What is happening to the Iranian rial? As of late August 2018, the rial was trading at 44,000 to the US dollar — an all-time low value, as compared to 32,000 per dollar when Trump took office vowing to kill the JCPOA nuclear agreement in January 2017.
Free-market economists will tell you that currency values fluctuate strictly in response to the laws of supply and demand. They will insist that the rial is low because there is less demand for it today than two years ago. And they will tell you that demand for the rial has slackened due to withdrawal of Western investment from Iran in the wake of Trump’s threats and ramped-up sanctions. Two years ago, Western companies, anticipating a rosy post-JCPOA future in Iran, were starting to pour money into Tehran, thereby exchanging other currencies for rials. Today they are siphoning it out.
Trump’s sanctions have also put a crimp in Iranian oil exports. According to spglobal.com, Iranian crude exports dropped from 2.3 million barrels per day in July to 1.7 million barrels per day in the first half of August. Slackening oil exports means less foreign currency entering Iran, shifting the currency equation against the rial. Trump-Bolton threats to “drive Iranian oil exports to zero” also puts downward pressure on the rial by leveraging futures markets, that is, raising the possibility that Iran’s oil earnings will continue to drop, which generates a bubble (a self-fulfilling prophecy) by scaring people away from rials. This would be true even if Iran’s oil exports do not in fact go to zero, which seems likely (Iran says it will close the Persian Gulf to oil traffic if Trump and Bolton succeed in carrying out their threat, a prospect that may frighten various global actors, including China, into making sure that Iran continues to export oil).
Anti-Iran ideologues, who are mostly neoliberal free-market enthusiasts, generally accept the above analysis. But they throw in accusations of corruption, nepotism, inefficiency, and so on, in an attempt to blame Iran’s leadership for the rial’s recent woes.
There is some truth in all of these strands of analysis (except for the anti-Iran propagandists’ implication that corruption in Iran is the fault of the top leadership, when in reality Iran enjoys the least corrupt high-level leadership of any nation on earth). But the free-market analysis misses the forest for the trees. The pressures pushing Iran’s currency downward are not the cumulative result of free economic actors pursuing their own individual interests. The rial is the victim of a premeditated economic war of aggression. To understand the true situation, we need to examine the larger historical context of currency wars.
Currencies are not neutral means of exchange, as free market economists teach. Instead, they are politicized, weaponized instruments of power. To put it another way: currencies are issued and manipulated in such a way as to maximize the wealth and power of those who issue and manipulate them. And the issuance of currency is the ultimate weapon, the ultimate strategic high ground. As Mayer Amschel Rothschild is reported to have said, “Permit me to issue and control the money of a nation, and I care not who makes its laws!”
The current economic war on Iran is being waged by those who issue and control the money of Western nations. Who are they? A cabal of wealthy banking families who happen to be disproportionately Jewish in ethnicity and Zionist in ideology. Their headquarters is the Bank of International Settlements in Basel, Switzerland. Through a complex and opaque system of interlocking directorates, front companies, and other tricks, these families dominate the central banks of most countries in the world — including the Federal Reserve Bank of New York, the biggest stakeholder in the USA’s so-called Federal Reserve (which is neither federal, nor has any reserves).
These “Money Masters” (the title of an excellent documentary film on the subject) create currency out of nothing by lending it into existence at interest. Since it is mathematically impossible for both the principal and interest to be repaid, more and more money has to be created in the same way to keep the system going. The result is an exponentially-exploding, cancerous Ponzi scheme aimed at reducing the world’s population to debt slavery.
John Perkins, in Confessions of an Economic Hit Man, describes how the system works in practice. He explains that the Western banking cabal intentionally drowns target countries in loans that are designed to be unrepayable. The exponential interest ensures that those countries fall into ever-increasing debt slavery, forcing them to hand over more and more of their labor power and resources to the bankers,
I am haunted everyday by what I did as an economic hit man (EHM). I’m haunted by the lies I told back then about the World Bank. I’m haunted by the ways in which that bank, its sister organizations, and I empowered US corporations to spread their cancerous tentacles across our planet. I’m haunted by the payoffs to the leaders of poor countries, the blackmail, and the threats that if they resisted, if they refused to accept loans that would enslave their countries in debt, the CIA’s jackals would overthrow or assassinate them. I wake up sometimes to the horrifying images of heads of state, friends of mine, who died violent deaths because they refused to betray their people. Like Shakespeare’s Macbeth, I try to scrub the blood from my hands.
It is often overlooked that the international banking cabal is the dominant force behind the military-industrial complex — and the main planner, instigator, and beneficiary of wars. That is because wars force governments to borrow outrageous amounts of money at unrepayable rates of interest. Thus even the world’s most powerful countries, including today’s would-be global hegemon the United States, always “lose” wars, while the bankers always win, regardless of the outcome on the battlefield.
Today’s currency war on Iran is not driven by concerns about Tehran’s nonexistent nuclear weapons. Nor is it about Iran’s power in the region per se. The main factor behind the Anglo-Zionist Empire’s currency war on Iran is the threat Iran poses to the international banking cabal.
The cabal prizes its crime base in Colonized Palestine and its domination of Persian Gulf oil. Islamic Iran wants to liberate Palestine and help the people of the Muslim East regain control over their own energy resources. These long-term aims are integral to the identity of the Islamic Republic. No wonder the cabal wants to undo the Islamic Revolution — whether by slow-motion cultural attrition, as the Obama regime intended, or by ramped-up pressure under Trump.
Along with preserving “Israel” and “Saudi” Arabia, the cabal wants to re-enslave the Iranian people and regain long-term control of their energy resources and labor power. This would be done through the neoliberal “reforms” — opening Iran to debt slavery — that typically follow regime change operations.
The money masters have all sorts of ways to rig and manipulate currency markets. Some, like sanctions, are right out in the open. Others — such as telling the Saudis to pump more oil to push the price down and put pressure on Iran, Russia, and Venezuela — are covert but easy to recognize. And finally there are the complex and opaque machinations of such outfits as the Plunge Protection Team, which rigs markets on behalf of governments and the big bankers who own them using such secret and illegal techniques as counterfeiting, insider trading, and other varieties of fraud.
So Islamic Iran is facing an all-out fight for survival against history’s biggest and nastiest usurers. The current assault on the Iranian rial (and other currencies) is just one phase of that long-term struggle.