Transcript [00:00] Hey everyone. [00:01] So, in this video I want to talk about [00:04] the Iranian economy. The Iranian [00:07] economy. I want you to understand [00:08] something that a lot of people who are [00:10] watching the news, including us on this [00:12] channel, we have not really been talking [00:14] about enough and therefore aren't really [00:16] noticing and understanding. Because [00:18] everyone's talking about the war, [00:21] the ceasefire, the ceasefire falling [00:22] apart, the negotiations, the Strait of [00:24] Hormuz, the MOU. [00:26] That's all very important, of course. [00:29] But there's also a story going on about [00:33] what's actually happening to the [00:36] 90 million or so Iranians that is [00:40] possibly in the long run more important [00:42] than anything else going on in this war. [00:44] And it's the Iranian economy that is not [00:47] just struggling, it's in catastrophic [00:50] shape, the worst shape it's been in [00:52] since the Islamic Republic came into [00:53] existence in 1979 and it's not even [00:56] close. This is not it's not just bad, [00:58] it's not just a rough patch, okay? It is [01:02] historically bad. I'll walk you through [01:04] all of it. [01:06] Now, the numbers are honestly staggering [01:08] and I want to talk about also in this [01:10] video we're going to what we're going to [01:11] get to [01:12] is what this signals in terms of what to [01:14] look for in the war moving forward and [01:17] what it says about the about the people [01:21] who are still in charge and about the [01:22] regime itself. Meaning it's going to [01:23] have some geostrategic implications [01:26] beyond just uh [01:28] you know, being shocked at how bad the [01:31] situation actually is. So, let's start [01:33] with with something that a lot of people [01:35] get wrong. A lot of people assume that [01:36] Iran's economy [01:38] is in collapse now because of the war [01:41] that started on February 28th, which is [01:43] not true. The war did not break an [01:46] economy that was doing okay. That the [01:48] economy was already not just doing [01:50] badly, but in absolute freefall. [01:52] Remember, that is what led to all of the [01:56] protests that precipitated that you know [01:59] in the way the dominoes fell we had the [02:00] protests at the end of last year [02:02] December January the massacre [02:05] Trump help is on the way and then [02:06] finally [02:07] we have and then we have the military [02:09] build up that goes on for about 6 weeks [02:11] or so and then finally at the end of [02:13] February we have the war beginning so [02:14] the economic collapse was already well [02:17] on its way in 2025 [02:21] now here [02:22] let's pull up the first piece that we're [02:23] going to look at here [02:25] and this is from the foundation for the [02:28] defense of democracies a fantastic think [02:30] tank and really you should follow them [02:33] they have a a lot of fantastic people in [02:36] fact as you're going to see I'm going to [02:39] we're having a webinar very soon where [02:40] we're going to have one of their great [02:42] one of their great authors who's going [02:43] to be joining us I'll tell you more [02:45] about that in a couple of minutes but [02:47] let's first let's first get to this [02:49] piece [02:50] we're not going to read all of it cuz [02:51] it's quite long [02:53] but I want to take a look at just the [02:55] first couple of paragraphs to start here [02:58] we go [03:01] on February 28th 2026 American and [03:04] Israeli forces launched epic fury the [03:06] country they targeted was already in [03:08] economic crisis inflation had topped 50% [03:12] the currency was in freefall merchants [03:14] had shuttered their shops in protest a [03:17] major private bank had just collapsed [03:19] when the bombs began to fall on Iran's [03:22] petrochemical plants and military [03:23] installations they did not break a [03:26] functioning economy they shattered one [03:28] already in advanced decline rebuilding [03:30] the country will require political [03:33] transformation [03:35] the Islamic Republic has spent 47 years [03:37] resisting that's an understatement they [03:39] just they just can't and without that [03:42] transformation the foreign capital [03:43] needed for recovery will not come by [03:46] late 2025 Iran's economy was unraveling [03:50] the International Monetary Fund had [03:52] already estimated consumer price growth [03:55] at 42.4% [03:57] for 2025 [03:59] with no expectation for improvement in [04:02] 2026. Iranian merchants shuttered their [04:05] shops in protest at the end of 2025 [04:09] triggering mass demonstrations that the [04:11] regime suppressed with brutal force. [04:15] The roots go back further than 20 [04:17] go further back than 2025. Look at this. [04:20] Per capita income had already collapsed [04:23] from roughly $8,000 US [04:28] in 2012. So, we're going