Tag: uae

Doug Casey on Swap Lines, Secret Bailouts, and the Weaponization of the Dollar

International Man: While the term “swap line” sounds technical and harmless, it seems like it’s just a euphemism for a bailout.

What does it say when Washington starts extending swap lines to countries like Argentina and the UAE?

Doug Casey: First, we should define what a swap line is. It basically amounts to the US giving a foreign country X amount of currency in dollars, and the other country paying for it by giving the US the same amount in their currency. For decades, US dollar swap lines were mostly reserved for major allies and core financial centers around the world.

It’s a problem, however, with countries whose currencies have no value outside of their boundaries. A country that gets a swap line from the US is trading its paper for liquid and fungible dollars. The US may then get stuck with UAE dirhams or Argentine pesos. It’s trading real money for play money, Monopoly money.

In the case of Argentina, that swap line may never be repaid. The US might wind up being stuck with a bunch of worthless Argentine pesos.

When the US gives a foreign country a swap line, it basically creates those dollars out of nothing. They enter the banking system and debase the dollar. Doing so gives the US some leverage over a country that takes the swap.

But it’s a pretty expensive way of getting leverage.

International Man: In Argentina’s case, the US framed the swap line as a stabilizing measure. But was this really about financial stability, or was it about propping up a politically important ally at a critical moment?

Doug Casey: Since Milei is Trump’s new BFF, the swap was intended to help Argentina’s perennially weak economy, thereby helping Milei. That’s great for the moment, but now Argentina has to deal with another $30 billion of debt. I would’ve recommended Milei default on all of Argentina’s debts to the IMF, the World Bank, and the US—that might have worked during Milei’s first few months. “I’m sorry, everyone. We just don’t have the ability to pay right now. Wait until I set things straight.” I’m not sure that Argentina would’ve been punished badly for that. Third World countries default all the time.

Instead, Argentina taking the swap just indebts them by another $30 billion. The way to look at this is that future generations of young Argentines are being turned into serfs in order to repay that swap line, along with the rest of the debt.

Milei should have called a spade a spade and admitted bankruptcy instead of going further into debt to keep the Ponzi scheme going.

Argentina’s financial situation under Milei is very strange. The country theoretically owns two million ounces of gold. A million of those ounces were already sitting in London. But then, as soon as Milei got into office, he physically transferred another 440,000 ounces to London, saying that they were safer there. Which is an obvious lie; there’s no reason to think they’ll ever return.

That’s on top of buying 24 F-16s from Denmark—totally useless planes for Argentina—for another $350 million, plus $150 million per year in maintenance. And failing to abolish the central bank, which was a centerpiece of his election campaign. And worse, using the central bank to maintain the peso at ridiculously high levels, which is serving to bankrupt thousands of small businesses.

These stupidities might make the $30 billion swap seem necessary.

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Yemen’s Prisoner Swap and the UAE–Israel Project Saudi Arabia Couldn’t Bury

Behind a UN-backed prisoner exchange between Yemen’s internationally recognised government and the Houthis lies a deeper story of islands, radar, black sites, and a southern Yemen security order Riyadh chose to dismantle after years of coalition decay. This proxy network stretching from Yemen’s Socotra Island to Bosaso on Somalia’s coast, across the maritime corridor between the Red Sea and the Horn of Africa, was built on torture, constant sea surveillance and coalition infighting, only to be sold to the world by Western navies as “freedom of navigation.”

After January 2026, we were told that this decade-long tripartite between the UAE, Israel, and the Yemeni separatist Southern Transitional Council (STC) had been dismantled. But how much of that machinery still stands, under new flags and quieter names, waiting for the next round? Since January 2026, the noise has been about “dissolving” the STC and managing Saudi–UAE friction, but what almost no one has asked is whether the UAE–Israel island pact, its radars, runways and black‑site prisons strung along Yemen’s southern waters, ever stopped operating, or just slipped under friendlier flags.

Riyadh’s strike on the STC shattered a larger Red Sea order

On 14 May 2026, negotiators for Yemen’s Presidential Leadership Council and Ansarallah signed the country’s largest prisoner exchange since the war began, agreeing in Amman to swap more than 1,600 detainees under UN auspices. Saudi Arabia helped facilitate the deal behind the scenes, while the Emirati-backed Southern Transitional Council stayed out of sight and the UAE had no formal role at the table, even though some of the war’s most notorious detention networks grew out of the southern security order they built together. For families searching prisons, camps, and unofficial detention sites, the agreement offered a rare opening in a war that turned disappearance into routine.

