Alex Krainer on the US-Iran war, the Strait of Hormuz, and escalating global conflicts
Glenn Diesen interviews market analyst and author Alex Krainer on the US military campaign against Iran, the failure to secure the Strait of Hormuz, and the broader geopolitical implications for Ukraine, Europe, and the global order.
Summary
Glenn Diesen speaks with Alex Krainer, a market analyst, author, and former hedge fund manager, about the rapidly deteriorating US position in its military campaign against Iran. Krainer argues that the United States has painted itself into a corner by launching a war it cannot win militarily while simultaneously eliminating any face-saving exit — particularly by committing what he describes as a war crime on day one (killing 20 volleyball players, 168 schoolgirls, and Iran's spiritual leader) and then publicly claiming credit for it. He contends that control of the Strait of Hormuz is existential for Iran and therefore non-negotiable, making a US declaration of victory impossible without achieving something Iran will never concede. Krainer also traces the persistent pressure to attack Iran back through multiple US administrations to what he describes as a London-based banking establishment that created Israel as a strategic asset and continues to drive both British and Israeli foreign policy. The conversation extends to Europe, where Krainer identifies the new Joint Expeditionary Force — ten northern European nations placing their navies under British command — as a deliberate escalation ladder aimed at Russia, one he believes leads inevitably toward a catastrophic confrontation.
Key Takeaways
FULL TRANSCRIPT
Opening: The failed "Operation Prosperity Guardian" and the Strait of Hormuz impasse
Glenn Diesen: We are joined again by Alex Krainer, a market analyst, author, and former hedge fund manager. Thank you for coming back on the program.
Alex Krainer: Thank you for the invite, Glenn. Good to be with you, and warm greetings to your audience.
Glenn Diesen: We're barely into this new project — the US operation to open the Strait of Hormuz by force. This was going to start on Monday. It failed on the first day. On the second day, Trump said we're going to put it on pause, and when asked to explain why, he now says the Pakistanis asked us — apparently that was the reason. Now it seems it might restart again as we see American warships trying to go through the Strait of Hormuz. We also have Marco Rubio saying that the operation has achieved its objectives and has come to a conclusion, in his words — but at the same time he's insisting that the Strait of Hormuz has to be open and that the current situation is not acceptable. That's kind of the main reason why they can't declare victory and go home. How do you make sense of what's happening at this moment?
Alex Krainer: It's apparent that the administration has a very thoroughly thought-through strategy of making it up as they go along. They're just in reactive mode now. As things change on the ground or as new opportunities open up, they act without thinking too many steps ahead. It's clear that this is a war that never should have happened, because it created the problems they're now trying to solve. They're in a weak position to solve them, so they're reactive.
Part of the problem is that Trump doesn't get to walk away with any ability to credibly announce a victory. He still has to humiliate Iran — or he's trying to — because he needs some kind of tangible, visible proof that he achieved his objectives, that he prevailed, that he won. I don't even understand why they're doing it this way, especially since next Thursday he's due to visit China. I wonder if this isn't some kind of desperate attempt to go to China with better cards to play, rather than going as a failed, defeated, lame-duck president. It's very hard to understand what the actual situation is, but we are very far from stabilization.
It seems to me that Trump's goal was essentially a decapitation strike against Iran. Maybe he was talked into believing it had a high chance of success. But he always had the fallback option of essentially what he did in Yemen — go in, do some bombing, and if it doesn't work, pull out and declare victory. The main problem here is that he can't leave and declare victory without the Strait of Hormuz, because that is essentially the source of Iranian security. If Iran controls the Strait, it can pressure neighboring countries to decouple from the US, possibly disband military bases, stop trading in dollars, even demand reparations and punish countries that continue to sanction Iran. There's a lot Iran can do to increase its own security and standing in the region if it doesn't give up on Hormuz. But this also means that without the Strait under Iranian control, US-Israeli dominance in the region is effectively over. So he can't go home, but the Iranians can't give this up. What are we looking at? How can this war possibly come to an end?