back quite a [04:30] ways now. [04:32] 14 years ago. [04:33] $8,000 in 2020 in 2012 to approximately [04:37] $5,000 in 2024. You get that over a [04:40] 12-year period. [04:42] The [04:43] the income the per capita income dropped [04:47] from 8,000 to $5,000. [04:51] Hallowed out by decades of [04:52] mismanagement, endemic corruption, and [04:54] layered American and other international [04:56] sanctions. Overall economic growth had [04:59] averaged little more than 1% per year [05:02] over the prior two decades. Again, not a [05:05] functioning economy with per capita [05:07] income contracting for much of that [05:10] period as we just said. Iran's once [05:12] sizable middle class shrunk from 58.4% [05:16] of the population in 2011 to 48.8% in [05:20] 2019. [05:23] Okay. Now, that's So, that is setting [05:26] the stage before anything. Before the [05:29] the 12-day war, before anything else [05:31] happened. [05:33] But, look at those numbers. [05:36] Look at that. [05:38] That's over a decade of steady decline. [05:41] Not a sudden shock. [05:42] Uh this is a slow bleed. Order ordinary [05:45] Iranians getting poorer, significantly [05:48] poorer, year after year for more than a [05:51] decade. [05:52] And by the end of that decade, months [05:54] before the war even started, you already [05:55] had merchants shutting their shops in [05:57] protest and a regime cracked down in the [05:59] streets. [06:01] And then the war comes. [06:04] So, it was already an economy that was [06:06] in absolute collapse and was not [06:09] actually functioning for more than a [06:11] decade. [06:14] Now, before we talk about what the war [06:15] actually did to the Iranian economy, I [06:17] want to tell you about an event that you [06:19] do not want to miss. Okay, let me just [06:22] let me just tell you about this quickly. [06:23] We are having a webinar [06:25] uh [06:26] Israel 365 Action, the organization that [06:28] I lead. We are having We are hosting a [06:31] live webinar next Monday, meaning a week [06:35] that is a Monday, July 20th, so a week [06:38] from tomorrow when I'm recording this. [06:40] And it's fantastic fantastic lineup. I'm [06:43] going to be joined by Brigadier General [06:45] Amir Avivi, founder of IDSF, otherwise [06:48] known as a B'Tselem. He's I've quoted [06:51] him on this channel before and recently. [06:53] He's incredible. We also have Brian [06:55] Kennedy, [06:57] who is one of the great public [06:58] intellectuals uh today. He's the [07:00] president of the American Strategy Group [07:02] and he's a former president of the [07:03] Claremont Institute. We also have the [07:05] great David Dr. David Wurmser. And if [07:07] you don't if you haven't been seeing my [07:09] weekly conversations with Dr. Wurmser [07:11] since since the Iran war started at the [07:13] end of February on the Israel 365 news [07:15] channel, you got to go check those out. [07:17] They are fantastic and [07:20] and they're so we learn so much from [07:22] him. He's really one of the great [07:24] experts on the Middle East in the world. [07:25] And Lieutenant Colonel Jonathan [07:27] Conricus, former spokesman of the IDF, [07:30] currently with the Foundation for [07:31] Defense of Democracies, whose article I [07:32] was just quoting from. So, that is next [07:35] Monday. [07:36] That is next Monday. [07:38] Um and uh, at [07:41] at 1:00 p.m. Eastern, 8:00 p.m. in [07:43] Israel, and you don't want to miss this. [07:46] You can sign up uh, either by clicking [07:49] this QR code. You can click the QR code [07:51] right now. You can just hold your phone [07:52] up. If you're not on your phone, I don't [07:53] know how you do that exactly. I'm not a [07:55] tech person, but you can click this QR [07:57] code or click on the link in the [07:58] description of this video for the [08:00] webinar. Or if you're listening, just go [08:02] to uh, [08:04] just go to israel365.com [08:08] /regime. [08:10] Israel365.com/regime. [08:13] As we've titled it, Are We Headed for [08:15] Regime Change? What to Expect from the [08:16] Middle East. A fantastic, fantastic [08:19] lineup of top experts, and I'll be I'll [08:23] be joining them all in conversation. An [08:25] amazing panel. Next Monday, 1:00 p.m. [08:28] Eastern, 8:00 p.m. in Israel. Don't miss [08:30] it. Okay, let's get back to what we're [08:32] talking about here. So, let's talk about [08:34] what 40 days of Operation Epic Fury [08:37] actually did to the and then the [08:39] sanctions and the blockade that [08:41] followed. What all of this has done to [08:43] the already collapsing Iranian economy. [08:46] So, let's go back to that piece from the [08:47] Foundation for Defensive Democracies. [08:50] Let's pull that up again. [08:52] And let's let's continue reading. [08:55] Cuz I'm not going to read everything, [08:56] but there's some very important sections [08:59] here. [09:00] So, they have here an estimate of the [09:02] damage. [09:03] Let's take a look. [09:05] The Foundation for Defensive Democracies [09:07] Center on Economic and Financial Power [09:09] estimated the total economic damage of [09:11] the war [09:13] uh, and this piece was written just a [09:14] just like a week or two ago [09:16] at approximately $144 [09:19] billion. [09:20] Roughly 40% of Iran's pre-war GDP with a [09:24] plausible range of 50 billion to 300 [09:27] billion. The Iranian regime's own [09:29] spokesperson, Fatemeh Mojarrani, put the [09:32] figure even higher [09:34] at $270 billion in direct and indirect [09:38] damage from the 40-day war. [09:43] Let that sink in. Iran's own government [09:45] said that the damage is worth more than [09:46] a quarter trillion dollars. Okay, that's [09:49] not the Israeli estimate or the American [09:50] estimate. That's Tehran's estimate. So, [09:52] where did that damage come from? It came [09:54] from two places. About 2/3 of it came [09:58] from the air campaign itself. Let's take [10:01] a look. [10:03] It goes on. [10:05] Uh the the [10:07] Here it is. 2/3 of the economic damage [10:09] came from the US and Israeli air [10:11] campaign itself, with the remaining [10:13] third attributable to the US naval [10:15] blockade imposed on April 13th. The air [10:18] campaign's most consequential strikes [10:20] hit Iran's two main petrochemical hubs [10:22] at Mashar and Asaluyeh, including a [10:26] devastating strike on the South Pars [10:28] complex responsible for more than 48% of [10:31] Iran's pre-war petrochemical output. And [10:33] that was on March 18th. Iran had [10:35] invested an estimated 70 billion dollars [10:38] over decades in building this [10:40] petrochemical infrastructure. Depending [10:42] on the scope of the damage, rebuilding [10:44] it under sanctions without access to [10:47] international capital markets or western [10:49] technology could take more than a [10:51] decade. That's a very important point [10:52] they make here. Remember, they're going [10:54] to need foreign investment. No one wants [10:55] to invest in Iran. So, even the [10:57] prospects for rebuilding are not even [11:00] very very good. And we're talking about [11:02] this one strike hitting South Pars, [11:05] half the half the country's [11:06] petrochemical output output, 70 billion [11:09] dollars in infrastructure down the [11:11] drain. The other third of the damage [11:13] came from something less dramatic. [11:14] That's 2/3 of the damage is from the air [11:16] strikes. [11:17] But the other third of the damage came [11:18] from something less dramatic, but [11:20] arguably [11:22] more devastating over time, which is the [11:25] naval blockade. Let's take a look at [11:28] what they have to say about that here. [11:30] Um [11:32] The US naval blockade has proven to be [11:34] the most economically precise instrument [11:36] deployed. Iran exported zero crude oil [11:39] zero crude oil in May 2026, down from [11:42] just over 2.1 million barrels per day [11:45] per day, not in the month, [11:48] in February. So, in February they were [11:49] doing 2.1 million barrels per day. [11:51] Multiply that by 28 days in the month of [11:53] February. Okay? That's mil- 2.1 million [11:56] per day to zero in May. [12:01] February was the last full month before [12:02] hostilities. Estimated export revenues [12:05] for May fell below This is export of [12:08] everything they export below $200 [12:10] million against a pre-war monthly [12:13] revenue baseline more than 20 times that [12:16] figure. [12:17] Oxford Economics estimated the blockade [12:19] could cut off 70% of Iran's export [12:22] income. [12:23] FDD estimates that the combined daily [12:26] economic damage from the blockade ran at [12:28] approximately daily damage [12:30] at approximately $435 [12:33] million per day. [12:37] Wow. [12:40] Zero in May. [12:42] And oil is the thing that funds this [12:43] regime. [12:45] Zero in May. [12:47] I mean, to make that up considering that [12:49] we're doing 2.1 million barrels per day [12:51] beforehand. Look, here's another detail. [12:54] The regime did some more damage. Some of [12:57] the damage they did to their economy [12:58] they did to themselves. [13:01] Here, [13:02] take a look at what they did with the [13:04] internet. We all heard about the [13:06] internet blackout. [13:08] Let's jump down to that. [13:10] Here we go. The internet shutdown, which [13:12] began on January 8th, 2026, when the [13:15] regime severed connectivity in response [13:17] to nationwide protests, and continued [13:19] for at least 88 days, was itself a [13:22] self-inflicted economic wound of [13:24] significant scale. Independent estimates [13:27] ranged widely. Daily costs to the [13:30] digital economy ran between 30 and 80 [13:33] million dollars, while broader estimates [13:35] reached as high as 250 million per day [13:38] when factoring in the paralysis of [13:40] banking