a) If Iran was attacked with sufficient severity they would take the step to close the straight of Hormuz
b) Iran was developing or already had small-boat, mine laying, missile and UAV capacity sufficient to do so
c) Iran was actively working on ways to hide this missile, uav, small boat capacity in the general region of the straight of hormuz in hundreds of small locations (down to the size/scale of a civilian small warehouse or garage), making it impossible to air strike/remove all of this capability with any known certainty without causing absurd levels of civilian casualties
d) The only way to remove the missile, small boat, uav capability would be an extremely large boots on the ground and manpower intensive ground based search to hunt it down. You couldn't be sure you could remove the capability strictly from the air.
The separation between the cause and the effects are way less important than their polarity. High-order effects tend to be smaller, but they are also way more numerous, so things can cancel out or end-up resolved on either way.
since this would be very meaningful for my understanding and reasoning about many social fields such as business or politics, i‘d like to know whether you have source material that supports the premise? is this a grounded concept or more of an ad hoc observation
https://www.law.uchicago.edu/sites/default/files/file/coase-...
It turns out that for many purposes friction and externalities are small enough that they can be ignored for most purposes.
Physicists and Economists are very aware of the tradeoffs.
Although, I am all for a data driven world but somehow it is my opinion that we have ended up with the worse of both as combined with the goodhart's law, this measurable thing just ends up somehow getting manipulated for short term gains over real long term damages.
As is your case in the example, the business will ruin the river for everyone having severe damage both culturally and I think financially as well given downstream effects of all people depending upon that river.
But the business has externalized the losses to the people and the people have externalized the responsibility of the river to the government and the government believes in absolute free capitalism! (or sometimes the businesses give the government some money in the pocket ie. corruption. "Cost of doing business" they said.)
I am not against capitalism itself (that Adam smith proposed) but capitalism in its current form is definitely something... and surely some if not most of us might agree to the fact that system isn't working as intended (well not working if it was intended for us ie.)
You could probably do some simulations to see this was almost always going to be a losing strategy. Detailing the N order effects is good accounting, but the picture likely gets murkier the more you try to extrapolate N+1.
It's all petty BS and I really do hope the electorate gets it together.
Otherwise they'd impeach Trump by now. Even if they make a 2 month ceasefire deal now, it will start again after that.
They absolutely are
If you're an engineer, you've experienced something similar. You come across some code and scratch your head thinking "why did they do it like this?", spend half a day getting rid of it and then find out why it was the way it was.
There are people who understand all these complex systems. We just insist on silencing them, even firing them and then listening to the dumbest people on the planet.
You see this in startups too, even very large ones. I've now spent years watching people in crypto discover why exactly the financial system works like it does while spewing banalities about "disruption". Sometimes new thinking can be good but more often than not it's somewhere between ignorance and a scam, particularly when so much money is involved.
Another classic example: orbital data centers.
It doesn't have to be that way. The Chinese Communist Party is, despite the name, technocratic [1]. Xi Jinping's undergraduate degree is in chemical engineering.
[1]: https://issues.org/perspective-the-benefits-of-technocracy-i...
$611 for 2x 5 gallon buckets just to do my garage.
& this increased commerce all around the globe.
but destroyed due to bad propaganda.
wtf are you all babbling about
First, some context. OPEC/OPEC+ generally set their production to meet demand and to keep oil prices stable. That means they aim for a floor and ceiling on oil prices. Every 3 months they meet and try and anticipate demand. Produce too much and the price is too low. This hurts revenue. Produce not enough and it creates political instabilities, both locally and abroad. It would in particular hurt security guarantees with the US that go back to FDR and King Faisal making an oil-for-security deal in 1945. Now, that doens't mean OPEC members can't and don't cheat. They can and do. But it is generally successful [1].
In January-February 2020 we had the start of the pandemic. A lot of people weren't paying attention or thought it could be contained. That was over by March 2020 and much of the world went into lockdown. A lot of travel just stopped. This had an immediate effect on the oil market. Nobody was buying. Nobody had places to store excess oil. Russia and Saudi Arabia got into an oil price war. And the futures price briefly went negative [2]. This technically was an extreme contango market [3].