The war that should never have happened — and the options that were foreclosed
Alex Krainer: It does appear that we're going into another escalation, which is horribly unfortunate. Before the war started, in those last few days when even I realized it was going to happen, I wondered if Trump wasn't going to do another token round of bombings — kind of pre-agreed: we're going to bomb you here, please evacuate anything sensitive — essentially a fake war for domestic audiences, but light enough that you could come back from it.
Because previously, up to 28 February, the United States was in a position to really negotiate with the Iranians, and the Iranians were forthcoming. They were willing to open up Iran to American businesses, which would have been a hugely important thing for Trump to have — maybe not a spectacular Hollywood-style demonstrable victory, but a real victory. You would have just gained access to the fifth-richest nation in the world in terms of natural resources, with a population of 92 million, ranked fifth or sixth in the world in the number of engineers and scientists it produces. What a great entry that could have been. And you could have kept that door open if you'd gone with a token war.
But instead, on day one, they committed what I would describe as a war crime — killing 20 volleyball players, 168 schoolgirls, and Iran's spiritual leader. Then Trump got up on stage and said, "We killed him. He was one of the most evil people in history," which is complete nonsense and very dishonorable. Now you cannot go back. It seems to me a particularly idiotic way to paint yourself into a corner where you no longer have choices. You have the choice of victory or defeat — pursuing victory or accepting defeat. If you ask me how this ends, my only answer is that it ends in defeat of the United States, because they cannot win militarily.
At the same time, they've given themselves two mutually exclusive choices with nothing in between, no gray zone. They've apparently already been bombing Iran overnight, just a few hours ago, and obviously Iran is going to retaliate. We're now into a new escalation. In the end, it's going to be the United States that is defeated. They can talk about the most powerful military in the world all they want, but that most powerful military is spread thinly across the whole world — across Europe, across 700 or 800 military bases everywhere. They've been waging wars non-stop for the last quarter of a century. They've depleted their arsenals. They've exhausted their troops. And they are halfway around the world, where they need very robust logistical chains just to maintain war operations.
Iran was due for regime change since 2006 according to the neocon plans, and nobody dared to do it until now — and there's a reason why they didn't, because it was a dumb thing to attempt. It had to wait for Donald Trump. I watched Tucker Carlson's monologue about ten days to two weeks ago, and Tucker said he'd been talking to Trump about this for the last ten years and was convinced they were on the same page — that Trump perfectly well understood this would be a dumb thing to do, that going to war with Iran was wrong, that he was perfectly aware of the risks. He went and did it anyway, and he did it in a way that gives him no face-saving way out. He himself made it so that he has no way out, and then he climbed up on stage and owned it fully.
Ultimately, it's going to be a defeat of the United States. I can't imagine that American troops are very thrilled about being sent into a meat grinder that they largely understand to be done for the sake of Israel — which was not the deal. That's not what the American people voted for. There's no public support for this either. The whole thing is, I think, a very tragic and catastrophic blunder on his part. Combined with his inability to concede defeat, admit failure, and walk away, it means the ultimate eviction of the United States from the region.
Asymmetric warfare and why Iran cannot be defeated militarily
Glenn Diesen: The United States does have the most powerful army in the world, but as you said, when it's organized as if it were still a collective hegemon — having to be in every single part of the world — it's stretched thin. In a multipolar world you can't be everywhere. You have to make adjustments, and if you don't prioritize anything, you effectively prioritize nothing. But besides the thinned-out army, there's also the very specific dynamic of this war against Iran. Opening the Strait of Hormuz — Iran doesn't need a matching army. The weapons it uses, whether mines, underwater drones, or conventional flying drones, are cheap to make and easy to produce. They can easily boost their industrial capacity to build more underground. Because the Strait is so narrow, they don't need advanced weapons to stop US ships. A few drones and missiles and it's blocked. You can't prevent Iran from having this capability.