and traditional businesses [13:43] unable to process payments or coordinate [13:45] with suppliers. Imagine [13:47] today, whatever job you have, no [13:49] internet for weeks, months on end. [13:52] The blackout has been characterized as [13:54] the longest in history with businesses [13:56] severed from clients, foreign trade [13:59] halted, and import-export operations [14:01] ground to a standstill since even basic [14:04] functions like issuing proforma [14:06] invoices, confirming shipments, and [14:08] transferring funds depended on [14:11] connectivity. Freelancers, teachers, [14:13] crypto traders, digital entrepreneurs [14:15] who had built Iran's fast-growing [14:17] informal digital economy were wiped out [14:21] virtually overnight. So, think about [14:22] this. The Americans are bombing them, [14:24] the Israelis are bombing them, and they [14:25] have a blockade, they can't sell their [14:26] oil. And meanwhile, the part of the [14:28] economy that could possibly function if [14:31] there's an internet gets shut down by [14:33] the government. [14:36] Think about that. [14:38] It's wild. [14:39] The regime shut down the internet to [14:41] control protests, and in doing so [14:43] blacked out an entire huge slice of its [14:46] own economy. [14:48] And we didn't really see it because, you [14:50] know, this whole time there was no [14:51] internet, we we were kind of like [14:53] we knew that we were bombing them a lot, [14:55] we were causing a lot of damage, [14:57] but the I mean, the damage was just [14:59] something that we we did not really know [15:01] about. So, those are the big macro [15:02] numbers. I want to bring this down [15:04] though to the ground level cuz, you [15:06] know, GDP contraction doesn't mean it [15:09] it's hard to wrap our head around as [15:10] normal people on these big numbers in [15:12] the hun- in the millions and billions of [15:13] dollars, they're about the economy. [15:15] Let's talk about what this actually [15:17] looks like for an for an ordinary [15:19] Iranian family trying to buy dinner. [15:23] Okay, so uh here's a piece from uh a [15:25] website called The Levant Files. [15:28] Iran's econ and this is published uh [15:30] yesterday. Iran's economic collapse [15:32] deepens as food prices soar. [15:36] Iran is grappling with an escalating [15:37] cost of living crisis that has left [15:39] basic food staples increasingly out of [15:41] reach for ordinary citizens, according [15:42] to a new a new analysis published by the [15:44] Center for Strategic and International [15:46] Studies. The report, part of CSIS's [15:50] Charting the Middle East series and [15:51] authored by Lilia Yatim, draws on data [15:54] from the World Food Programme Inc. [15:55] showing, [15:57] get this, that the price of wheat flour [15:59] in Iran rose by 124% [16:04] in May compared to November 2025. That's [16:06] not a year-over-year inflation number, [16:08] that's a year-over what is it? 6 months [16:10] inflation number. [16:13] The period just before a sharp [16:15] depreciation of the rial, that's the [16:16] Iranian currency, [16:18] just before that depreciation triggered [16:20] widespread protests across the country. [16:22] Prices for beef, chicken, and cooking [16:24] oil have also climbed sharply over the [16:26] same period, according to World Food [16:30] Programme figures cited by CSIS. [16:34] Whoa. [16:36] Flour, the most basic staple, [16:39] 124% [16:43] over 6 months. [16:45] Imagine a $10 bag of flour [16:48] costing $22 the next time you go back to [16:51] the store. [16:54] Okay? Now there's another piece here [16:56] from Euro News that also speaks to this [16:59] stuff. I'm going to It's a long piece. I [17:00] mean, the title of it is Iran's [17:02] inflation spiral deepens as rial slides [17:04] and tensions rise. I'm going to go down [17:06] to the bottom where it talks about the [17:08] effect on food. The steepest price [17:10] increases have been recorded in [17:11] categories most closely associated with [17:14] everyday household spending. Official [17:16] statistics indicate that food prices [17:18] have more than doubled compared with the [17:21] same period year a year earlier. [17:23] Year-on-year inflation reached 173.8% [17:27] for tobacco, around 178% [17:30] for meat, poultry and related products, [17:33] approximately 152% [17:35] for milk, cheese and eggs, and around [17:37] 139% [17:38] for bread and cereals. That's not 39%, [17:40] that's 139% for bread and cereals. That [17:43] mean 100% is it doubles. Then this is [17:45] more. [17:47] Non-food categories have also recorded [17:49] substantial price increases. Prices for [17:51] furniture and household equipment rose [17:53] by more than 111% while transport costs [17:56] increased by over 103%. [17:59] These figures suggest that the [18:00] inflationary shock extends well beyond [18:02] food prices. Alongside the rising cost [18:05] of everyday essentials, households are [18:07] also facing substantially higher costs [18:09] for household goods and transport, [18:11] further eroding purchasing power and [18:13] placing increasing pressure on household [18:16] budgets. [18:19] Meat up 178%. [18:24] That means if you spend $20 on chicken [18:26] for your family, [18:27] let's say last year, that same amount of [18:30] chicken would be $56 today. [18:33] Not $23 or $25. [18:36] $20 of chicken last year, now it's $56. [18:42] And the rest of these numbers are just [18:44] as brutal. Dairy and eggs up 152%, [18:47] bread and cereals 139%, [18:50] tobacco 174%. I won't do the math out [18:53] loud on all of them, but you get the [18:54] idea. Every single category of daily [18:56] life just exploded. I'm talking dub more [18:59] than doubling prices on everything. [19:03] But, it gets even worse. [19:06] Wages fall behind the cost of living. [19:08] One of the clearest consequences of [19:10] sustained inflation is the widening gap [19:12] between wages and the cost of meeting [19:14] basic living expenses. According to the [19:16] Iranian Labor News Agency, the official [19:19] minimum monthly wage for the current [19:21] year was set at 166.255 [19:26] million rials, which is approximately 85 [19:29] euro. [19:30] While representatives at a meeting of [19:32] the Supreme Labor Council on 13th March [19:34] 2026, [19:36] that's whatever a couple months ago, [19:37] estimated that a minimum household [19:39] living basket would cost around 450 [19:42] million rials, which is approximately [19:44] 225 [19:46] euro per month. [19:48] On this basis, [19:50] the official minimum wage, [19:53] listen to this. [19:54] Uh let's slow down and read this. [19:57] The official minimum wage covers only [20:00] around 37% [20:03] of the estimated cost of a basic living [20:05] basket, [20:06] leaving a shortfall of approximately [20:08] 63%. [20:13] Uh [20:14] Th- This is insane. [20:17] If you work a minimum wage job in Iran [20:18] right now, your entire paycheck covers [20:21] barely a third of what it costs to feed [20:24] and house your family. [20:26] Imagine working full-time and your whole [20:28] paycheck only gets you a third of the [20:30] way to just surviving. [20:32] You need three jobs paying that same [20:35] amount to break even on groceries and [20:38] rent. [20:40] And most people don't have three jobs to [20:41] work because jobs have been wiped out. [20:46] Here, let's go back to the uh Levant [20:47] Files piece. [20:49] Let me show you something else in here. [20:55] Tehran has attempted to respond to the [20:57] crisis by establishing a so-called [20:59] resistance economy committee tasked with [21:02] cracking down on price gouging and [21:03] addressing shortages. Despite these [21:05] measures, these measures, CSIS noted [21:08] that hyperinflation and scarcity have [21:10] persisted, forcing Iranians to wait in [21:12] long lines for government-subsidized [21:15] bread and to cut back on meat and dairy [21:19] consumption. [21:24] Wow. [21:27] Oh, you know, let me read another [21:28] paragraph here. [21:30] Here. The outlook offers little relief. [21:33] CSIS cites International Monetary Fund [21:35] projections, estimating that Iran's [21:37] inflation rate will reach 68.9% [21:41] in 2026. The highest level recorded [21:44] since the 1979 Islamic Revolution. The [21:47] combination of soaring inflation, [21:49] currency depreciation, rising costs, [21:52] continued economic sanctions, [21:54] CSIS warns risks deepening food [21:57] insecurity and broader humanitarian [21:59] strain, posing a significant challenge [22:01] for the Iranian government once the war [22:04] subsides. As if they would care. [22:09] Let's take this all together before we [22:11] get to where the Iranian regime is on [22:13] all of this. [22:15] They set up a committee. [22:16] That's their answer to this. [22:18] They're not opening up the economy. [22:20] They're not They're not redirecting [22:21] resources towards the people. No, no, [22:23] no. They set up a committee [22:24] to try to control prices, [22:28] to berate the merchants while people [22:30] wait in bread lines. And remember, this [22:32] is happening with inflation now the [22:33] worst it's been since 19 79, 47 years. [22:37] Every war, every economic crisis, every [22:39] round of sanctions this regime has lived [22:41] through. [22:43] And this is the worst it's ever gotten. [22:47] Now, here's where I want to make the [22:48] point that I think actually matters most [22:50] in this entire story. You'd think You'd [22:52] think that a regime facing this level of [22:55] human suffering, [22:56] right, bread lines, 37% wage uh [23:00] coverage, the worst inflation in [23:02] history, it would completely you'd think [23:04] it would like out of panic out of out of [23:06] you know to survive that it would [23:07] reorient itself towards fixing