So what did the Trump administration do? Well, in my estimation, they panicked. They feared this would be devastating to US oil producers. So then-president Trump went to MBS and cajoled him into getting OPEC to massively cut oil production [4][5]. How much? Initially by 9.7 million barrels per day and then going down over the next 2 years to 6.3 million. That's roughly 10% of global crude oil output.
When I say "panicked", because of the OPEC meetings every 3 months, this would've happened anyway. OPEC would've cut production. The market would've stabilized. Instead, Trump locked OPEC into a 2 year cut and essentially gave them permission to drive up oil prices. And that's exactly what happened. This deal maps pretty much exactly to the pandemic inflation spike.
And nobody talks about it. Republicans were keen to blame Biden. Democrats chose to blame "greedy" oil companies even though no amount of US production could replace what OPEC had cut. Biden even went to Riyadh to beg MBS to increase production and he refused [6]. And nobody talks about any of it.
That was 10%. The Hormuz closure is 15-20% and also impacts natural gas, helium, fertilizer and a bunch of other things not impacted by the OPEC deal. Oil is being kept at a futures price of ~$100/barrel by record withdrawals from strategic reserves. By early July, those strategic reserves will be empty and there'll be no way to inject oil back into the market other than reopening the Strait. And that will lag weeks because oil container ships move as fast as bicycles.
So think back to the pandemic. Shipping containers 6x'ed. Gas prices went way up. It impacted jet fuel and sea freight. All of that is coming in the next month or two and there's honestly little we can do about it now. If the Strait reopened today, these second and third order effects are already baked in.
This is now a structural repricing event and we're going to see crude oil and gas prices near current levels probably for years.
Oh and oil CEOs are starting to warn about the coming energy shock [7][8] so buckle up.
[1]: https://www.macrotrends.net/1369/crude-oil-price-history-cha...
[2]: https://www.congress.gov/crs_external_products/IN/PDF/IN1135...
[3]: https://www.investopedia.com/terms/c/contango.asp
[4]: https://www.reuters.com/article/economy/special-report-trump...
[5]: https://www.reuters.com/article/world/trump-touts-great-saud...
[6]: https://www.congress.gov/117/meeting/house/114185/documents/...
[7]: https://www.thestreet.com/investing/stocks/chevron-ceo-drops...
[8]: https://finance.yahoo.com/sectors/energy/articles/exxon-warn...
Nobody ever thinks of, you know, building redundancy for Hormuz?
Not to mention USA investing heavily in fraking to counter balance the middle east...
When you have questions like that in mind, the answer is pretty much always „yes, that’s a well known topic of discussion in that field“
You can see alternatives that exist here: https://hormuzstraitmonitor.com/alternative-routes/
(Really neat website, I think it was shared on HN a few months ago?)
There is a lot of other proposed routes but it’s actually pretty hard to create them in that region, lots of actors with their own interests and not the best history of collaboration. And Iran would definitely be against it given it reduces their influence
Most ordinary Iranians, sure; certainly not the Islamic regime. It was their decision to train, fund and supply weapons to terrorist groups like Hezbollah, Hamas, PIJ and the Houthis since the early 80s.
Exactly! Iranian regime has been adversarial to say the least.
Not sure what evidence you had that they were friendly...
* https://en.macromicro.me/charts/94482/imf-strait-of-hormuz-n...
(screenshot https://images2.imgbox.com/cd/73/yMf1mwKy_o.png )
every 1 single day = another 1 week of misery for the world
100 ships per day now single digits sometimes zero
90 days = 90 weeks
except it's going to be still like this in SIX MONTHS if not all the way through January 2029
wait until Cuba happens some Friday night too
Without a coalition of fools, the US has zero odds of success in that first step. It wouldn't be a long war of insurgency, it would just be a long war.
Iran is far bigger, far more capable, and far more difficult to wage war in than Iraq ever was.