Furthermore, Iran sees this, quite reasonably, as an existential threat. The goal here is not just regime change — it's the destruction of Iran. So they'll be willing to absorb any pain America brings, because the alternative is so much worse. This begs the question: what could the US possibly do in such a scenario? If the US gets desperate enough, it might escalate to much more powerful weapons — Israel could even drop a nuclear weapon. But if the alternative is to de-escalate, find some way of declaring victory and going home, it's not just the Strait of Hormuz — it's also the presence in the Gulf states and the relationship with Israel. I can't imagine Israel permitting the US to disentangle from this conflict. Is it even possible to extend the ceasefire? Lebanon was supposed to be included. I can't imagine the Israelis accepting that they should pull out of southern Lebanon. How do you see it — forget about peace, but even extending a ceasefire?
Alex Krainer: It seems that the ceasefire has already been broken. From what I'm reading in the news today, it's already off the table, because the United States went and bombed several targets — I think Qeshm Island and another one. Just scanning the news before we connected today, it seems the ceasefire is already off the table. They might re-establish it in the future.
With regards to Israel, I don't even know how to comment on it, because it doesn't seem we're dealing on a rational basis at all. Israel apparently isn't capable of functioning without being at war. It doesn't matter what makes rational sense. They might even accept a ceasefire under duress but completely disregard it and just continue as if they hadn't agreed to one. They're still bombing people in Gaza. They're still bombing people in Lebanon. They're still brutalizing Palestinians in the West Bank. They're still talking about going to war against Turkey. They're still talking about Greater Israel. No political faction is emerging to say, "Wait, stop. We can't continue this way. We're going to destroy ourselves." They're all pushing harder and faster, and it seems like a nation pressing on the accelerator of its own destruction.
By now even the Israeli press is talking about everything already being destroyed, that the country is over — that there's a pumpkin version of the country still there but it's been gutted. A very recent piece in Haaretz talks about it in the sense that all the decisions, all the developments, are already completed. The country is no longer. So it's only a question of when they get completely exhausted, or when their neighbors finally come together and go to total war against Israel — not just an exchange of missiles but an actual ground war. We've already seen the first step, because Hezbollah has taken certain areas and villages in northern Israel from the Israelis.
When it comes to the relative strength of American military power, you would have thought they learned something in Afghanistan, or learned something from their ten years of trying to destroy Ansar Allah in Yemen. In Afghanistan, they were at war for 20 years — the most powerful military in the world, which was arguably a lot more powerful 25 years ago than it is today — and they spent 20 years there, lost four to five thousand troops, destroyed the country completely, and then had to withdraw and turn it back over to the same Taliban they wanted to take down. The same thing with the Houthis in Yemen. You would think that boasting about the biggest military power in the world could accommodate a reality check: yes, this all looks very big on paper, but there are problems. There are logistical problems. You can't easily fight wars on the other side of the world when you have no popular support in the nation you're trying to control.
And now you're taking on Iran, which is orders of magnitude more powerful than either Ansar Allah or the Taliban in Afghanistan. It's a huge country — 92 million people, a very powerful army. Whatever you think you did with your bombing — imagine you hit ten or fifteen thousand targets across Western Europe. What is that? It's a drop in the bucket. Whatever you think you destroyed is probably far from breaking the country and defeating it. It's not going to happen.
Many policy papers and intelligence reports have been written on this subject, and they virtually all came to the same conclusion: this is a dumb thing to do. In Trump's administration, there were advisers around him who told him this is a dumb thing to do. So what did he do? He fired them. He removed them. Now it's a ship with a handful of officers determining what happens, and that means anything is possible. A nuclear strike from the United States is probably not possible, but it's possible from Israel. We're in some kind of chaotic stage of development where anything is possible from day to day. But the one thing I would take off the table as a possibility is that Trump is just going to walk away and accept that Iran is now the new regional hegemon and that the United States has to accept Iran's terms to conclude this conflict.
The unipolar-to-multipolar transition as the common thread
Alex Krainer: I think that would be the wisest thing, and it would also be consistent with objectives the US set out last year — adjusting to a new international distribution of power. If we take a step back, it does appear that most of the wars breaking out all over the world have a common denominator: it's a struggle between two different world orders. We're shifting from a unipolar world order — where the US has global dominance, doesn't have to make compromises, doesn't have to take into consideration the security concerns of others, and can impose itself — to a world that actually has an international distribution of power with many centers of power, in which unipolar policies no longer work.
