Transcription
Welcome back, everybody, to Neutrality Studies. Today, for an update with the one and only Larry Johnson. Larry, welcome back.
>> Thanks, Pascal. You're you're a busy man, traveling the world.
>> Well, you are busy too. You're now, by the way, before we start, I mean, you started a venture with Pepe Escobar, and you are now having a new channel up and running, right? Do you want to tell us about this one first?
>> Yeah, Transition Protocol. And, uh, it is, uh, we actually started off as Powershift, but then Marco Rubio called Google, said, "Shut them down because they're telling too much truth." So, so we rebooted this, the, the channel. Uh.
>> Everybody, if you want to follow Larry, try the Transition Protocol. I mean, it's, it's fantastic, and I, I love it very much. Your, your discussions with Pepe are great. And, uh, but let's, let's dive in now into our subject, and I would really want to pick your brain on Iran and the negotiations that are happening. Actually, I'm in Switzerland right now, so right next door to me in Luzern.
>> Um, you wrote on your Substack, uh, not your Substack, sorry, 21 actually, that you have good reasons to believe that the Iranians are actually threatening a nuclear detonation. And how, um, you wrote that on the 4th of June, I believe. Today is the 22nd. How, how is that one going along? Do you still think that's really an option?
>> That is their, let's call it, that is their nuclear option. Okay? Not to, you know, mix the metaphors here. Um, they, we're, we're relying upon a Pakistani source that we, Pepe and I, uh, we, we have pretty good understanding who this person is. So it's not, it's not like somebody sitting in a coffee shop said, "I got an opinion about this." No, it's somebody directly involved and has the knowledge, uh, that, um, Iran did, did threaten the United States, basically, if, if you don't, the easiest way to say it is, if you don't negotiate in an honest, direct fashion, then we'll have no choice but to demonstrate that we can, we can do a nuke, and that we'll detonate a nuclear device.
>> Inside Iran, right? As a nuclear, nuclear explosion tested?
>> Right. And, and most likely, it would not be above ground where you'd see this mushroom cloud and then radioactivity, uh, material spreading around. It would be the kind of thing to say, uh, on, you know, on July 1st at, uh, 11 a.m. Tehran time, we will be detonating, uh, a 5-kiloton device, something like that. And because then that the seismic meters would record that. That's how, that's how you'd convince the world, yeah, you're going to see an earthquake at this time.
>> And it's not an earthquake. So, uh, they, they, Iran, according to our Pakistani source, has made that a direct threat to the United States.
>> Do you believe that's one of the reasons why the United States, in the end, signed the MOU, which for all intents and purposes, you know, reads like a surrender document? And the irony, of course, that Trump signed it in Versailles, and I think that one's lost on him. But, uh, you know, we are now in this negotiation process, and do you think that that's actually at the back of the mind of the American team?
>> I, I think that was one factor, but actually, I think the more important factor was the, uh, the oil crisis that is going to hit, that is hitting the world now. Except the world doesn't, uh, we're in the chicken without a head stage. You know, if you've ever seen when they butcher a chicken, cut the head off, it can still run around for a while before it realizes it's dead, and then boom.
>> Um, about two, two weeks ago, Trump, uh, reportedly, there was a group of senior oil executives that met with Trump. And I don't, I don't know as well if he got briefed by the intelligence community or by the Secretary of Energy, right? But he's told, "We, there is a crisis looming that is unavoidable." And it, it gets a little complicated with, it starts with the Strategic Petroleum Reserve. So this is, uh, this is like putting oil in the bank that you can draw up on for a rainy day. It's a savings account. Uh, this is oil that was stored in salt caverns that are in the southern United States. There are four main areas where these salt caverns are. And what I, what I've learned is that it's not like there's one big cavern, but as, as salt was mined out, it left these holes. And so at each of these locations, you may have three or four different holes in, like, one location. That total, total volume capacity, like 750 million barrels of oil. And so as they get filled up, and each hole is monitored, the way you get the, and the reason they use the salt caverns is because the petroleum does not bind with the salt and, you know, create salty petroleum. Instead, like if you put water in, you get saltwater. It goes from fresh water to saltwater. But to get that oil out when you decide to pump it out, you have to pump water in, and the oil sits on top of the water. Oil comes to the top, and then it's, it's drained out.
>> Um, so what was a 750 million barrel capacity is now down to more than half of that has been withdrawn. And right now, it's being withdrawn at the rate of 16 million barrels per week.
>> So you say, "But we got 340 million, so we're okay." Well, you know, stop right there because the, to maintain, if you end up putting too much water in those salt caverns, the caverns can collapse. And so they can no longer hold oil. So they, they estimate that about, at 140 million barrels of oil, you get to, uh, the, that's the destabilization point. So that means as of, like, June 15th, there were about 200 million barrels of oil to work with. Now, within that, that's not all one type. There's light crude and there's heavy crude. And it's on the heavy crude, what's called the mid, middle distillates. I, I've been getting educated by a friend over the last, "Hey, look what Larry knows." But, uh, I, I, it's stuff I didn't realize. And once you realize it, you go, "Holy shit."