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Iranian Hostilities Flare Up Again as Drone Strike Sparks Fire Near Abu Dhabi Nuclear Plant

A drone strike sparked a fire near the Barakah Nuclear Power Plant in the United Arab Emirates on Sunday, in the latest sign of continued regional hostilities linked to the Iran conflict.

Authorities in Abu Dhabi said the drone struck an electrical generator outside the nuclear facility’s inner perimeter in the Al Dhafra region.

According to UAE officials, no injuries were reported, radiation levels remained normal, and the plant’s core systems were unaffected.

The UAE Defense Ministry said three drones were launched from the country’s western border.

Two were intercepted, but a third struck the site, causing the fire.

The Federal Authority for Nuclear Regulation said the plant continued operating normally, while the International Atomic Energy Agency confirmed that Emirati authorities had informed it that radiation levels remained stable.

“The IAEA is following the situation closely and is in constant contact with the UAE authorities, ready to provide assistance if needed,” the UN nuclear watchdog said.

Footage of such incidents is notoriously scarce because of the UAE’s aggressive crackdown on posting photos or videos that could damage the country’s image as a “safe haven.”

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UAE Becomes Active Combatant in Iran War, Secretly Launching Strikes Against Islamic Regime

The United Arab Emirates (UAE) has been secretly carrying out attacks against Iran, according to The Wall Street Journal.

The attacks included a strike on an oil refinery on Iran’s Lavan Island in early April, triggering a major fire and knocking much of the facility offline for months.

Iran acknowledged at the time that the refinery had been struck in what it described as an enemy attack.

Tehran later responded with missile and drone strikes against the UAE and Kuwait.

While Gulf states publicly insisted before the war that they would not allow their territory or airspace to be used for attacks on Iran, the UAE became an active participant in the conflict after coming under sustained Iranian attack.

Iran launched more than 2,800 missiles and drones at the UAE during the war, more than against any other country besides Israel.

The attacks disrupted tourism, aviation, and property markets across the Emirates and reportedly triggered a major shift in Abu Dhabi’s strategic outlook toward Tehran.

U.S. officials are said to have quietly welcomed the UAE’s participation in the war effort, according to the report.

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Ceasefire Apparently Over as Iran Fires Missiles at UAE – Fujairah Oil Zone on Fire

UAE claims to have the ‘full and legitimate right to respond to these attacks’.

The ceasefire in the Middle East seems to have been broken today, as the United Arab Emirates reports that Iran fired four missiles toward its territory.

The UAE says that it is actively engaging with a ‘missile and drone attack’.

Axios reported:

“There were also fires reported at a fuel facility in the UAE and on ships off its coast. Iran has not claimed responsibility for any of the apparent attacks.

This would be the first time Iran attacked a Gulf state since the ceasefire was announced nearly a month ago. The U.S. and Iran may now be on the precipice of a return to war.”

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Israel Deployed Iron Dome and Troops to Support UAE Defense Amid Iran Attacks — First Deployment Abroad

Israel quietly deployed its Iron Dome air defense system along with dozens of IDF troops to the United Arab Emirates in the early days of the Iran conflict, according to reporting, marking the first operational use of the system outside Israel and the United States as Tehran unleashed a sustained and intense missile and drone barrage against the Gulf state.

According to reports published Sunday by Axios and The Jerusalem Post, Israeli Prime Minister Benjamin Netanyahu ordered the deployment early in the conflict following a call with UAE President Mohammed bin Zayed Al Nahyan, directing the Israel Defense Forces to send an Iron Dome battery, interceptors, and several dozen operators to help defend the country as Iran escalated its attacks across the region.

The move represents an unprecedented step in Israeli defense policy, with officials confirming it was the first time an Iron Dome system had been transferred abroad for active use. A senior Israeli official said the UAE became the first country outside Israel and the United States to deploy the system operationally, with another official noting it intercepted dozens of incoming threats.

Iran’s barrage on the UAE was among the most intense of the conflict, with more than 550 ballistic and cruise missiles and over 2,200 drones launched at the country — more than at any other nation, including Israel — with numerous strikes hitting civilian infrastructure, residential areas, and economic hubs in what analysts say reflects Tehran’s effort to pressure U.S.-aligned regional partners.