They are also incapable of forming a coalition. They pushed the Saudis and all the Gulf states, who hate Iran with a passion to the moderate "maybe starting a war was not such a good idea" camp. The latest noises about forcing them to make friends with Israel is exactly what you would do if you wanted to be absolutely sure that they will never help you. The noises about annexing Greenland and Canada made sure that nobody in Europe is going to be part of any coalition there willingly.
That's what happens when you take stupid decisions on your own because you're a big bully boy and allies are for chumps.
They don’t need missiles to keep the Gulf pretty much closed, they just need drones. They have what, 1000 km of coast line with convenient mountains nearby? The choke point is 30 km wide, you don’t need more than shaheeds to prevent enough ships from sailing through that the others either stop trying or pay.
And you won’t prevent rockets or drones from reaching that coast line unless you have absolute control over the interior. Look at how much trouble Israel has with getting rid of rockets in the Gaza Strip.
> Continue combat operations and destroy the rest.
Afghanistan and Iraq demonstrate that it is much easier said than done.
> Escort ships trapped in the Gulf out.
That is going to be very impractical as long as they can just send marine, submarine, or aerial drones. Not unfeasible, but very difficult. The Huthis are still making trouble in the Red Sea, and there is an actual coalition to deal wit them there. Being locals with this kind of terrain is a massive advantage. There is a reason why anybody sane was saying that it was a stupid strategy.
> Maintain the blockade on Iranian ports to apply maximum economic pressure on the theocracy.
Which also applies maximum pressure on most of the world. That will become untenable quickly. Of course, the Russians are happy, though.
> I don't care about the internal politics of Iran.
You cannot solve a problem if you don’t understand it and the situation that caused it. Bush thought he could and he was wrong. Trump thinks he can and he is deluded.
> this may result in a collapse of the so called Islamic Republic
And I thought you guys were against regime change and forever wars. In the real world, it caused a rally-around-the-flat effect and a hardening of the government’s position and its grip on the country. I hope the Iranians can get out of this nightmare at some point, but it is not a given, and it is not the strategy most likely to lead to that outcome.
> so long as it does not interfere with global and in particular U.S. interests
lol. The US serve only the oligarch class’ interest. If you are serious about that, fix your government. It might not be as dire as the Islamic republic, but it is disintegrating.
The present US President is smart enough to realise that now. In this case he let himself be misled by Israelis & their supporters that Iranians would rise up and replace their own Government. That indeed might have happened if the US had intervened when the Iranians were actually protesting some months before the present crisis. Now the US administration is looking for a way out without putting boots on the ground and Iran is looking to haggle on the price and for the US. this very business like cutting of ones losses is almost certainly the right move.
If you want a used 20' container, they're under $1000 right now in the Fontana area. Probably much less in quantity.
It's actually strange that we don't seem to have any system for just dropping containers at the destination until the contents have been processed, instead of the current system that essentially mandates unloading the container rapidly as soon as it shows up because an entire truck+driver is waiting for the unloading to complete.
For palletized loads it's easy to unload them into temporary space in the building they're delivered to, but not everything is palletized.
There are big forklifts for taking containers off trucks and stacking them. Some recipients buy in bulk, store for later use, and stack their own containers. But most distribution centers want to get the contents into pickable inventory and start selling it.
The US military does a lot of container stacking, because they want reserves, not a "just in time" supply chain. "Moving Mountains", by Gen. Gus Petronis, covers this. He handled logistics for the Gulf War.
1. Not even in retrospect - intelligence agencies knew this was a significant risk and I'd bet your average person on the streets would have come to the realization that it was a bad idea if they thought about it for like a week.
There doesn't appear to be a single serious person in the US military, intelligence community or policy support organizations who thought this was a good idea. It was purely political. The administration seems to have listened solely to and relied entirely upon Benjamin Netanyahu and Mossad. Israel has been trying to get this war with every president since Reagan [1] and they've all said "hell no". Until this one.