>> Hey, just a very quick note. The best way to support this channel is by signing up for my free Substack. You can also help with a paid subscription there. Or you can get some of our new merch on neutralitystudies.com. Links below. See you there.
>> You kindly sent me that PDF this morning, and I read through it. And it boils down to the, to the very, to the realization that, you know, the, the crude is shared, right? Some of the crude goes to gasoline for, for you and, and I at the pump, and parts goes into aviation fuel, and part goes into jet fuel, and part goes into, you know, uh, then all the stuff, the diesel, the diesel you need in order to, to drive the whole, uh, economy. And it's a trade-off, right? So basically, what it says is that, well, we run short on things, we will run short also on war-making, uh, oil in order to fuel our, our jet planes and so on. So you, it, it gets more and more expensive to make war, to make war going. And the US, the US military, I mean, including the Navy and so on, is of course, a major user,
>> Of US oil. Heavy crude. That's not the one that the United States is independent of. You, you're independent of light crude, but not of heavy crude.
>> Right. That's the one we have to import.
>> Exactly. That's the one we have to import. And that, so you take that barrel of oil, and the 30% of it, the middle distillate. You got to make a choice.
>> Are you going to make diesel fuel out of it, or are you going to make fuel for the airplanes, the, the combat, both military jets as well as civil aviation? It's not like you can do both. You have to choose one or the other. And that's where the problem is because the, the, the normal supply of that heavier crude that came out of the Persian Gulf, cut off, uh, Russia, basically, you know, they've tried to cut them off, and they've suffered some damage to some of their, uh, refineries. But then, then that leaves, uh, Canada, Mexico, and Venezuela. And again, the Venezuelan infrastructure is having trouble supporting increased production. So the bottom line is, and Trump said it in his press conference at the G7, "We got four weeks left. In four weeks, there's going to be, there's going to be out." Now, this is where it gets really interesting from the standpoint that say, "Well, we got to open the Strait of Hormuz." Falsely implying that if you say, "Oh, the Strait of Hormuz is open, and all of a sudden all the oil is going to start flowing, and we'll be back, and it'll be okay." Uh-uh. Well, not going to happen. They're, number one, those ships that have been sitting there in those hot waters, that hot, salty water, they're collecting barnacles and God knows what else going on on the shipboard. Those ships basically have to be refitted, re, they have to be cleaned up, and then before they're going to be able to start hauling product again. And the estimate is about 12, up to 12% of the total world supply of commercial cargo vessels like this are are sitting there idle. So, you know, the, that in and of itself is a problem. Then you get the insurance because they can't guarantee that the Strait of Hormuz is and the Persian Gulf is free of mines. Lloyd's of London says, "Well, we're not insuring, insuring your ships. You know, we have to, we have to have a guarantee that it's clear." And then the, the US, the military went and testified before Congress, said, "Yeah, we, we think we can get it cleared up within about six months." You go, "Okay." So right here, we say six-month delay, and then you, once you get the ships moving, they may have another two-month delay to get them cleaned up. So I, I mean, so the point is that while the goal is to get the oil supply back up because the, the world global oil supply is de, has been diminished by 20% over the course of four months, and a lot of countries have been dealing with it by drawing down their reserves, but now those reserves are are running on empty. It's a really interesting situation in which I believe that it finally sank in in the United States that these capacities are finite, right? The, the missiles and the kind of, uh, the, the ammunition and whatnot is finite. But now it sinks in that even the oil supply is finite. And somebody must really have had a talking, a sit-down with Donald Trump and actually explain to him, "Look, it still looks fine right now, but we are already late in like resolving this."
>> On my channel the other day, Steve Jeremy, Commodore Steve.
>> Yeah, yeah, I know.
>> The point that each percent of, of reduction of, of, um, of oil supply in the world can go along with 1% of GDP, you know, the impact that it will have. And this is, this is just absolutely huge by now. Yeah. So there is no time, right? The, the, the Trump administration has no time to avoid chaos that will strike precisely around the time everybody gets starts getting heated up for the midterms. I mean, the, the timing couldn't be much worse for him, could it?
>> Yeah. Yeah. And, and that is, um, I think candidly, I think he's waited too long.
>> Uh, so the, this deal was available in April.
>> Yep.
