Major investment bank issues warning on strike against Iran

Bank sees February or March timeline if Israel strikes

Warning that investors might be "in for a shock," a major investment bank has told the financial community that a preemptive strike by Israel with American backing could hit Iran's nuclear program, RAW STORY has learned.

The banking division of ING Group released a memo on Jan. 9 entitled "Attacking Iran: The market impact of a surprise Israeli strike on its nuclear facilities."

ING is a global financial services company of Dutch origin that includes banking, insurance, and other divisions. The report was authored by Charles Robertson, the Chief Economist for Emerging Europe, Middle East, and Africa. He also authored an update in ING's daily update, Prophet, that further underscored the bank's perception of the risks of an attack.

ING's Robertson admitted that an attack on Iran was "high impact, if low probability," but explained some of the reasons why a strike might go forward.

The Jan. 9 dispatch, describes Israel as "not prepared to accept the same doctrine of ‘mutually assured destruction’ that kept the peace during the Cold War. Israel is adamant that this is not an option for such a geographically small country....So if Israel is convinced Iran is aiming to develop a nuclear weapon, it must presumably act at some point."

Sketching out the time line for an attack, Robertson says that "we can be fairly sure that if Israel is going to act, it will be keen to do so while Bush and Cheney are in the White House."

Robertson suggests a February-March 2007 timeframe for several reasons. First, there is a comparable situation to Israel's strike on Iraq's nuclear program in 1981, including Prime Minister Ehud Olmert's political troubles within Israel. Second, late February will see Iran's deadline to comply with UN Security Council Resolution 1737, and Israel could use a failure of Iran and the UN to follow through as justification for a strike. Finally, greater US military presence in the region at that time could be seen by Israel as the protection from retaliation that it needs.

In his Jan. 15 update, Robertson points to a political reason that could make the assault more likely – personnel changes in the Bush administration may have sidelined opponents of attacking Iran.

Preisdent Bush recently removed General John Abizaid as commander of US forces in the Middle East and John Negroponte as Director of National Intelligence, both of whom have said attacking Iran is not a priority or the right move at this time. The deployment of Patriot missile batteries, highlighted in President Bush's recent White House speech on America's Iraq policy, also pointed to a need to defend against Iranian missiles.

The ING memo was first sent to RAW STORY as an anonymous tip and confirmed Monday by staff in the bank's emerging markets office, who passed along the Jan. 15 update. The full PDF documents can be downloaded at this link for the Jan. 9 report, and this link for the Jan. 15 update. A screenshot of the first page is provided below.

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