What's more interesting is that it's been clear what a disaster this almost immediately so we've had ~2 months where it was clear that the US has militarily lost and a negotiated settlement was the only outcome. This would mean the end of economic sanctions and, for anti-Iran hawks in the US and Israel, a spectacularly worse deal than the JCPOA that got torn up. Yet the administration seems more willing to let the world ban than split with Israel.
edit; grammar and syntax for clarity
https://www.youtube.com/watch?v=ahlH32Lprto is a video from Peter Zeihan covering that exact topic.
sorry to spoil your predictable and boring narrative
Just because somebody tells us they are not lying does not mean they are not. But some people believe it because it makes them feel great again.
Trump seems to be able to do that well enough in the normal business world. The thing is when it comes to countries its harder to get them to roll over because if a dictator looks too weak its off with their head. If you give a dictator the choice of ruling over an impovrished country or dying in a coup, they are going to choose the former. On top of that its hard to make international coercive deals stick. In the normal business world, you can sue if someone reneges. When it comes to countries, what are you going to do? Whine to the UN? Good luck with that. Countries can stick with deals when it suits them and forget about them when it no longer does. At worse that may not make countries want to make deals in the future, but if it was a coercive deal that doesnt matter much.
The idea that a chump who bankrupted a casino could outmaneuver the country that invented the term "checkmate" was always profoundly stupid... so of course, Trump's supporters lapped it up like antifreeze.
1: https://www.cbsnews.com/news/tony-schwartz-trumps-ghostwrite...
To me, the interesting part is that people used to believe it in the first place. Anything that I heard of the guy and his agenda 2025 or whatever it was called had some really weird points which America (and for what its worth, the world, who didn't have any say in the American election but is dragged into it as the prices of my gas station rise)
Was it the silos of internet in an ever-polarizing nation that created the perfect conditions for a trump-esque person to take political power?
I should read more American history but Reagan seems like a similar guy but the only difference seems to be the short-term vs long-term consequences in the damage of Reagan's trickle-onomics (note that Trump's damage is pretty irreparable as well)
IIRC there’s also major long-term supply destruction happening, because wells have to be capped around the Persian Gulf since the tanks are full.
The US SPR is at 365m barrels and has a max withdrawal rate of 4m bpd. Currently they’re withdrawing 9m/week. There is 0 chance reserves are gone by July, just incredibly incorrect.
America as an organization needs to stand up and get retributive with robbing government coffers or it'll just breed even more kleptocracy.
6,500,000,000 / (350,000,000 * 0.99) = $18.76
don't spend it all in one place, champ!
Trump often said "Tariffs is the most beautiful word". I think he said that because he thought his followers were too stupid to realize that he was transferring tax-burden from the rich to the middle-class and poor. That's why he thought they were "beautiful". They enabled him to gaslight people.
American people are not stupid but many of us have to work hard so there's not a lot spare time nor energy to try understand what is actually happening. Fox News is misleading us purposefully playing emotional tricks on patriotic Americanss.
Now import-companies should get back the tariffs they paid. But does it mean they will lower their prices? Probably not.
As the saying goes: “The voters know what they want, and they deserve to get it good and hard”
That is why. Because if you dont "take revenge" things will get worst. Because not taking revenge made conservatives know the strategy works.
> As democracy is perfected, the office of president represents, more and more closely, the inner soul of the people. On some great and glorious day the plain folks of the land will reach their heart's desire at last and the White House will be adorned by a downright moron
Leaving aside the fact that the Economics prize isn't actually a Nobel Prize, topics which historically haven't been given enough attention are exactly where the highest impact research takes place.
If externalities had always received the attention they deserved, Coase would have never received his prize, because his work would not have been so important.
I think its safe to say that externalities are not, and were not, an ignored sector given more than a century of serious work, and the fact that it is covered in any intro level Econ course.
The consideration of externalities that don't impact the bottom line is so alien to the real observation of the rites of capital that it might as well be written on the inside of a particularly boring rock in the oort cloud.
This is an extremely HN specific and tech industry specific comment. Go for a day-long drive through middle America, like from Nebraska to Wyoming or something, and 95%+ of the people you will see are living on less than $60,000 total family income per year. A very small selection of very specific jobs start at $200k a year.
So is America rich or poor? Because Europeans, that you claim to be dirt poor, can afford EVs just fine?