>> Uh, so he's lost May and now June. Uh, whether they get something done in, you know, in concrete by July remains to be seen. But, but the actual, the use, the consumption, uh, they, they've covered it up to this point, uh, because the oil markets, you get, you get a lot of different people are out there, you know, I, Chris Martenson's another smart economic analyst, and he's looked at it because, you know, and I, I presume when you went through university, you had to take an econ, economics course of some sort, and you learn the basic concepts of supply and demand. But, and that markets normally, you know, if you got high demand, uh, that there could be incentives to increase the supply, or if you don't increase the supply, the price of it is going to go up. So, you know, they get this dynamic environment. Well, they've suppressed that. They, they've gone in and manipulated the market and tried to artificially pretend, "Oh, there's no problem here. We got plenty of supply." But that's because you've been pulling all the equity out of the ground.
>> Yeah. And the price fluctuations that we've seen over the last three months actually have more to do with price speculation and forecasting than they have to do with real, um, shocks on the supply and demand side. And those real shocks are now going to come and start setting in and drive the prices up, even if the news about the, the negotiations are good.
>> Um, so what do you think that this does to the negotiations? On the one hand, we are seeing that, uh, Iran wants verifiable stuff, right? That's why they want the MOU first, and now they're going to monitor whether the US is going to try to live up to the MOU or not, and whether their ships can actually go through. And it looks, as of now, that that's actually the case. But on the other hand, there's the whole Israel problem and Lebanon. Do you think the United States will, for the first time, put real pressure on Israel in order to, uh, to get this situation resolved?
>> Well, I wouldn't say it's for the first time. I mean, historically, we go back to Dwight Eisenhower put pressure on Israel on this and France and Germany on the Suez crisis. And then Reagan did it again back in 1982 when Israel invaded, you know, one of its first invasions of Lebanon during the Lebanese Civil War. But it does appear that Trump finally has, uh, exerted the pressure on Bibi Netanyahu because on Saturday, it looked like Israel wasn't going to stop, and then it stopped. So they stopped the attacks. Uh, there is a cease, it does appear to be a functioning ceasefire in place so far. Uh, and, and it comes, it's, it's real simple. Uh, the United States is the primary supplier of Israel's military assistance and weapons. And as the Washington Post reported, I guess it was in April, two-thirds of the air defense systems that were employed during the first 40 days of this Ramadan war, that was US systems operating. It wasn't Iron Sling or David's Sling and Iron Dome. It was Patriot missile and THAAD missiles, THAAD interceptors. So, uh, Trump's in a position he can withdraw all that and threaten, you know, either you're going to come do what I asked, or we're going to pull that out. At the same time, the, uh, the US military under Centcom, which had been stood up for a 24/7 operation and, you know, when, when the, when you got military units deploying, you set up what are called joint operations centers or tactical operation centers or, and in this case, they call them CATs, Crisis Action Teams. So it is all the different elements that comprise the military, plus there'll be interagency elements from CIA, you know, any other agency that may be relevant to a military operation. And they operate 24/7. So they, they got communications from the field. They're sending orders out to the field. They've got action items that come in, things that need to be addressed, providing, issuing orders for, uh, a tactical operation that you're going to strike this target at such and such time, and then making sure all that going on. That's been dismantled. That's been taken down now. So it's back to sort of normal operations. I, I've been told. And, uh, so that means the United States is now not in a position to just flick the switch and launch an attack. Before, when you have those CATs up and running, yeah, you can get pretty quick action. So.
>> Is that observable on the ground? Can the Iranians, from their vantage point, know that that's what happened?
>> Yeah, I think so. And, and then the whole issue is, uh, the starting to ferry US combat aircraft back to the United States because, you know, an F-35 can't fly, you know, the, the 8,000 miles or 7,000.
>> Fly itself back, back home. Yeah.
>> Yeah. It's got to, it's got to, about a 600-mile range when it's not in a combat load. And so it has to be air-refueled. It has to either fly to an airfield or be air-refueled, or both, to get them all back. And then so, you know, to move, to move and deploy these both to the combat zone and then from the combat zone is a big logistics effort. And there, and there again, doing that, you're dealing with aviation fuel. And so you've got this competition between going to need all this jet fuel to keep these planes flying, that's less for the diesel trucks that are going to be taking food to grocery stores. You know, it's a trade-off. So, uh, you've got that underway. And I, I, I think the, you know, the United States also in those last two days of, uh, pretty intense, there was the US hit Iran on the 9th and 10th of June, and then the United, the Iran retaliated and really put, caused some significant damage to both infrastructure, communication systems, and aircraft in, in, uh, Kuwait, in Bahrain, in Prince Air Base, and in Jordan at Moaf Alti.
>> Why? I, I didn't understand that. And I was, I was out in, in the field at conferences, so I didn't have time to cover it. But why, why did the United States do that? I mean, didn't, didn't the Iranians manage to drive the point home in the, in the 40 days war already that, no, whatever you throw at us, we will, we will, we will, we will destroy something of equal value, or even more? I mean, why, why did they do that?