With Iran, if the US wants to solve this crisis, it can't try to fix it within the limited scope of still having unipolarity, because there's no pathway anymore. They have to take a step back and accept that there's a wider shift in the world. You can say the same with the Israelis — the whole Clean Break strategy they've had for the past 30 years was largely built around the idea that they don't have to make compromises, they'll just, with the Americans behind them, impose themselves and dictate to others. Peace through force. And that also applies to the Europeans. If we want to solve the crisis with Russia, they only want to look at it through the prism of preserving the unipolar moment — Russia has to bow, Russia has to capitulate, pay reparations, NATO has to continue rolling forward toward Russian borders, and Russia should just accept that this is a force for good.
None of these conflicts can be resolved unless we recognize that the distribution of power no longer permits this. I don't care if people think it was a good time or a bad time — it just is not possible anymore. The West is not dominant. It's not going to happen. It's just the way the world is. But they keep looking at it in this narrow way, as if this is the only acceptable framework. The idea that in Europe we could have a collective security architecture that also recognizes the security of the largest state in Europe — this is blasphemy, it's treasonous to even suggest in Europe. You'll be smeared and cancelled. There's no appetite for it.
Back in December 2025, the United States recognized in its new security strategy that the world is becoming multipolar, that Europe is declining, and that the US can't be everywhere and should focus on the Western Hemisphere and possibly East Asia. That would have widened the aperture and recognized the world we actually live in, and there would have been many more opportunities to find a new status quo that actually delivers peace — one that doesn't simply require overwhelming an adversary that cannot be overwhelmed.
Glenn Diesen: What do you think happened to Trump? Because it looked like in 2025 he was leaning in this direction — at least before June. He was going to get out of Ukraine, he wasn't going to get involved in any more stupid Middle Eastern wars. And now we're here. They're not getting out of Ukraine. They're sending more weapons. They're not getting out of Iran — they're going up the escalation ladder. What do you think happened?
What changed Trump — and who is really driving the agenda
Alex Krainer: I genuinely don't know, Glenn. I'm mystified. The opinions about what happened cover practically the whole range of possibilities. Some people say Trump was always like this — he was just hiding his game, and he's just come out of the closet as this globalist warmonger. I don't know if that's true or not. Some people say he's been had in some way, that somebody somehow got to him. I think that can't be excluded either.
Here's one thing that mystifies me: this drive to take total control of the Middle East and take down Iran goes back to at least the first Bush administration. We remember Wesley Clark's revelation that in 2001 they were going to take seven countries down in five years and that Iran was last on that list — meaning Iran was due for regime change by 2006. They never got there. But the pressure on administrations to go to war against Iran was coming from somewhere, and it seemed like it was coming from Israel. We know that in 2019 the pressure on Trump to go to war against Iran was coming from the British side — from the British embassy and their ambassador Sir Kim Darroch. That turned into a whole diplomatic incident which ended with the Foreign Office in London having to recall Sir Kim Darroch and nominate a different ambassador.
This time around, the pressure is coming from Netanyahu and from the Zionist establishment in the United States. So we have two different sources of power pushing for the same agenda, which to me suggests there's a higher level of power that has decisive influence over both of them — meaning over Israel and over the British government, and then ultimately over Trump as well in some way.
Part of this equation probably has to do with the fact that Israel, one of these sources of pressure, is the creation of the other source of pressure — the British establishment. Israel was created by the British Empire as a bridgehead intended to help them control the Middle East, its energy resources, and the trade routes that were essential to control. So it seems to me that the big power we're talking about is the banking establishment — the high-level banking cartel — and since they have a very powerful satellite on Wall Street, when push comes to shove they are able to exert such powerful influence that whether Trump was on board with this or not — and in 2019 he was not on board — they can still move him.
If you read Sir Kim Darroch's cables to the Foreign Office from 2019, they were extremely annoyed with Trump. But they also suggested they would continue to exert pressure, flood the zone around Trump with Trump whisperers, and that the next time some pretext happened — Iran does something they could create outrage about — they would be able to tip Trump over. Maybe this is what happened.
