This one innocuous looking photograph which is the headline thumbnail for this article is the key to understanding why ES is not down 100 points in the E-Mini futures tonight, gold is not up $100 per ounce, and WTI/Brent could not hold their opening gains in the Sunday night NYMEX session.
Abbas Araghchi, the Foreign Minister of Iran, arrived several hours ago in Moscow for a meeting Monday morning with President Vladimir Putin of Russia. This begs the question, just what the heck does old Vlad have to do with how markets perform in the US and commodity markets globally on Monday?
Everything.
The world’s master of manipulative mayhem is meeting Iran’s foreign minister after the nation of Iran took several massive gut punches which was culminated with the “Peace” President electing to attack their largest nuclear facilities.
The Iranian military needs this pause to reposition its remaining launchers, refuel and refresh whatever assets they have less, and to see just how far they can go in their “revenge” attacks against Israel and the US as both China and Russia are more interested in not having commerce interrupted nor any further destabilization at this time; unless both can profit from it.
Via The Times of Israel:
Iranian FM arrives in Moscow for talks on ‘regional and international developments’
This should leave a window of time until after 11 a.m. Moscow time (5 a.m. ET) when the meeting should start or be close to concluding for oil traders, precious metals investors, and equity gamblers to get the information they are waiting for to decide if the One Day War from America on Iran is over or if something larger is in the offing.
Personally speaking, I think the green light will be given for only one thing and that is designed to bleed the US and Israel dry in an asymmetric fashion that Jerusalem and Washington, DC did not anticipate. Odds are on Tuesday morning, after Mr. Araghchi returns to Tehran, briefs whoever is left of the government in charge, and the refresh period for the Iranian military is over, a decision will be made and action taken to renew the missile campaign against Israel, which is extremely popular in the Shi’ite and Sunni streets around the world.
Putin will probably turn a blind eye to this action along with China offering similar sentiments. A prolonged terror and missile campaign to not only bleed Israel dry but reduce their strategic influence in the region and leave President Trump with potentially a massive pie in his face. Will it be successful? Who knows, I shall not even attempt to speculate on that, however at its current pace it will bleed their economy and the weapons stores of the United States quite dry very, very, quickly.
Once the realization hits that the US does not have the capacity at this time to put boots on the ground to foment or validate a regime change in Iran, the Iranians will have cart blanche to launch 5, 10, or more MRBM (Medium Range Ballistic Missiles) into Israel on a daily basis. That does not even account for the dozens to hundreds of drones which could be launched in addition to propagating their cheap, effective strike drones to radical Islamist cells throughout the Middle East or even Europe.
Just remember as markets soar tomorrow, barring a major strike action from Tehran or other terrorists engaging in an attack between now and Monday, everything is hinging on this meeting tomorrow morning in Russia. Despite all the derision from the West, Putin is a very pragmatic leader and if he sees an opportunity to bleed the US dry of military stores and put a major drain on Israel’s finances then of course he will jump all over it and indirectly assist Iran in this goal.
Look for an almost 200 point up Dow day, flat commodity trade, and muted currency moves barring any military action in the region tomorrow.