>> Yeah. So I'm looking at it and, and so I think what happened because remember, um, when, like, they take off with a combat mission, it's not just that somebody's sitting around saying, "Hey, you know, I feel a little, uh, antsy. I'm going to get up in a plane and go fly and attack such and such target." No, they are responding to very specific missions that have been prepared, targets identified. So I think what was going on, someone made the decision to say, "Okay, let's see if we can open, if we can use military force to open the, the Strait of Hormuz." So what we need to do is we need to identify the firing positions of Iranian missiles and and and and drones. Two, we need to identify and destroy the communication nodes that how the Iranians issue orders to coordinate, uh, these different issues, and, uh, so and we need to destroy radars, etc. So what the United States would do, in like, one of the occasions, they, they set four ships into the Strait of Hormuz. Iran lights up, you know, you, so if you're, if you're monitoring with satellites and other, other technical means, you see how the communication system lights up, how they start communicating, how they start reacting. So therefore, that's one way you try to identify that network so you can destroy it. And then in retaliation for that, the United States came in and started hitting those sites in Bandar Abbas and Qeshm Island and down another port, was it Turkey, uh, that's just south of Bandar Abbas. But Iran was ready. As soon as they got hit, man, they turned around and said, "Okay, we're hitting this target and this target and this target." And I know from, uh, people who, you know, know what the damage was, that Iran was causing significant damage. And clearly, Iran was doing some of it. You know, in one of the attacks, I'm told, you had Pakistani military technical people who were trained on Chinese systems that were using Chinese-supplied missiles to hit US targets.
>> Oh, wow.
>> Yeah. So, and so the United States suffered some significant damage from that. The, the one of the last strikes at the Al-Salti, the Moafiq Al-Salti air base in Jordan. You had both, uh, Iranian and Russian sources reporting that that attack either destroyed or damaged 12 F-35 jets. Well, you know, that's more than a billion dollars worth of aircraft right there.
>> I, I have this pet theory of mine, which is that at least one of the factors for the US to decide, "Fine, we need to do whatever it takes to to get to a negotiated solution," is that also Saudi Arabia, Qatar, and maybe Kuwait and Bahrain actually put some pressure on the US and said, "Like, you either stop this, or we will cancel the base agreements and so on." Do you have any, I mean, do you have any, any indications that this pet theory, for which I have zero proof, might there might be something on this, or on the contrary, that they are just like the satellites that, that they are?
>> No, no, I think it's not a pet theory. Uh, and, uh, both Pepe and I received information that, um, Pakistan, so Pakistan is playing a very central role in the, and it's amazing how how important it has become in this whole process. So Pakistan, working with Qatar, Saudi Arabia, they are both sending the message to the United States, "You're going to get out of our country." Is apparently informed the United States. You got about nine, we went, we went alouded closed in nine months. Now you say, "Well, that sounds a little far-fetched." But did you see the video of how the Qatari foreign minister dissed JD Vance yesterday in at Bürgenstock?
>> Didn't see it yet, but.
>> Oh, you got, you got to look at it. So, uh, you got Prime Minister Sharif of Pakistan, you got the General Munir, Pakistan, and JD Vance is standing to the right of, uh, Sharif. And so up comes the Qatari foreign minister, you know, hugs it out with the, with Sharif, you know, kiss. And then you see Vance go like, and the foreign minister just goes, turns away, goes over, hugs it out with Munir, and then turns around and standing. And you see JD Vance is again standing to Sharif's right, and JD Vance does one of these sort of turns, and like his his left hand sort of reaching in the direction, and the Qatari foreign minister goes, crosses his arms and looks away.
>> Oh, that was that was.
>> They're seriously, they're seriously pissed. They're seriously pissed.
>> Yes. Yes. Yes. And, and you know, I think this, we must not underestimate this. And, and it's true, I forgot in my last interview that I just did earlier to mention that, but the, um, the fact that the Qataris are there, and the Pakistanis are there too. I think this is in order to flank the United States, in order to make sure that, you know, things have to get moving, guys. Uh, so it's, it's, it's actually not one-on-one, it's actually three-on-one at this point. The Qataris are not there to support the United States.
>> Yeah. And then look what happened. Look at the other meeting that took place yesterday. I forget where it was. I think it was in Islamabad. Uh, foreign ministers of Egypt, Turkey, Saudi Arabia, and Pakistan. Now, you think, you think that was just a coincidence? No. Yeah. So what?
>> Go ahead. But Larry, like, you know, I just did this, did this interview with with Denny Davis, and he showed me this crazy talk from Lindsey Graham who said, like, "We're going to bomb them to obliteration," blah, blah, blah. And, and, by the way, uh, um, Saudi Arabia has to join the Abraham Accord, and, you know, it's going to be greatest, blah, blah, blah, blah. Are they, are they insane? I mean, this is literally the opposite that's happening. I mean, the, the Gulf States are now putting pressure on the United States to finally call it quits and leave and be done with it. And I don't think, I don't think the United States has a lot of love left in the Middle East. Maybe with the, with the exception of the UAE, but apart from that.