the [23:10] economy, at least putting some band-aids [23:11] on it, do something to stop the [23:13] bleeding. [23:15] Cut military spending perhaps. Remember, [23:18] this free fall was already happening [23:19] after the 12-day war. [23:23] You'd think just out of survival, [23:25] strategically, even if all you want to [23:27] do is destroy America and Israel. [23:30] For a for a few months at least, cut the [23:31] military spending, redirect resources [23:33] towards the people who can't afford to [23:35] eat. [23:36] But that's not what happened. [23:38] And and when you think about this [23:40] specific detail [23:42] that I'm going to share with you because [23:44] I think it says more than any budget [23:46] number could. [23:49] I I I mentioned this in a video just a [23:51] couple days ago that Iran recently [23:53] purchased [23:56] Russian fighter jets. [23:58] I 30 uh [24:00] uh S-35s, SU-35s, and SU-30s. [24:04] This is from a month ago. [24:07] Iran orders 12 Russian long-range [24:10] fighters for delivery in 2027. THEY'RE [24:12] STILL ORDERING FIGHTER JETS. [24:15] More and more Russian fighter jets. [24:19] How about this one? Iran weighs purchase [24:21] of used Chinese J-10B fighters. This is [24:24] from [24:25] June 20th, less than a month ago. [24:27] They're they're they're they're buying [24:28] fighter jets from Russia and China. [24:31] This is what they want to spend their [24:32] money on. [24:34] And the the SU-35s are part of a defense [24:37] deal with Russia worth over $6 billion, [24:39] meaning they got a little bit of relief, [24:41] they got a little bit of money in this, [24:42] and what are they doing? They're sending [24:44] the money to Russia to buy weapons. [24:47] While Iranian families are standing in [24:49] bread lines and minimum wage covers a [24:52] third of what it costs to survive, [24:53] Iran's government is literally paying [24:55] Russia [24:57] to store and maintain an order of of [24:59] advanced fighter jets [25:01] to hold on to them and not deliver them [25:03] yet because the air base meant to [25:05] receive them in Iran hasn't been rebuilt [25:06] yet and they're investing more money in [25:08] that. [25:11] And just in case that deal falls through [25:13] or moves too slowly, they're also out [25:15] shopping for used Chinese fighter jets [25:17] as a backup plan to rebuild their air [25:19] force even faster. This is what they are [25:21] spending their money on. [25:24] Guns over bread isn't a metaphor here. [25:26] It's literal monthly it is the policy of [25:30] Iran [25:32] to pay for jets they can't even use yet [25:34] while their people can't afford to eat. [25:38] This is not a regime that got caught off [25:40] guard by some tough choices. [25:44] They had the choice in front of them, [25:45] guns or bread. After the 12-day war, [25:47] Trump lifted sanctions on them so they [25:48] could sell their oil. He even said at [25:50] the time, they have to rebuild their [25:51] economy after everything we did with you [25:53] know, we did to them. And what did they [25:54] do? They they like more than doubled [25:57] their pace of ballistic missile [25:58] production. That's what they did with [26:00] the money. [26:02] In the middle of the worst economic [26:03] crisis in the in its history. And I I [26:06] need you need to get into the head of [26:08] the people in this regime, understand [26:09] how diabolical they are. [26:11] Their own regime almost collapsed over [26:14] this and they still this is what they [26:15] spend all the money on. [26:17] It's this is what I want you to walk [26:19] away from this from this video [26:20] understanding. [26:22] This is not about incompetence. It's not [26:25] mismanagement. [26:27] Or that or all because of the sanctions. [26:29] Mismanagement matters, there's that too. [26:32] But underneath this is a regime whose [26:34] actual priority when forced to choose is [26:37] its ideological military project. The [26:40] proxies, the weapons, the [26:42] not the well-being of its own [26:43] population. This is the proof of it. [26:45] This is not rhetoric. If you're ever [26:47] arguing with someone and say, "Oh, they [26:48] don't care about the Iranian people." [26:49] This is it. [26:51] This is not incompetence. This is a [26:53] value system. And once you see that [26:56] clearly, a lot of other decisions, [26:57] right, the proxy funding, the nuclear [26:59] program, the ballistic missiles, the [27:01] refusal to change course, even as people [27:03] starve, it all starts to make sense. [27:06] This is a regime acting exactly [27:08] according to what it actually believes [27:11] matters. [27:13] Yes, this is [27:16] This is who they are. [27:18] It is. [27:21] I'm sorry I'm being so emphatic here, [27:22] but we have to get this into our heads [27:24] cuz it it's such a a paradigm shift for [27:27] us coming from the West. [27:29] Last point. [27:30] Cuz