I wouldn't exclude the possibility that this included threatening Trump or his family. If anybody thinks that's a bridge too far, let's remember that somebody assassinated John F. Kennedy and somebody assassinated Robert F. Kennedy. We know that both were not exactly Zionist — they had a very adversarial relationship with Israel. John F. Kennedy also wanted to destroy the CIA. Nobody was held accountable for that other than the lone gunman. What happened instead is that these structures of power got away scot-free for assassinating the president and his brother, who was the next presidential candidate. They didn't lose power — they consolidated power, they became more powerful. So their ability to assassinate presidents didn't go away. But maybe they don't have to assassinate presidents anymore. Maybe they can say, "Look, if you're not on board with us on this, we're going to start killing your family members."
I don't know. As a possibility, I don't think it can be eliminated. And if Trump is pushed into that position as commander-in-chief and president of the United States, he has to own it. He can't say, "I'm the president of the United States, but somebody else is pulling the levers and I'm just along for the ride."
I don't think we know the answer to any of these questions. But whatever it is, Trump is their errand boy — that's for sure — and he owns this mess. Ultimately, whoever has been pushing this during the Clinton administration, the George W. Bush administration, the Obama administration, the Biden administration, the first Trump administration, and now again — that is not the person the American people elected. It's a structure of power that's above the US president and the political class, above the British prime minister and British political class, and above Benjamin Netanyahu as well.
I think we can narrow it down to the City of London — to the people who control the City of London and who created the state of Israel. We know that about a hundred years ago, even before the Balfour Declaration, the establishment of the state of Israel was being discussed. Alumni of Alfred Milner's Round Table were giving statements to the media saying that if the British Empire was going to continue as a dominant maritime empire, they were going to have to seed that region — meaning the eastern Mediterranean, Palestine — with a particularly patriotic stock. And that's what they did. I don't think they ever relinquished control of Israel.
These are the same forces that, for the same reason, haven't been able to give up on the Middle East for over 120 years. They will not be able to give up now. Ceasefire or no ceasefire, this is going to have to go to the ultimate and total defeat of one side or the other. And I think that this time around it's going to be the imperial forces who are defeated.
Glenn Diesen: One doesn't even need to threaten to kill Trump — the Epstein files essentially take care of much of this. But there's an interesting contradiction in Trump's statements over the past 40 years. He kept making the point that all these forever wars were a big mistake, that we should stay out of it, stop financing other people's wars. On the other hand, he also argued that America was always weak — we shouldn't allow Iran to do this, why are we allowing them to do that? So how do you square the circle? It seems he often found the solution in the idea that those leaders were simply weak, and that you can achieve results by simply showing strength. That's kind of his main tool — maximum pressure. And this is often what got him what he needed. My concern was always: what happens when maximum pressure meets another great power, or a large power at least, that fears for its existence? You can do maximum pressure against Russia, but as Trump noticed, it doesn't mean anything, because if Russia sees itself faced with an existential threat, it's going to go all the way. What happens when you do maximum pressure against the Iranians? They face an existential threat as well. They're going to go all the way. So he hit a wall. And then what do you do — do you change the recipe for how you achieve success, or do you go to war? And if he has enough Trump whisperers around him telling him how great he is and how everyone will back away when his mighty army shows up, then perhaps, given his narcissistic tendencies, he buys into such an argument.
The Iran war's impact on Ukraine and the new European naval alliance
Glenn Diesen: I want to ask a last question: how is this Iran war now affecting the NATO-Russia war in Ukraine? The Iranian war has obviously taken a lot of resources away from Ukraine. The Americans are still sending weapons, but there's much talk about delays or weapons being diverted. So if the US has less capability and even less intention to commit to the war against Russia in Ukraine, it seems that the Europeans — unless they're going to make peace with Russia, which isn't on the table — are going to have to escalate. And we do see some cases of this, happening at a very sensitive time when US protection of Europe is going away and Russia seems determined to restore its deterrence by hitting back. This is when we see the Europeans — at least some of them, the UK plus nine northern countries — forming this new naval bloc to confront Russia. If we end up in a massive war with Russia, with the Russians possibly launching a limited nuclear strike to restore deterrence, I think this is going to be the most likely pathway now. How do you read this situation?