>> Yeah, the US hasn't earned much goodwill. Uh, you know, this entire relationship was built up, "Hey, we're going to protect you. You got, you know, you come with us, you're going to be golden. Nobody's going to touch you." [Laughter] Now they're looking around saying, "Yeah, we lined up with you. We got the hell beat out of us."
>> Yeah. I mean, to be fair though, I mean, Iran isn't, isn't, isn't really touching them as much as, yeah, beating the holy hell out of them.
>> Well, and so the, and I think that that message sunk in in the, in the, in the whole environment. And also the fact that the United States throws them under the bus, right? This is, this was, this was predictable. This was predicted, and they must have said, "Don't do this." And the United States still did it. And they did it again, like again this month, right? So it's like, no, and they will be hit time and time again. So.
>> Yeah. Well, see, there again, the cash flow for Saudi Arabia, Qatar, uh, Kuwait, uh, and UAE, it's, it's all, it's all way, way down. So they're not getting the cash flow that they once had. Now, the, the whole relationship between Qatar and Iran is just fascinating because, you know, Qatar's tried to play both sides. Remember, they, they just gave President Trump this $400 million, uh, presidential jet that he unveiled this last week. But then you saw what the Qatari foreign minister did dissing JD Vance. So, you know, Qatar is not happy with the United States.
>> Then the, the vision of Russia and China. So Russia and China are sort of the, they're the, I'll call them powers behind the throne here because there are two things going on. They are both, they recognize you've got to restructure the security architecture. And what that means is you're going to create a military alliance among the Arab Muslim countries. So Iran's not Arab, but it is Muslim. And so Turkey and, and Egypt, you know, they've been, they've been a little difficult to control because both have been paid off by by Israel. I mean, they've been, they've been siphoning money off of, in the case of, uh, Erdogan, it's oil. In the case of, uh, el-Sisi, it's liquid natural gas. And then the other one in this, uh, that's been totally compromised by Israel, uh, the United Arab Emirates. Uh, their system, you know, they've been, they've been probably one of the biggest money laundering centers in the world until the start of this war on the 28th of February. Uh, there, there's still. So I, I've had report from a reliable source that one of the roles they've been playing is, uh, Zelensky's uncle is a bagman. It comes out of Kyiv or Kiev every week on a flight down to, uh, uh, Dubai or Abu Dhabi and takes bags, literally millions of dollars that can be carried, and gets them on deposit in these Emirati banks. That money is then used, is purchased in real estate. They call them scams. So then they get, they purchase the real estate, then the real estate is sold, so that the proceeds then are wired into Israeli banks, and then out of there, some of that money is funneled back into members of US Congress. That's how they're, that's how this, that's how you're getting paid. So they've paid that role. But what's happened as a result of this war is it has disrupted the Emirati financial system. So a lot of the, the, the, well, the very wealthy, their money is heading back to Singapore because they see Singapore as more stable than say, Abu Dhabi and Dubai, which in partially explains why, you know, over the last three weeks, you know, here were the Emiratis who were, you know, they were married with Israeli intelligence. Now they appear to be getting some distance. And, you know, that was why they went to Tehran on June 9th to sit down and chat with, uh, Rachi. In my view, you know, there is just no way around some form of, um, negotiated outcome of this. And the, the Iranians are at the longer they have more leverage. They, they're going to be the ones to to dictate where this is going. Although, the United States will certainly, uh, keep, keep like doing its bombastic announcements and whatnot. That's for sure. But there seems to be, to me, like now everything in place to drive a serious wedge into this, into an already like open wound that the Israelis have with the United States because also the public, the public opinion has been lost. Right. So we are reaching a point where US, where US congressmen now looking at the, at the, at the midterms will for the first time be really wondering, should I be pro or anti-Israel? This, what do you think this impact is going to be on the daily relationship?
>> It, it, it's, it's a generational change. So, you know, still the people that are my age, uh, you know, people 60 and above, uh, we're the, were the last of the boomer generation. You know, I was born in 1955. Um, we grew up with this, the David versus Goliath myth of Israel, that Israel was little David against this behemoth Goliath, the Arabs, and it was fighting against impossible odds. And, you know, uh, the, the, the generation that's 50 and under, they're looking at it and again, they're seeing on social media, despite Israel's attempt to shut down and control social media, that, uh, the, the Israeli, uh, genocide against the Palestinians. And it's not just Muslims that they're attacking. I mean, they're attacking Christians. So, that message is now starting to resonate. And then when you tie that in with prominent podcasters that are now, you know, Tucker, there was a point at one where Tucker Carlson would have been considered a reliable ally of Israel. No longer. Same for Candace Owens, Joe Rogan, Theo Von, just a number of people. Well, Judge Napolitano, his podcast, he's, he's at almost a million subscribers. Yeah.
