is going to be fighting with one arm tied behind its back. LFG.
Biden is still focused on a two-state solution that hasn’t worked over decades of peace negotiations? And he’s focused on this in the middle of a war? Wow, sounds like the US really isn’t all that focused on the war aspect of what’s going on here. LFG.
Biden is urging caution on the part of Israel in the middle of a war? Wow. Seriously, this seems almost too good to be true. Is the US on our side here? LFG.
Biden’s address tonight did not project a serious wartime posture because it wasn’t a serious wartime posture. Biden is up for reelection next year and desperately wants to avoid a recession, higher oil prices, and a full-scale war in the Middle East. This overt lack of seriousness oozed from the address, and our terrorist enemies lapped it up.
After absorbing Biden’s address and reading the bad/ugly quotes through the lens of the Iranians, it’s mission critical to then listen closely to the entire interview below with Israeli citizen and reporter Haviv Rettig Gur.
Israel-Hamas is going to get very ugly, and it is going to stay very ugly until Biden starts taking it seriously.