I think this is the part that people [27:32] really don't grasp. [27:35] And this is this is important like for [27:37] to think ahead about what we're seeing [27:39] and what to expect [27:42] downrange as we as we see this whole [27:45] drama play out. [27:47] So, [27:49] imagine that the war completely ends [27:51] tomorrow. [27:53] Right? And and we would be like, "Oh my [27:54] gosh, no. Oh, the war's ending. You [27:56] know, the regime is still is still [27:58] there." [27:59] Imagine a deal gets signed [28:02] and America walks away. [28:04] Iran is nowhere near recovery. [28:08] The all the problems I laid out to you [28:10] here are nowhere near getting solved. [28:12] It's not like there's foreign investment [28:13] coming in. [28:17] You you know, that's let's actually go [28:19] back to the uh [28:21] to the FDD piece. This will be a good [28:23] way to [28:24] you know, to end us off. [28:26] Let's go back to the FDD piece. Here, [28:27] where is it? [28:29] Here. [28:30] The most sign- Even setting aside the [28:32] scale of destruction, Iran's path to [28:34] potential economic recovery faces [28:36] structural obstacles that distinguish it [28:39] sharply from post-war reconstruction in [28:41] other contexts. The most significant is [28:43] the sanctions. [28:44] Key sanctions, including US Treasury [28:47] counter-terrorism designations on the [28:49] National Iranian Oil Company and Iran's [28:51] Ministry of Petroleum, are not measures [28:53] that a president can wave unilaterally. [28:56] Trump can't remove those. Reinforced in [28:58] US legislation, they constrain not only [29:01] government actors, but deter private [29:03] sector participation from banks, [29:05] insurers, energy companies that face [29:07] secondary sanctions risk. Any [29:10] reconstruction program funded through [29:12] international capital would require not [29:14] merely an executive order, but would [29:16] require major political changes, [29:18] including verifiable constraints on its [29:21] nuclear program, dissolution of the [29:23] IRGC, an end to the financing of [29:25] proxies, human rights improvements, [29:28] limits on the ballistic missile program [29:30] to satisfy the stack of statutory [29:33] sanctions restrictions. This is all in [29:35] these laws. [29:36] What they have to do to remove the [29:37] sanctions. And this is not executive [29:39] orders. Trump cannot remove these [29:40] sanctions on his own. [29:43] These are no technical adjustments. They [29:44] would likely require the end of the [29:46] Islamic regime itself. [29:49] In other words, there's a limit to even [29:50] how much Trump can save the regime, even [29:52] if he completely wanted to. [29:58] Iran's frozen assets held overseas, [30:00] estimated over a hundred billion dollars [30:02] by Iranian officials and independent [30:03] analysts, represent a potential, but [30:05] deeply uncertain lifeline. [30:07] Approximately 12 billion US dollars is [30:10] believed to be held in Qatar, 10 billion [30:12] in Iraq, tens of billions in China, but [30:14] not all these funds would be [30:15] recoverable, even under a full sanctions [30:18] relief agreement. Some are entangled in [30:19] legal disputes entirely separate from [30:21] the sanctions regime. As of early June [30:24] 2026, last month, negotiators were [30:27] discussing an immediate package of of [30:28] roughly 12 billion, less than 10% of the [30:31] estimated damage. [30:38] The IMF's April 2026 World Economic [30:40] Outlook projected Iran's Iran's economy [30:43] will contract by 6.1% [30:46] that's crazy. [30:47] I mean like growth or contraction of 1% [30:49] or 2% is already these are big big these [30:52] are already big numbers. [30:54] Contraction of 6.1% [30:56] in 2026 with an inflation rate of 68.9%. [31:01] Senior Iranian economic officials have [31:03] reportedly warned president [31:05] Pezeshkian that restoring the war [31:07] affected economy could take more than a [31:10] decade. [31:12] More than a decade. [31:16] You see what what you see what's [31:17] happening here? [31:19] The kind of sanction the kind of [31:21] sanctions relief that would actually let [31:23] Iran rebuild isn't something a president [31:26] can sign away. It's built into law and [31:29] unwinding it requires changes this [31:31] regime has spent decades refusing to [31:33] make. [31:34] And it talks about oh 12 billion dollars [31:36] might be available here and we're all [31:37] like oh no oh we're going to give them [31:39] we're going to unfreeze 12 billion [31:40] dollars in assets. [31:42] Remember we were talking about the MOU [31:43] we're going to we're going to unfreeze [31:44] funds or they're selling their oil [31:46] they're making a few billion dollars. [31:48] Yeah, we don't want them to be able to [31:49] do that but against the damage the [31:52] regime itself values at over a quarter [31:54] trillion [31:56] it's