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The Dollar Lifeline in War – Currency Swaps

I have said for years that people misunderstand the global monetary system. It is not driven by trade balances. It is driven by capital flows and access to dollar liquidity. The discussion of a currency swap between the United States and the United Arab Emirates shows how the system actually works under stress.

The United States is now considering a currency swap with the UAE as tensions around Iran rise. This is not about trade policy. It is about liquidity. When uncertainty increases, capital begins to move. Countries need dollars to stabilize their financial systems and maintain confidence.

Currency swaps are often presented as technical tools. In reality, they are lifelines. They allow a foreign central bank to access U.S. dollars directly. This bypasses stressed markets and helps prevent a liquidity crisis that could trigger capital flight.

This is exactly what happens during geopolitical conflict. The Iran situation has raised concerns about the Strait of Hormuz. That region is critical for global energy flows. When energy is threatened, markets react immediately. Currency volatility rises and capital seeks safety.

The UAE is a strong economy, but it is still exposed. Its currency is pegged to the U.S. dollar, meaning it must maintain sufficient dollar reserves to function properly. When global stress increases, even strong economies seek direct dollar access. That is why a swap line becomes important.

There is also a geopolitical layer. Currency swaps are tools of influence. When the United States provides dollar liquidity, it reinforces alignment. If access is restricted, countries look for alternatives. That can include increasing use of other currencies like the Chinese yuan. The UAE has stated it would consider using the yuan if the U.S. denies them the opportunity to swap, but the issue has become polarizing.

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US Mideast Allies including Saudi Arabia, UAE, and Others, Urge President Trump to Continue War on Iran

US Gulf allies, including Saudi Arabia, UAE and other Gulf allies urge President Trump to continue war on Iran,

The US allies privately warned President Trump that Tehran has not been weakened enough.

The US Allies say four weeks of bombings has not been enough to destroy the barbaric Iranian regime.

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‘Punish Iran’: Saudi Arabia & UAE Inch Closer To Joining US-Israeli War

Earlier this month, Elbridge Colby, a senior official in the US Department of War, held a call with Saudi Arabian Defense Minister Khalid bin Salman, who is also the brother and top adviser to Crown Prince Mohammed bin Salman. Iran’s attacks on US bases in the Gulf were heating up, and the US needed expanded access and overflight permissions. Saudi Arabia agreed to open King Fahd Air Base in Taif, in Western Saudi Arabia, to the Americans, multiple US and western officials familiar with the matter told Middle East Eye.

The base is important because it is farther from Iranian Shahed drones than Prince Sultan Air Base, which has come under repeated Iranian attacks. Taif is also close to Jeddah, the Red Sea port that has become a critical logistics hub since Iran effectively took control of the Strait of Hormuz. Current and former US officials tell MEE that if the Trump administration is preparing for a longer war on Iran, Jeddah may be critical for sustaining US armed forces. Thousands of US ground troops are en route to the region from East Asia. 

Saudi Arabia’s decision to expand base access, current and former officials say, underscores a shift in how the kingdom and some other Gulf states are responding to the US-Israeli war on Iran. “The attitude in Riyadh has shifted towards supporting the US war as a way to punish Iran for strikes,” a western official in the Gulf told MEE.

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Iran strikes UAE base housing British, US and Australian troops

Iran struck a military base housing British, US and Australian troops in the United Arab Emirates during overnight strikes across the Gulf.

A missile hit the Al Minhad Air Base where the UK maintains a permanent military facility, at 9.15am AEDT on Wednesday morning.

Anthony Albanese, the Australian prime minister, said the projectile caused ‘minor damage’ to an accommodation ​block and a medical ‌facility ⁠due to a small blaze that was created as ​a result ​of ⁠the missile hitting on ​a road leading ​up ⁠to the base.

More than 100 Australian military personnel are deployed at Al Minhad.

Albanese confirmed that all Australian staff were ‘absolutely safe’ following the attack at the base, which is operated by the UAE and functions as Australia’s military headquarters for the Middle East. 

He could not confirm if Tehran directly targeted the site, however, while maintaining Australia was not at war. 

‘The Iranian regime is engaging in random attacks right across the region. We know that is the case,’ the prime minister said. 

In 2014, the UK launched a permanent headquarters at the base to support British operations in the region. 

The Ministry of Defence has yet to comment on the attack. 

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