Alex Krainer: This just happened on 23rd April — British representatives and naval chiefs of ten European nations signed the protocols for formation of the Joint Expeditionary Force. Ten northern European nations are voluntarily putting their navies under British command, obviously with the intent to create a new military alliance aimed against Russia. They intend to cut Russia off from its northern maritime routes and to harass Russia. They're already doing it — aggressive boarding and inspections of Russian ships suspected of circumventing sanctions or espionage or whatever. That is forcing the Russians to respond. Apparently they're putting FSB-linked security personnel on high-value tankers, or sending submarines or frigates to accompany the ships. Then the British say, "Oh, Russian incursions into our waters have been increasing." Well, yes — because you're harassing them. The Russians are obliged to send military escorts with their cargo ships, and then you say, "Look, they're making incursions into our waters." It's an escalation escalator that is obviously coming from and being instigated by London again.
All roads always end up leading to London. This new Joint Expeditionary Force, crafted to antagonize Russia, is again a brainchild of the British governing establishment — with headquarters in London, operational control in London, and a British general as the top commander of this structure. They're not there yet, because they've given themselves about four years to bring these forces into sync. They still have different equipment, different electronic standards, different ammunition and types of weaponry. They want to harmonize all this so they can operate as one military unit, and that's going to be a process and an investment.
But the mysterious aspect that needs to be explained is: why would ten European nations agree to put themselves at risk of war with a nuclear power and submit their navies to the control of a London-based command and control center? Why did they agree to be led by a power that obviously has aggressive designs toward Russia? Why wouldn't any of these nations say, "Maybe it better serves our interest to find a way of cooperating with Russia, to have peaceful coexistence where everybody can be safe and everybody can trade with one another and we can focus on developing our economies"? Instead, they all sign up to an agenda that has very high risks of bringing them to a devastating war against a nuclear power.
Furthermore, all ten of these nations are already NATO members. They're already in a military alliance. Why do they need a new one? They say they need to be more agile, that they don't want to deal with the whole NATO bureaucracy that might inhibit their freedom to act. So they created a new alliance — but if that alliance gets into trouble against Russia, they're going to say, "We're NATO member nations. Article 5 — everybody has to unite and go to war against Russia." It's basically a trip wire, being done deliberately, taking the whole world to the precipice of World War Three.
If you follow the breadcrumbs, it always ends up in London. We have to take that situation seriously. They're also saying they need this because they need to bring the focus back from the Middle East to Russia — because the Middle East may be Trump's obsession, but London is still primarily obsessed with Ukraine and Russia, and they're losing there. They need a second front. It was meant to be the Balkans, but the war drive in the Balkans dissipated since Trump came into the White House. So now they're instigating it in the Baltics. It's this cabal that is pushing us into World War Three. And for the reasons we discussed, their designs are essentially hegemonic. They will not give up. They've been trying to take control of Russia for more than 200 years and they never stopped. They will not stop again until one side or the other is completely defeated and destroyed.
Glenn Diesen: I think possibly the reason why they're willing to essentially risk their own countries instead of pursuing basic national interest by adjusting to this new balance of power is because this is not simply a war about whether a particular territory should be part of Russia or Ukraine. This is a war about whether we have a multipolar system or a unipolar one with collective hegemony. If they can push back the Russians, they'll have this powerful Ukrainian shield in front of them, the Americans will return standing behind them, and that's the formula for collective hegemony. If they begin to pursue common sense — trade, accepting a new status quo — that means a new distribution of power, a multipolar system. It's not that different from Iran. It's not that different from the Americans ending the economic war against China, where both could prosper if they cooperated, but that means living next to China as an equal. I don't think we're past this yet. My prediction is this new world will be born in blood and fire, not diplomacy, unfortunately. I hope I'm wrong though.
Alex Krainer: Blood and fire and viruses, Glenn — that's coming.
Glenn Diesen: Interesting times.
Alex Krainer: Extremely. Yes.