not even close to a down payment on [31:58] fixing things. [32:00] And here we read that Iran's own [32:02] officials the people inside the system [32:04] are telling the president that this [32:05] could take more than a decade. [32:09] Okay, last [32:10] last excerpt from this piece [32:13] here where is it? Donya [32:16] Eghtesad [32:17] an Iranian business newspaper which is [32:19] currently offline laid out a four-stage [32:22] domestic reconstruction model this [32:23] month. [32:24] First macroeconomic stabilization [32:26] through currency reform and budget [32:28] consolidation. Second institutional [32:30] reform including anti-corruption [32:32] measures over five years. Third [32:34] development of non-oil export sectors [32:36] over 10 years so that you can diversify [32:39] the economy and fourth a gradual [32:41] transition to a market economy over 12 [32:43] years. [32:44] Very nice. The publication acknowledged [32:46] frankly that Iran requires a native [32:48] reconstruction model one adapted to its [32:51] specific political conditions rather [32:53] than any imitation of post-war cases [32:55] like Germany or Japan which were rebuilt [32:57] with open access to international [32:59] capital and genuine institutional [33:01] reform. In other words, no one's going [33:04] to come to their rescue. [33:07] Iran's own financial newspapers own [33:09] roadmap [33:10] and it openly says that it can't follow [33:12] the model of Germany or Japan because [33:13] those countries had access to capital [33:15] markets and real institutional reform [33:17] because they surrendered the evil [33:19] regimes went away but Iran by its own [33:21] admission doesn't have either of those [33:23] things and it isn't on a path to get [33:25] them. [33:26] So here's where this leaves us. Let's [33:28] bring this to a close finally. [33:31] Before the war already during the worst [33:33] economic conditions in decades. [33:36] During the war [33:37] a quarter trillion dollars in damage by [33:40] the regime's own count and right now the [33:42] worst inflation since 1979 [33:45] minimum wage covering a third of [33:47] survival costs, breadlines [33:50] and in the in the best case scenario [33:52] going forward a decade or more before [33:54] any real recovery [33:56] and only if a regime that has spent 47 [33:58] years refusing to change actually [34:00] changes. [34:02] And through every single stage of that, [34:04] the decline, the war, the suffering, the [34:05] negotiations, the regime's answer has [34:07] never been hey, you know, maybe we [34:09] should take care of our people. [34:11] No, it's been weapons, ideology [34:15] survival of the regime. [34:18] That's it. That's all they care about. [34:20] One more thing before I let you go. [34:22] When people talk about regime change in [34:24] Iran [34:25] they usually [34:27] and you know, when when I talk about it [34:28] even on this channel we usually frame it [34:31] as a question of what is America going [34:32] to do? What is Israel going to do? Are [34:34] we going to finish the job militarily? [34:37] Uh, you know, whether it's, you know, [34:39] blockade, strikes, sanctions. [34:43] Marching on Tehran, taking Kharg Island. [34:46] But all of that misses this. [34:51] This that the regime is not a stable [34:54] government facing an external threat. [34:57] It is a collapsing government collapsing [35:00] from the inside. [35:01] And history is full of regimes that [35:03] looked completely stable right up till [35:06] the moment that they collapsed. [35:09] The Shah's government looked stable in [35:10] 1978. The Soviet Union up to the final [35:14] days didn't it didn't look like it was [35:15] about to collapse. Do you remember that? [35:17] Regimes like this don't usually give you [35:19] advanced warning. They hold on and hold [35:21] on. Same thing with Assad, right? Assad [35:23] in Syria. [35:24] We didn't see that coming until like the [35:26] day it happened. [35:28] Regimes hold on and hold on and then one [35:31] day they're gone. They don't anymore. [35:34] And I don't know when that's going to [35:35] come, but Iran's regime right now is [35:37] sitting on inflation worse than anything [35:39] it's seen in its history. A currency in [35:41] free fall is is an understatement. [35:45] And all they're doing with any money [35:46] they get is buying more fighter jets [35:48] rather than feed the people. [35:51] The population has taken to the streets [35:52] before. It's going to happen at some [35:54] point. [35:55] Nobody knows exactly when or how this [35:57] ends, but but this is not a static [35:59] situation. [36:01] Anyway, this video has gone on far too [36:03] long. Thank you very much for watching. [36:05] I hope you found this useful. Please [36:07] make sure to like, share, subscribe, [36:09] drop a comment. I want to know what you [36:10] think. Thanks for watching and God [36:14] bless.
