On Thursday, we revealed something truly shocking: ISIS is no longer handing out free Snickers bars and Gatorade to its fighters.
Apparently, the cash crunch created by Russia’s unrelenting assault on the group’s illicit oil trafficking operation has left Abu Bakr al-Baghdadi with little choice but to cut salaries by 50% and eliminate some of the perks soldiers have until now enjoyed.
Like free candy bars.
And complementary sports beverages.
For those unaware, ISIS brings in around a billion a year in proceeds from various illicit activities including, but certainly not limited to, illegal crude sales, slave trading, and taxes (and yes, we deliberately lumped taxes in with “illicit activities”, an editorial decision we’re sure readers will agree with).
Those profits are being eroded by the Russian Defense Ministry’s assault on militant oil smuggling routes, and unless Raqqa’s terror-crats can figure out how to extract a commensurate amount of profits from Libya’s oil riches, the caliphate may be set to enter a terminal decline.
As we also noted on Thursday, Islamic State’s balance sheet demise “isn’t a consequence of one airstrike on a Mosul cash center as AP and other Western media would have you believe.”
We were referring to the much balleyhooed strike on an ISIS “bank” in Mosul, Iraq’s second largest city that’s been controlled by ISIS for the better part of two years. “We’re talking about an organization that brings in a billion dollars a year here, so destroying a few million in hard currency isn’t going to make a difference,” we remarked.
Well, don’t look now, but ABC is out with a new piece claiming that “coalition” strikes have destoryed more than a half billion in illegal dollars procured by Islamic State. “The U.S. believes that airstrikes in Iraq and Syria have destroyed more than $500 million in cash that ISIS used to pay its fighters and fund its terror and military operations,” ABC reports. “Ten strikes have been conducted since then with the most high profile being two airstrikes in Mosul, in northern Iraq, targeting facilities that American officials characterized as ISIS banks.”
“Obviously, it’s impossible to burn up every single bill,” Warren says. “So presumably they were able to collect a little bit of it back. But we believe it was a significant series of strikes that have put a real dent in their wallet.”
We imagine Janet Yellen will say the exact same thing when the FOMC runs out of options and bans cash.
via Zero Hedge http://ift.tt/1KvKBSS Tyler Durden