>> Uh, so this, this message is getting out, and now Israel doesn't have this, does not have the political support among the majority of the American population that it once had. Now, they, they've still been managing to secure congressional support by virtue of buying congressmen. But even that's starting to, you know, that has been exposed, that is becoming a potential liability. So.
>> Yeah. Yeah. Know, this is, you know, it's quite, quite a change. And again, like wars, as horrible as they are, they, they bring out certain realities on the ground. What do you think, shifting gears just a little bit, toward Russia?
>> What's the learning for the Russians from this one? The, the Iranians stood, stood their ground like against all odds, I would say. And they, they kind of made the point that you have to strike the proxies in order to, uh, to, to get concessions from the, from the big guy, right? And this is what they're doing in Bürgenstock right now, that's like calling in the concessions, right? So where do you think that leaves the, the Russians in their learning process, pro process about how to, how to address their thing? And this war in, in Ukraine is now already longer than the Great Patriotic War, right, for part of the Second World War.
>> Yeah. So a couple of interesting changes over the last week. Uh, a close advisor of, uh, Putin came out and said the, uh, Minsk agreements, they're dead. That's done. That's, you know, that's come and gone. So that's off the table.
>> They, they clung on to that for almost a year. Almost a year. Even though nothing was coming out of it, but they, they just, you know, they have long kind of ways of of sticking with things if they, when they believe that something might still happen down the road. But so that road is gone. That's.
>> Right.
>> And, and now the, uh, as far as military operations on the ground, they have accelerated dramatically, uh, really in the course of the last two weeks as well. So Konstantinovka has been captured. Uh, they are, uh, closing in on Krasny Lyman, and from that position, they will be at least in the, the Nats, they will, Russia will be in a position to encircle both Kramatorsk and Sloviansk, which are the last two strongholds, uh, in the Donbas. Once they got that, it is a wide open, uh, step, if you will, to the Dnieper River. Uh, they're also accelerating the attack in Zaporizhzhia and up in Sumy and Kharkiv. Now, that said, Ukraine, with the assistance, primarily assistance of the UK, has stepped up drone strikes on targets throughout Moscow. That they look worse than they are, but still they're killing civilians. So now the pressure is growing on Putin to militarily strike the UK. So I, I would, if, if these drone attacks continue like this, and if the UK continues to provide supplies, I anticipate that before the end of August, Russia will strike the factories in the UK. So this will, this, this runs the real risk of expanding this war. But the Russians are now at the point, as Sergey Karaganov has openly expressed, you know, that they've lost the fear of, uh, retaliation. And so we're going to have to show them retaliation in order maybe to put back the, the nuclear deterrence. Because right now, the, the, the Europe, primarily the UK, uh, I don't see the same level of enthusiasm in Germany for this. M is in, you know, here's Kier Starmer is now out of office. We'll see if his successor is as ambitious about supporting, uh, these, uh, drone attacks in Ukraine. But, but clearly, we've entered a new phase with, with this war. And from Putin's standpoint, he's talked about it as a terminal phase. So the, the, these last desperate attacks with drones, they, they're not, they're not changing the strategic picture. They are creating polit, you know, the, I guess the, the, the Western hope is that this would create political pressure to force out Vladimir Putin. And it's like, "What the hell are you people thinking? You think they're going to come in with some moderate who goes, 'Oh, let's, let's stop attacking Ukraine.'" Good God, no. Medvedev is standing in the wings, and he is much more willing to pull the trigger than Vladimir Putin has been.
>> But yeah, it is true. It's like, though, you know, what, what Ukraine is hoping for, and we know that they've been trying that for years now, is to create an Article 5, right, for NATO. They, they are trying to, theoretically, this is the only thing that can still save Ukraine, right? Article 5, and then all in, and a super big war, including the United States. And that's, that's the one thing that, that you could still say, like, "Maybe that's how what's going to get is our territory back." Uh, and you can see how they are trying to bait Russia, right? And all of these drone attacks, um, especially also like last week in Sevastopol, blowing up that war memorial that has zero, uh, tactical value. The only value is that it makes the Russians angry, and it makes them angry, and they told me so. The stars keep saying, "We are really, really pissed by now." Yeah. Um, but in, in that sense, it's, it's this kind of trap of trying to get the Russians to do something that the Europeans have been saying for the longest time, "They will do it. They will come, and they will attack us." And then once it happens, they go like, "Ah, unprovoked attack. Now, one for all, all for one." But, but we are at a point where the United States can't even fight a war anymore in West Asia. Right. So this, in my view, this increases the chances within Russia to, to make the, to roll the dice and say, "Like, fine, let's give them what they want." So you also think that it's likely that this calculation is now changing in Russia?
>> Oh, yeah. Yeah. You know, I think there was always caution for the start of the special, this is why Putin called it a special military operation. He was going to fully mobilize society.