But tech workers are a tiny sliver of the population so no, $200k starter jobs are extremely unusual in USA.
Bruh
> That's fresh out of college or shortly after.
Bruh
> Obviously not everyone makes that much, but it's not unusual at all in tech.
Triple bruh.
Maybe in some heavy tech based tiny regions like SF or NYC.
Even in second tier tech hubs like Boston new grads are doing great if they break 120k.
And tech jobs are a small minority of all jobs. The only way I could understand your description of a “decent job” is if you think the vast majority of jobs aren’t decent, much less good.
They’re not even pretending not to be antisemitic.
I'd say they are acting in a far more restrained and reasonable manner than the belligerents in the 'west'. And most rational people are in agreement with me on this.
Imagine what the US would have done in response to a massive surprise bombing attack that killed the president, most of the senior cabinet and military, struck bases across the country, sunk most of it's navy, and blew out a few elementary schools and apartment blocks and civilian infrastructure targets for good measure.
The last time something that was a tiny fraction of that happened, it started two wars and killed half a million people (most of them from a country that had nothing to do with the attack).
Iran's response was downright restrained.
Here's a radical idea. Don't start wars with countries if you don't like the consequences.
US/Israel may have opened the current front, but the Iranian regime has been waging proxy warfare since the early 80s. They also attempted to assassinate our president. It's misleading to paint US/Israel as the aggressors for occasionally responding to years of indirect or unsuccessful attacks.
To look at it another way: if US/Israel hadn't responded directly, but instead paid Erdogan a large bribe to strike a list of coordinates in Iran, while also supplying the missiles and the training, would that get around your concern? Probably not.
We knew they could disrupt shipping through the strait, that is a large part of the purpose behind "drill baby drill", stopping Venezuela from invading Guyana where we have oil infrastructure, and increasing oil investment into Venezuela, along with reopening some oil drilling off California.
We also knew we likely couldn't justify the risks and costs of sending in a large invasion force for multiple reasons. If a decent deal couldn't be made, then at least you remove an oil supplier from China and you mow the grass to limit the threat Iran poses in the near future. Even if the strait remains in conflict for years, in the long-term that is a good thing, because it forces an acceleration of bypassing it as an issue which means Iran loses a big button to push in the future.
Meanwhile, with oil prices higher, that is historically good for oil investment which is excellent for Venezuela so more of the fuels that countries rely on come from our hemisphere. We're not new at this game.
- I don't care about removing oil suppliers from China, I don't know anyone who does. I get most of my stuff from them, seems like a bad idea
- I don't care about Venezuela or lies about them being (drug lords|conquering invaders|bad hombres), they are sovereign, the U.S has no right, justification or excuse to be kidnapping their leaders or fucking with their politics.
- The United States has been spreading extremism and instability globally for 40+ years.
- Oil production in the U.S. is not meaningfully higher than it was under Biden, so "drill baby drill" was just another lie that's been lapped up and is now being spit back out
- A decent deal HAD BEEN MADE under Obama, it was pretty good most would say, then Trump tore it up because of his ego and tiny dick/tiny hands syndrome.
- "mowing the grass" sounds like terrorism first and foremost and crimes against humanity second.
- Just because the U.S. and Israel Administrations want to self select into being world police does not make it just or right.
