#GREXIT And The #IRANDEAL

July seems to be so generous this year because in one week Greece saved its behind, Iran struck a deal with the “Greater Devil”, New horizons sent us live pictures of Pluto and Bastian Schweinsteiger became a red devil (this last piece of info can be a source of conflict though!).

If anything, the Greek and Iranian deals are purely business driven. Make no mistake, no party involved in any of both deals struck a “yes” purely because of goodwill or good citizenship. A Greek exit from the EU would have signaled the beginning of the union’s end and would have opened the door for other less convinced members to leave the group (Britain comes right on top of my head) and the domino would have rolled and although France and Germany seem somewhat eager to trim off the extra fat, deep down they knew that they had to keep Greece tucked in.  Perhaps the biggest catalyst for the Greek deal came from Russia; it was more than enough for President Putin to hint in one of his press conferences that a Greek exit meant more currency freedom for the country and meant that they were acquitted from all agricultural quota agreements with the EU to make all members eager to solve the situation. Last year’s EU’s sanctions against Russia have hurt both the EU’s and Russia’s economies and Putin might have seen in an independent Greece a possible ally especially that Russia lost important agricultural suppliers in Europe.

On the surface, one might think that Putin was dealt a hand, but the truth is that comrade Putin was a winner because he was smart enough not to slide in the Greek mud while successfully pushing the troubled EU further deep inside.

On the other hand, Putin’s real trophy was the Iranian nuclear deal; and I’m not talking in the political terms but rather in the economic terms. You see, Iran has tons of cash stacked in banks all over the world and years of sanctions have created a very thirsty economy that is ripe to use these funds in attracting investors and in investing heavily in the country. On the other hand, all the global economy is suffering and they are all in dire need for new markets and new money sources. These were the exact reasons that forced USA to restore diplomatic relationships and of course business with CUBA and they were also the reason here. Even France, the biggest ever opponent of the deal was the first country to announce that French companies might still get a chance to invest in Iran despite France’s official stand on the deal and French foreign minister Laurent Fabius has already announced that he will be visiting Iran next week (wait a minute dude, did you consult with your Israeli friends before taking such a hasty decision?). It’s very strange how the slight notion of money and profit can make one turn against their closest allies – just like the current situation of France and Israel.

But before everyone starts drooling over the Iranian pie, take a minute to remember that this is Iran – the country which until recently has been considered the heart of axis of evil and was named all sorts of names and remember that they are not known to be forgetful, so if anything then the biggest chunk will go to their staunch ally – yes you guessed it, it’s comrade Putin again. Russia has already announced that there will be deals that involve planes and if the sanctions are lifted then this will definitely mean both civilian and military planes. In addition, the country that has been for the longest time ever suffering from oil shortages will be able to fulfill its needs both in production and consumption with all the ramifications that will come from such a thing.

Iran might not really replace the EU in terms of trade size with Russia but Putin will definitely benefit the most especially that Iran has high agricultural production which Russia can definitely benefit of. On the other hand, Poor Obama has worn himself out to get that deal done and it so far seems that the Americans will not benefit financially whatsoever despite Obama’s relentless offers to market the deal in USA as a means to prevent war and promote peace, not unless Iran decides to lure them in even more.

A few years ago, Britain released the Lockerbie bomber who was Iranian; the official reason back then was humanitarian – the man was supposedly suffering from terminal cancer. The real reason though was to allow BP to strike a deal in Iran and that was what happened exactly. In 2015, the same is going to happen and nuclear Iran will be allowed to become so in return for financial benefits that the whole world desperately needs.

A lot can be said about diplomacy, about peace, about war and negotiations; a lot has been said about these in the last few weeks but the truth is it was all purely business; the country that until recently represented radicalism and extremism has become the world’s sweet heart and Israel which also until recently was Europe’s and America’s protégée has been shoved aside because it is not economically interesting anymore. For after all, and as one of my MBA finance professors used to frequently say: “It is not unethical, it is just business.”

War and Economy: The All-Time Best Friends

“Be where your enemy is not.” Sun Tzu, The Art of War. In modern business terminology we call this “First mover advantage” this is one of the many quotes that apply equally on war and business. In fact ask anyone in the business world what the best ever business book is and the answer will be a no brainer “The Art of War.” History is loaded with examples on the strong and tight correlation between war and economy; it is very evident that the only thing that propelled the economy forward and pushed industry were times of war and that times of peace were harmful for the economy.

Since the time of the Pharaohs and if you track every civilization that reigned, whenever they stopped waging wars someone else waged a war on them and took over and another people prospered and another culture shone. Some of the greatest inventions that we enjoy nowadays were created because of war; take the internet for example which was created by the US military in the 60’s as a method of exchanging military information safely without falling in the hand of the Russians. Today the internet can be called the corner stone of our lives and almost everything related to us is on it.

Perhaps the 20th century and namely the USA provide the biggest proof to my point of view. At the turn of the century, the USA was still the new country that no one was really very interested in and Europe was still the beating heart of the world. The continent which had been in a constant state of partial war since the middle of the 19th century was the power center of the world and was still enjoying the effects of the industrial revolution. Then came WWI and the USA was still on the side until they suffered the longest and worst depression ever for 10 straight years and they were only saved by the break of WWII which put them in the spotlight right away. During that era, the American industry peaked out and there was excessive demand for US products and the USA witnessed a wealth and growth period like never before. Even the German economy was thriving during WWII and employment was at 0 rates and government spending was uncontrollable and no one questioned where and why the money was being spent. In both USA and Germany there was enough money in that era to go around everyone without caring or scrutinizing.

Then came the cold war to further extend America’s economic boom, the 50’s and the 60’s were the United States golden ages and in the 70’s and 80’s they focused on kicking the soviets out of many countries and coming in instead of them with their companies and American business men who established companies and bagged money and wealth from them

It is important to note that most wars were waged for economic reasons either for land, resources, food, oil and rare earth metals. Wherever there is a country that is rich with a certain natural resource you will see that it is plagued with wars; take the Middle East for example and Africa.

When President Clinton assumed office in the early 90’s his country had just come out of the Gulf War and there was an economic boom that economists were not really able to explain and the same happened when president Bush moved to the white house and especially in the early 2000’s. Some think that it was as a result of the Bush administration tax breaks policy but the truth lies somewhere else (I mean Clinton’s head was literally between Monica’s legs and president Bush well he was busy protecting his head from flying shoes, did you guys really think that they had the time to use their heads for something else?). Truth is that both booms were the result of war and only war. Clinton’s administration reaped the benefits of Bush Senior’s Gulf war against Iraq and the fees that Kuwait and Saudi Arabia paid for that involvement and the countless contracts which American companies got in those 2 countries not to mention the boost in American car sales. And then Bush Junior was in for round 2 and this time they secured the oil deals not to mention the reconstruction and security deals in Iraq to mention a few (Halliburton, Bechtel, Exon-Mobil, Blackwater and the list goes on and on).

“In respect of military method, we have, firstly, Measurement; secondly, Estimation of quantity; thirdly, Calculation; fourthly, Balancing of chances; fifthly, Victory.” Sun Tzu, The Art of War, which we also know as the SWOT analysis. Yet another proof of the correlation and bonding between war and economy, for as long as there will be a need there will always be war and the dream of global peace will always be an illusion and not because people love to hate each other but because they have to in order to prosper and to get the best of what is out there.