>> Uh, they recognized they had, Russia had some built-in limitations. They did not have fully mobilized manpower. The, the factory system to be able, in the, the manufacturing industry wasn't up and running to do replacements in the event of, let's call it, an industrial scale war. Uh, there were, they didn't have a full array of their different weapon systems. But now they're in a position as after four years without, they didn't have to mobilize society and, you know, force consumers to go without in order to support a war effort. They were able to do guns and butter at the same time. But now they're in a position where the, the army is solidly at least 1.5 to 2 million mobilized, uh, people. So they've got, they've got the armed force in place. They're trained. They're not untrained. So it's not like you're dealing with a bunch of recruits. Uh, the industrial base is, is rock solid. The only problem they have sometimes is finding enough workers. Uh, and the, the weapon systems that have been developed, apart from the Tsirkon, the Tsirkon, uh, the, the four varieties of hypersonic missiles. They've got FAB bombs. So they are now ready. They were, I, I guess they didn't want to put themselves in a position of pressing a conflict with Ukraine that could possibly draw in Europe until they were prepared to defeat all of Europe. Now they're prepared and ready for that. And I think that's the stage. And now they're telling the, and then on top of it, though, I think they were surprised to learn how weak, how shallow the United States capability was. They, they made some assumptions about, "Oh, the United States has, has is this great powerful nation that could mobilize these resources." Turns out they can't. And that, in, in producing certain weapon systems, those systems have been depleted. And then the United States talks a big game about, "Oh, yeah, well, we'll, we'll start production." Except the critical rare earth minerals that come from China's not supplying, which means they can't build those weapon systems. Tomahawk cruise missiles, a case in point, requires 18 different rare earth minerals.
>> But this, this means if the, if the Europeans are dumb enough to do something big, you know, something that that pushes Russia now finally over the brink, they'll have the war. That's just like all the logic now points toward that direction. And the only thing that can keep that from happening is if the Europeans start calming down and and and finally get their crap together. And but it, it, one more, one more big thing, one more thick, big blow up inside Russia that actually kills a couple, a good number of civilians, and Russia will strike back, and they will do it. Right.
>> Okay. So this, this premise that the Europeans are smart. Okay. So let's walk this through.
>> I would never say that. I would never. It's not a premise I make. They prove that they're insane.
>> Yeah. I mean.
>> They're living up to that. Now.
>> Look, look at the logic of this. So, the, our, our econ, our, our European economies, they, they thrive. They need low energy costs. So, that means we need inexpensive oil and inexpensive liquid gas. Therefore, what we're going to do is we're going to go along with the US plan to blow up the Nord Stream pipeline and then impose sanctions on Russia. So we no longer buy cheap, inexpensive oil. We're going to buy more expensive oil, and we're going to have, and we're gonna only buy expensive liquid natural gas from the United States. So therefore, we're going to increase our prices by 50 to 100%. And you're going, "Yeah, that, that, that's a great strategy." [Laughter] And in the process, we're going to start de-industrializing, even though we're claiming we're going to go to war with Russia, which is going to require major industrial output to sustain artillery and tanks and planes and missiles and drones, etc. I mean, makes no sense.
>> No, it doesn't. But, but again, I, I, I think the Europeans, a good number of them, are caught in a mass psychosis or a mass formation event that makes them believe that if they just want it enough, then it will happen because everybody is Churchill. And they've lost the capacity of reasoning within actual, you know, realist terms. I watched the Swiss, the TV program the other day where they were discussing about the pros and cons of maybe sending weapons to Ukraine. One hour they were discussing about like moral pros and cons. Not once did it occur to them that if they send weapons to Ukraine that are used to kill Russians, maybe the Russians are just going to nuke the hell out of Switzerland. Not once. Not once. So that doesn't even, it doesn't even cross their minds. And that's the general problem we have in Europe at the moment. But so it seems to me as if the, the Russians will, like Karaganov says, have to have to reassert that point. And probably, I mean, if it doesn't stop, they will. So, and you, you would agree to that, I suppose.
>> Oh, yeah. Absolutely. And again, uh, you know, I'm fascinated by how, uh, Sergey is portrayed in the West as this sort of crazy Dr. Strangelove sort of character. Sergey is, is a wonderful guy, delightful man, uh, smart. Uh, he, he's not, he's not some intellectual lightweight. Uh, and, you know, and he's not, he's not some delusional thinker. I mean, he's given some thought to this. And, you know, he, he was the first one talking about that Russia's future lied in the East with that, you know, he said, "I used to be sort of a Europile and and bought into that." But he said, "Recognize there is no future in relationship with Europe. They were just too poisoned, too set in their ways to recognize the opportunity of working with Russia." And that's why he said, "Hey, let's go, let's go East to Siberia, to China. That's where the future is." And lo and behold, that is where the future is. And, and, and, and that's, but he was the first one to see that and write about it. So when he talks about, you know, the need to reestablish nuclear deterrence with Europe, in other words, wake them up so they recognize what they're actually up against, uh, I, it's not just idle talk on his part. And, and it appears that it's, it's gaining traction among more and more Russians as, you know, because frankly, if, if Russia did to the United States or to Europe what Europe and the United States have been doing to Russia, we would have been at war a long time ago.
