only
thing the fed would say is that they were going to discuss possible
rate cuts and . . . . . a liquidity injection after the Iran War.
That
last part . . . . the "liquidity injection" caught my attention. So I
dug into it. Quietly. Well, as I write it is 11:33 PM on Wednesday
night and I just got told:
The Iran War has almost totally cut-off the inbound cash flow of all the big oil players in the Persian Gulf.
Based
on 2025–2026 data, oil-producing nations in the Persian Gulf region,
particularly around the Strait of Hormuz, typically manage roughly $1.2
billion to $1.6 billion worth of crude oil, refined products, and
liquefied natural gas (LNG) exports on an average day.
The
Strait of Hormuz has been effectively "closed" since February 28.
That's 31 days in March and 8 more days in April. 39 days. at $1.2
Billion per day is $46.8 Billion in actual CASH money they didn't get.
In
addition, many of these countries have been hit by Iranian missiles,
which have done tens-of-billions more dollars worth of damage to
state-owned energy facilities, like refineries. Tens-of-billions more
will be needed to begin repairs.
Now, those oil-producing nations need cash to continue existing. They informed the US and EU Banks they will not be rolling-over certain investments, but instead withdrawing them; they need the money THIS WEEK.
The Banks went to the fed and explained how much the Arabs have to pull out, and that the banks "DO NOT HAVE THE LIQUIDITY TO RETURN THAT AMOUNT OF CASH.
The Banks also told the fed, if they have to sell Treasury Bills to get the cash,
it will wreck the USD Bond Market PLUS, the Banks will have to enter
"unrealized losses" onto their books as actual losses, making them
officially insolvent."
HINT: These are not small banks.
The
European Central Bank also spoke to the fed about the Dollar Swap Lines
to European Banks and were told that The US Government is not presently
looking favorably at Europe or its banks, after being abandoned by
NATO, and the federal reserve will "have to get back to you" on the ECB
query about dollar swap lines.
The
fed realizes that if they do not provide the dollar swap lines to the
European Banks, some of those banks will go under . . . . which would
hit US Banks the same day- likely causing US banks big harm, too.
So the fed is damned if they do and damned if they don't.
Big financial trouble brewing. REALLY BIG.
