Chaos and War

If our leaders and allies still think they have the power to impose their brand of peace and freedom on the Middle East, they need to check into an insane asylum.

Here’s what the region looked like about five years ago when the wars of Iraq and Afghanistan were still in full swing, the country was debating withdrawal, and nearly all American citizens voted for the candidate they thought could do the best job of ending the conflicts.

Aside from mostly isolated or sporadic conflicts elsewhere, Iraq and Afghanistan were the only hot spots and Iran was the only major country where long-term stability could be seriously questioned.

The focus of the U.S. and its NATO allies was strictly those three countries. And their challenge was strictly to bring the troops home without leaving chaos in their wake.

The Palestinian-Israeli conflict was raging, as always. But in contrast to the new wars elsewhere, that six-decades-old conflict was such a known quantity one would be hard pressed to argue that it was a significant destabilizing factor for the region.

Bottom line: Two, maybe three, conflicts to seriously worry about. Moderate impact on the major world powers. No broad threat to the global economy. High hopes for future long-term stability.

Now, fast-forward to the last day of August, 2013, and look how dramatically the picture has changed:

The word “stability” is fundamentally and inexorably gone from the lexicon of any serious observer in the region; every country in the region is impacted — internally and externally … politically and socially … in terms of trade, the influx of refugees and the stirring of pre-existing conflicts.

Worse, several — Egypt, Libya, Yemen and Pakistan — are in various stages of becoming collapsed states, where the rule of law is virtually gone and chaos begins to reign.

Worst of all, the wars have come back and spread. Iraq’s “Arab Awakening,” years past largely responsible for the end of its civil war, is now buried and gone; and in its place, a new, even more virulent form of ethnic strife has returned.

Meanwhile, jihadists have poured into Syria from all over the globe, also helping to rekindle the fires in Iraq.

But anyone who still thinks there’s a wall surrounding the region which can contain the conflict needs to check into the same institution as those who think they can fix it.

Unlike the conflicts of five years ago, the major world powers have drawn a line in the sand — U.S. and its NATO allies vs. Russia and China.

Unlike any time in the past, U.S. and Russian battleships are moving into the area.

And unlike any time in the past, the ECONOMIC consequences of the NEXT phase of this regional — and possibly global — war are boundless. Ask yourself:

How will it impact energy prices?

How will energy prices impact inflationary expectations and interest rates?

What do you do to profit and protect yourself?

Hop on my blog and give me your answers.

Good luck and God bless!

Martin