1. The British were stealing Iranian oil (ie the Anglo-Persian Company, which is now BPl;
2. Iran democratically elected Mossadegh who said Iranian resources would be for Iranians;
3. The British freak out. MI6 twice goes to the newly elected Eisenhower administration to get them to intervene. They are rebuffed the first time so the British come back with a fabricated story about how this is communism somehow and the Eisenhower administration takes the bait;
4. Eisenhowever overthrows the democratically elected government of Iran to install the Shah as an autocrat (he was previously a figurehead pretty much);
5. The Shah takes the oil and basically gives it to the Americans so the British didn't even get what they wanted;
6. The Shah was a brutal dictator that included Savak, a secret police that had a history of violence, represseion and disappearing people;
7. By the late 1970s it was becoming clear that the Shah's regime would fall. The Americans were worried that the Communists would win and Iran would fall into the Soviet sphere of influence so got their puuppet in the region, Saddam Hussein, to expel Khomenei from Iraq in the hopes that the Isalamic fundamentalists would win;
8. The fundamentalists did win. Iran was punished for expelling the American puppet with crippling economic sanctions. Additionally, Saddam Hussein was armed and prompted to go fight a war with Iran. The Iran-Iraq war lasted years, killed over a million people (iranians and Iraqis) and basically had no other change in borders or regimes in the region;
9. After 9/11. Iran gave material aid to the US including rounding up hundreds of al-Qaeda fighters;
10. Despite 15 of the 19 hijackers being Saudi, Osama bin Laden being Saudi and al-Qaeda getting material support from Saudi princes and Saudi madrasses (religious schools), Iran got lumped in with Iraq and North Korea as the "Axis of Evil". The reason for this were the hawks in the US administration who believed that George HW Bush messed up not overthrowing Saddam Hussein in 1991. They had prior to 9/11 urged the Clinton administration and Congress to invade Iran;
11. Iraq was invaded because the neocon hawks, particularly Cheney, Rumsfeld and Wolfowitz, won the policy debate. It is highly believed they thought they would be overthrowing Iran too;
12. North Korea managed to stave off attacks by developing a nuclear weapon. That was the true lesson of the Global War on Terror: only a nuclear weapon will guarantee your survival;
13. Despite that the second Ayatollah, Khamenei, issued a fatwa against developing a nuclear weapon, something which still stands to this day, in 2003;
14. Obama negotitated (with European allies) the JCPOA, a program to inspect Iranian nuclear sites, in exchange for sanctions relief. There is no proof the Iranians ever violated the agreement. They even kept abiding by it for up to a year after Trump tore it up to appease Israel;
15. Israel committed too many hostile acts to enumerate, including the bombing of an embassy in Damascus, targeted assassinations within Iran, the murder of Iranians overseas, etc, pretty much all of which Iran just took on the chin;
16. The US and Israel started an unprovoked war last year, which included killing the Iranian negotiators. This war went so badly that hostilities ended after 12 days. It was widely suspected at the time that supplies of anti-missile munitions were getting critically low. Iran basically acted in good faith here that the Americans would negotiate in good faith; and
17. The Iranians were wrong. America did not act in good faith and started another unprovoked war at Israel's urging that included, for some reason, blowing up a middle school with almost 200 10-12 year old girls in it and killing an 87 year old man who had refused to develop a nuclear weapon (ie Khamenei) who also refused to go into a bunker because his people didn't have the same protections. That strike also killed a whole bunch of his family and the new Ayatollah's family.
18. This brings us to today. From Iran's position, the US cannot be trusted and does not negotiate in good faith. The uS will not restrain Israel in any way, which is an issue given Israel's insatiable appetite for blowing up babies. So Iran has concluded that the only way to guarantee their sovereignty is to make the economic pain so dire that th eUS never thinks about doing this again.
This has been clear for months now and Trump is choosing Israel over the economic pain that has been inflicted and is still coming. Millions will likely starve in the coming year.
But sure, keep repeating your State Department talking points.
I actually cook extensively with non-animal proteins but I enjoy the choice to do otherwise and, if it's going to be curtailed, I'd prefer it happen for a reason more meaningful that some idiotic international blunder.
Eh it doesn't work any better in the business world really.
His only move is shameless bullying, belligerence, and vexatious lawsuits.
It works on some smaller parties who really don't want or can't afford drawn out disputes, but otherwise it usually backfires.
Now he is still the exact same man, but to them, he is the second coming.
Reagan was elected before general Internet availability.
I think it's a mistake to overstate the effect but it's definitely there and it seems different than even Obama's use of social media, which was considered revolutionary at the time.
Inside of economics, they have more than 130 years of work, and are taught in any intro class.
If your argument is that we are bad at correcting for them, then yes. But that is different than not considering them.
Climate change has been discussed for well over a half century, yet one of the main priorities of the current administration has been to hamstring renewable energy and promote coal and oil. I think it's pretty fair to say the issue is being ignored.