>> Yeah, of course. Of course. I mean, that's, that's this entire complete and utter misunderstanding about what the Russians are really doing and what they're up about. But the propaganda in Europe has been so thick that what you and I talk about will sound like, like crazy talk to a lot of people over here. So, and that, that's just another fact that, you know, needs to be dealt with. So, um, yeah, um, overall, do you think that the new, like, the fact that Starmer is gone, we don't know who will be the new guy, but, you know, do you think that has any impact on the dynamic overall?
>> Yeah, potentially because this was like Starmer's pet project, and he was known to have, he was alleged to have had intimate relations with some young, young Ukrainian men. So, who knows if that was a motivating factor in all of this. But, um, you know, if it depends if the new, if his replacement decides, "You know what, we need to focus. The ba, the Labour base is eroding and eroding dramatically because of domestic conditions in the UK, both in terms of the economy, in terms of migration, in terms of public safety, etc." So you would think the smart tack would be, "Let's shift away from all this international madness that produces nothing but distraction and risk, and let's see what we can do to restore our credibility at home." That would be the smart thing to do. But, you know, these politicians don't necessarily do the smart thing.
>> No. No. Uh, I think they've proven time and time again that they're incapable for this kind of stuff because what we just talked about at the beginning also about, you know, uh, crude oil shortages and heavy, heavy crude shortage for the United States. I mean, it's even worse for the Europeans because they're downstream US at this point.
>> Yeah.
>> It makes me, it makes me want to go like, "Just, just pull out all of my hair." But the last question, any, any kind of, um, any kind of estimations about what this whole thing does for China and its its outlook at on the world? Because I think they learned a lot this year about the, the US and the West in general is is accelerating China's rise as the dominant economic power in the world.
>> M. So, um, you know, when you, at the start of the special military operation in 2022, uh, the, you know, the Chinese and Russians, as part of BRICS, had talked about, "Yeah, you know, we need to, we need to, we don't need to be dependent on the West." But it really, there was no urgency to it then. With the sanctions that were immediately, uh, executed upon Russia, then followed on rhetoric and threats from the United States towards China, they both realized, "Okay, we need to step this up." That summit that took place, I think it was January, February of 2023 in Moscow, where Xi Jinping came, that was the, that's where they really lit the fuse. "Okay, we got to accelerate putting together this intern, a new international financial order." And so it's culminated now with the Chinese created an alternative to SWIFT, which is called CIPS, Cross-border Interbank Payment System. It is digital. SWIFT is analog. And just in the last, I understand the last two or three weeks, 26 other international banks have basically lined up with Chinese banks in signing agreements so that this, this system now is, it, it's becoming international. So you don't, to transfer money, you're not dependent upon SWIFT and US dollars. Now, to wire money, you can use a variety of currencies, but it ultimately goes down to the Chinese renminbi. So the, yeah, China, uh, and China at the same time, they're selling off US Treasuries. They're buying gold and silver. Russia selling off Treasuries, buying gold and silver. Japan selling off Treasuries. So the US, the US bond market, which used to be seen as sort of the safe haven, it's no longer seen that. So that's where China is definitely stepping in to create an alternative with the full backing of Russia.
>> The, the gears are now starting to really click and into each other, like the stuff that has been put into place, and it's going to start the machinery, the new machinery is getting started.
>> Correct. Yeah.
>> Good.
>> Larry, um, I've stolen a lot of your time. Thank you very much. You're always very generous with that and with the updates. People who want to follow you, there's sonar21.com, your homepage, and there's now Transition Protocol, your, uh, your YouTube channel. People should go there. Any other place to find you?
>> Uh, those are the two big ones. I mean, the Substack, I'm Larry C. Johnson at Substack. Um, so, but, uh, between Sonar and then, uh, the Transition Protocol, those are, those are the big ones. I also have a counter-occurrence that I just do, uh, once a week, uh, you know, short, short videos. But the Transition Protocol is becoming, with Pepe and Pepe and me, sort of the principal analyst, Zulfiqar Ali, we call him the Z-man. Uh, he's, uh, he sits there sort of the, the host, and then allows Pepe and I to focus on really trying to integrate journalistic reporting with intelligence. And, uh, I think we get a pretty, pretty potent combination out of that.
>> It's absolutely fantastic. I recommend it to everybody. I'll put the links into the description box down below. Larry Johnson, thank you so much for your time today.
>> Thanks, Bo. Always a pleasure, my friend.